On Wednesday’s broadcast of CNBC’s “Squawk on the Street,” White House Council of Economic Advisers Chair Jared Bernstein reacted to the downgrading of the U.S. credit rating by Fitch and its concerns about government deficits and debt by stating that the debt-to-GDP ratio “has stabilized, admittedly at a higher level” under President Joe Biden.
Co-host Julia Boorstin asked, “I understand that you see this as a lagging indicator, but how do you address Fitch’s concerns about the rising government deficit, because that’s really fundamentally what this is about?”
Bernstein answered, “I think, again, the timing issue is germane here. The deficit went up every year under President Trump. The debt-to-GDP ratio rocketed under President Trump. It has stabilized, admittedly at a higher level, under this President. But we’re doing all we can to try to ameliorate those tensions and the proof is in both the movements in actual deficits, down 1 trillion under the President’s watch thusfar, and then, as I just mentioned, another trillion of deficit reduction in the Fiscal Responsibility Act. Then look at the budget, the President proposes 2.6 trillion in deficit reduction over the next ten years. So, we are doing our best to try to address these fiscal issues, because they matter a lot to this President, and he has a solid track record on that front. So, the idea that you would then somehow fail to do this under the prior administration, when these fiscal measures were massively deteriorating, and then go a notch down, when we’re, not only trying to move in the other direction, but actually having some success in moving in the other direction, it makes no sense.”
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