The backup debt limit plan introduced by Senate Minority Leader Mitch McConnell (R-KY) would not prevent a downgrade of U.S. debt, according to Moody’s, even though it would raise the debt limit.
According to Reuters, the credit rating agency says the plan’s failure to deal with the growing federal deficit might lead it to cut it’s AAA rating on treasuries.
“The numbers that are being discussed in terms of any possible deficit reduction coming out of this plan don’t seem to be very large,” Moody’s analyst Steven Hess told Reuters in an interview. “Therefore, this plan might result in a negative outlook on the rating.”
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