U.S. Treasury Secretary Timothy Geithner on Tuesday said there was no risk that the United States would lose its prized AAA credit rating, saying political prospects for long-term deficit reduction were improving.
No risk of that, Geithner told Fox Business Network when asked if the United States would see a downgrade after Standard & Poor's on Monday slapped a negative outlook on its Treasury debt rating.
Again, if you listen carefully now, you see the leadership of the United States of America ... recognizing now this is the right thing to do for the economy.
Geithner made the comments in a morning blitz of three major business network interviews to voice disagreement with the S&P move and emphasize Washington was serious about putting in place mechanisms that would bring down deficits.
Actually, I think things are better than they've been if you want to think about the prospects for improving our long-term fiscal position, Geithner told CNBC television.
If you're looking very carefully at what's happening in Washington you see people on both sides -- Democrats and Republicans -- agreeing with the president that we have to put in place some reforms now to bring down our long-term deficits, he added.
Geithner told Bloomberg Television that both domestic and foreign investors are still confident in U.S. debt and the stronger growth prospects of the U.S. economy.
You can see that in the price at which we borrow every day, but we have to earn that confidence, Geithner said.
He said that he believes it is possible for the Obama administration to secure a deal with Democrats and Republicans in Congress to reach a deal to lock in targets and mechanisms to cut deficits by $4 trillion over the next 10 to 12 years, but these will have to include discussions about entitlement programs such as Social Security and Medicare.
(Reporting by David Lawder; Editing by James Dalgleish)