“I think that Moody's is a lagging indicator. I think that's what everyone thinks of credit agencies. And just like Sean Duffy said with our air traffic control system, we didn't get here in the past 100 days. It's the Biden administration and the spending that we have seen over the past four years. If we go back to your initial question on the Moody's downgrade, who cares? Qatar doesn't. Saudi doesn't. UAE doesn't.
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Moody's Strips U.S. of Last AAA Credit Rating
May 16, 2026
On May 16, 2026, Moody's downgraded the U.S. government's long-term credit rating from Aaa to Aa1, becoming the last of the three major credit agencies to strip the U.S. of its top-tier rating (following S&P in 2011 and Fitch in 2023). Moody's cited over a decade of growing federal deficits, rising debt-to-GDP projections reaching 134% by 2035, and repeated failures by successive administrations and Congress to address the fiscal trajectory. The downgrade came as Congress debated the "One Big Beautiful Bill" reconciliation package, sending the 30-year Treasury yield surging past 5%.
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“I heard the treasury secretary say that, 'Who cares about the downgrading of our credit rating from Moody's?' That is a big deal. That means that we are likely headed for a recession and probably means higher interest rates for anybody out there who is trying to start a business or to buy a home.
“Moody's downgrade of the United States' credit rating should be a wake-up call to Trump and Congressional Republicans to end their reckless pursuit of their deficit-busting tax giveaway. Republicans are hell-bent on a multi-trillion tax cut for the ultra-wealthy, leading to nothing but higher prices, more debt, and fewer jobs.
“This downgrade is a direct warning: our fiscal outlook is deteriorating, and House Republicans are determined to make it worse. On top of Trump's reckless tariffs and years of Republican debt ceiling brinkmanship, now they want to add trillions to the deficit — all to hand out even more tax breaks to billionaires and the biggest corporations.