It was about time the president weighed in with a statement about the U.S. credit rating downgrade by Standard & Poor’s. And that’s not just because the reporters in the room were getting antsy after the president was 50 minutes late getting started.
Rather, Obama’s press briefing Monday afternoon about the Standard & Poor’s downgrade came after a weekend in which the primary messaging strategy from the White House seemed to be excuses. Following a bizarre back and forth Friday evening in the news over whether the ratings agency got its math right—a “has it really come to this?” moment if there ever was one—the Treasury Department posted a blog entry called “Just the Facts: S&P’s $2 Trillion Mistake.” Senior administration officials were calling it political and “a facts-be-damned decision.” Obama, meanwhile, remained publicly mum.
On Monday afternoon, there was less finger pointing, even if the president did refer to S&P as “some agency” and invoked the words of Warren Buffett (who said he’d give the country a AAAA rating if there was one) to cast doubt on their decision. He called our problems “imminently solvable.” He said he would be putting together his own plan for consideration by the so-called Super Committee. And he laid out a range of oft-repeated steps—extending the payroll tax deduction and unemployment insurance, investing in infrastructure—for helping to improve the economy.
While the statement was a step in the right direction amid the finger-pointing of the weekend, it didn’t go far enough. He seemed to focus much more on deficits rather than job creation. There was little in the way of new ideas. And while he paid homage to the hard work and tough times average Americans are experiencing, he didn’t address the fears of higher interest rates he surfaced repeatedly during the threat of default. A credit rating downgrade, he said in his July 25 address, would leave “investors around the world to wonder whether the U.S. is still a good bet. Interest rates would skyrocket on credit cards, mortgages and car loans, which amount to a huge tax hike on the American people.” Pretty scary stuff for your average American consumer.
Then again, it’s hard to say what more he should have said. No one knows what’s going to happen to interest rates for consumers. No one knows when the stock market will stop falling. And the big levers available to fix the economy, to be fair, are in short supply these days. We already pulled most of them in the last recession.
As a result, I’d say the president’s statement failed not due to what he said or didn’t say, but when he said it. Saturday morning might have been a much better moment than 50 minutes late on Monday afternoon. When something as unprecedented and historic as S&P’s Friday evening decision occurs, people aren’t necessarily looking for immediate solutions. But they do want immediate reassurance.
More from On Leadership: