The United States isn’t a top-tier creditor, in one map

October 16, 2013

On Tuesday, we brought you the news that Fitch has put the U.S. government on watch for a credit downgrade; Ezra argues that it makes perfect sense to downgrade America's political system. But how does the United States stack up internationally?

For that we turn to the BlackRock Investment Institute, the research arm of the giant money manager. It has created the "BlackRock Sovereign Risk Index" which aims to combine key aspects of creditworthiness of 48 countries around the world. It factors in plenty of things that have to do with the substance of different countries' finances, such as their current debt and deficit levels, banking system strength, and exposure to debt denominated in foreign currencies. But it also adds an important layer that it calls "Willingness to Pay." It measures the effectiveness and efficiency of governments to meet their obligations, and counts for 30 percent of the total index.

Perhaps it shouldn't be surprising after the last couple of weeks of government shutdown and debt ceiling chicanery in Washington, but by BlackRock's reckoning, the United States is not among the top-tier credit risks by this ranking. Here's a complete map:

WorldCreditRisk

You can check the detailed analysis for each country in an interactive graphic here.

By BlackRock's reckoning, the world's most creditworthy nations--those with both solid finances and solid political systems that ensure bonds will be repaid--are the likes of Norway, Singapore, and Switzerland. The United States, as the map shows, is in the second tier, more similar to South Korea and Austria and Malaysia in its creditworthiness.

For anyone who follows the news, it is hard to disagree.

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Neil Irwin · October 16, 2013