AUGUSTA, Maine — Gov. Paul LePage on Saturday criticized the recent passage of federal legislation that allows the U.S. to raise the debt ceiling while also requiring steep spending cuts.
“It’s clear now, Congress and the White House antics over raising the nation’s $14.3 trillion borrowing limit has cost Americans,” the governor said in a statement released Saturday morning, his first extensive comments on the debt ceiling debate. “The U.S credit rating downgrade from AAA to AA+ will deeply affect our nation in a way that we have not experienced since 1917.”
LePage referenced Friday’s decision by Standard & Poor’s, a national credit rating agency, to penalize the U.S. for its failures during the debt ceiling negotiations.
“The downgrade reflects our opinion that the … plan that Congress and the [Obama] Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government’s medium-term debt dynamics,” the S&P report stated.
Maine’s governor, who campaigned heavily on fiscal conservatism and who repeatedly has criticized additional borrowing, called out Congressional leaders for political posturing instead of fixing a broken system.
“Using debt default as a bargaining chip rather than putting our fiscal house back in order was an enormously risky maneuver that failed,” he said. “It is a major setback for our future and economic credibility of our country and it’s time our leaders in Washington start working to get our economy back on track instead of worrying about upcoming elections.”
Maine Democratic Party Chairman Ben Grant said LePage clearly did not read the S&P report closely.
“They downgraded us because the Republican Party held the economy hostage in order to force Congress and the White House to adopt draconian and unpopular budget cuts at the expense of the middle class,” he said. “In their explanation of the downgrade, S&P said what a lot of Americans and Democrats have been saying through this debt crisis, it’s time to raise revenue.
“Let’s hope LePage and his fellow Republicans take note of this as we move forward.”
That outcome is not likely. LePage has never favored tax increases for anyone during his time as governor.
LePage’s spokeswoman Adrienne Bennett pointed out Saturday that Maine could serve as an example for the country. The state chose not to take on any new debt by rejecting any and all bond proposals during the recent session of the 125th Legislature.
“Maine has done exactly what S&P’s John Chambers said is what Washington should have done,” she said. “We can take away a very valuable lesson from this downgrade decision, in that, it is important to not separate the budget process from debt authorization. In order to achieve fiscal stability we must examine both and acknowledge the impact they have on our state.”
Although the effects of the recently passed national legislation are not fully known, LePage has no plans to wait to see what will happen in Maine. On Thursday, he ordered state agencies to identify $100 million in possible spending cuts in anticipation of losing federal dollars.
The Streamline and Prioritize Core Government Services Task Force, a state panel of lawmakers and other public and private leaders led by Finance Commissioner Sawin Millett, will be asked to examine the potential cuts. That group already is charged with addressing a $25 million shortfall in the $6.1 billion, two-year budget that passed in June.