Governors United in Anger on Debt Ceiling Stalemate, Divided on Who to Blame

Jul 29, 2011 5:37pm

 Governors United in Anger on Debt Ceiling Stalemate, Divided on Who to Blame

ABC News’ Amy Bingham reports:

After Moody’s Investor Service announced it was reviewing both Maryland and Virginia for a possible downgrade from their perfect AAA credit rating, the states’ governors have ratcheted up their rhetoric demanding Congress reach a deal and avoid default.

But with a Democrat to the north and a Republican to the south, Washington’s neighbors have starkly different messages for their comrades inside the Beltway.

Maryland Gov. Martin O’Malley, head of the Democratic Governors Association, blamed the brinksmanship on the “dinosaur wing of the Republican party led by Eric Cantor” which he said is threatening to “drive us needlessly into a default.”

Meanwhile the Republican governor of Virginia, Bob McDonnell, places the stalemate blame on the president.

“Your new programs and spending, and unfunded state mandates, have exacerbated the problem,” McDonnell wrote in a letter to President Obama last week. “Your failure to get the job done is hurting the businesses and citizens of our Commonwealth.”

Both Governors are facing a possible smear on their state’s finances after Moody’s announced Thursday that it was considering downgrading the AAA credit rating of 162 local governments, including 15 in Virginia and five in Maryland.

Moody’s cited the states’ high concentration of federal employees and dependence on federal contracts as two reasons for their possible credit downgrade.

“On both sides of the Potomac, Maryland’s triple-a bond rating and Virginia’s triple-a bond rating is threatened by our potential inability to pay the bills of the United States, the wealthiest republic on the planet,” O’Malley said Thursday to congressional Democrats.

One Virginia county on Moody’s possible downgrade list, Hanover county, is in House Majority Leader Eric Cantor’s district.

“Moody’s announcement further demonstrates why it is so important to take serious steps to cut spending and get our fiscal house in order,” Cantor’s spokeswoman Megan Whittemore said in a statement. “No one wants to default on our debt, and with so many people still out of work we have to focus on getting the economy going again.”

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