Moody's downgrade US credit rating: What led to Moody's downgrading the U.S. credit rating to Aa1, first time in over a century? Here are the reasons the agency cited and why Americans should be worri
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For the first time in over a century, the US does not hold a top-tier rating from any major credit agency, as even Moody's Ratings downgraded the US government's credit rating from Aaa to Aa1 on Friday, as per reports.Moody's explained that it reduced the ratings due to repeated failures by successive administrations to control the country's growing debt, as per Newsweek. However, the ratings agency also mentioned that the United States 'retains exceptional credit strengths such as the size, resilience and dynamism of its economy and the role of the U.S. dollar as global reserve currency," quoted AP.ALSO READ: Moody's downgrades U.S. rating from AAA to Aa1; what are the consequences of this move, and will the economy be affected? Here are all the details The rating agency also pointed out that, 'We expect federal deficits to widen, reaching nearly 9% of (the U.S. economy) by 2035, up from 6.4% in 2024, driven mainly by increased interest payments on debt, rising entitlement spending, and relatively low revenue generation," quoted AP.While, Moody's also cautioned that extending US president Donald Trump's 2017 tax cuts, which is now a key priority for the Republican-led Congress, would add $4 trillion to the federal primary deficit over the next 10 years, as per Newsweek.It is the latest downgrade of the three major rating agencies to lower the federal government's credit, Standard & Poor's downgraded federal debt in 2011 and Fitch Ratings followed in 2023, reported AP.ALSO READ: Who is Mark Zandi, the Iranian-American Moody's chief economist whom Donald Trump accuses of downgrading the U.S. credit rating to Aa1? Democratic strategist Chris Jackson posted on social media platform X, saying, "BREAKING: In a stunning move, Moody's has downgraded the U.S. credit rating from Aaa to Aa1—for the first time in history. That's right: the only major credit agency that hadn't downgraded us under Trump just did. Who else enjoying all this 'economic winning' under Trump?" as quoted by Newsweek.It means the US no longer holds the highest credit rating.Moody's downgraded the US due to the rising national debt and a lack of government action to address it.
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It led to the ban on student elections which has remained in effect till this day. Ahmed said that the NSUI gained immense significance after former prime minister Rajiv Gandhi lowered the voting age to 18. 'I had requested Rajiv Gandhi to restart student elections in Karnataka, who in turn referred me to Oscar Fernandes who was KPCC (Karnataka Pradesh Congress Committee) president. Fernandes asked Ranganath but he did not budge,' Ahmed said. The Congress, like its counterparts, relied on student movements to shape young leaders. 'It was a breeding ground for future leaders,' he added. But multiple leaders who spoke to ThePrint said the practice of honing student leaders has now been replaced with that of children of established politicians being paradropped into key positions. Leaders like Hariprasad also lamented the decline of the infrastructure that gave the party its strength. In the 2022 hijab-related protests, the Congress literally had no position nor presence on campuses. The Campus Front of India, student arm of the now banned Popular Front of India, stood with the students who demanded the right to wear a hijab in classrooms while several pro-Hindu organisations stood with those opposing this. Student-led movements also played a crucial role in the Emergency-era protests against Indira Gandhi. With ABVP and Left-leaning parties dominating student elections in other states, the Congress hopes that its strong presence in Karnataka will attract young students to its ideology and help increase its base among state youth. (Edited by Nida Fatima Siddiqui) Also Read: Hyderabad university land row: NSUI members oppose own Congress govt, condemn CM Revanth's remarks
