Mitch McConnell says S&P downgrade could 'be helpful' to spark big debt reduction deal

08/07/2011 12:32 PM

MAYFIELD, Ky. — The first downgrading of the United States’ credit rating could help leverage a more sweeping deal to reduce the nation’s debt, Senate Republican Leader Mitch McConnell said.

Speaking to several reporters after a political breakfast Saturday, McConnell said he remains hopeful that a bipartisan committee can reach agreements on revamping Medicare and Social Security and closing tax loopholes.

“Everything will be on the table — entitlements, tax reform,” he said.

When asked about taxes, McConnell said he wants to see a proposal that would lower corporate income tax rates as a way to free up private sector money, while ending exemptions and loopholes riddling the U.S. tax code.

“Everybody I know, from the president to myself and others, think that we ought to go through tax reform, try to lower the rates, get rid of the preferences,” McConnell said (1:00 into the interview video).

His comments came the morning after Standard & Poor’s downgraded the U.S. credit rating from AAA to AA.

“I hope it will be helpful. It further underscores the need to do a lot more,” McConnell said of the downgrade’s effect on the forthcoming negotiations. (See the 1:30 mark.)

As part of last week’s deal to raise the debt ceiling, Congress approved the creation of a bipartisan committee that must outline additional spending cuts of at least $1.5 trillion over the next 10 years.

“I am optimistic that they will produce a very significant package. The country needs it. And I’m going to put people on there who want an outcome. We’re not interested in gridlock,” McConnell said as part of his first answer on the video.

Watch to find out more about how he’s going to choose which GOP senators to appoint, as well as his negotiating philosophy:

- Interview by Ryan Alessi, video produced by Chris Bratton


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