China says the U.S. is already defaulting on debt

Forget the debt ceiling debate — the U.S. is already in default, a Chinese ratings agency claims.

“In our opinion, the United States has already been defaulting,” said Guan Jianzhong, president of Dagong Global Credit Rating Co. Ltd., reports AFP, describing that organization as “the only Chinese agency that gives sovereign ratings.”

U.S. Treasury officials have already said that the government exceeded its $14.3 trillion debt ceiling in April, but that accounting procedures would finance obligations through Aug. 2.

The Chinese claim to the contrary comes just two days after another Chinese official warned that congressional Republicans are “playing with fire” in opposing efforts to increase the debt ceiling.

The debt ceiling is a primary topic of ongoing budget talks between President Obama’s administration and members of Congress from both parties.

Republicans, including those who control the U.S. House, say they won’t vote to increase the debt ceiling until the administration commits to major spending cuts.

“We believe that many of the problems surrounding the lack of job creation and growth in this country have to do with the fact that there isn’t a credible plan to manage down the debt and deficit in this country,” said House Majority Leader Eric Cantor, R-Va. “That’s what we’re trying to produce here.”

Obama officials say they too want to reduce the debt, but raising the debt ceiling as soon as possible is an imperative.

“This is not a matter of spending,” Obama said. “This is a matter of the United States meeting its obligations, not defaulting on its obligations.”

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