Tuesday, Aug. 9, 2011 | 3:18 p.m.
The role of the state treasurer, a fairly obscure office historically, has been inflated by both Republicans and Democrats in the special congressional election this summer.
Democrat Kate Marshall has worked to amplify her performance as treasurer, taking credit for “steering the state” through difficult economic times while her Republican opponent Mark Amodei and national Republicans have tried to pin the entire economic collapse on her.
But in the wake of the first ever downgrading of the U.S. credit rating, Republicans have sought to draw scrutiny to how well Marshall has managed Nevada’s credit rating.
And Republicans may have purchase here.
Unlike the state’s skyrocketing unemployment and foreclosure problems, issues the state treasurer has really nothing to do with, Marshall is largely responsible for keeping Nevada’s credit rating healthy.
In a press release this week, the National Republican Congressional Committee criticized Marshall for overseeing a downgrade by two credit agencies of Nevada’s credit rating.
“Why is Kate Marshall bragging about a credit downgrade?” NRCC spokesman Tyler Houlton wrote.
Indeed, last quarter Nevada’s credit rating was knocked down a notch by both Moody’s—to Aa2 from Aa1—and S&P—to Aa from Aa-plus.
Both ratings agencies noted Nevada’s severe economic recession, the narrow tax structure, an over-reliance on consumer spending in gaming and tourism and lawmakers’ refusal to enact long-term budget fixes, including tax increases.
But both ratings agencies also praised the state for maintaining healthy liquidity and cash management, which are the responsibility of the treasurer.
On that front, Marshall argues the credit downgrade could have been much worse had her fiscal policies not been in place.
“It’s unfortunate that the state’s credit rating was downgraded slightly in the early part of 2011 due to years of deep economic recession, but it is still in the AA range,” Marshall said in a written statement. “However, the credit rating agencies specifically point to structural issues like the tax code and Nevada’s reliance on consumer spending to fund revenue sources as the reason for the credit rating change, which are not the constitutional responsibilities of the treasurer.”