The day after Standard & Poor’s took the unprecedented step of stripping the U.S. government of its top credit rating, the ratings agency offered a full-throated defense of its decision, calling the bitter standoff between President Barack Obama and Congress over raising the debt ceiling a "debacle." It warned that further downgrades may lie ahead.

In an unusual Saturday conference call with reporters, senior S&P officials insisted the ratings firm hadn’t overstepped its bounds by focusing on the political paralysis in Washington as much as fiscal policy in determining the new rating. "The debacle over the debt ceiling continued until almost the midnight hour," said John B. Chambers, chairman of S&P’s sovereign ratings committee.

Another S&P official, David Beers, added that "fiscal policy, like other government policy, is fundamentally a political process."

But, rather than building consensus on how to best rein in the nation’s staggering debt, the downgrade left political leaders as divided as ever. Politicians on both sides used the decision to bolster their ideological positions.

Officials at the White House and Treasury criticized S&P’s action as based on faulty budget accounting that did not factor in the just-enacted deal for increasing the debt limit.

Gene Sperling, director of the White House national economic council, called the difference, totaling more than $2 trillion, "breathtaking" and said "the amateurism it displayed" suggested "an institution starting with a conclusion and shaping any arguments to fit it."

Even as the ratings agency insisted on Saturday that its move shouldn’t have come as a shock, it reverberated around the world. Officials from China to Europe scrambled to assess the downgrade’s impact on the already troubled global economy, and political leaders in the United States sought to frame the issue in their favor.

Republican presidential candidates on Saturday seized on the downgrade as a new line of criticism against Obama, suggesting that ultimate responsibility rests in the Oval Office.

"It happened on your watch, Mr. President," Rep. Michele Bachmann said, drawing applause at an afternoon rally in Iowa. "You were AWOL. You were missing in action."

The White House blamed Washington’s polarized political climate for the downgrade. "We must do better to make clear our nation’s will, capacity and commitment to work together to tackle our major fiscal and economic challenges," the White House press secretary, Jay Carney, said in a statement.

The ratings agency’s action puts additional pressure on a still-to-be-named congressional committee to find additional spending cuts, tax increases or both to bring down the inexorably rising national debt.

The wrangling over S&P’s downgrade to AA(PLUS) from AAA stretched on for days. But interviews with both officials from the administration and S&P reveal sharply differing perceptions on whether a downgrade was imminent. The rating agency argued that their intentions had been plain for months if the government didn’t take strong action to curb the debt; administration officials claimed they were blindsided.

The drama, which would culminate late Friday and into the weekend, actually began to gather speed Wednesday, when S&P executives came to the Treasury Department to meet with a group of administration officials led by Mary J. Miller, the assistant secretary for financial markets.

At the meeting, the S&P executives walked the Treasury Department team through its analysis. Government debt was growing rapidly, they said, and the just-completed deal wasn’t going to do enough to slow it down, endangering the AAA rating.

As early as April, S&P had changed its credit outlook on the United States to negative. By July, S&P warned that if the government did not agree to a deficit reduction package of about $4 trillion, there was a one-in-two chance a downgrade.

Still Treasury officials claim they were taken by surprise Wednesday. Just the day before, Miller and her team met at the Hay-Adams Hotel with a group of senior Wall Street executives who advise the Treasury on its borrowing. None of the members believed that the government’s credit rating would be lowered in the near-term.

On Thursday, the ratings agency informed the Treasury that its seven-person panel would meet Friday morning to assess the creditworthiness of the U.S. government.

Even then, one administration official said, "We didn’t think they would actually do it."

At 8 a.m. Friday, S&P convened a global conference call of its sovereign rating committee including Beers, Chambers and others. By 10 a.m., they’d reached a majority decision — the United States no longer was entitled to its top rating. Beers would not say whether the verdict was unanimous.

Rumors of a downgrade were already swirling in the markets — a prime reason the Dow dove more than 200 points at lunchtime, and at 1:15 p.m., the three men called the Treasury to inform them of the decision. "They were not pleased with the news," Beers said.

Half an hour later, Treasury Secretary Timothy F. Geithner called William M. Daley, the White House chief of staff, as well as Sperling, according to administration officials. They delivered the news to Obama in the Oval Office, before he took off to Camp David for the weekend.

Inside the Treasury, meanwhile, John Bellows, an acting assistant secretary, flagged a concern over S&P’s methodology. In its analysis, S&P had projected the nation’s debt as a share of gross domestic product to reach 93 percent by 2021. That was around 8 percentage points higher than the figure administration officials believed the rating agency should have used — what they now call a $2.1 trillion error.

In a Treasury blog entry, Bellows wrote that the difference raised "fundamental questions about the credibility and integrity of S&P’s ratings action."

Around 5:30 p.m., S&P officials called the group of Treasury officials. "You were right," Chambers told them, but said he was prepared to proceed because the revisions didn’t meaningfully affect S&P’s conclusion.

In one final effort to prevent what was once unthinkable from becoming inevitable, the Treasury officials again pressed S&P to reconsider. At 8 p.m., the ratings agency sent them the final press release on the downgrade. By 8:20 p.m., the news was out.

"For those who follow the fiscal situation of the United States, this shouldn’t be news to anyone," Chambers said.

© 2011 The New York Times Company