Not much, in my opinion. In my last post, I argued that I'd take the debt deal even at the expense of the negative publicity we got for the juvenile way the negotiations were conducted. So we avoided default and got downgraded by S&P anyway. S&P's arithmetic mistake aside, I don't think potential investors in U.S. Treasuries relied too much on its previous AAA rating in actively valuing the bonds and bills. And even if they did, they should be only minimally bothered by its current AA+ rating. Potential investors have plenty of public information on current and projected cash flows of the U.S. government. In those circumstances, there is little value added by a ratings agency's grade.
Where ratings agencies can add value is in rating securities that are harder to value. I cannot say it better than E.J. Dionne did:
And to complete this portrait of fecklessness, Standard & Poor’s, which once happily and profitably stamped triple-A ratings on rip-off mortgage-backed securities, ended the week by downgrading the federal government’s creditworthiness. S&P once caved to pressure from Goldman Sachs in its rating of private securities, yet it refused even to pause in its dissing of American creditworthiness despite the Obama administration’s successful challenge to some of its numbers. We need to learn far more about what forces pushed S&P to this outlandish and highly politicized decision. [links in original]
The consequences of the downgrade, if any, will play out over time in the level of the term structure for U.S. Treasuries. At present, the U.S. government can borrow at ridiculously low levels. We should do so, as needed, to support investment that will boost output, employment, and productivity in the future.