Stephen A. Schwarzman said Fitch Ratings' downgrade of the U.S. long-term credit rating was appropriate after multiple debt-limit standoffs.
"The numbers justify it, regrettably," the Blackstone chief executive officer said Friday on CNBC. "We've had an explosion of debt since the global financial crisis. We don't appear to have a lot of discipline."
Fitch's decision this week to lower the U.S. long-term rating to AA+ from AAA, based on the American government's debt burden and "erosion of governance," rattled the stock market and prompted criticism from both inside and outside the Biden administration.
J.P. Morgan Chase & Co. CEO Jamie Dimon also told CNBC that the downgrade "doesn't really matter that much," and that U.S. credit is sound and should be the highest rated in the world. Treasury Secretary Janet Yellen called the downgrade "entirely unwarranted."
Mr. Schwarzman said regardless of the rating, for now the U.S. is the world's reserve currency. "When there's a crisis in the world, they buy our securities," he said.
But that doesn't last forever if there isn't discipline, he warned.
In the wide-ranging interview, the executive said he's optimistic that the Federal Reserve's fight against inflation is working, and the U.S. might be able to skirt a recession if price pressures continue to ease.
Mr. Schwarzman also weighed in on the emergence of artificial intelligence, calling it "one of the most exciting developments of a lifetime" and a competitive advantage for businesses. "If we get there first with our companies, then they'll be much better positioned than somebody who shows up five years later."
He predicted that a global institution akin to the World Trade Organization will emerge to audit the safety of AI technologies.
The billionaire Republican donor continued to keep mum about which candidate he's backing in the U.S. presidential race, but he said "it's time for a new generation of people to take that slot."
The job of president is demanding, which raises questions about whether someone approaching their 80s would be best-suited, he said.