Below is President Barack Obama's statement on the downgrade of the U.S. credit rating and the loss of 30 American lives in Afghanistan this weekend.

Good afternoon, everybody. On Friday, we learned that the United States received a downgrade by one of the credit rating agencies. Not so much because they doubt our ability to pay our debt if we make good decisions but because after witnessing a month of wrangling over raising the debt ceiling, they doubted our political system's ability to act.

The markets, on the other hand, continue to believe our credit status is AAA. In fact, Warren Buffet, who knows a thing or two about investments said 'If there were a AAAA rating, I'd give the United States that'.

I, and most of the worlds investors, agree. That doesn't mean we don't have a problem. The fact is, we didn't need a rating agency to tell us that we need a balanced long-term approach to deficit reduction. That was true last week. That was true last year. That was true the day I took office.

We didn't need a rating agency to tell us that the gridlock in Washington over the last several months has not been constructive, to say the least. We knew from the outset that a prolonged debate over the debt ceiling, a debate where the threat of default was used as a bargaining chip, could do enormous damage to our economy and the world.

That threat, coming after a string of economic disruptions in Europe, Japan and the Middle East, has now roiled the markets and dampened consumer confidence and slowed the pace of recovery.

So all of this is a legitimate source of concern. But here is the good news. Our problems are imminently solvable. And, we know what we have to do to solve them. With respect to debt, our problem is not confidence in our credit. The markets continue to reaffirm our credit as among the world's safest.

Our challenge is the need to tackle our deficits over the long term. Last week we reached an agreement that will make historic cuts to defense and domestic spending. But there is not much further we can cut in either of those categories.

What we need to do now is combine those spending cuts with two additional steps. Tax reform that will ask those who can afford it to pay their fair share and modest adjustments to health care programs like Medicare.

Making these reforms doesn't require any radical steps. What it does require is common sense and compromise. There are plenty of good ideas about how to achieve long-term deficit reduction that doesn't hamper economic growth right now.

Republicans and Democrats on the bipartisan fiscal commission that I set up put forth good proposals. Republicans and Democrats in the Senate's Gang of Six came up with some good proposals. John Boehner and I came up with some good proposals when we came close to agreeing on a grand bargain.

So it's not a lack of plans or policies that's the problem here. It's a lack of political will in Washington. It's the insistence of drawing lines in the sand; a refusal to put what's best for the country ahead of self interest or party or ideology. And that's what we need to change.

I realize that after what we just went through there's some skepticism that Republicans and Democrats on the so-called "Super Committee", this joint committee that's been set-up, will be able to reach a compromise. But my hope is that Friday's news will give us a renewed sense of urgency.

I intend to present my own recommendations over the coming weeks on how we should proceed. And that committee will have this administration's full cooperation. And I assure you, we will stay on it until we get the job done.

Of course, as worrisome as the issues of debts and deficits may be, the most immediate concern of most Americans and of concern to the marketplace as well is the issue of jobs and slow pace of recovery coming out of the worst recession in our lifetimes.

The good news here is by coming together to deal with the long-term debt challenge. We would have more room to implement key proposals that can get the economy to grow faster. Specifically, we should extend the payroll tax cut as soon as possible so that workers have more money in their paychecks next year and businesses have more customers next year.

We should continue to make sure that if you're one of the millions of Americans who is out there looking for a job, you can get the unemployment insurance that your tax dollars contributed to. That will also put money in people's pockets and more customers in stores. In fact, if Congress fails to extend the payroll tax cut, and the unemployment benefits that I've called for it can mean one million fewer jobs and half a percent less growth. This is something we can do immediately, something we can do as soon as Congress gets back. We should also help companies that want to repair our roads, and bridges, and airports so that thousands of construction workers that have been without a job for the past few years can get a paycheck again that will also help to spur economic growth. These aren't Democratic proposals, these aren't big government proposals. These are ideas that traditionally Republicans have agreed to, have agreed to countless times in the past. There's no reason we shouldn't act on them now. None. I know we're going through a tough time right now. We've been going through a tough time for the last two and a half years.

I know a lot of people are worried about the future, but here's what I also know: There's always going to be economic factors that we can't control. Earthquakes, spikes in oil prices, slowdowns in other parts of the world. But how we respond to those tests, that's entirely up to us.

Markets will rise and fall, but this is the USA. No matter what some agency may say, we've always been and always will be a triple A country. For all of the challenges we face, we continue to have the best universities, some of the most productive workers, the most innovative companies, the most adventurous entrepreneurs on earth. What sets us apart is not only that we've had the capacity but also the will to act, the determination to shape out future, the willingness in our democracy to work out our differences in a sensible way and to move forward not just for this generation but for the next generation. And, we're going to need to summon that spirit today. The American people have been through so much over the last few years dealing with the worst recession, the biggest financial crisis since the 1930s and they've done it with grace.

Their working so hard to raise their families. All they ask is that we work just as hard here in this town to make their lives a little bit easier. That's not too much to ask. Ultimately the reason I'm so hopeful about our future, the reason I have faith in the USA is because of the American people.

It's because of their perseverance, and their courage, and their willingness to shoulder the burdens we face together as one nation. One last thing: there is no one who embodies the qualities I mentioned more than the men and women of the US Armed Forces, and this weekend we lost 30 of them when their helicopter crashed during a mission in Afghanistan. Their loss is a stark reminder of the risks that our men and women in uniform take every single day on behalf of their country. Day after day, night after night, they carry out missions like this in the face of enemy fire and grave danger.

In this mission, as in so many others, they were also joined by Afghan troops, seven of whom lost their lives as well. So I've spoken to our general in the field, as well as, President Karzai and I know that our troops will continue transitioning to a stronger Afghan government and ensuring that Afghanistan is not a safe haven for terrorists.

We will press on and we will succeed. But now is also a time to reflect on those we lost and the sacrifices of all who serve as well as their families. These men and women put their lives on the line for the values that bind us together as a nation. They come from different places. Their backgrounds and beliefs reflect the rich diversity of America. No matter what differences they might have as individuals, they serve this nation as a team. They meet their responsibilities together and some of them, like the 30 Americans this weekend, give their lives for their country. Our responsibility is to ensure that their legacy is an America that reflects their courage, their commitment, and their sense of common purpose. thank you very much.