Skip to comments.US taps pension fund to avoid passing debt limit (Borrowing against borrowed pensions)
Posted on 01/15/2013 3:15:10 PM PST by tobyhill
Treasury Secretary Timothy Geithner says the government has begun borrowing from the federal employee pension fund to keep operating without surpassing its debt limit.
Geithner says in a letter to congressional leaders that the move will free up $156 billion in borrowing authority while Congress debates increasing the $16.4 trillion debt limit.
(Excerpt) Read more at money.msn.com ...
they put folks in jail for that in the private sector
Yep, I bet that shocks alot of federal employees that they could go and grab that. I’ll bet unions get dragged into changing the future of the fund after this mess and remove it from federal hands.
The other question will be if they can grab the TSP (the 401k fund of gov’t employees). That will really screw up stocks and investments across the nation if they removed money from that.
What will they do if Congress refuses to raise the debt ceiling?
This is a criminal illegal act, probably being done not to bide time, but to apply alinsky rules to ramp up the crisis
Put pressure on Congress to raise the debt limit by tapping employee pension. Obamster and his crew should all be in jail.
Obama is making sure he gets his hands on their “Fair Share”.
Sounds like there is some impact on the TSP G fund. It reads like the TSP will take deposits, but not issue securities. So where does the money go...
A Message from the TSP’s Executive Director
As we await legislation on raising the Federal debt limit, I would like to address your concerns about the possible suspension of issued securities to the Government Securities Investment (G) Fund. In the event that the U.S. Government reaches the statutory Federal debt limit, the Federal Government may temporarily be unable to issue new securities to the G Fund because to do so would exceed the present debt limit. However, G Fund investors are always fully protected and G Fund earnings are fully guaranteed by the Federal Government due to statutory protections in the Thrift Savings Plan Investment Act of 1987. This protection, known as the make-whole provision, will work to ensure that G Fund investors are completely unaffected by the limitation on securities issued by the U.S. Treasury. G Fund account balances will continue to accrue earnings and be updated each business day, and loans and withdrawals will be unaffected.
The Government Accountability Office has published a report which explains the full protection provided to G Fund investors when the U.S. Government reaches the statutory Federal debt limit. The report can be found here: http://www.gao.gov/products/GAO-12-701
If you have any additional questions, please call the toll-free ThriftLine at 1-877-968-3778 and speak to a Participant Service Representative.
Greg T. Long
© 2012 Thrift Savings Plan
Madoff, Stanford, Ponzi - are pikers compared to the Government thieves who live in DC.
Said it before and saying it again - this administration is conducting the biggest heist of all time.
another lock box with no money in it....
Sounds like an inside job.
I say we make them “borrow” every last cent of every last government pension then watch the rat bastards squirm like hell when their core constituency demands the money be put back.
Hell, if Social Security is ok with nothing but IOU’s sitting in it, then why not the same for gubbermint employees?
Screw em all I say.
Without getting too specific, it may be time to "feed the hogs" or past that "awkward moment". We have criminals in our government.
DC is out of other people money. It’s cannibalizing its own debt. The Ponzi scheme called big gov’t is crashing hard. Lil Barry is now a farce.
Where is ERISA when you need it, they probably have someone running it that has the same epistemology as Van Jones...
All they are doing is putting an IOU in a box full of IOUs.
They can't take any money out...there isn't any there.
Well, they embezzled our Social Security funds long ago -
now they’re robbing themselves - although I doubt a single congresscritter or senators retirement funds will be touched.
Geittner has done this before. On the off chance he fails to make it work this time then he won't be able to walk the streets in public again in his life, nor, probably, appear before Congress.
I bet that shocks alot of federal employees
They voted for Obama. Haha. The joke’s on them.
All they are doing is putting an IOU in a box full of IOUs.
GREAT POST! You nailed it.
He did the same thing last time, so then when he does get borrowing authority a lot is used up quickly by paying the retirement back.
Shoot just think of all the extra time we could have if they used the Postal Employees retirement funds
Not even close to true.
I have inside information refuting this statement.
B-b-b-but there might not be enough debt/revenues for big government tomorrow! That would be just terrible. ;-)
If you are a govt worker, you should pay attention very closely
It appears things are actually worse than they want to admit.
There are 10 total TSP funds. There is one and only one, the G fund can be borrowed from. The other 9 are index funds invested in the market. The G fund has been borrowed from before, and later repaid. The G Fund buys a nonmarketable U.S. Treasury security that is guaranteed by the U.S. Government. This means that the G Fund will not lose money. “They voted for Obama. The jokes on them.” Don’t bet on it, all Civil Servants are individuals, just as your Company employees, Church members, your drinking buddies, friends you went to High School and College with, they all voted individually, not lock step because of their race, color or creed. For me it’s Freedom, Family values, Conservative principles and Patriotism before these liberal progressives, skin pigment, small minded princes who want to control everything in our lives.
“I have inside information refuting this statement.”
Unnamed sources? A well-placed official? Sounds like the liberal media. Post your views (unsourced is OK) so we can at least see some rationale as to why you think this is not even close to being true.
“The G Fund buys a nonmarketable U.S. Treasury security that is guaranteed by the U.S. Government. This means that the G Fund will not lose money.
They voted for Obama. The jokes on them. Dont bet on it, all Civil Servants are individuals, just as your Company employees, Church members, your drinking buddies, friends you went to High School and College with, they all voted individually, not lock step because of their race, color or creed.”
1) The “guaranteed” G Fund may not lose money technically speaking, but it is losing buying power. Rate for the last 12 months was less than 1.5% which does not keep up with inflation.
2) I didn’t say that ALL Civil Servants were in lock step. Some are probably horrified at the what this regime is doing to their country. However, the vast majority of feds (70%) and their unions (NTEU & AFGE) strongly supported Obama. His administration is now tapping the federal employees’ G Fund to avoid passing the debt limit. And the pay raise for 2013 will be a paltry .5%. Like I said, the joke’s on them.
Just know, that there are a ton of federal workers that
don’t like Odumbo, and certainly didn’t vote for him.
No doubt some federal workers are horrified by what this regime is doing to their country. I personally know some who are. However, the vast majority of feds (70%) and their unions (NTEU & AFGE) strongly supported Obama.