Government Will Borrow From Federal Employee Pension Fund

[Rocktown Gal]

Isn't this still borrowing? No matter how you twist it...they are stealing from retirement funds to aid their spending. They say it won't be missed...but for those with these plans...good luck on getting that money back if the debt limit is not raised.

Government Will Borrow From Federal Employee Pension Fund to Avoid Passing Debt Limit

Treasury Secretary Timothy Geithner said that the government has begun borrowing from the federal employee pension fund (the G fund) to keep operating without passing the approaching debt limit.

The move will free up $156 billion in borrowing authority while the debt limit debates proceed in Congress. Geithner said that he will replace the money in the fund after the borrowing limit is raised. That of course assumes Congress comes to an agreement soon and does, in fact, raise the debt ceiling.

Geithner’s letter to House Speaker John Boehner reads:

Dear Mr. Speaker,

I am writing to notify you, as required under 5 U.S.C. 8438(h)(2), of my determination that, by reason of the statutory debt limit, I will be unable to invest fully the Government Securities Investment Fund (G Fund) of the Federal Employees’ Retirement System in interest-bearing securities of the United States, beginning on Tuesday, January 15, 2013. The statute governing G fund investments expressly authorizes the Secretary of the Treasury to suspend investment of the G Fund to avoid breaching the statutory debt limit. Both my predecessors and I have taken this suspension action during previous debt limit impasses. By law, the G Fund will be made whole once the debt limit is increased. Federal retirees and employees will be unaffected by this action.

Sincerely,

Timothy F. Geithner

http://www.fedsmith.com/2013/01/15/g...ng-debt-limit/

[unioncreek]

I'm a federal employee and they do this every couple years. The interest we get paid for the use of our retirement funds is minuscule compared to what they would have to pay anyplace else.

Bobg

[TNHermit]

I'm sure even if this has been done for a while its now a preclude to 401K and other plans. they will get it all if they can. but we have been warning about this for over a year so don't feel bad for those who lose. And Timy has been broke for a couple months now and he is struggling

[Sawmill Jim]

Bet those funds only exist on a computer somewhere .They print as needed

[Old Vet]

Oh they will give them treasury notes for them to hold on to. Just like the ones they gave to the Social Security.

[Danaus29]

Too bad they don't borrow from the paychecks for congress and the pres. Maybe then they would work to keep their spending under control.

[where I want to]

There was a proposition passed in California to hold back the legislature's pay if they did not pass a balanced budget on time. So they did- with prospective revenues everyone knew would never be received and disregarding expenses that everyone knew would have to be paid. It was challenged in court where the judge ruled that only the legislature could make the determination as to expenses and income estimates. And there you were, a complete circle around on the merry-go-round.
A good attitude in elected officials is the only thing that can save us and how likely is that?

[Ozarks Tom]

It's just an accounting gimmick. All it means is instead of putting an IOU in the file as usual, the don't bother putting the money in the fund to be borrowed in the first place. The government retirement fund is as empty as the SS "trust fund".