Thursday, December 18th, 2014

Overdrawn Fed Govt Dips into Pension Funds to Pay Bills

Kimberly Paxton
www.TheDailySheeple.com
January 17th, 2013
Reader Views: 1,412

geithner

Don’t worry, folks! We can stay below the national debt limit! We’ll just take it from the pension funds!!!!

Phew. Emergency averted.

The federal employees surely won’t mind helping out the government as their investments are involuntarily “borrowed”.

Treasury Secretary Timothy Geithner wrote a letter to bipartisan Congressional leaders stating that he “will be unable to invest fully” the federal employees retirement system fund.

I am writing to notify you, as required under 5 U.S.C. § 8348(l)(2), of my determination that, by reason of the  statutory debt limit, I will be unable to invest fully the portion of the Civil Service Retirement and Disability Fund (“CSRDF”) not immediately required to pay beneficiaries. For purposes of this statute, I have determined that a “debt issuance suspension period” will begin today, May 16, 2011, and last until August 2, 2011, when the Department of the Treasury projects that the borrowing authority of the United States will be exhausted. During this “debt issuance suspension period,” the Treasury Department will suspend additional investments of amounts credited to, and redeem a portion of the investments held by, the CSRDF, as authorized by law.

In addition, I am notifying 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 today, May 16, 2011. 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.

Each of these actions has been taken in the past by my predecessors during previous debt limit impasses. By law, the CSRDF and G Funds will be made whole once the debt limit is increased. Federal retirees and employees will be unaffected by these actions.

I have written to Congress on previous occasions regarding the importance of timely action to increase the debt limit in order to protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens. I again urge Congress to act to increase the statutory debt limit as soon as possible.

Sincerely,

Timothy F. Geithner

The fund Geithner is dipping into to pay the bills is called the G fund. This is the pension fund for federal employees. Without “other people’s money” the US Federal Government cannot pay its bills without breaching the much-touted “debt ceiling”. This frees up  free up $156 billion in borrowing authority while the debt limit debates lumber on  in Congress.

The funds affected are  Civil Service Retirement and Disability Fund and treasury securities held as investments by the Government Securities Investment Fund of the Federal Employees’ Retirement System Thrift Savings Plan.

But those with funds being tapped shouldn’t worry. A soothing letter has been issued to them by TSP Executive Director Greg Long.

Dear Participants:

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
Executive Director

You can learn more about the practice of using personal pension money to fund the overdrawn government HERE.

Federal employees have seen their investments plundered 6 times over the past 20 years. This precedent should not set their minds at ease, as the debt ceiling has been raised numerous times since then, so that the amount in the red is ever increasing.

Will this be the time that the money is not replaced?

Delivered by The Daily Sheeple


Contributed by Kimberly Paxton of www.TheDailySheeple.com.

Kimberly Paxton, a staff writer for The Daily Sheeple, is based out of upstate New York. You can follow Kimberly on Facebook and Twitter.

This content may be freely reproduced in full or in part in digital form with full attribution to the author and a link to www.TheDailySheeple.com.

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  • Cymro

    This is the best news I have heard all day. This is an OUTSTANDING way to solve the debt crisis. I say take all the money from this fund and let those sorry ass tax eaters fend for themselves like the rest of us. They have sucked at the public teat for long enough.

    • Wild Blue Yonder

      @Cymro

      Be careful. While I empathize with your feelings on this issue, we should be wary. When the feds are finished feeding at this trough they will start looking for another to feed at. And there’s a nice one ripe for the taking. The retirement savings of private citizens. IRAs, 401ks, etc. Trillions of dollars worth. How yummy!!

  • Mark

    You are correct Wild Blue…
    If you think you retirement pensions, 401K, and IRA’s are safe think again
Your next!!!

    • SKIP

      ROGER THAT Mark, those are going to be attacked before armed resistance begins in the U.S. Take the money and run slogan comes to mind.

  • Z

    nothing is safe. they will take your property if they have to.
    you own nothing under this government.

  • DHS

    Turn in your guns at any police station or military post.
    If you are not able to travel please call us and we will pick up your guns at no charge.

    You will be given a 4 week grace period to turn in all weapons and ammo. After 4 weeks you will be considererd an enemy combatant.

    Those who intentionally attempt to decieve personal in charge of gun confiscation will be detained in our holding facilities.

    After 30 days anyone still in possession of firearms will be subject to the articles of war.

    Please help us to make america safe for you and your family.

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