Tim Geithner once again is raiding the federal pension funds since the debt ceiling has been breached. Don’t worry about federal retirees not getting their pension check: the government is required to pay them whether money is in the pension fund or not. In other words, the federal pension fund is just another slush fund and its assets are available to be spent as necessary without any penalties. If an “evil corporation” did this, their officers would be put in prison after a well publicized trial.
Remember last may when Geithner blackmailed Congress using this same trick?
The US has suspended payments into a civil service pension fund to free up almost $150bn as the major debtor nation approaches its legal borrowing limit.
Timothy Geithner, the US Treasury Secretary, announced the move in a letter on Monday to Congressional leaders as he explained that the move extends the government’s breathing space to August 2 to avoid an unprecedented default on its borrowings.
How did that work out for us? After eight months and another $1 trillion later, we are once again going down the same path. Remember the spending cuts Boehner wanted in order to agree to the August debt ceiling increase? John Boehner is more concerned about election results than doing his job and the people continue to pay the price for his incompetence.
The Treasury on Tuesday started dipping into federal pension funds in order to give the Obama administration more credit to pay government bills.
Treasury started suspending reinvestments in a federal pension fund known as the G-Fund in order to avoid hitting the country’s $15.194 trillion debt limit.
“I will be unable to invest fully” the federal employees retirement system fund, beginning Tuesday, Treasury Secretary Timothy Geithner told Democratic and Republican leaders in Congress.
The House of Representatives is expected to vote Wednesday on the Obama administration’s request to increase the debt limit by $1.2 trillion.