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U.S. Starts Tapping Into Federal Pensions

May 16, 2011 by  

U.S. Starts Tapping Into Federal Pensions

On Monday, United States Treasury Secretary Timothy Geithner told Congress that he will begin suspending investments in government retirement funds in order to free up borrowing capacity.

CNBC.com reported, “Geithner said he would suspend investments in two government retirement funds, which will give the U.S. Treasury $147 billion in additional borrowing capacity.”

Geithner also said, “I again urge Congress to act to increase the statutory debt limit as soon as possible.” The Treasury has said that it will continue to suspend such investments as part of a plan to keep the government solvent, but that such measures would only work until Aug. 2.

The article said, “Previous administrations have also tapped the retirement funds at times to avoid breaching the debt limit. Over the past two decades, Treasury has suspended investments five times, with the most recent suspension in 2006.”

Geithner claimed, “Federal retirees and employees will be unaffected by these actions,” but that he “will be unable to invest fully” in the civil service retirement and disability fund and the government securities investment fund.

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  • s c

    Geithner, in his limited capacity to understand the difference between up and down, seems determined to replace Rahmbo as the Obummer
    administration’s #1 horse’s asset. So he needs a way to increase Uncle Scam’s ability to BORROW. Gee, and I’ll bet he thinks he’s pursuing a semi-divine approach to reality.
    Does anybody not understand the significance of what that twit wants to do? Is there anyone brave enough out there who will try to defend this greed and stupidity?

  • Raggs

    Another screw to the private sector… Go figure….

  • Pete

    I got to admit these guys are brilliant, and I’m not being sarcastic. But when is Congress going to balance the budget and pay back all that money they borrowed ? If Congress can’t pay back all the money, it’s time for BANKRUPTCY. This probably would effect the economy dramatically for two or three years …

    Here is a good question: “Is the Federal Reserve being hijacked by Congress right now ?” or “Is the Treasury being hijacked by Congress right now ?”. That’s something to consider. Why wasn’t Bernanke held in contempt of Congress when he refused to give an accounting on them bailouts ?

    I’ll tell you why, because the Congressmen (ie the Democrats and Republicans) are going to scapegoat Geithner and Bernanke as being the cause of the collapse.

    A strong Congress could stop the collapse – right now !

    But they are corrupt……

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