Treasury to tap pensions to help fund government
The Obama administration will begin to tap federal retiree programs to help fund operations after the government lost its ability Monday to borrow more money from the public, adding urgency to efforts in Washington to fashion a compromise over the debt.
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May 13 (Bloomberg) -- Lee Sachs, chief executive officer for AlliancePartners and former assistant U.S. Treasury secretary, says the debt ceiling can’t be tied to deficit talks.
A look at the national debt and the debt ceiling for the past 30 years.
Treasury Secretary Timothy F. Geithner has warned for months that the government would soon hit the $14.3 trillion debt ceiling — a legal limit on how much it can borrow. With that limit reached Monday, Geithner is undertaking special measures in an effort to postpone the day when he will no longer have enough funds to pay all of the government’s bills.
Geithner, who has already suspended a program that helps state and local government manage their finances, will begin to borrow from retirement funds for federal workers. The measure won’t have an impact on retirees because the Treasury is legally required to reimburse the program.
The maneuver buys Geithner only a few months of time. If Congress does not vote by Aug. 2 to raise the debt limit, Geithner says the government is likely to default on some of its obligations, which he says would cause enormous economic harm and the suspension of government services, including the disbursal of Social Security funds.
Many congressional Republicans, however, have been skeptical that breaching the Aug. 2 deadline would be as catastrophic as Geithner suggests. What’s more, Republican leaders are insisting that Congress cut spending by as much as the Obama administration wants to raise the debt limit, without any new taxes. Obama is proposing spending cuts and tax increases to rein in the debt.
“Everything should be on the table, except raising taxes,” House Speaker John Boehner (R-Ohio) said on CBS’s “Face the Nation.” “Because raising taxes will hurt our economy and hurt our ability to create jobs in our country.”
The Obama administration has warned that it is dangerous to make a vote on raising the debt limit contingent on other proposals. But Boehner is demanding that Congress use the debt vote as a way to bring down government spending.
“I’m ready to cut the deal today,” Boehner said. “We don’t have to wait until the 11th hour. But I am not going to walk away from this moment. We have a moment, a window of opportunity to act, because if we don’t act, the markets are going to act for us.”
Geithner’s plan to tap federal retiree programs as a temporary means to avoid a government default comes as the Obama administration has shown growing interest in altering those programs to curb the debt in the long run.
Administration officials have expressed interest in raising the amount that federal employees contribute to their pensions, sources told The Washington Post.
The Republicans have suggested that the civilian workforce contribute more to its retirement in the future, effectively trimming 5 percent from salaries. The administration has not been willing to go that far in talks being led by Vice President Biden.
Treasury secretaries have tapped special programs to avoid default six times since 1985. The most protracted delay in raising the debt limit came in 1995 after congressional Republicans swept to power during the Clinton administration.
But today, the government needs far more money to cover its obligations than in the past, making the special measures less effective than they used to be. The government needs about $125 billion more a month than it takes in each month.
In a letter released last week to Sen. Michael Bennet (D-Colo.), Geithner wrote that a default would risk a “double-dip” recession.
“Default would not only increase borrowing costs for the federal government, but also for families, businesses and local governments — reducing investment and job creation throughout the economy,” Geithner wrote.
But several prominent congressional Republicans have dismissed the Obama administration’s assertion that the country would face dire consequences if Congress does not vote to raise the federal limit on government borrowing by August. Many of the skeptics are affiliated with the tea party.
In the Senate, freshman Sen. Pat Toomey (R-Pa.) has said the Obama administration has been exaggerating the effects of hitting the default mark. He says breaching the limit would cause only a partial government shutdown.
Other freshman Republicans have said that Geithner could raise money to avoid defaulting by selling investments in private companies. The Republican Study Committee, which represents more than 150 lawmakers, sent a letter to Geithner last week pressing for more details about the Aug. 2 deadline.
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The news that China has STOPPED wasting their money buying our JUNK FEDERAL DEBT is being withheld from the Public.
It's ALMOST over.
Geithner, who has already suspended a program that helps state and local government manage their finances, will begin to borrow from retirement funds for federal workers. The measure won’t have an impact on retirees because the Treasury is legally required to reimburse the program.
The maneuver buys Geithner only a few months of time. If Congress does not vote by Aug. 2 to raise the debt limit, Geithner says the government is likely to default on some of its obligations, which he says would cause enormous economic harm and the suspension of government services, including the disbursal of Social Security funds.
Many congressional Republicans, however, have been skeptical that breaching the Aug. 2 deadline would be as catastrophic as Geithner suggests. What’s more, Republican leaders are insisting that Congress cut spending by as much as the Obama administration wants to raise the debt limit, without any new taxes. Obama is proposing spending cuts and tax increases to rein in the debt.
“Everything should be on the table, except raising taxes,” House Speaker John Boehner (R-Ohio) said on CBS’s “Face the Nation.” “Because raising taxes will hurt our economy and hurt our ability to create jobs in our country.”
The Obama administration has warned that it is dangerous to make a vote on raising the debt limit contingent on other proposals. But Boehner is demanding that Congress use the debt vote as a way to bring down government spending.
“I’m ready to cut the deal today,” Boehner said. “We don’t have to wait until the 11th hour. But I am not going to walk away from this moment. We have a moment, a window of opportunity to act, because if we don’t act, the markets are going to act for us.”
Geithner’s plan to tap federal retiree programs as a temporary means to avoid a government default comes as the Obama administration has shown growing interest in altering those programs to curb the debt in the long run.
Administration officials have expressed interest in raising the amount that federal employees contribute to their pensions, sources told The Washington Post.
The Republicans have suggested that the civilian workforce contribute more to its retirement in the future, effectively trimming 5 percent from salaries. The administration has not been willing to go that far in talks being led by Vice President Biden.
Treasury secretaries have tapped special programs to avoid default six times since 1985. The most protracted delay in raising the debt limit came in 1995 after congressional Republicans swept to power during the Clinton administration.
But today, the government needs far more money to cover its obligations than in the past, making the special measures less effective than they used to be. The government needs about $125 billion more a month than it takes in each month.
In a letter released last week to Sen. Michael Bennet (D-Colo.), Geithner wrote that a default would risk a “double-dip” recession.
“Default would not only increase borrowing costs for the federal government, but also for families, businesses and local governments — reducing investment and job creation throughout the economy,” Geithner wrote.
But several prominent congressional Republicans have dismissed the Obama administration’s assertion that the country would face dire consequences if Congress does not vote to raise the federal limit on government borrowing by August. Many of the skeptics are affiliated with the tea party.
In the Senate, freshman Sen. Pat Toomey (R-Pa.) has said the Obama administration has been exaggerating the effects of hitting the default mark. He says breaching the limit would cause only a partial government shutdown.
Other freshman Republicans have said that Geithner could raise money to avoid defaulting by selling investments in private companies. The Republican Study Committee, which represents more than 150 lawmakers, sent a letter to Geithner last week pressing for more details about the Aug. 2 deadline.
Why doesn't The TSP Administrator design a new fund in the program were the goverment may transferred the invesments in private companies at present to participants of Thrift Savinngs Plan Without tapping in the federal pension's plans. Something like a private yardsale.
sort of a Mutual Fund in the trift saving plan- A Fund (America)
No, Obama's not a socialist. Everyone knows socialists don't seize people's assets. Nothing to see here.
Treasury to tap pensions to help fund government. Kiss your Fed pension goodbye. Timmy Boy is doing a Halloween trick or treat with Congress. Give me more $$ or the goblins will get you.
Timmy Boy's tactics are scandalous and outrageous. He wants to wipe out your pensions so we can fund more foreign wars and give more trillions to the international banks.
Timmy Boy's tactics are scandalous and outrageous. He wants to wipe out your pensions so we can fund more foreign wars and give more trillions to the international banks.
On raising tax of fuel it will make environment better because of lower emissions, building better cars with lower consume.
Public trafic would gain, so health of peoples too.
Public trafic would gain, so health of peoples too.
If the Obama Administration would DROP the nearly ONE trillion dollar in "Stimulus" money which is now in every Budget from 2009 on out, it would go some way for helping the Debt Ceiling Crisis. You may recall that the Stimulus was supposed to be ONE year only and to go for stimulating all those jobs. The "Stimulus" money helped many -- including local and state employees -- but it was supposed to be ONE year only. No wonder this country is going BROKE.
AMERICANS have DEMANDED that the BAILOUTS and BANKER THEFTs from TREASURY stop -- for 2 yrs now, since the first $700 billion bailout in the fall of 2008. WE HAVE BEEN IGNORED, and the THEFTS CONTINUE AND BREAKNECK SPEED. Besides that, the banks have committed HUGE BANK FRAUDS to oust people who were actually paying their mortgages from their homes. THIS IS NOTHING SHORT OF A NATIONWIDE COUP AGAINST THE ENTIRE U.S. POPULATION.
NOW...Americans are being besieged by the HAARP weather modification satellite array in Alaska which is creating tornados, hurricanes, the Gulf oil fiasco, and from May 16-21 FEMA is holding NLE (national level exercises) along the New Madrid faultline, which is BAD news. The Mississippi is being flooded to soften the ground to create a New Madrid earthquake very soon, centered from Memphis to St. Louis along the Mississippi. FEMA has ordered millions of "underwater body bags" and MREs with "New Madrid earthquake" stamped on the paperwork. You might want to GOOGLE: Navy Future Map of the U.S.
NOW...Americans are being besieged by the HAARP weather modification satellite array in Alaska which is creating tornados, hurricanes, the Gulf oil fiasco, and from May 16-21 FEMA is holding NLE (national level exercises) along the New Madrid faultline, which is BAD news. The Mississippi is being flooded to soften the ground to create a New Madrid earthquake very soon, centered from Memphis to St. Louis along the Mississippi. FEMA has ordered millions of "underwater body bags" and MREs with "New Madrid earthquake" stamped on the paperwork. You might want to GOOGLE: Navy Future Map of the U.S.
I hope both GEITHNER and BERNANKE drop dead....the sooner the better. Exactly WHAT AUTHORIZATION does Timmy have to STEAL money from federal pension funds? They've already cleaned out all the Social Security and Medicare funds; now they're trying to reneige in paying those benefits to people who PAID IN FOR 50 YEARS. CONGRESS is such a bunch of gutless cowards, they will apparently let the THIEVES CONTINUE STEALING until there's no money in ANY fund.
When will our Government stop wasting so much Money on Earned Income,Welfare for 28Million People,medicaid for Free Babies,and etc....-Plus why the US Government keep adding so many People to the Payroll,to turn into a Roman Empire?
We could get out of Afghanistan immediately .asap, that would save plenty. We could also SELL our, the Gov't. partial ownership in private companies. We could stop the foreign gift, Money giving.
Obama is giving millions to Brazil now to develop/drill for OIL. Obama will be offering MORE AID to the Mid-East, and no. Africa...don't do this. Obama is giving over 1 billion MORE to Jordan along with 15,000 tons of wheat..don't do it! OBAMA could stop his un American talks/speeches for more Muslim Outreach and money giving. Obama could stop bailing out Fannie Mae/Freedie Mac who consistently needs billions more. I could go on and on...sell Gov't. owned property..on and on. Things that won't Hurt the U>S> at all, but HELP US, the AMERICANS. Gov't. can stop stealing, borrowing, taking our money and giving it away as the US loses our standing, loses our own economy, loses everything globally in respect. MUCH that Administration can do.
Obama is giving millions to Brazil now to develop/drill for OIL. Obama will be offering MORE AID to the Mid-East, and no. Africa...don't do this. Obama is giving over 1 billion MORE to Jordan along with 15,000 tons of wheat..don't do it! OBAMA could stop his un American talks/speeches for more Muslim Outreach and money giving. Obama could stop bailing out Fannie Mae/Freedie Mac who consistently needs billions more. I could go on and on...sell Gov't. owned property..on and on. Things that won't Hurt the U>S> at all, but HELP US, the AMERICANS. Gov't. can stop stealing, borrowing, taking our money and giving it away as the US loses our standing, loses our own economy, loses everything globally in respect. MUCH that Administration can do.
How on earth do we stop these idiots? We vote them out, the new ones aren't any better. They are not the least bit interested in "fixing" anything. All they want to do is make the lobbyists and special interest groups happy because that is where their campaign funds originated. I repeat, how and when does this every stop?
How on earth are we supposed to stop them? It would seem that no matter who is voted into office, the same mistakes are made, no one really wants to fix anything and all these people want to do is make the lobbyists and special groups happy that gave them so much money to get into office. Again, where does this end and how?
Why?
The news that China has STOPPED wasting their money buying our JUNK FEDERAL DEBT is being withheld from the Public.
It's ALMOST over.
Horrible Horrible idea! Put the money back into our account now!
Understand your feelings. I feel the same as Gov't. has consistently "TAKEN" money out of Social Security Trust Fund so that Congress can spend anyway they want. Too many people do not know this so after taking social security money, they now wanting to scare the hell out of the elderly and disabled. They lie when it comes to "borrowing" but will pay it back later.
Later, when"?? After you dead??
Later, when"?? After you dead??
Leave our retirement programs alone! I don't trust the government enough to believe you will pay the money back later. And your comments about altering our retirement programs scare the poop out of me!
I don't believe they will pay it back either... they have "borrowed" all the money out of SS... and it, SS, is owed Trillions of $$$... and people are still paying 15% in.. it's a big scam. FDR will go down in history as the man that scrawed the countty !!!!!! Now it's you federal workers turn... to get scrawed. Believe me, most of the state, county, and city pension funds are going broke too.
what's next for these out-of-control spenders, intent on bankrupting the USA? Selling federal lands to the Chinese, whom will pollute without consequence? Selling the national gold supply? When do they stop? What event will stop them?
They could START TAXING Gold, Silver, Copper, Uranium Mining that does NOT GET TAXED AT ALL...NEVER AND NOT NOW. That is a lot of TAX they do not have to pay. OIL companys have to pay tax and so do Coal mines. BUT NOT Gold, Silver Copper, Uranium..NO TAX!
What else do we not know? Plenty. IF WE, the taxpayers have to Juggle to pay to Live, one can imagine what Government does that we do NOT know and never will.
What else do we not know? Plenty. IF WE, the taxpayers have to Juggle to pay to Live, one can imagine what Government does that we do NOT know and never will.
We need to stop SPENDING... !!! Taxing will just bring in more money to SPEND. There is a structural fault... and that is spending.
