Source: Washington Post
The Civil Service Retirement and Disability Fund is the latest victim in a Republican-controlled Congress and White House who have failed to practice any level of fiscal responsibility.
The Treasury Department has started drawing from the civil service pension fund to avoid hitting the $8.2 trillion national debt limit. The move to tap the pension fund follows last month's decision to suspend investments in a retirement savings plan held by government employees.
In a letter to Congress this week, Treasury Secretary John W. Snow said he would rely on the Civil Service Retirement and Disability Fund to avoid bumping up against the statutory debt limit. He said the Treasury is suspending investments and will redeem a portion of the money credited to the fund.
Once Congress raises the debt limit, the Treasury will "restore all due interest and principal" to the pension fund as soon as possible, Snow said. He made a similar promise when the Treasury announced that reinvestment of some assets in the Thrift Savings Plan's government securities fund, or G Fund, had been suspended.
The civil service trust fund will provide the Treasury with several billion dollars for extra borrowing. The fund had an estimated balance of about $655 billion at the start of the year, but only a small portion of that is available to the Treasury because of the statutes restricting the fund's use during "debt issuance suspension" periods. The G Fund has assets of about $65.3 billion, and all are available for Treasury's use.
The Treasury has leaned on federal employee retirement funds in past years when officials worried about a possible default on the national debt, and most federal employees take it in stride. Still, many employees object to the financial maneuvers, arguing that they amount to a raid on their personal accounts.
How about a little restraint with the checkbook from the guys on the hill? If this country was ran like a business, we would be bankrupt by now.
It's always nice when retirement funds get raided because politicians can't just say no to a spend-happy White House.
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