I swear, you know I’m good for it. Ain’t I always paid you back before? Except that one time, but… yeah….
Treasury Secretary John W. Snow told Congress last week that it had begun to use the TSP’s government securities fund to keep from hitting the $8 trillion debt limit. He called on congressional leaders to increase the debt limit by mid-March, suggesting that was when the Treasury might not be able to meet its financial obligations.
Let me descramble that transmission for you, if you’d like. It’s the third month of the year 2006, and the Treasury Secretary is essentially saying “Look, yeah, we’re dipping into the RETIREMENT SAVINGS OF FEDERAL EMPLOYEES… but it’s cool and shit. We can always print more money or something.”
The G Fund is one of the most popular investment choices for federal employees, in part because it provides steady returns (4.48 percent for the 12-month period ending Jan. 31). The fund, available only to government personnel, allows investors to earn rates of interest similar to those of long-term government securities without any risk of losing principal and with little volatility in earnings.
The G Fund has about $65.3 billion in assets, but a Treasury spokeswoman said officials “will just take what we need to get through each day.” Treasury began suspending G Fund investments Thursday, according to Snow’s letter.
Just a little taste to beat the shakes, man, that’s all I need.
I am not sure why they’re dipping into the G Fund to avoid the $8 Trillion line, unless it’s just to avoid all of those headlines that say “Fiscally Conservative Republican Administration Hits $8 Trillion Debt Mark.”
Numerous federal employees object to the Treasury maneuver, contending that it amounts to a raid by the government into personal savings accounts. But officials noted that the G Fund has been used to avoid defaulting on the national debt several times, including during the budget showdowns of 1995 and 1996.
I am not sure how the first half of that paragraph is negated by the second half of that paragraph. Unless, of course, you’re looking at this from a purely partisan perspective, and what you’re essentially saying is “IT HAPPENED UNDER CLINTON, TOO!” which is cute, but fucking stupid. Those budget showdowns were engineered to make some kind of point by Cobb County Machiavellian Newt Gingrich. They lasted, what, five days? Ten?
This is hitting the bottom of the barrel of federal money, breaking through and continuing to dig into the earth’s crust, because of the disaster in Iraq soaking up trillions of dollars.
Hat tip to Agent Little Bird.