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Feds Use Retirement Funds To Finance Spending
Posted By Jim On 03/08/2006 @ 8:00 pm In Government | 11 Comments
The company you work for is running into some financial woes and needs a quick loan, so it dips into your 401(k) and your pension funds and borrows a few million dollars but it promises to you pay you back. Sound shady? That’s exactly what’s going on right now. The Treasury Department has started to take money out of the Civil Service Retirement and Disability Fund because we’re closing in on the national debt limit of $8.2 trillion. While they promise to pay it back, with interest, this strikes me as a serious mistake of funds. Sure, the government won’t go bankrupt and the money will be repaid but on principle it sounds terrible.
This has happened in the past and no one has liked it at all. From the Washington Post ,
Colleen M. Kelley , president of the National Treasury Employees Union, said last month that federal employees should not have their pension accounts “used as a rainy day fund. . . . No private-sector employer would ever be allowed to do this.”
What’s the most puzzling is that lawmakers don’t seem to have a problem just raising the debt ceiling every time we hit it, so why bother with the charade and just do it already? We’re not going to address the underlying problem, the huge trade deficit, so we might as well not do one bad thing (borrowing from a retirement fund) in order to pretend we’re not going about business as usual with respect to the soaring debt.
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 Washington Post: http://www.washingtonpost.com/wp-dyn/content/article/2006/03/07/AR2006030701736_pf.html
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