The government is within weeks of hitting its debt ceiling, requiring political leaders to take some sort of action to prevent the government from defaulting on its debts. The House could consider as early as today (Wednesday) a bill (HR-692) that would allow further borrowing only to pay off principal and interest coming due on Treasury securities, one of several possible stopgap approaches. The limit technically was breached earlier this year but since then the Treasury has been using several financial maneuvers–including one that essentially takes the TSP government securities G fund obligation off the books. The Treasury most recently projected that even those will be exhausted around November 3, several days sooner than its prior prediction; the CBO recently said it might be as late as mid-month. Budgetary brinksmanship around the debt ceiling has become commonplace in recent years, many of which have been resolved only by a deal involving spending cuts, or at least a commitment to seeking them. Employee organizations are raising concerns that often-repeated proposals regarding federal employees could be put in the mix in that case–such things as raising required retirement contributions, lowering the annuity payout formula for future retirees, decreasing the rate of return on the G fund, and more. Debt ceiling issues also commonly are linked to shorter-term budgetary issues, such as the need to fund agencies beyond the December 11 expiration of a temporary measure in effect since the October 1 start of the current fiscal year. One possible scenario is that the debt ceiling would be temporarily suspended and the two issues will be merged.
|TSP||G Fund||F Fund||C Fund||S Fund||I Fund|