GovernmentExecutive.com

Treasury Secretary John Snow Thursday indicated the government has reached the statutory federal debt ceiling, notifying Congress that he must begin to tap a federal retirement fund to avoid breaching the limit.

In a letter to Senate Majority Leader Bill Frist, R-Tenn., Snow wrote that, starting Thursday, he would be unable to fully invest in the Government Securities Investment Fund, the so-called G Fund.

"The statute governing G Fund investments explicitly authorizes the Secretary of the Treasury to suspend investment of the G Fund to avoid breaching the statutory debt limit," Snow wrote.

The action is temporary and will not affect G Fund beneficiaries because, by law, Treasury must make up the lost investments when the debt crisis is over.

Congress failed to raise the debt limit before departing this week to campaign. Snow said Congress must raise the limit by mid-November, "at which time all of our previously used prudent and legal actions to avoid breaching the statutory debt limit will be exhausted."

Congress is planning to return Nov. 16.

COMMENTS

• Wow, you Dems need to go to an anger management course. Not only did Bill raise taxes and raid our retirement funds, he got rid of 345,000 government jobs. So much for being for the workers! GovExec.com reader Posted November 9, 2004 7:44 PM
• Please tell us what debt auction had no takers! When I look I see the government issued successfully almost $100 billion in debt in the last few weeks. The bid to cover ratio was in excess of 2 in all auctions I examined. That means the USA could have sold twice as much debt as it actually sold. Also, the after tax yield on 6 month bills is in excess of 6 month CD rates. What is missing? tax payer Posted October 22, 2004 6:47 AM
• Imagine that- a crime to raise taxes 13% to pay for services. No-I imagine it's better to borrow money from the Saudis at huge interest rates to pay for these same services. So much for the Conservative Philosophy of FISCALLY RESPONSIBLE GOVERNMENT. I thought it was we tax and spend Democrats who were irresponsbile-- now I see that the borrow and spend Republicans are even worse. The Gov't will soon learn they can't keep borrowing. Treasury just went out with a bond auction and nobody came. Our foreign investors have stopped lending us money- we refuse to raise revenue internally- So Mr. I told you so from DHS/ICE- who is going to pay for your salary, who is going to pay for mine? Yes we are in a debt crisis- isn't it time to start paying off our creditors by raising revenue?????????? It is fiscally irresponsible to burden our children and our grandchildren with our paranoid, fiscally irresponsible actions. If we are going to be delusional, let's at least pay for the delusion ourselves. HR Specialist GovExec.com reader Posted October 20, 2004 8:42 AM