The Treasury Department announced on Thursday that the United States government has hit its statutory “debt limit.” The next several months will be full of political drama, with serious risks at hand for working people and working-class retirees.
While the debt limit was technically reached this week, the Treasury Department has begun certain accounting measures to extend its ability to pay the government’s bills. Among the “extraordinary measures” announced by Treasury are some that are of serious concern to postal workers.
The Treasury Department has announced it will begin a “debt issuance suspension period” which will affect the Civil Service Retirement and Disability Fund (CSRDF), the Postal Service Retiree Health Benefit Fund (PSRHBF), and the G Fund of the Thrift Savings Plan
These funds are normally invested in U.S. Treasury bonds. By suspending the debt issuance, Treasury temporarily saves the interest that would normally be paid into the funds.
While the political brinksmanship around the debt ceiling is a shameful reflection of Congress’s disregard for working peoples’ interests, postal workers and other federal employees should rest assured that their retirement benefits are secure at this time. No postal worker or federal retiree will see a gap or reduction in pension payments or healthcare coverage. The law further requires that the Treasury Department make whole the affected funds once the debt ceiling has been either raised or suspended.
Treasury has previously taken similar actions, and in each instance, benefits continued to be paid and the CSRDF, the PSRHBF and the G Funds were fully reimbursed for the temporary losses incurred by the funds. Today, the law makes that reimbursement automatic once the debt ceiling issue is resolved.
The debt limit showdown is a manufactured crisis, the product of decades of tax cuts for the wealthy led by a political elite that is more comfortable debating cuts to already-starved social programs and hard-earned benefits than ensuring the federal government works for working people.
The new Republican majority in the House is demanding the Biden Administration agree to steep cuts in federal spending in exchange for raising the debt ceiling. It’s projected that the Treasury Department will be unable to pay bills in a few months, putting the “full faith and credit” of the U.S. government in question and risking an unnecessary recession that would surely hit working people hardest.
“Make no mistake working people and our unions won’t stand for benefit cuts in exchange for what should be a routine act of Congress,” said APWU President Mark Dimondstein. “The debt limit has been increased on a bipartisan basis dozens of times before, including three times during the Trump presidency. The cynical hostage-taking is unnecessary and dangerous.”
The APWU leadership is following the developments closely and will continue to demand our political leaders don’t sacrifice working people’s benefits in exchange for a debt limit increase and will keep members informed of any new developments.