Bad news, according to the old saying, comes in threes. Unless maybe you are a government worker. In that case, you are eligible for an extra kick, punch, or dose of bad news because you decided to make public service a career.
The theme of yesterday’s column was that some, maybe most, federal workers face the prospect of being furloughed, locked out or fired sometime in the new fiscal year which starts Oct.1. Three very real possibilities. Silly me…
Turns out, that was a happy-meal forecast. Things have suddenly gotten worse.
Now we learn that the Treasury Department says that Uncle Sam’s line of credit, with China and other nation’s, will run out in mid-October. By law the federal borrowing limit is capped at $16.7 trillion (with a T). And we all know prices keep going up.
So, Treasury Secretary Jacob Lew has informed Congress that the federal piggy bank will be down to a mere $50 billion (with a B) by mid-October. That’s just enough to cover Medicare, Social Security payments, federal and military salaries, and Uncle’s power bills for a short time. Then nothing.
The last time this happened (in 2011), Congress and the White House dueled for months. Finally, the White House agreed to make $2 trillion in spending cuts over a 10 year period. Generally speaking Republicans, especially in the House, want to make savings by cutting federal spending — though not necessarily on the contractor side. Democrats favor tax increases and some spending cuts.
Both political parties hope to come out of this — or any other — squabble with the other side looking bad. That would be especially helpful in the upcoming off-year (2014) election when only the most die-hard voters tend to go to the polls. Republicans usually seem to lose these sort of political tests of will in the judgment of voters and the media. The government shutdown of 1995-96 was a case in point. President Clinton was largely judged the winner and statesman (the intern thing came later), while House GOP leader Newt Gingrich (R-Ga.) was the goat.
While President Obama and Democrats agreed to the long-term spending plan in the summer of 2011, the White House has said it won’t negotiate on the debt ceiling limit again. The Treasury Department says the Congress should authorize paying for the items it, and the U.S. government, have already charged.
While it is unthinkable that even the dumbest, most ideological politician will let Social Security payments and military pay lapse, the debt ceiling issue is still a threat. And federal workers, as per usual, are on the front lines.
Are you mentally prepared to retire? The latest report by MetLife shows boomers are not “working til they drop” as previously thought. More than half of the oldest boomers are retiring years earlier than expected. But financial planning isn’t the only preparation they have to make.
Treasury says US will hit debt limit in mid-Oct Treasury Secretary Jacob Lew has told Congress that the government will run out of money to pay its bills in mid-October unless lawmakers raise the country’s borrowing limit, which is capped at $16.7 trillion. Lew said in a letter to Speaker John Boehner released Monday that the government is running out of accounting maneuvers it has used to avoid hitting the borrowing limit. He pressed Congress to act so Treasury can keep paying the government’s bills.
OPM pushes telework Wednesday for March on Washington anniversary The Office of Personnel Management is pushing federal agencies to allow their employees to telework Wednesday to help ease traffic congestion stemming from the 50th anniversary celebration of the March on Washington. Large crowds are expected for President Barack Obama’s speech on the steps of the Lincoln Memorial. The federal government will remain open on Aug. 28.