Presto! Debt Crisis Averted
Give this a try the next time a credit agency comes calling: Calmly explain that the money you owe isn’t really a debt and doesn’t need to be paid. Tell them if they don’t believe you, they can call Treasury Secretary Timothy Geithner for confirmation. This from CNSNews:
In a letter to Senate Majority Leader Harry Reid on April 4, Treasury Secretary Timothy Geithner said: “The Treasury Department now projects that the debt limit will be reached no later than May 16, 2011.”
But Geithner also said in that letter there were “extraordinary measures” he could take to push back the day of reckoning.
One of these is particularly symbolic of the way the federal government handles taxpayers’ money.
One thing he could do, Geithner told Reid in an appendix to his letter, was determine “that a ‘debt issuance suspension period’ exists, which would permit the redemption of existing, and the suspension of new, investments in the Civil Service Retirement and Disability Fund (CSRDF).”
Geithner spelled out what this means in the obscure lexicon of Treasury wonks.
“The CSRDF provides defined benefits to retired and disabled Federal employees covered by the Civil Service Retirement System,” wrote Geithner. “The fund is invested in special-issue Treasury securities, which count against the debt limit. Congress has given Treasury statutory authority to take certain actions in the event of a debt limit impasse. Specifically, the statute authorizes the Secretary of the Treasury to determine that a ‘debt issuance suspension period’ exists and, once he has done so, Treasury can (1) redeem certain existing investments in the CSRDF, and (2) suspend new investment.”
In plain English, this means Treasury can temporarily stop counting the debt it is accruing by spending money that belongs to the Civil Service Retirement and Disability Fund, and it can take debt it has already piled up from that fund and temporarily pretend it is not debt.
So good news, folks: if you’ve happened to rack up any massive credit card debt, no worries. Tell the credit scoring agencies to go screw, and let the party continue. Tell them it’s the new American way.
Let’s see how that works.
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