Wednesday, May 18, 2011

U.S. hits $14.3-trillion debt ceiling!

Brickbats, Bouquets & Backfeeds are welcome on prmadhura@yahoo.com

The U.S. government hit its $14.3-trillion debt ceiling on Monday, triggering a series of “extraordinary measures” to stave off a default while politicians argue over raising the borrowing limit.

Treasury Secretary Tim Geithner announced he was suspending payments into two federal pension funds, after the government reached its maximum legal borrowing limit. Mr. Geithner said the suspension should allow the U.S. to avoid a default before August 2 and urged Congress to agree to raise the debt ceiling before this 11-week deadline expires.

“I have written to Congress on previous occasions regarding the importance of timely action to increase the debt limit in order to protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens,” said Mr. Geithner in a letter to Congress. “I again urge Congress to act to increase the statutory debt limit as soon as possible.” Under Mr. Geithner's plan, the U.S. government will temporarily stop payments into the civil service retirement and disability fund and cut payments into the federal employees retirement system. Both funds provide retirement benefits to federal employees.

Mr. Geithner pledged to repay the lost funds once Congress has approved a higher debt ceiling. But there has been little progress in recent weeks over this issue.

Under the circumstances, US Administration should conserve every dollar of its tax payers money and ensure while the 'war on terror' along with war against job-losses and stagnant economic growth should continue, not one dollar of its foreign aid is spent on sheltering, arming, training and exporting terror.

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