Senator Mikulski Objects to Use of Federal Employees' Pension Funds in Debt Reduction Negotiations

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By on June 13, 2011 in Pay & Benefits with 29 Comments

Senator Barbara Mikulski (D-MD) sent a letter to Treasury Secretary Tim Geithner urging him to take federal employees’ pension funds off of the list of available resources used to prevent the country from defaulting on its debt obligations.

Maryland, the state Mikulski represents, is home to a large number of federal employees due to its proximity to the nation’s capitol. According to the U.S. Census Bureau’s 2009 American Community Survey, 262,984 federal employees live in Maryland, and undoubtedly many of these employees would like to see their senators working on their behalf to keep their pension plans in tact.

“Promises made must be promises kept” is the overarching theme of Mikulski’s letter. The full text of the letter follows.


Timothy F. Geithner
Department of the Treasury
1500 Pennsylvania Avenue, NW

Washington, DC 20220 


Dear Secretary Geithner:

I write out of concern for our hardworking federal employees and the pension funds that they have paid into over their working lives. Federal employee pension funds are being used to prevent a fiscal disaster, and federal worker’s pensions are being targeted for cuts to balance the budget.

Right now, the Department of Treasury is borrowing billions from these workers as part of a series of emergency measures to prevent the catastrophic consequences of hitting the debt ceiling. This is not the first time that federal employee pension funds have been used to prevent the government from defaulting on its debts. It is the fifth time in fifteen years. Each time, federal employees are told “Don’t worry—your retirement savings aren’t at risk,” but Congress has tested the faith of our federal workers repeatedly.

These men and women are dedicated and duty driven. They are on the frontlines protecting America every day securing our borders, inspecting our food, and performing critical health research. They deserve a decent wage, safe working conditions, and our thanks and respect.

Unfortunately, rather than being recognized for their contributions, federal employees have become scapegoats for the financial problems our nation faces.  They have already been subject to a two-year pay freeze.  But that wasn’t enough. Now, some Members of Congress and Administration officials are asking federal workers to contribute significantly more to their retirement plans—a proposal that would essentially lead to a 5 percent pay cut.

I value the service of federal employees, and I know how important these benefits are to millions of middle class families. Promises made must be promises kept. We must not put federal employee pensions on the chopping block in budget reduction negotiations.


Barbara Mikulski
United States Senator


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About the Author

Ian Smith is one of the co-founders of He enjoys writing about current topics that affect the federal workforce.