Another bill has been introduced to try to stop the TSP from switching the I Fund to a new benchmark index.
This latest bill (H.R. 6614) was introduced by Congressman Michael Waltz (R-FL). It would prohibit any investments in the Thrift Savings Plan from being invested in China.
A press release issued by Waltz suggested that the change approved by the FRTIB was politically motivated. A statement from the release reads, “If a group of Obama-appointed federal retirement board members have their way, members of the United States military and federal employees will inadvertently fund China’s People’s Liberation Army through their federal retirement plans…”
About the I Fund Change
The Federal Retirement Thrift Investment Board, the agency that oversees the TSP, approved a change to the I Fund benchmark index which will allow the fund to invest in emerging markets.
Critics of the change have said that this will be funneling federal employees and retirees’ assets into Chinese companies which is too risky and aids a corrupt government.
Senator Marco Rubio (R-FL) is one lawmaker who has been leading the charge against the change on the Senate side. He went so far as to ask President Trump to remove the FRTIB board members for “ignoring the concerns of Congress” and moving forward with the I Fund change.
The FRTIB, however, has defended the decision and said it is in line with what other large retirement investment plans do.
Waltz suggested in his press release that the situation would be indirectly funding the Chinese military.
“It is absolutely crazy for our military and federal employees to be indirectly contributing to China’s military operations – and what’s worse is that nearly all of these people are completely unaware of this situation,” Waltz said.
The hard-earned retirement savings of our servicemembers are funding the #Chinese military RIGHT NOW.— Michael Waltz (@michaelgwaltz) April 20, 2020
Meanwhile, #China is attacking our online healthcare systems & stealing our intellectual property.
We can't let this continue. It's time to #ProtectOurTSP! pic.twitter.com/ftOlULRg6f
No doubt, criticism surrounding China’s handling of the COVID-19 coronavirus has fueled the calls from lawmakers to stop the TSP from allowing the change to the I Fund that would include investments in Chinese companies.
FedSmith readers have said in the past that they want to see more investment options in the TSP, and this includes more options to invest in emerging markets. This change to the I Fund would broaden investment options in emerging markets.
Do you like the proposed change to the I Fund, or is it a bad idea as some lawmakers have suggested? Share your feedback in the comments below.