[Congressional Record Volume 149, Number 127 (Tuesday, September 16, 2003)]
[Extensions of Remarks]
[Page E1812]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     THRIFT SAVINGS IMPROVEMENT ACT

                                 ______
                                 

                             HON. RON PAUL

                                of texas

                    in the house of representatives

                      Tuesday, September 16, 2003

  Mr. PAUL. Mr. Speaker, I rise to introduce the Thrift Savings Fund 
Improvement Act. This legislation to expand the investment options 
available to congressional and other federal employees by creating a 
precious metals investment fund in the Thrift Savings Plan (TSP). 
Adding a precious metals fund to the TSP will enhance the plan's 
ability to offer congressional employees a wide range of investment 
options that can provide financial security even during difficult 
economic conditions.
  All of us recognize the importance of maintaining a professional 
congressional staff and promoting longevity of service in order to 
enhance stability in the operations of Congress. This is why we have 
recently enacted legislation authorizing new benefits, such as a 
student loan forgiveness program, and have taken other measures to 
improve staff compensation and benefits.
  The Thrift Savings Plan is one of the most important benefits offered 
to congressional employees. A strong TSP can obviously play a key role 
in attracting and retaining talented individuals to serve in the 
legislative branch. However, the three stock index funds in the Thrift 
Savings Plan have not recently performed well, especially when measured 
against inflation. In 2002, for example, losses from these funds were 
greater than three, four, and five percent, respectively, in the month 
of December and, more than 15, 18, and 22 percent, respectively, for 
the entire year!
  In contrast, increases in gold spot prices more than offset the 
losses experienced by even the worst performing stock-indexed fund in 
the Thrift Savings Plan in 2002, with the price of gold increasing by 
nearly 25 percent in the year and by more than nine percent in 
December!
  Recent gains aside, precious metals have a number of features that 
make them a sound part of a prudent investment strategy. In particular, 
inflation does not erode the value of precious metals is not eroded 
over time. Thus, precious metals can serve as a valuable ``inflation 
hedge.'' Precious metals also maintain, or even increase, their value 
during times of stock market instability, such as what the country is 
currently experiencing. Thus, investments in precious metals can help 
ensure that an investment portfolio maintains its value during times of 
economic instability.
  Federal employees could greatly benefit from the protection against 
inflation and economic downturns provided by prudent investments in 
precious metals. I, therefore, once again urge my colleagues to 
cosponsor the Thrift Savings Fund Improvement Act.

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