Rep. Michael Waltz (R-Fla.), who introduced the Taxpayers and Savers Protection Act, said he worried that the TSP I-Fund would inadvertently fund foreign firms with ties to countries that were hostile to the U.S.
Rep. Michael Waltz (R-Fla.) introduced legislation supporting efforts to bar the Thrift Savings Plan from investing in foreign index funds that included companies with ties to the Chinese government.
The Taxpayers and Savers Protection Act would specifically prevent the Federal Retirement Trust Investment Board (FRTIB) from investing funds in foreign markets that the Public Company Accounting Oversight Board had not inspected or was forbidden from investigating due to conflict with another country's jurisdiction.
Though the bill's text did not mention specific countries, Waltz said he worried that the TSP I-Fund would inadvertently fund foreign firms with ties to countries that were hostile to the U.S.
"Currently, the I-Fund doesn't include developing economies but last year, the FRTIB board approved a change to this fund -- scheduled to go into effect later this year --to adopt the All Countries Index, which includes adversaries like China and Russia," Waltz said in a statement announcing his bill.
In November, the Board had affirmed a decision it had made two years previously to shift its International Funds index to the MSCI All Country World Ex-US Investable Market Index. The move drew criticism from senators such as Marco Rubio (R-Fla.), Jeanne Shaheen (D-N.H.) and Mitt Romney (R-Utah) and led to the introduction of the Thrift Savings Act in the Senate.
Earlier this months, a group of military and intelligence veterans led by Marine Gen. James L. Jones (Ret.) and Vice Admiral John M. Poindexter (Ret.), both former National Security Advisors, wrote to the Joint Chiefs of Staff warning that adding Chinese shares to the I-Fund would both inadvertently underwrite China's military industries. The letter was arranged and promoted by a group called Committee on Present Danger: China, which is urging U.S. financial firms as well as U.S. government pension funds to divest from companies linked to China's military.
An open letter with different signatories from the group was directed at President Donald Trump on April 25.
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