They are at it again.
California’s government unions have already run up an astounding debt of $250 billion for unfunded retirements for state and local government employees. We have seen taxes hiked and services slashed to pump billions into these unsustainable pension systems. Now the unions want to take what little is left in government pension systems and use it for “shareholder activism.”
In the real world, pension trustees are sworn to a fiduciary responsibility to make all decisions to the benefit of a) beneficiaries and b) the plan sponsor (in government, that would be us taxpayers.) No other criteria should cloud their decisions. In fact, in the real world trustees get sued and may go to jail if they violate their fiduciary responsibility
Not so in California state government.
In today’s UT San Diego, a union representative on the county pension board admits she’s a “shareholder activist” and wants control of investment decisions so she can invest in companies that promote her social goals.
I may agree with firing the county’s outsourced investment manager, but not for the main motivation revealed by this union representative on the pension board. She comes right out and admits it: she just wants to control the investment decisions herself.
This is yet another reason why we need common-sense pension reform – to protect taxpayers and retirees alike.
Next year Sacramento politicians and their union backers will ask for a massive tax hike, but they still refuse to reform unsustainable pensions. We cannot let that happen.