When the November election was still a long way off,
Sacramento-area streets were already plastered with campaign signs for a
little-noticed political race: candidates are running to serve on the
board of the California Public Employees’ Retirement System, better
known as CalPERS. While not as high-profile as the statewide and
congressional races, these seats are arguably of equal importance to
Golden State taxpayers. CalPERS, the largest state pension fund in the
country, not only manages more than $257 billion in assets, but also
loves to use its political muscle to prod corporate America into
“socially responsible” (read: leftist-friendly) investing.
Sacramento,
as the state capital, is Public Employee Central, so the race has
become heated and costly. The campaign signs that caught my eye promised
“pension security” and were paid for by the Service Employees
International Union. This election is a touchstone for the entire
pension issue in California—and, per usual, it doesn’t look good for the
taxpayer.
In short, the people who benefit from
CalPERS have complete control over it. Those who pay the tab have little
if any say. Six of the board seats are set aside for various groups of
CalPERS “members”—for example, one for retirees who receive pensions,
one for eligible current state employees, and so on. Then there are
three members appointed by the governor and the legislature, both of
which are wholly owned subsidiaries of California’s public-sector
unions.
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