Why Progressives should care a lot about public pension funds

If you care about corporate accountability, socially responsible investing, reforming the economic system, investing in corporations that don’t severely undermine worker’s rights, and want to see more progressive, environmentally friendly investing, Schwarzenegger’s plan to wipe out public pension funds in California should be a really, really big deal to you.

Schwarzenegger has gone on the road for the last few days to gather signatures and push this initiative at malls across the state. Like Bush’s plan to privatize Social Security, Schwarzenegger’s plan to privatize retirement accounts for public sector workers has strong support from Wall Street. And they both have the support of a fellow named Grover Norquist, head of an organization called Americans for Tax Reform. Less well known than Karl Rove but equally as effective. In a Bill Moyers interview, Norquist revealed his agenda:

GROVER NORQUIST: No. The first part is an accurate statement of exactly what we're trying to do. We've set as a conservative movement a goal of reducing the size and cost of government in half in 25 years, which is taking it from a third of the economy down to about 17 percent, taking 20 million government employees and looking to privatize and get other opportunities so that you don't have all of the jobs that are presently done by government done by government employees. We need a Federal government that does what the government needs to do, and stops doing what the government ought not to be doing.

Norquist has been secretly meeting with Schwarzenegger and trying to guide his administration. California matters for a lot of reasons but mostly it matters because labor, State Treasurer Phil Angelides, and other CalPERS board members have been moving some serious reform. In probably one of the very best articles I have seen about economic reform and the battle we face over the next four years, William Grieder, a correspondent for the Nation, explains why California matters and why Schwarzenegger and Norquist are moving this initiative:

CalPERS is the largest pension fund in the nation, holding $180 billion, and it is indeed trying to "strong-arm" companies--scores of them--into making reforms. Angelides has become a favorite target of the corporate critics--and a visible point man for pension-fund activism--because he sits on the boards of both CalPERS and CalSTRS (California State Teachers Retirement System), the country's second-largest, with holdings of another $125 billion. Angelides has pushed both funds to adopt a whirlwind of reforms--dumping tobacco stocks, blacklisting ten "emerging markets" that ignore international labor standards, redeploying capital to neglected sectors like inner-city redevelopment and innovative environmental technologies, and, above all, peppering scores of corporations, banks, brokerages, financial markets and federal regulators with critiques and demands for change.

Read the full article if you want to get a sense of what is at stake. Check out Grover more if you want to know who is behind the anti-tax movement in our country and what his agenda is. Mother Jones did a profile last year that is worth checking out. Local Examiner writer Adriel Hampton did a very informative series on the struggle last month.