If you build a pile of pension money, they will come.

By “they” I mean people who want to use the money.  To push their own causes.

Case in point is NY State’s big pension fund. It is for the retirements of various state and local government workers. It is run by the state comptroller.

He sets broad investment policies. He hires companies to invest the fund’s money. In stocks and bonds and other assets.  The companies are expert in particular fields. Foreign stocks maybe. Or bonds from big companies.

He recently found a bunch of elected officials on his doorstep. From various New York villages and towns.  They lobbied him.  To get the fund to sell off its investments in fossil fuel companies.  The fund has about $10 billion invested in such companies.

Excuse me, but does the money belonged to these officials? Did voters elect them to pick winners and losers in stocks and bonds? Did voters elect them to push environmental issues? With money that belongs to workers? State and local government workers.

I don’t believe that is the case.

Simple point: A pension fund’s sole purpose is the financial benefit of its members. Its purpose does not include promoting the causes of the left or right. Or the causes of environmentalists. Or anybody’s causes. Other than the cause of the workers when they retire.

Too many officials fail to recognize this. They see the money as their play money, I guess.

Now, you may be comfortable with this.  You may fear for our environment. So much so that it is okay, you think.  It is okay for guys who run public pension funds to boot fossil fuel companies from the funds’ investments.

But how would you feel if the boot was on somebody else’s foot?  Suppose these guys are vegans.  Okay for them to dump stocks of companies that deal in meat?  Or stocks of fish and seafood companies?

Suppose they are health nuts. Okay for them to dump non-organic companies?  Should they sell off stocks in McDonalds?  And all fast-food companies?  No money in Coke?

Suppose they are animal lovers. No stocks in dairy companies then?

Suppose they were born in Europe. They love public transport. As opposed to cars.  Is it okay for them to dump stocks in auto companies?

Suppose they are bird lovers.  Okay for them to dump stocks of companies involved with wind power?  After all, those windmills grind up countless eagles and other precious birds.

Suppose they are isolationists.  Okay to dump all foreign stocks and bonds from pension portfolios?

Suppose they feel the followers of Al Gore are misguided.  And that the issue of climate change is overblown.  Okay for them to try to dump stocks and bonds of green companies?  To cleanse the fund’s portfolio of such investments?

Suppose they feel our big banks got us into the housing and banking crisis of a few years ago.  Okay for them to dump banking stocks from the pension investments?

Pension funds are for the financial benefit of pensioners.  And future pensioners.  The money in pension funds belongs to them.  It should be invested to get the best return for their fund.  It should not be invested to satisfy political beliefs.  Or environmental beliefs. Or any other beliefs and prejudices.

Pensioners may want to invest to support favorite or popular causes. Trustees and other elected officials may want to do the same. They should do it with their own money.  And not with money that belongs to members of a pension fund.

From Tom…as in Morgan.

Find Tom on Facebook. You can write to Tom at tomasinmorgan@yahoo.com.