I just happened to scoop up a copy of today's USA Today Money section, and hey, there's Gov. Ed Rendell at the top of the page, next to the headline, Do political donations win pension fund deals?This being USA Today, he was surrounded by a giant green circle illustrating the $129 million that Blackstone (a private equity group) has earned in management fees from handling PA pensions juxtaposed with a tiny black dot illustrating the $11,000 that its chairman Stephen Shwarzman contributed to Rendell in 2002 and 2006.
The next two graphic illustrations of states and private equity firms (New York / the Carlysle Group and New Mexico / the Quadrangle Group) were significantly smaller and lower down on the page. $38.6 million generated for Carlyle by N.Y., for example.
Although the subheading reads, States, SEC scrutinize investment awards to some firms, the article is larded with such calming statements as:
Even in cases with no charges of illegality, watchdogs argue that the campaign contributions — known as pay-to-play — create conflicts of interest.
"The selection of investment advisers to those plans shouldn't be based on campaign contributions. They should be based on the merits," said Mary Schapiro, chairwoman of the Securities and Exchange Commission, which she said is probing potential pay-to-play cases "in multiple states." (UST, Kevin McCoy)
And:
The firm (Blackstone) has not been accused in the New York investigation. (ibid)
Just thought it was a strange coincidence, today. If Pittsburgh really is going to politically oppose this pensions takeover, maybe this is a little ammunition -- but then again it's a lot easier to rail against "Harrisburg" and "legislators" than it is to talk smack on "Gov. Rendell".
Why didn't the governor (Former Mayor of Philadelphia) sell out his own backyard?
ReplyDeleteOh yeah, that was Communication, give me a break. Who was supposed to make a "contribution" to Rendell and forgot? Come on? Somebody fess up!
Cursory examination of Pittsburgh's record with respect to selection of investment advisors for pension assets would extinguish any thoughts of raising the issue, let alone trying to score points based on the state's record.
ReplyDeleteIf you are watching the public hearing in council chambers right now, you will hear why every taxpayer in this city ought to be screaming to high heaven over what the State Legislators and OUR Governor is about to do to us, as a CITY!
ReplyDeleteJust thought it was a strange coincidence, today. If Pittsburgh really is going to politically oppose this pensions takeover, maybe this is a little ammunition -- but then again it's a lot easier to rail against "Harrisburg" and "legislators" than it is to talk smack on "Gov. Rendell".
ReplyDeleteBram, You don't think the officials in Harrisburg who developed and voted for the pension takeover receive "contributions" from these fund managers? This is a money grab. Plain and simple. Don't let talk of "poor communication with Harrisburg" cloud what is very clear.
Control the assets and you get paid.
Pay to play is far less of a factor when competitive bids are used. These contracts are not let by sealed competitive bids. The public process into the early stages of the process is needed.
ReplyDeleteCan anyone tell me how the pension plan gets better under control of the State? What will they do better? Where will the money come from to make the plan fully funded?
ReplyDeleteAnon at 8:46,
ReplyDeleteStep 1: Collect underpants
Step 2: ????
Step 3: Profit
Every resident of this City should unite behind the administration, at least for this issue, and call our state officials on this massive sell out. Jim Ferlo is number one. He is hurting Pittsburgh and hurting his district. City residents will suffer greatly by the burden the State is placing on us - all to rush a bill through to aid Philadelphia.
ReplyDeleteCity residents will suffer greatly by the burden the State is placing on us - all to rush a bill through to aid Philadelphia.
ReplyDeleteGood point. What is up with the rush to put this through? Why the sense of urgency?
As former VP on the City's Municipal Pension Fund's Board of Directors...
ReplyDeleteI concur with today’s vote to ask Harrisburg to delay State takeover of Pittsburgh's Pension Fund for 2 years.
Kunka, and Urbanic know situation...
And, Zober doesn't need someone... 'sponsor of pension takeover bill in Harrisburg'... to tell him: "Green tea is remedy for his opposition of Bill."
Those in Harrisburg, are the ones that need their colon cleansed...
And, if the truth be told...no amount of Green Tea will cleanse Harrisburg...nor 30 years of Cheese Steaks from Rendell’s bowel...
Got to go with Grant Street on this..,.Act 205 passed in '80's was supposed to be the solution...
Don't be fooled again!
But isn't that the point... that Act 205 was supposed to solve the problem. How has the city impeded Act 205 over the years? If that really is the logic then I will have to address Monk's point over on NS. Maybe tomorrow.
ReplyDeleteAct 205 handed out money to Upper St. Clair, Cranberry etc.??? Doesn't anyone see any issues with the unfairness of the STate Legislators? Philadelphia has been bailed out time and again since the 1990's, their budget, their schools.
ReplyDeleteSo Bram, yes we are responsible, (our own Mayor's of past, Sophie, dropped the % of tax,raped the pension fund to balance a budget, then handed hundreds of police 3/4 pensions, and Murphys complete denial that there was ever a pension problem.)but we also have not been treated fairly (not once) by Harrisburg or Rendell.
They way you deal with these issues is to go after the people that try and duck for cover. For example, Rendell could care less right now. He is a lame duck. He is trying to pad the pockets of his friends and bring the Pittsburgh pension under the administration of people like Swartzman. What we need to do is say, fine, then we go after all your allies Case in point, where is Onorato? He is running for governor, so what is his position? Why is he silent. Unless he speaks up and takes a side, the bloggers should take him to task. He is unfit to lead if he can't, well, lead. Also, Ferlo is responsible. He could have led the local delegation to support the City, but didn't. Next election Jim? Looking forward to it.
ReplyDeleteI'm still trying to figure out what all I think of this ... I mean, we have to slow down the process, Nutter be damned -- more important to get this right than Philly "start collecting its sales tax soon". And it sounds like we need to amend HB 1828 in some way. But I'm not sure where to take it from there.
ReplyDeleteSomeone sent me this blog post, tell me what you think of it:
http://thepensionbubble.wordpress.com/2009/08/30/pittsburgh-city-pension-is-dead/
Two things I have to say about that link are 1) I'm curious as to its output and anonymity and 2) it does say some things I've been hearing and that I've agreed with. The Kumbaya Hearing at city hall was informative but a little eye-opening.
ReplyDelete