I have been accused of making Illinois’ pension theft too big a deal.
Some have suggested that Illinois’ pension theft is just a local Illinois problem.
But the scandal is a national one.
And the fightback must be national too.
Something to keep in mind at the upcoming NEA and AFT national meetings.
Today Pando Daily’s David Sirota goes further into New Jersey Governor Chris Christie’s use of pension funds as his personal campaign resource.
New Jersey and federal pay to play rules have a very clear purpose: To prevent executives at financial firms that do business with the state from making contributions to New Jersey politicians or political organizations that operate in New Jersey.
Over the past few weeks, Pando has reported several cases where New Jersey’s rules have, at best, been ignored and, at worst, clearly violated in the awarding of pension management contracts to political donors. Throughout our reporting, and as New Jersey’s pension crisis is now making national headlines, the one question we’re most frequently asked is: How widespread is the problem?
Today, after a two month investigation, we answer that question.
Below is a spreadsheet showing that political donors associated with 43 financial firms managing New Jersey pension money have spent a total of $11.6 million on contributions to New Jersey politicians and to major political organizations operating in New Jersey elections.
Many of those donations have gone directly to Gov. Christie’s election campaign and to the New Jersey Republican State Committee. Additionally, many of the contributions came either just before or just after the Christie administration awarded the firms multi-million-dollar pension management contracts. Indeed, Christie officials have given many of the firms that have made the donations additional pension investments, often worth hundreds of millions of dollars.
In total, New Jersey government data show that the 43 firms now manage roughly $14 billion worth of New Jersey state pension money.
To produce our report, Pando evaluated campaign contributions from donors associated with every hedge fund, private equity firm and other so-called “alternative investment” firm that the New Jersey Division of Investment says is managing pension state pension money. Pando’s analysis also includes other more traditional investment management firms that the division also says is providing financial services to the state pension system.
We cross referenced those firms with campaign contributions to all New Jersey politicians and state parties. We also evaluated all contributions to the Republican and Democratic governors associations and to the Republican National Committee because those organizations spend heavily in New Jersey state elections. We did not include contributions to the Democratic National Committee because campaign finance records show that in the timeframe evaluated, the DNC has not spent heavily in New Jersey state elections (as the Newark Star-Ledger put it in 2013, the DNC “has had little presence in New Jersey”).
The data includes all campaign contributions from donors whose campaign disclosure forms list firms doing business with the pension fund as their employer.* It also includes investment management professionals who are close family members of executives at those firms. The data goes back to 2009 when Christie first ran for governor. For each investment company, we include all contributions two years prior to New Jersey investing public money in the firm. That two year window is relevant because that is the so-called “look back” period that New Jersey Division of Investment rules prohibit campaign contributions from being made.
Fred Klonsky 