Take a few minutes to read this article in The Intercepts which describes how our pension funds are being used by companies owned by private equity firms in order to fight unions.
Which begs the question as to what voice do we as members of pension funds like the Illinois Teacher Retirement System have in the management of the system’s investments?
To be clear, of the sources of pension fund revenue, teacher contributions and returns on investment have been the most reliable.
The state has been the least reliable.
They continue to short their pension responsibilities by billions of dollars every year.
I’ve been writing about the threats to our teacher pensions for years.
I have spent that time organizing to preserve them.
I was on the phone the other night with a friend who retired a year ago.
“Thank goodness for all those bus trips to Springfield,” he told me.
Many of my retired friends lost interest once the Illinois Supreme Court declared that our pensions could not be diminished or impaired – to use the language of the state constitution.
Once our monthly checks were secured by the Illinois Supreme Court many of us have moved on to other things.
An interesting side bar:
The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that requires investors for private pensions to act in the interest of the individuals in these plans.
ERISA does not apply to public pension plans. When some members of public pensions like TRS brought suit to have ERISA cover our public pension plans, the US Supreme Court ruled that they had no standing.
They and we are in a defined benefit pension plan.
In other words, those who manage our retirement savings can do it in secret, can charge hidden fees, can hide actual earnings, but since our monthly pension check is guaranteed, we cannot claim that we are harmed.
In her dissent, Justice Sotomayor wrote, “After today’s decision, about 35 million people with defined-benefit plans will be vulnerable to fiduciary misconduct.”
If, like me, you believe that even though we are retired we are still part of a movement for workers’ rights and social justice, then the idea that our pension funds are being secretly invested in private equity companies to bust unions, is outrageous.
But much of that information is hidden from us by TRS trustees and investment managers.
A monthly guaranteed defined benefit can’t be enough to shut us up.
We have standing no matter what the courts say.