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Are government workers who rely upon underfunded state pensions willing to allow DeSantis to risk … [+]
From facilitating the spread of Covid in Florida, to bullying kids about wearing protective masks and their sexual orientation, Governor Ron DeSantis has demonstrated reckless disregard for the public welfare and a willingness to say anything—no matter how outrageous—to garner headlines. Now, DeSantis, who has absolutely no financial experience, wants to dictate how trillions in state pensions established to provide retirement security for government workers should be invested. Are pensioners willing to let DeSantis endanger their retirement savings to further his political ambitions?
Floridians are used to hearing Governor Ron DeSantis make one outrageous statement after another, seemingly for no other purpose than to garner headlines. Since the outset of the pandemic, he has demonstrated a willingness to risk lives to make political points. Thanks to the Governor downplaying the threat of COVID-19, the Sunshine state’s death toll from the pandemic has far surpassed (78,000-plus) the number of American soldiers killed in the Vietnam War (58,000). He has no quams about bullying kids for wearing protective masks or their LBGTQ sexual orientation.
More recently, DeSantis has suggested the pension system of the state of Florida work together with pensions in other Republican-controlled states like Texas to push back against activist-led environmental, social and governance—or ESG—initiatives at corporate shareholder meetings. With assets of nearly $6 trillion, U.S. state and local public pensions have often been a powerful force helping activists pursue ESG issues on corporate ballots but, since they are rarely the largest investors in U.S. publicly traded companies, their influence is limited.
DeSantis wants Republican-controlled state pensions to vote together as a bloc solely to make a political statement—regardless of the investment merits of such ESG proposals and whether pension participants may support them.
It has long been recognized that the highly-secretive $250 billion Florida state pension has a deeply-flawed governance structure. DeSantis is one of only three trustees who oversee the pension, the other two being restaurateur Chief Financial Officer Jimmy Patronis, and Attorney General Ashley Moody—all elected politicians utterly lacking any pension experience. Whether they know it or not, as members of the board, DeSantis and his fellow board members are “fiduciaries.”
The Florida Retirement System’s website acknowledges their fiduciary duties:
“A three-member Board of Trustees governs the SBA. The three trustees are the Governor as Chair, the Chief Financial Officer, and the Attorney General. They have the legal authority and fiduciary responsibility (emphasis added) for the investments of assets under management… The Trustees, Executive Director and staff always act solely in the best interest of FRS participants and beneficiaries. At the SBA, we clearly understand that thousands of Florida’s state government employees, public school teachers, local public safety officers, firefighters and retirees count on us to provide superior investment and trust services while adhering to the highest ethical, fiduciary (emphasis added) and professional standards.”
And, as fiduciaries, DeSantis and the other board members must always act solely in the best interest of pensioners—politics aside.
“What we need to do is get other like-minded states to have all our retirement systems’ voting rights used as a bloc,” DeSantis said at a July 27 news conference.
“We could be a real check against a lot of the excesses that we’ve seen and probably have enough resources to beat back a lot of this stuff.
Shooting from the hip—with typical DeSantis bravado and a complete absence of substantive knowledge of pandemic health care, child psychology and now pension law—there is no mention of investment considerations or fiduciary duties, only politics.
It’s been easy, to date, for DeSantis to bully school kids and LGBTQ youth to score points to further his sad political ambitions. Whether government workers who rely upon already severely underfunded state pensions are willing to allow DeSantis to risk their retirement security for his political gain remains to be seen.
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