A recent editorial piece in the Wall Street Journal criticized the use of union pension funds to achieve social agendas not related to their primary goal (and fiduciary duty) of maximizing the return of its members. WSJ cited the example of the Safeway strike where Calpers threatened Safeway (a stock it owned) even though the result would make Safeway a less valuable investment. While this and other examples are certainly true, Independent Sources would like to point out to the Journal (granted somewhat tongue-in-cheek) how far the union pension funds have come.

Not that long ago, many union pension funds ignored the well-being of their members to line the pockets of mobsters. The Teamsters’ pension fund is what allowed the Midwest mob families to buy and build Las Vegas casinos such as the Flamingo, Sands, Circus Circus and others. Today, union pension funds rarely fund mob construction projects (okay, they probably don’t do it at all anymore). The fact that Calpers sometimes uses its resources for short-term partisan politics instead of funneling money to the modern day Meyer Lanskys is a pretty big improvement.

Vegas

This entry was posted on Tuesday, May 3rd, 2005 at 11:36 pm by Insider and is filed under Brilliant, but uncategorizable. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.