I think that part of the problem, and I'm talking about myself here, not those who understand all this, is that I have no idea how my blessed pensions have been funded--- I'm just grateful that they're there at all in this day and age, where most decent things have been thrown away by the Pigs who pretend to love America but worship money. Thank you for the wakeup call.
I am down with this but as an individual, it's hard to do the right thing here. I only recently started working in an industry where a 401k is available. I decided to plop it into a fund that was purportedly all about ESG and green industries and stuff rather than the broader index fund they had on offer. I looked closer and saw that Tesla was the top investment in that portfolio... Second was Microsoft I think. Further down there were literal oil companies.
Practically speaking as you note it is very hard for individual investors (who should be in index funds) to do much on this front, because you don't have enough money, among other things. Pensions have billions and should be our focus because they money they manage belongs to workers and should be used for their benefit.
(On the upside your 401k is not gonna offer you access to any evil VC or hedge funds so rest easy.)
I wonder if it would make sense for you to run for office—presuming elections are still a thing. A Mamdani/DSA/Abughazaleh-type run, at some noticeable level. You can obviously communicate.
But when I say “I wonder” I mean it: I’m not sure. Maybe better/more than enough to try to get labor to grow a spine.
Your article makes a lot of sense. And I agree we should take these relatively easy steps...because future steps are indeed likely to be much more challenging.
Agree 99%. You spoiled your essay with your admittedly parenthetical reflexive throwaway about divesting from Israel of course goes without saying.
That 1% disagree detracts from credibility and unintentionally proves your point sorting out largely theoretical ideological hobbyhorses and looking at things that affect money and power that we can and should control.
You know, it’s not like pension funds or universities do some huge amount of investment in Israeli Shekels with Bank Hapoalim or most of Harvards endowment is tied up with the local Coca Cola beverage franchise in Tel Aviv or get people to boycott US Coke because they sell in Israel or whatever the theory is here.
Which is there is no theory other than propaganda noise, that the idea of BDS isn’t that it can wreak real financial impact on a foreign country but gives protesting students and professors an excuse to cosplay this protest to get the university to “divest” of its non existent assets.
You know there’s just a tad of ambiguity objectively if this rises to a “genocide” but I don’t follow genocides as a hobby myself. Tell me, are there a lot of them that concern you?
These are good ideas. And I'd like to offer up one more: delay paying your federal taxes. If we are in a fascist country then your tax dollars are directly funding fascism. If there was a real mass movement to file extensions, or submit overly complicated tax documents to the IRS we could (legally) keep funds out of the hands of the government for at least a while. If it's a small group, the movement would falter, but if millions, or tens of millions followed suit the government would be in quite a pickle. Because once the reporting comes out that 100M filed for extensions, we would know where they power really was, and just maybe we could put that money to another cause.
Except the federal government doesn't actually wait for your taxes to spend things or to bring more money into existence. Were you here for the Stephanie Kelton interview?
There's a much larger problem for pension funds: they're overwhelmingly underfunded and so are mathematically doomed unless they can somehow achieve sky-high returns in perpetuity. They also have no real fiduciaries in charge at any level. There's a perverse and unbelievable kind of deception. The public sector officials lie to themselves and their employees that the pension is bulletproof. The employees believe the lie and come up with self-deceiving platitudes to make themselves completely oblivious to the concept of pension failure or default.
The officials in charge either know and don't care that the pensions are doomed (because they have their own separate, fully funded retirements) or they're incompetent. No one in charge has skin in the game. Fund managers also don't care, because they're just collecting fees.
It's absurd of course, but apparently people need to learn a hard lesson about trusting public officials. I don't know where this fount of trust comes from but it will run out at the worst possible time. People will wonder how this happened, as if it was not decades in the making and obvious to anyone who can do 4th grade arithmetic.
Yes, there are obvious incentives for officials to underfund pensions and overstate expected rates of return which contribute to them desperately scrambling for higher yields and being lured into more exotic investments. These incentives should be regulated away. Still they are an inadequate excuse for investing in firms run by the very, very worst right wingers.
It seems like you're worried about the wrong thing. Regardless of what these pension funds are invested in, they're in deep trouble. It seems like maybe there's a belief that the Federal Govt will swoop in and bail state pensions out. That's a big assumption, and there might not be political will to do it. If it meant investing 100% of the funds in private prisons or landmine companies in order to fix the funding problem, they probably should.
No one seems to want to tell public employees about the risks to the defined benefit option. If you care about these people, the focus should be on funding the pension or giving people the option to take a buyout for a privately held 401k plan. Investing in DEI/green energy or whatever else is not going to fix anything.
You are conflating two separate issues. "Pension funds have been mismanaged and are therefore underfunded" is an issue that needs to be corrected by regulating away the poor incentives leading pension managers astray. (Or in the bigger picture, improving social security as an alternative to private retirement funding.) "Workers' capital is invested in explicitly anti-worker firms" is another issue. To say that investing in awful things is the only way to pull public pensions out of their financial holes is not true.
They're not two separate issues. If the pension is doomed, that's a much more pressing and important concern that supersedes whatever preference you have for how the money is invested. IF these pensions could be saved by investing in something you find unpalatable, I assure you that pension recipients would prefer the funds to be solvent rather than abide by your preferences.
But the problem is much worse, because there is no magical super-high yielding investment that's going to save most of these pensions. They're just going to have to default in various ways. The people who will get screwed by default would again, likely prefer the money be invested by satan himself rather if it meant the pension would be solvent.
You articulate to the nth degree what my wife and I discuss all the time, specifically, the dismantling of the institutions that have defined us as a democracy to, for and by the people. The very least can do is not fund the oligarchs who are more than willing to support this devious effort.
Great idea. Isn’t this market a free traders market? Where are all the capitalists? All these tariffs. Dumb! Pharmaceutical , are being tariffed, it seems like everything is .
I took the route you advise years ago after a careful study of “A Random Walk Down Wall St.” and other investment books that aren’t peddling hogwash. But our IRA and 401k money in index funds is therefore absolutely still financing the rape and pillage of the earth and the Death Star of corporate capitalism.
They can decorate each little door differently at the Automat and make it seem that some of the offerings are different than the rest, but when you go to the Automat, all the food comes from the same commissaries and all the money goes into the same place. With an index fund, you buy a little bit of the food from each window and you avoid giving a cut of your money to a huckster who promises you something different and delivers exactly the same old same old, but you shouldn’t think you’ve stopped giving your money to the bad guys — indeed, you are giving a little bit to ALL the bad guys, and keeping the system humming along. ESG conscious investing reminds me of Noam Chomsky’s comment on the NYT corrections . . . It’s designed to make you think everything else in the paper was correct.
Hamilton writes: "The simple act of getting our political parties, businesses, social groups, unions, and other aspects of civil society to grasp the peril that democracy is in and act as if it is our job to do something meaningful about it is the first and most important step to getting the still-powerful machinery of opposition moving with the urgency that we need."
He's writing with the plural pronoun, "we," which clouds the fact that, before doing something meaningful, clear-minded individuals are internally motivated, generally after rationally evaluating their own thoughts, feelings, situations, and values before resolutely responding. Is this too much to ask of ourselves and neighbors?
When opposing the facile pleasures of authoritarian fascism, massive oppositional change is needed. How do individuals focus this change?
What political parties, businesses, social groups, unions, and other aspects of civil society hold in common is an addicted thralldom to something most don't want look at: Ego.
Overcoming authoritarian fascism requires identifying, understanding, seeing-through, sidelining, taming, and even participating in the annihilation of Ego: a project Ego vehemently denies is possible, yet substantial evidence exists showing otherwise. But it requires willingness to see.
Individuals need the right knowledge and motivation to see how substantial change is possible.
I washed my stuff in a capitalist washing machine, and it came out dirtier. My socialist washing machine does not work either - I haven't even looked at it in the last 50 years.
I think that part of the problem, and I'm talking about myself here, not those who understand all this, is that I have no idea how my blessed pensions have been funded--- I'm just grateful that they're there at all in this day and age, where most decent things have been thrown away by the Pigs who pretend to love America but worship money. Thank you for the wakeup call.
they're not funded. Most of them are underfunded. Hope you like wake-up calls.
I am down with this but as an individual, it's hard to do the right thing here. I only recently started working in an industry where a 401k is available. I decided to plop it into a fund that was purportedly all about ESG and green industries and stuff rather than the broader index fund they had on offer. I looked closer and saw that Tesla was the top investment in that portfolio... Second was Microsoft I think. Further down there were literal oil companies.
Practically speaking as you note it is very hard for individual investors (who should be in index funds) to do much on this front, because you don't have enough money, among other things. Pensions have billions and should be our focus because they money they manage belongs to workers and should be used for their benefit.
(On the upside your 401k is not gonna offer you access to any evil VC or hedge funds so rest easy.)
Excellent idea.
I certainly agree. Why finance the rope for your own hanging. Thanks for another great read.
Now if CalPers will follow their lead.
I wonder if it would make sense for you to run for office—presuming elections are still a thing. A Mamdani/DSA/Abughazaleh-type run, at some noticeable level. You can obviously communicate.
But when I say “I wonder” I mean it: I’m not sure. Maybe better/more than enough to try to get labor to grow a spine.
Your article makes a lot of sense. And I agree we should take these relatively easy steps...because future steps are indeed likely to be much more challenging.
Agree 99%. You spoiled your essay with your admittedly parenthetical reflexive throwaway about divesting from Israel of course goes without saying.
That 1% disagree detracts from credibility and unintentionally proves your point sorting out largely theoretical ideological hobbyhorses and looking at things that affect money and power that we can and should control.
You know, it’s not like pension funds or universities do some huge amount of investment in Israeli Shekels with Bank Hapoalim or most of Harvards endowment is tied up with the local Coca Cola beverage franchise in Tel Aviv or get people to boycott US Coke because they sell in Israel or whatever the theory is here.
Which is there is no theory other than propaganda noise, that the idea of BDS isn’t that it can wreak real financial impact on a foreign country but gives protesting students and professors an excuse to cosplay this protest to get the university to “divest” of its non existent assets.
Disliking genocide is one of my hobbyhorses.
You know there’s just a tad of ambiguity objectively if this rises to a “genocide” but I don’t follow genocides as a hobby myself. Tell me, are there a lot of them that concern you?
These are good ideas. And I'd like to offer up one more: delay paying your federal taxes. If we are in a fascist country then your tax dollars are directly funding fascism. If there was a real mass movement to file extensions, or submit overly complicated tax documents to the IRS we could (legally) keep funds out of the hands of the government for at least a while. If it's a small group, the movement would falter, but if millions, or tens of millions followed suit the government would be in quite a pickle. Because once the reporting comes out that 100M filed for extensions, we would know where they power really was, and just maybe we could put that money to another cause.
Except the federal government doesn't actually wait for your taxes to spend things or to bring more money into existence. Were you here for the Stephanie Kelton interview?
Rubbish
You lose all credibility with that foul mouth.
There's a much larger problem for pension funds: they're overwhelmingly underfunded and so are mathematically doomed unless they can somehow achieve sky-high returns in perpetuity. They also have no real fiduciaries in charge at any level. There's a perverse and unbelievable kind of deception. The public sector officials lie to themselves and their employees that the pension is bulletproof. The employees believe the lie and come up with self-deceiving platitudes to make themselves completely oblivious to the concept of pension failure or default.
The officials in charge either know and don't care that the pensions are doomed (because they have their own separate, fully funded retirements) or they're incompetent. No one in charge has skin in the game. Fund managers also don't care, because they're just collecting fees.
It's absurd of course, but apparently people need to learn a hard lesson about trusting public officials. I don't know where this fount of trust comes from but it will run out at the worst possible time. People will wonder how this happened, as if it was not decades in the making and obvious to anyone who can do 4th grade arithmetic.
Yes, there are obvious incentives for officials to underfund pensions and overstate expected rates of return which contribute to them desperately scrambling for higher yields and being lured into more exotic investments. These incentives should be regulated away. Still they are an inadequate excuse for investing in firms run by the very, very worst right wingers.
It seems like you're worried about the wrong thing. Regardless of what these pension funds are invested in, they're in deep trouble. It seems like maybe there's a belief that the Federal Govt will swoop in and bail state pensions out. That's a big assumption, and there might not be political will to do it. If it meant investing 100% of the funds in private prisons or landmine companies in order to fix the funding problem, they probably should.
No one seems to want to tell public employees about the risks to the defined benefit option. If you care about these people, the focus should be on funding the pension or giving people the option to take a buyout for a privately held 401k plan. Investing in DEI/green energy or whatever else is not going to fix anything.
You are conflating two separate issues. "Pension funds have been mismanaged and are therefore underfunded" is an issue that needs to be corrected by regulating away the poor incentives leading pension managers astray. (Or in the bigger picture, improving social security as an alternative to private retirement funding.) "Workers' capital is invested in explicitly anti-worker firms" is another issue. To say that investing in awful things is the only way to pull public pensions out of their financial holes is not true.
They're not two separate issues. If the pension is doomed, that's a much more pressing and important concern that supersedes whatever preference you have for how the money is invested. IF these pensions could be saved by investing in something you find unpalatable, I assure you that pension recipients would prefer the funds to be solvent rather than abide by your preferences.
But the problem is much worse, because there is no magical super-high yielding investment that's going to save most of these pensions. They're just going to have to default in various ways. The people who will get screwed by default would again, likely prefer the money be invested by satan himself rather if it meant the pension would be solvent.
You articulate to the nth degree what my wife and I discuss all the time, specifically, the dismantling of the institutions that have defined us as a democracy to, for and by the people. The very least can do is not fund the oligarchs who are more than willing to support this devious effort.
Great idea. Isn’t this market a free traders market? Where are all the capitalists? All these tariffs. Dumb! Pharmaceutical , are being tariffed, it seems like everything is .
I took the route you advise years ago after a careful study of “A Random Walk Down Wall St.” and other investment books that aren’t peddling hogwash. But our IRA and 401k money in index funds is therefore absolutely still financing the rape and pillage of the earth and the Death Star of corporate capitalism.
They can decorate each little door differently at the Automat and make it seem that some of the offerings are different than the rest, but when you go to the Automat, all the food comes from the same commissaries and all the money goes into the same place. With an index fund, you buy a little bit of the food from each window and you avoid giving a cut of your money to a huckster who promises you something different and delivers exactly the same old same old, but you shouldn’t think you’ve stopped giving your money to the bad guys — indeed, you are giving a little bit to ALL the bad guys, and keeping the system humming along. ESG conscious investing reminds me of Noam Chomsky’s comment on the NYT corrections . . . It’s designed to make you think everything else in the paper was correct.
Hamilton writes: "The simple act of getting our political parties, businesses, social groups, unions, and other aspects of civil society to grasp the peril that democracy is in and act as if it is our job to do something meaningful about it is the first and most important step to getting the still-powerful machinery of opposition moving with the urgency that we need."
He's writing with the plural pronoun, "we," which clouds the fact that, before doing something meaningful, clear-minded individuals are internally motivated, generally after rationally evaluating their own thoughts, feelings, situations, and values before resolutely responding. Is this too much to ask of ourselves and neighbors?
When opposing the facile pleasures of authoritarian fascism, massive oppositional change is needed. How do individuals focus this change?
What political parties, businesses, social groups, unions, and other aspects of civil society hold in common is an addicted thralldom to something most don't want look at: Ego.
Overcoming authoritarian fascism requires identifying, understanding, seeing-through, sidelining, taming, and even participating in the annihilation of Ego: a project Ego vehemently denies is possible, yet substantial evidence exists showing otherwise. But it requires willingness to see.
Individuals need the right knowledge and motivation to see how substantial change is possible.
https://noegoodyssey.com/
I washed my stuff in a capitalist washing machine, and it came out dirtier. My socialist washing machine does not work either - I haven't even looked at it in the last 50 years.