Jim Carlton and Tamara Audi. 2009. "Orange County Dodged Bullet by a Avoiding Calpers: Southern California Locale Decided to Stick with Its Small Pension Fund in 2006." (16 October): p. A 4.
"Orange County had a chance three years ago to join the California Public Employees' Retirement System. Instead, county leaders stayed with a small Orange County pension fund, and now they feel vindicated for their stay-local strategy. While Calpers's investments went on to lose almost 30% of their value during the crash of financial markets last year, the Orange County Employees Retirement System, or Ocers, lost only 21%."
"Now that Calpers has revealed that a former board member allegedly reaped $50 million in fees for arranging investments that could saddle state taxpayers with hundreds of millions of dollars in losses, those in Orange County who once lobbied to ditch Ocers are even happier their side lost the debate."
"Calpers, whose board is dominated by union ties, has invested much more aggressively in equities."
In fact CALPERS lost big by investing in real estate and hedge funds. Also, Orange County had a curious investment history, when in 1994, its treasurer, Robert Citron, lost heavily investing in derivatives, which he did not understand. The county went bankrupt.
Of course, treasurers were expected to make big bucks as a way to keep taxes down. This sort of pressure still continues.
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-- Michael Perelman Economics Department California State University Chico, CA 95929
530 898 5321 fax 530 898 5901 http://michaelperelman.wordpress.com