american outlook has released a fascinating but harrowing new report on cyclical violence in the financial sector. This will look like this: Civil servants invest in pension funds run by private companies. Of course, the choice to do this is a wise one and, at least according to the capitalist structure in which we live, a largely good thing. Those private companies then take those pension funds, invest them, and hope to get the best returns for both themselves and their pension members. The same fund then becomes a major investor in a private equity firm that takes the money and eviscerates the lives of workers to benefit its investors, most of whom are public servants. It turned out that.
From the article:
Public pension funds are now the largest backers of private equity, based on a database of 6,700 acquisitions from 1997 to 2018 compiled by a recent graduate of Columbia Business School. It has become.student Vrinda Mittal. Pension funds make up almost a third of all investors in private equity. 13 percent The asset class will account for more than $620 billion in capital by 2022, up from 3.5% in 2001 and 8.3% in 2011, according to data from the Equivre Institute, a public pension research nonprofit.like a pension fund calpersthe second largest in the United States Assets $462 billionThe plan is to allocate . more Funding for private equity.
“Private equity is fundamentally dependent on public pension funds. [This] David H. Weber, a law professor at Boston University who writes about shareholder activism, says:
Public pension funds are unfazed by a growing body of research showing that private equity acquisitions are having the following impact: job losses, wage cuts, Decrease in income, decline in labor productivity, and the company’s bankruptcy. In some cases, civil servants’ savings are used to reduce the salaries of their own members. In 2011, Aramark, then owned by private equity and backed by 37 state and local retirement funds. Refuse to join the management association In the case of the school cleaning contract, he offered the custodian his job back at a reduced rate of $11 an hour.
“If you’re killing jobs, even if you get good returns, that could hurt the fund because there’s no one paying into the fund right now,” Weber said. Ta.
In a way, it makes me think about ESG and the recent debate surrounding ESG. environment, society, administration funds. Some financial institutions offer focused investments in companies that meet specific environmental goals or demonstrate a certain level of commitment to ethics, transparency, and diversity.Several Member of Parliament People are complaining about these funds, but it’s obvious that this isn’t just a dressed-up neoliberal marketing scheme to perpetuate a problematic system with some friendly platitudes. Not for some cynical reason. Rather, it is because they believe that everyone, especially public servants, should do so. Required Invest your capital in things that will give you the biggest ROI, no matter how much it destroys the planet, your way of life, or something else.
But it turns out we don’t even need to block ESG funds to ensure our investment system continues to feed the beast. What does it say about ethical consumption under capitalism?
Workers who finance the miserable lives of other workers [Rachel Phua / American Prospect]