Nice TryHad Ollie read the entire article, he might have understood why the Bush admin had a problem with the pension fund threatening to pull funds from investment purely for political reasons. He would've also seen that the AFL-CIO actually agreed that they probably wouldn't be able to withdraw funds from Ed Jones, Charles Schwab, etc b/c of those companies' support for SS reform.
Smell the desperation?The Bush administration has warned the nation's biggest labor federation that union-run pension funds may be breaking the law in opposing President Bush's Social Security proposals.So, the Bush administration has decided that union opposition to social security privatization and benefit cuts is somehow a violation of the law.
The department did not cite any specific instances and it stopped short of any formal accusations. But the letter came after a well-orchestrated campaign by the A.F.L.-C.I.O. to criticize investment firms that appeared to be supporting Mr. Bush's proposal for private investment accounts. "A fiduciary may never increase a plan's expenses, sacrifice the security of promised benefits, or reduce the return on plan assets, in order to promote its views on Social Security or any other broad policy issue," the letter said.Hey, Ollie... if you want the Union Pension funds to become political tools, let's remove the reigns of federal regulations... whatdya say? Just don't come complaining when their investments go south b/c they play politics like this instead of taking their fiduciary responsibilities seriously.
Damon Silvers, associate general counsel for the A.F.L.-C.I.O., described the warning as mostly a matter of "tone" rather than substance, and said union officials agreed with the Labor Department's main principles about fiduciary responsibility.
The nation's labor unions run pension plans that hold hundreds of billions of dollars in assets, and those plans are tightly regulated by federal employee-retirement laws.
The key issue in the warning was whether union-backed pension funds were either spending money to protest Mr. Bush's proposal in communications with pension-fund participants or threatening to take business away from qualified investment firms that support the proposal.
Bill Patterson, head of the A.F.L.-C.I.O.'s campaign over investment companies, said the government's warning would have little impact on his efforts.
"We operate comfortably within the principles laid out by the Department of Labor, and we're going to keep on doing what we've been doing," he said.
Ahh, union pension funds... always the model for efficiency and honest dealings.
Why do the reporters for the NYTimes insist on the inverted style for their stories? I mean, the main point of the article is the actions the union pension fund was contemplating (pulling business away from pro-SS Reform companies) and Bush Admin response. Why do I have to read the entire article and get to the 18th paragraph to get to what is the "key issue" (even according to the NYTimes)? (perhaps Ollie didn't make it down to the key issue or the sentence on how union pension funds are heavily regulated.
Also, how many single sentence paragraphs are acceptable at the Times? It seems like the more, the better.
***UPDATE - 10 secs later***
I should've read through the comments before posting... what idiocy. Folks, Union Pension Funds are not allowed to put their funds and their future payouts at risk (ie increased costs, decreased returns, etc, etc) for political purposes. Threatening to remove investment funds from specific brokerages for political reasons seems to approach that threshold, thus the letter - a friggin letter - reminding them of this responsibility, with which the Union reps agree.
They can take a position publicly... they just can't use their funds as a political tool. Those are the facts, oh great Twinkie-meister.
ARC: St Wendeler