Wall Street Is Fleecing a Bunch of Teachers
For decades, public workers’ pensions have been moved into private equity, hedge funds, and real estate investments, enriching finance industry moguls — and shortchanging retired public employees and teachers.
A new lawsuit in Pennsylvania could shed light on how retirement funds are siphoning employee’s earnings to Wall Street firms. (@sachab / Flickr)
A new era in the decade-long battle by retirees and whistleblowers to halt massive transfers of wealth out of retirement funds and into Wall Street firms could be at hand, thanks to the case of Katie Muth.
Muth, a Democratic Pennsylvania state senator, is one of fifteen trustees who oversees Pennsylvania’s largest public pension fund, the Pennsylvania Public School Employees’ Retirement System (PennPSERS). Not long after her February 2021 appointment to the board, Muth began questioning the fund’s investments in areas like private equity, hedge funds, and real estate.
Over the past thirty years, public pension funds have moved $1.4 trillion of retiree savings into such high-risk, high-fee “alternative investments,” enriching finance industry moguls like Stephen Schwarzman of the Blackstone Group and Robert Mercer of Renaissance Technologies while often shortchanging retired public employees and teachers.
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