Even More Pension Money Is Headed to Wall Street
New York’s Democrat-controlled legislature passed a bill this week to funnel an additional $54 billion in public pension funds to high-risk private equity investments. It's most likely an unwise financial strategy — and only Wall Street will benefit.
Legislation now headed to Democratic governor Kathy Hochul’s desk — would allow officials to invest up to 35 percent of New York’s $545 billion state and local pension funds in hedge funds, private equity, real estate, and other so-called “alternative investments.” (Wally Gobetz / Flickr)
New York’s Democratic-controlled legislature this week passed a bill to funnel as much as $54 billion more in retiree savings into high-risk Wall Street investments, amid a flood of campaign cash from the financial industry.
New York’s largest teachers’ union backed the legislation, even though the move came after federal regulators — and the union’s own national leaders — issued loud warnings about the risk of such investments.
The legislation — now headed to Democratic governor Kathy Hochul’s desk — would allow officials to invest up to 35 percent of New York’s $545 billion state and local pension funds in hedge funds, private equity, real estate, and other so-called “alternative investments.” The state currently caps pension funds’ outlays in alternative investments at 25 percent.
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