Ed Mendel’s report on CalPERS’ horrible investment returns over the past five years — 99 percent of big government pension funds did better — brings me back to the point I made two months back: No matter how badly CalPERS does, the bonuses keep flowing. I predict that later this year, we’ll find out this is still the case. It’s not like, yunno, CalPERS is hard up for cash. Groan.
Here’s a reminder of CalPERS’ insanity — an AP story from September 2010:
As its investment portfolio was losing nearly a quarter of its value, the country’s largest public pension fund doled out six-figure bonuses and substantial raises to its top employees, an analysis by The Associated Press has found. …
CalPERS’ plunging value came as stock values tumbled around the world, the state’s economy suffered its worst decline in decades and basic state services faced severe budget cuts.
Virtually all of CalPERS’ investment managers were awarded bonuses of more than $10,000 each, with several earning bonuses of more than $100,000 during the 2008-09 fiscal year. The cash awards were distributed as the fund lost $59 billion. …
Bonuses also were paid to employees who are not part of the fund’s investment team, including a public affairs officer who received bonuses of nearly $19,000 a year two years in a row and a human resources executive who received bonuses topping $16,000 both years.
The number of CalPERS executives making $200,000 a year or more rose from 13 to 15 over the two-year period. Those employees received an average salary raise of 12 percent and an average bonus of $115,705 in the 2007-08 fiscal year and $63,311 in 2008-09, according to the AP’s inquiry into CalPERS compensation.
If an institution in the private sector behaved the way CalPERS does — especially one with stockholders — its officers would go to jail. If CalPERS’ leaders give themselves huge bonuses after a five-year span of incompetence, this will be a fresh reminder of how this state is rigged against taxpayers — or at least the taxpayers who aren’t public employees.