Re: [OPE-L] debate on labor aristocracy

Date: Mon Mar 26 2007 - 12:22:24 EDT

---------------------------- Original Message ----------------------------
Subject: Second point Re: FW: [OPE-L] debate on labor aristocracy
From:    "Steve Palmer" <>
Date:    Mon, March 26, 2007 10:55 am

There seems to be some difficulty understanding how the bribery works.
It's not at all complicated. It affects their politics. Being
politically doesn't mean you have to be a card-carrying member of the KKK.
You just sit back and wait for retirement. Here's a case study of how
academics benefit and how they behave.

Look at the OPE-L email address. CSU Chico - California State University at
Chico. If somebody works for CA State, they're a member of CalPers, the
California Public Employees' Retirement System, which has $230bn of
assets. If you're in the public school system, you're in CalSTRS,
California State
Teachers Retirement System with $158bn. California Faculty Association has
a representative on the board. This money is not sitting in a piggy bank.
CalPERS takes a very active interest in getting a good rate of return and
engages in 'active Corporate Governance' getting 'shareholder value' from
its investments.

Look at the last couple of paragraphs of this article from the Sacramento
Bee for March 17th this year: Let's have a slice of Africa and Asia.

Jurriaan did some hand-wringing about the relationship between this and
political behaviour. Let's have a look. It's not simply a question of the
absolute or relative amounts, but of the source of the benefits
(imperialism vs labour productivity), the way in which the benefits are
paid (retirement at stake) and the way in which the labour aristocracy (or
whatever you  want to call this privileged group or groups) relates to
other workers.

Feckner's predecessor, Harrigan, was apparently fired because he was
thought to be using CalPERS to pressure Safeway in its battle with
striking UFCW workers (who, incidentally, lost benefits) and cut Sutter
Health out of CalPERS health insurance, to support SEIU - the low paid
service workers.

When benefits for better paid workers came into conflict with the
interests of lower paid workers, it was the lower paid workers who lost
out. I don't
remember academics striking over this. Passivity is a measureable political
behaviour just as much as militancy. This is of course completely consistent
with currently authorizing strike action: the passivity in relation to the
struggles of lower paid workers and the militancy in pursuit of their own
material interests are completely consistent.

Take this recipe and repeat for other groups of workers.


Banner year for CalPERS - Its 15.4% return in 2006 is topped by CalSTRS, at

By Gilbert Chan - Bee Staff Writer
Last Updated 6:13 am PDT Tuesday, March 13, 2007

For the fourth straight year, the California Public Employees' Retirement
System recorded another double-digit investment return, closing 2006 with a
15.4 percent gain and $230.3 billion in assets.

The nation's largest public fund reaped payoffs in global stocks, real
estate and the private markets, officials said Monday. Cal- PERS provides
pension benefits to 1.4 million state and local government workers.

The results were slightly behind the 15.8 percent growth in the Standard &
Poor's 500 index but bested the median of 14.34 percent for other public
funds with more than $1 billion in assets.

"It was a strong equity market year. We beat our benchmark," said Russell
Read, CalPERS chief investment officer. "What we are focused on right now
is how to achieve that type of outperformance going forward. The capital
market opportunities have changed dramatically. We are looking at some
material changes."

Across town, the California State Teachers' Retirement System fared even
better, producing a 16.6 percent return for 2006. With $157.9 billion in
assets and 800,000 members, CalSTRS is the nation's No. 2 public fund.

With the latest returns, CalPERS has averaged annual gains of 13 percent
over the past three years, 10 percent over five years, and 9.3 percent
over 10 years - each bettering the fund's benchmarks. The S&P 500 averaged
10.4 percent growth over three years, 6.2 percent over five years and 8.4
percent over 10 years.

CalSTRS annual returns have averaged 13.3 percent over three years and 10.3
per- cent over five years.

"Every year people say it's harder for CalPERS (to increase returns). Every
year they keep generating these phenomenal returns," said Michael
Schlachter, a managing director at Wilshire Associates, the fund's
investment consulting firm.

One expert said the results answer critics who argue CalPERS has sacrificed
returns at the expense of leading shareholder rights campaigns.

"They are activist investors. The activism leads to better results," said
Charles Elson, director of the Weinberg Center for Corporate Governance at
the University of Delaware.

For 2006, CalPERS' largest winnerwas its real estate investments, which
gained 27.6 percent and beat the fund's benchmarkof 17.6 percent. In other
results, international equities climbed 25.2 percent; U.S. stocks, 15
percent; private market investments, 20.9 percent; fixed income, 5

At CalSTRS, the fund recorded strong gains in real estate, 26.05 percent;
U.S. equity, 16 percent; international stocks, 26.4 percent; private
markets, 21.9 percent; and fixed income, 4.8 percent. CalPERS officials
acknowledged the giant fund will continue to be pressed to generate
handsome returns.

"The pressure is always there. We are going to look at new things," said Rob
Feckner, CalPERS board president.

Read said the fund plans to pursue more public and private market
opportunities overseas, especially in fast-growing emerging markets in
Asia and Africa. In the past year, Read has touted private equity
investments in natural resources, especially energy. A lot of that growth
is being driven by increasing demands by China.

"We are seeing some opportunities in Africa come across our desk for the
first time ever," Read said

"I study a lot. That is one of the responsibilities of every
revolutionary." Hugo Chavez.

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