Overrun By Politics

Aaron Deslatte of the Orlando Sentinel wrote an article titled "Is Florida retirement system overrun by politics?" The article should be read by everyone not once but twice. Read the article once from start to finish then read it a second time with pencil and paper. Take notes, then go online and begin putting the rest of a vast financial puzzle together involving the Florida State Retirement System, multiple state trust funds, the Governor, the Attorney General, and the Chief Financial Officer.

The Florida Whig Party has been beating the drum for a year now that the oversight of billions of dollars in trust funds is inadequate, lacks full transparency, and is highly political. The problems have been going on for a long time and include family members and others of those who are politically connected are far too often being hired to perform consulting services and/or appointed as department or division heads. The fiduciary standards owed to the citizens of the State of Florida should be second to none.

In the article by Mr. Deslatte, it says: "We are the envy of the nation," McCollum explained, when it comes to how the pension fund has weathered the financial storm. "Any change we make to the system today should be done with great caution." This shows how ignorant, short-sighted, and/or political McCollum is. Florida is a state that has rapidly grown in the past several decades. As such, state employees covered under the Florida State Retirement System (FSRS) greatly outnumber retirees. In addition, many employees are second career transplants and have not established long-term residency or pension benefits. As time passes, the ratios will change. The number of FSRS pensioners will increase as will the number of high salary employees. The number of those who have enhanced pensions under the category of “special risk” is also dramatically increasing. This isn’t rocket science, it is simply actuarial fact.

As for Sink, the article states: "Since then, Sink has been pushing to reform oversight of the SBA's $129 billion in investments. She wants to add a public-employee representative and someone with financial and investment expertise." The Florida Whig party agrees with half of what Sink said, financial and investment expertise is needed, but putting a public-employee representative in a position of oversight is simply dead wrong. Instead, the Florida Whig Party has always encouraged the appointment of a member of the Florida Press Association with a broad and deep understanding of finance. We can think of no other organization better suited to have as a representative on a board that manages billions than a member of the press. Who better is there to represent the holistic interests of We the People?

Technical economic articles that discuss actuarial facts (the mathematical realities of life) are rarely written unless there is a blazing fire of misdeed as most people are simply not hardwired to focus on issues from a numbers point of view. Instead, emotions overwhelming guide the electronic and print media centered viewer, reader, and voter.

Congratulations to Aaron Deslatte and the Orlando Sentinel for a well written article that needs additional column inches devoted to a full and comprehensive financial investigative report as we roll into the 2010 election.

Think About It