After mimicking Jim Nussle to the point of literal plagiarism, Chet Culver came out swinging with his campaign's first original policy proposal. How short the memory, only a year ago Chet and almost all other Democrat leaders squarely opposed permitting taxpayers to invest two and one half percent of social security in a diversified portfolio of Blue Chip stocks and government bonds. Now Chet proposes investing the public pensions of every Iowa public employee, including his most loyal and left wing supporters in the ISEA, in start up ventures. This proposal came in a prepared policy statement so it was no slip of the tounge.
Now, my last name isn't Smith, Malthus or Mills, not even Keynes, Friedman or Galbraith but that sounds nuts. While market investments are an excellent and necessary source of increasing pension savings for us baby boomers, but a 100%? Start up companies - you know, investments with a 90% failure rate? Chet's not a bad guy but doesn't this - his first display of new thinking - demonstrate that ingenuity isn't really his strength?
Chet's proposal is a form of strange egalitarianism - give everyone a chance to participate in failure. While I, like almost all Republicans, believe that Iowa must become a more hospitable environment for business creation, we've always thought of a more rational and less reckless alternative than the revolution in investment strategy Chet is now selling. Don't tax cuts, less and more certain regulation, and a non-adversarial relationship with government certainly appear safer than permitting, much less requiring, the IPERS fund managers to invest up to 100% of the fund in start up businesses.
The Real Sporer has learned that the Culver campaign didn't run this idea by anybody outside the campaign. While the Culver campaign having an original idea appears shocking in itself, even Chet's most liberal and loyal supporters in places like the ISEA are shocked by what emerged as that first original idea.
Do you really want to invest your IPERS savings in companies that are under represented in Iowa - demonstrating their inability to compete? Maybe Chet has a few more sawmills and bee keeping as advocated by team mate Denise O'Brien in mind? Chet's proposal is prohibitively reckless while concentrating breathtaking new economic power in the hands of government - a liberal exacta - but it does demonstrate a bold new and creative direction for the Culver campaign. Keep it up fellas.
27 comments:
Any investment idea like that would get you fired in real life.
Erich.. Democrats were united in their opposition to allow citizens to take 2.0 percent of their Social Security witholdings and invest it in a mix of very conservative stocks and bonds.
The government would have still held control of the money, but we as citizens would have been able to direct how a very small portion of it would have been invested.
Democrats called it "privatization" of Social Security, demogoged it to the extreme and REAL Social Security reform has gone by the wayside.
Chet's proposal would allow IPERS managers to invest 100% of IPERS funds in these so called "start-up" companies.
Let's look at facts here..no matter what the business climate..start ups have a high failure rate. Just on that fact alone Chet's proposal is extremely risky.
The hypocrisy here is MAJOR..Dems like Chet oppose citizens like us making investment decisions on our government retirement funds yet..they're for government making the same decisions about them.
Erich
Why don't you tell us what Chet really meant? Tell us what we have wrong? Make your case for investing any percentage of teachers retirement savings in one of the riskiest of all investments.
Even if only 2% - how is this good for teachers?
IPERS already sucks as a investment provider. Didn't we just bail them out with more taxpayer money? TIAA-Cref isn't much better.
If the people were free, like us that aren't unionized, they could have choice about what to do with their retirement savings.
Oh yea..D's don't believe in choice except the choice to kill their inconvenient pregnancies.
Erich,
Social Security isn't "invested" in Treasury bonds. All Social Security money either is immediately paid out to beneficiaries or is used by politicians to pay for things right now, like the deficit, thanks to bonding.
Bonding is debt. Maybe you don't understand what this means. It's sort of like if you take out a mortgage on a house. If I get a $200,000 mortgage on a house, I'm not worth $200,000. I've still got to pay it back, plus interest.
Social Security money in T-bills has to be paid back, with interest. Where's that money coming from? From future generations of taxpayers.
There's no lock box. There's no room with gold or dollars bills in it, waiting to be spend. Some day you may understand this.
What is the correct percentage? Maybe Ted had the wrong percentage. Please educate us.rt
After you answer that, explain the upside to this to the people whos retirement funds you are taking to benefit another person via "venture capital investement?"
How is this different than the values fund? How is this different thatn the Ag version of the values fund?
How many taxpayer provided funding schemes are out there?
None of them have worked. What is the reason to try it again using the retirement money of low paid workers who have no other option for retirement savings?
Chet's initial presentation indicated all IPERS funds, or at least didn't describe any limit on the funds. Multiple Democrats sourced the 100% claim-all of whom were so reporting based on their disbelief with the silliness of such an idea.
Chet's campaign has been back peddling hard on this plan, so I assume that they are now claiming that they only want to invest some IPERS funds-the proverbial unspecified percentage-into Iowa venture firms, or other unspecified industries that have had difficulty in accessing capital.
Either way, IPERS savings aren't appropriate to use for venture capital investments, that are highly risky and even more so when the target industries are evaluated on the basis of their inability to obtain capital on their own merits.
So, Erich, what is Chet advocating? What percentage of state employees pensions, including several of my family members, should be invested in high risk ventures? How do you square any part of this plan with the Democrat opposition to any use of SS funds in private investments-particularly when the investments would be in diversified blue chippers?
WAR SPORER!
I certainly never said the SSA trust has gold or dollar bills, it does have US securities.
Erich,
What is the value of that asset, those Treasury bills that the Social Security "trust" is invested in?
Can you tell me?
The fact is that Social Security is not invested in anything. Those T-bills are debt that future generations will have to pay back, plus interest. It's not an "investment" in any way, shape, or form.
I don't know where you get this idea that Social Security is a "Trust" in the legal/financial sense. You have been seriously misled if you believe that Social Security has assets, much less investments.
Hey Uncle Teddy
What was going on outside Centro with you, Gordo and the Fox people? You took off your jacket and rolled up your sleeves looking fairly animated.
Ya know Erich
We are talking about Chet and his risky scheme. Why won't you talk about that instead of trying to change the subject to Social Security.
All of us under 40 know it ain't gonna be there for us so invest freely in the entire marketplace.
Now, as a public employee, I can't depend on IPERS either.
I guess I'll have to work at Wal Mart to survive into my 90's.
Oh yea, you are trying to shut them down too.
How will I survive with no Social Security, No IPERS, and I can't work at Wal Mart for 10 hours or so a week because you want to put them out of business.
What's up with you guys? Why do you have issues with secure retirement income? Is that so you can house us all in govt run old folk institutions?
I saw this in the Register:
As governor, I will not put IPERS at risk,” Culver said today.
Venture capital, is by definition RISKY! This is an outright lie or an indication of chesters IQ.
assets,” the program’s guidelines say.
........later on, this:
Culver countered Nussle’s attack by criticizing the eight-term congressman’s support for President Bush’s proposal to allow younger workers to invest a portion of their payroll taxes in private accounts.
Culver has said that proposal would put the solvency of the federal Social Security program at risk.
Can someone tell me how Chet squares these two opinions? If he believes his own words about SS, what he proposes to do is even riskier. On top of that, the employees don't have a choice about that. With SS reform, the choice to invest elsewhere is voluntary.
Erich
So if IPERS is having good returns with this strategy on investing in venture capital, why did we just have to bail them out at the price of 2.2 billion?
Using the argument that they do it all ready falls flat. We didn't know that. Now we do. They shouldn't be doing that either for the same reasons.
You want to deal in facts? Tell us what the venture capital companies were and currently are that IPERS invested in and their current rate of return.
Ted: I know this post doesn't relate to yours but this is the only way I know to communicate with you. A democratic friend of mine sent this link to me and it's so shocking that it can't possibly be true. It's from Moveon.org so I have real reservations but if you follow the link it takes you to a video where George Allen uses a racial slur against the only non-white member of the audience at a speech he was giving. Is it for real? What do you know about it?
Here's the link. Please respond since his name is on your presidential poll:
http://political.moveon.org/withdrawallen/
Erich
So where is the 2.2 billion deficit?
You told us that the cost is cheap per employee - gee, since the employees don't pay those costs, the taxpayer does - why do you cite that?
You told us that you have great customer service.
Great - guess that makes up for the lack of returns, which you didn't cite.
I care about the rate of return more than that you have good customer service. With whom do you compete to be worse or better?
They have a monopoly.
Sporer has many many sources of information inside among the Democrats. He is very well informed.
Many many Democrats called many many Republicans about Chet's risky risky scheme.
I'm repeating myself already so I don't have to say the same thing in multiple posts like our Democrat posters.
why didnt Gordon come inside Centro? too afraid of all the Rs?
why did you need 2.2 billion? No, being cheap does not mean it is money well spent. Only D's think that way. It's the collectivism thing.
Lower price - decent service,
The Wal Mart way at IPERS!
I thought you guys were against that kind of thing. How much do you pay your workers? Is it below industry average? How much do you pay for health insurance? Do your people get lots of vacation?
How much service does a typical worker bee putting away 2% of their income each pay period really need from their retirement provider?
Erich,
Your right. So, when can we expect to see all your left friends apologize to GW and work to put Social Security in high performing investments? I know I would like to invest a portion of my own Social Security in something other than your "treasury securities." Please, you are so misinformed and a kneejerk liberal that you can't be intellectual honest about Chet's hypocrisy on this IPERS issue when you only last year criticized the GOP for wanting to allow private investment accounts of Social Security. This guy is pathetic and lazy minded.
Erich, are you a child? This isn't HS debate. Not one but several very highly placed Democrats confirmed the original story. Would you be happier if I cited a Jayson Blair or Dan Rather media source?
Chet has been backing off all week but that doesn't change his original "plan", such as it was.
Also, if IPERS is in such a good investment posture why is there such a large deficit? My source for that is the DMR.
Erich, you sound like a broken record. Do you think Sporer should burn his Democrat sources?
Why do you assert that IPERS is properly managed? The record shows shortfalls are routine-isn't that a factor that current fund managers should factor into their portfolio?
Or is this simply just another way the Democrats have of centralizing power even further, more money for welfare (corporate and personal) less money for taxpayers.
Democratic apologists/apologies/excuses/deceptions and risky truth schemes - all the same routine.
Chet gets the gold star for an original idea since most Democrats only run against Republican ideas and gets a kick in the butt for such a hairbrained idea.
Sporer: Instead of continually relying on ad hominym's about Jayson Blair, Dan Rather, and H.S. debate standards of evidence (which we all know are the last resort of the truly uninformed--or habitual liars), post the "prepared policy statement" you refer to from the Culver campaign regarding the Roveian "RISKY, RISKY, RISKY, RISKY" IPERS scheme. Why haven't you done so already? Obviously because it doesn't exist.
Awww. Here's he goes again.
Look, Sporer, if Jimmy Nussle has the chance he'll do the same thing. It ain't their person dough, after all, wha'do they care.
Both your boy and young Chester smell big bucks from biofuels. As usual Jimmy N was clueless until young Chester shot his mouth off.
They're both a couple of first-class jerks.
9:49
How is it you can predict that Nussle would do what Culver did? Is that how you rationalize this risky scheme to benefit the unions at the expense of the teachers and afscme?
This is risky and simply a payoff to the unions to create more union jobs.
Chet had a political reason to do it, not for economic development reasons.
If Chet is serious about economic development, how about he suggest legislative changes to the anti-business tax and regulatory environment which is causing all these companies to leave.
Heck, if Maytag wouldn't accept the $100,000 per employee bribe that Vilsack proposed, why do we keep thinking that just giving companies free money via the retirment savings of teachers and afscme people will do it?
Oh yea, because it isn't about economic development really. It's really about paying off the unions to get their vote.
Rate of return - be damned! I have to get elected first!!!
It's so sad that people who sound like they are promoting IPERS knows so little about the function of a retirement savings program.
But, it's good to know that your costs per saver (not paid by the employee) and your customer service numbers are good.
Mr. Ipers apologist - Is that why Chet did it? Will someone explain what Chet is up to? Why did he make this a political issue?
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