Wall Street Journal (September 6)
Numerous states have warned the “Big Three” asset managers (BlackRock, Vanguard and State Street) that their ESG policies appear to run counter to “the sole interest rule, a well-established legal principle. The sole interest rule requires investment fiduciaries to act to maximize financial returns, not to promote social or political objectives.”
Tags: “Big Three”, Asset managers, BlackRock, ESG, Fiduciaries, Financial returns, Investment, Maximize, Political, Social, Sole interest rule, State Street, States, U.S., Vanguard, Warned
Institutional Investor (September 24)
In the U.S., mounting unfunded liabilities of state retirement systems now total $1 trillion. The states desperately need to “find ways to slash costs,” but the “figure is expected to keep growing as states continue to put off pension and liability payments, and investment returns from capital markets sit in the low single digits.”
Tags: Costs, Investment returns, Markets, Pensions, Retirement systems, States, U.S., Unfunded liabilities
New York Times (November 12)
Only 36.3% of U.S. voters even bothered to vote in last week’s election. “The abysmally low turnout in last week’s midterm elections — the lowest in more than seven decades — was bad for Democrats, but it was even worse for democracy. In 43 states, less than half the eligible population bothered to vote, and no state broke 60 percent.”
The Financial Times (January 20, 2014)
“At a time when US federal government is largely paralysed, it is in the states–and particularly the cities–where America’s future is being played out.” City leaders are innovating to solve problems they can no longer rely on Washington to solve. This is hardly new. “The abiding lesson of most of US history is that when Washington fails to function, the action moves to the states, cities and municipalities.” This is what “keeps the US moving.”
Tags: Cities, Federal, Government, Leaders, Municipalities, States, U.S., Washington
Chicago Tribune (June 23)
“The rollout of Obamacare later this year is likely to bring a rate shock for many Americans who will buy health insurance from state marketplaces known as exchanges.” How much of a shock remains unknown as many implementation deadlines have been missed. Whether the rollout is a complete train wreck remains to be seen, but “this is not going to be a smooth ride.”
New York Times (August 14)
There is “a growing gloom for states and cities.” Struggling to balance budgets, city and state governments have cut 577,000 jobs since 2008. “Washington should have been trying to find a way to help states avoid the layoffs and cutbacks…. Instead, it seems to be doing everything possible to make the situation worse.” This includes “a budget deal that will probably lead to a significant reduction in federal aid; a bond downgrade that could eventually trickle down to the local and state level, making borrowing more expensive; and a stock market plunge that is bleeding state employee pension funds.”
Tags: Budgets, Cities, Local governments, Pension funds, States, U.S., Unemployment
The Economist (October 14)
American states like California are facing crippling budget deficits. As if things aren’t bad enough, the Economist points to a massive $3 trillion hole: public-sector pensions. States have been underfunding pensions to police, fire fighters and other civil servants. Overly generous benefits and an unrealistic assumption of 8% asset growth have contributed to the staggering pension shortfall. “American states have promised their employees benefits they can’t afford.”
Tags: Assumptions, Benefits, Pensions, Shortfall, States