Tuesday, September 23, 2014

The RI Democratic Unity Hoax

      Democratic Hypocrisy in Rhode Island is oozing even beyond its normal level.Debbie Wasserman Schultz now joins  in this  cynical effort to display a real unified policy front  in the corrupt state of  Rhode Island with its seriously flawed individual leaders. For example ,on the issue of Social Security and pensions Democrats are massively confused and conflicted,   Senators Sheldon Whitehouse and Jack Reed as well as Congressman David Cicilline and Jim Langevin  have expressed forcefully  on repeated occasions that  efforts to privatize or even  partially privatize Social Security are "risky". At  at the same time. as residents and supporters of people like Angel Taveras and Joe Polisena they have hugely underfunded local pensions. Stocks are the huge favorite by Democratic mayors on how to fund these retirement plans. Are the mayor being to risky ? Why aren't the Senators or Congressmen  speaking out? Dont they care about local retirements or public workers? Are they critical of Angel Taveras huge investment in a single leveraged hedge Fund?Unquestionably Taveras et al  have put  taxpayers and beneficiaries at risk of enormous losses due to hedge fund and private Equity investments. David Cicilline and Angel Taveras who are  both stalwart democrats   have invested huge in the same hedge funds  on behalf of public employees and taxpayers even while they knew their  pension plans were already at enormous risk and taxpayers would have to bail them out. How does that square with the idea that stocks are too risky for social security? Obviously, it does not square. No wonder 10% of the public believes in Washington. So lets look at our elected officials  comments and what they have done or said re pensions and stock investments.
   The  typical comment  Democratic position  on equity investment by  Social Security  or individuals investing with SS money is as follows:

                Privatizing Social Security, which essentially is putting peoples' retirement money at the whim of the stock market, will weaken the federal retirement system through potentially risky investments.
Both Whitehouse  and Reed have made similar comments

Debbie Wasserman Schulttz  clearly aligns with the near universal democratic position on  whether stocks or corporate bonds should be held by Social Security.   here is a comment during the recent presidential campaign;

“ Paul Ryan still pushes through his budget that ends Medicare as we know it,  -- he  moves toward privatizing Social Security, he asks for cuts education and increases taxes on the middle class, so that we can -- so that we can cut taxes for the wealthiest, most fortunate Americans,” Wasserman Schultz said. “That's why Americans are concerned that we're not going to actually be able to maintain the prosperity that we've finally returned to.

 Sheldon Whitehouseon Investing in stocks with retirement dollars

Q: Will you support or oppose using Social Security taxes to fund private accounts?
A: Social Security has been the foundation of our country’s promise that no American will have to face an impoverished retirement. The Republican leadership in Washington is committed to undermining this promise through a risky scheme to put Social Security funds in the stock market as part of new private accounts. We should never again put seniors’ livelihoods at risk from a catastrophic stock market crash. I am opposed to President Bush’s proposal to cut Social Security benefits to middle-income workers through progressive indexing, and am disappointed that Senator Chafee has expressed support for this plan.
Source: AARP Senate candidate questionnaire , Sep 29, 2006 
 So Mr Whitehouse thinks stocks are a risky scheme for SS participants but for Rhode island  State and Municipal Workers who do not pay into social security instead into local  plans not only are stocks fine, but Rhode Island retirees should be exposed to hedge fund investments by Cicilline, taveras  and Raimondo.  Why are stocks risky for social security and not for municipal or state employees?
Jack Reed
 "As we celebrate the great success of Social Security, we must also recognize that it does face a long term financial challenge. I will work with my colleagues to strengthen Social Security, not to dismantle it through a risky privatization scheme. Deep benefit cuts and trillions in new debt is no way to honor the great legacy of President Roosevelt and Francis Perkins."

 Again  Mr Reed supports the  governmental   policies of  Gina Raimondo and  David Cicilline and Angel Taveras. Yet they all had significant investments in hedge funds, equities and alternative investments using retirement money. There are no concerns  expressed by leading democrats about the retirements of State and Municipal portfolios.Are they too dumb to know they are walking hypocrites?

    Calpers recently announced ,to the delight of many dems and unions, the shedding of Hedge fund investments. My question is why did they do that and whats appropriate? How can Dems believe its appropriate to back social security with investments in only US  30 year bonds at 3% and then not have any qualms at all about the very risky portfolios for retirement managed at the State and Municipal level?  Where are the progressives on this? Should we invest retirement funds in stocks and hedge funds based on  mayor Taveras "feel"?  What is an appropriate investment for cities and towns retirees and why is it  different from Social Security?. In both cases the taxpayer would pay for shortfalls. Why not risk free instruments for states and munis?Why does  David Cicilline put a big bet on hedge fund Renaissance Technologies for Providence retired Police and Fire and then say in Congress that  stocks are inappropriate for social security. What exactly are the dems saying?

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