Go to the mobile version of this Web site.

Login | Contact Us | Site Map | Paid archives | Electronic edition | Subscription Questions | Extras

2 legislators want pension funds to cut ties to Iran

Group of state workers, retirees opposes measure

April M. Washington

Published December 12, 2007 at 12:30 a.m.

Text size  

Related Links

More Colorado Government

More stories »

Map my news

Two state lawmakers serving on the front lines in Iraq want the state's pension funds to divest from companies doing business in Iran.

Sen. Steve Ward, R-Littleton, and Rep. Joe Rice, D-Littleton, said Iran is supplying weapons to insurgents in Iraq that are being used to kill U.S. soldiers.

They're urging legislators to back a bipartisan bill three lawmakers plan to introduce next year requiring state pension funds to divest roughly $56 million from companies involved in projects in Iran and other "terrorist-sponsoring" nations.

"Greetings from Iraq, where Iranian supplied weapons are killing Americans," Ward wrote in an e-mail. "They have been especially adept at supplying Explosively Formed Penetrators. These are IED's on steroids," he said, referring to homemade explosive devices.

"EFP's are the most powerful IED's that our forces have to deal with, and the most deadly," Ward added.

Ward is a Marine colonel. Rice is an Army lieutenant colonel.

Both are serving in Iraq and are expected to return next month prior to the start of the legislative session.

Rice will partner with Rep. Frank McNulty, R-Highlands Ranch, and Sen. Josh Penry, R-Fruita, in sponsoring the divestment bill.

The push to divest from Iran comes nearly a year after the legislature enacted a similar measure requiring the state's major pension funds - the Colorado Public Employees' Retirement Association and the Fire and Police Pension Fund Association - to divest from companies doing business in Sudan.

Friends of PERA, a group of retirees and state employees, opposes the latest bill, contending lawmakers should leave investment decisions to the PERA board.

They argue in a letter to lawmakers that the situation in Iran isn't the same as the genocide taking place in Sudan.

"I'm concerned about lawmakers eating away at the retirees' fund and constantly telling PERA what to do," said Mary K. Thayer, of Friends of PERA.

The bill's sponsors replied by saying the state has no business supporting nations providing weapons killing and injuring Americans in Iraq and Afghanistan

"It's the right thing to do given Joe's and Steve's experience in Iraq," said McNulty. "Recent examples from other states show these pension funds can achieve the same return or higher return with a portfolio not linked to terrorist nations."

Comments

  • December 13, 2007

    1:13 a.m.

    Suggest removal

    SeniorMoment writes:

    PERA makes long term investment decisions and should not be forced to sell over short term concerns its interests in companies at historically low prices. No nation remains forever a threat.

    Iraq was an ally before it was an enemy, and both Russia and China were enemies before they were friends. Iran itself was a close ally before its revolution turned the nation into one run by religious scholars. Remember too that the U. S. funded Osama bin Laden when he was fighting Russians in Afghanistan as a holy warrior, but now we would like nothing better than to execute him.

    Why should Coloradoans disregard long term investment considerations and pay continuing higher PERA research costs just to respond to a temporary change in Iran's status on the enemy to friend continuum.

    There is every reason to believe that any company with significant investments in Iran has already experienced a reduction in the value of the company's stock because of the existing trade sanctions against Iran. So, what divestiture would do is turn potential long term gains into immediate short term losses.

    Any PERA losses will ultimately have to be made up for by taxpayers through a reduction in public services or an increase in taxes, so the less interfering with PERA's goal of the highest safe return on investment is at taxpayer expense. For existing retirees the pension obligation is not revocable, even if PERA were to go bankrupt.

    Support divestiture if you want a future reduction in public services or an actual increase in future taxes. Oppose it if you are happy with PERA's return on investments, since divestiture adds a layer of investment research costs. Even a $1,000 investment in Iran by a $30 billion company could force PERA to sell its stocks in the company. Little companies could even force PERA to sell its stake in them by simply investing a few hundred dollars in Iran, even if the only beneficiary of that sale is the company's chief executive.