Senate rejects governor's nominee for pension board

SACRAMENTO (AP) - Democratic lawmakers have denied David Crane (D), one of Gov. Arnold Schwarzenegger's friends and economic advisers, a seat on the California State Teachers' Retirement System board.

The Senate Rules Committee voted 3-2 along party lines Wednesday to reject the Republican governor's appointment of Crane to the board. Democrats said they were concerned he would not protect teachers' pensions.

Unions opposed Crane's nomination because he thought CalSTRS should not have weighed in on the governor's pension proposal.

Crane, a San Francisco financier, has served as the governor's special adviser on jobs and economic growth since Schwarzenegger was elected in 2003. He is a Democrat.

In voting against his nomination, Senate President Pro Tem Don Perata said he believed Crane was too concerned about the cost of state pension systems on taxpayers.

Those concerns, Perata said, "are not the job of the person with fiduciary responsibility for those retirees. That job is only to protect the members' benefits."

It was the second time since last year that the Rules Committee has defeated a Schwarzenegger nominee to the board. The last one, Kathleen Smalley, was one of the two who dissented when the board voted to oppose the governor's pension proposal.

Here's some more information:

Senate Rules rejects Schwarzenegger adviser for seat on STRS
By Shane Goldmacher
June 7, 2006

Senate Leader Don Perata and his fellow Democrats on the Rules Committee rejected the confirmation of David Crane, a top adviser and long-time friend of Gov. Arnold Schwarzenegger, to a powerful post on the CalSTRS board.

In a 3-2 vote, the committee on Wednesday turned down Crane's appointment to the board of directors of the State Teachers Retirement System, the influential panel that directs the investment of billions of dollars in teacher pensions. Crane's confirmation hearing took place two weeks ago, but the day before the scheduled vote, Craned offered to resign his post in the governor's office, as special adviser for jobs and economic growth, in exchange for confirmation.

Perata delayed the vote--twice--to consider Crane's fate. But on Wednesday, Perata declared in a lengthy statement that Crane's past criticism of defined benefit pension plans, combined with his "'macro-economic' viewpoint" doomed his candidacy.

"I don't believe he has any realistic intention of reining-in that world view and focusing exclusively on the welfare of the members of this retirement system," said Perata. "I simply don't believe it's in his economic 'DNA.'"

Crane received votes and support from both of the Republican members of the Rules Committee, Sen. Jim Battin, R-La Quinta, and Sen. Roy Ashburn, R-Bakersfield.

"If you are not qualified to do it, I don't know who is," said Ashburn at the hearing.

Margita Thompson, Schwarzenegger's press secretary, said the governor's office was disappointed with the Senate's decision.

"It is unfortunate that the Senate did not recognize that David Crane's unique financial expertise would have been of great value to California teachers and taxpayers," she said.

In his statement, Perata did acknowledge that, "Mr. Crane is a tremendously creative and successful financial entrepreneur. He is very talented, and, doubtless, has been as much an asset to this administration as he has to the governor personally in their many years of friendship and business partnership."

Before joining the governor's staff, Crane spent 20 years directing investments for Babcock & Brown, a multi-national corporation with 18 offices, in 13 countries and 600 employees.

Appointees to CalSTRS first became a hot-button issue last year, when Schwarzenegger announced that his special-election reform package would include pension reform, shifting retiree benefits from defined benefit to defined contribution plans.

Schwarzenegger's proposal was sent to the CalSTRS but was dealt a setback when the 12-member board rejected the plan, with the only dissenting votes coming from then-Director of Finance Tom Campbell and Schwarzenegger-appointed trustee Kathleen Smalley.

Schwarzenegger responded by pulling his appointees to the board, besides Smalley. The Senate then rejected Smalley's confirmation.

Crane was one of four nominees picked to replace the removed trustees, but now Schwarzenegger must name a replacement for Crane on the board.

In voting against his nomination, Senate President Pro Tem Don Perata said he believed Crane was too concerned about the cost of state pension systems on taxpayers.

Those concerns, Perata said, "are not the job of the person with fiduciary responsibility for those retirees. That job is only to protect the members' benefits."

The idiocy of that statement should be blatantly apparent to any teacher concerned about their pension. If those managing the pension are unconcerned about it's expense to taxpayers, it's quite likely that the taxpayers will eventually revolt over it's mismanagement and cost.

Pension systems are a means of control by employers and unions. They are not in the employees best interests. They make it costly and difficult for employees to change jobs and allow employees to be coerced by the threat of losing their pensions.

It's no coincidence that only unionized labor and government agencies still use pensions. The government and the unions also try and use the vast sums of money in these pension plans and voting rights from stocks held by the plans to push agendas without the approval of those to whom the pensions belong.

They are a tool of the corrupt. These politicians aren't concerned about protecting the retirement funds of teachers, they're concerned about protecting the power those funds give them.

FO > And you wonder why Arnold isn't nominating more Republicans -- when the Dems even reject his Dem nominees, if they show a modicum of sense.

Methinks there are other reasons why Arnold has become so "malleable"...

Robert Mapplethorpe, were he still alive, could probably explain the ease with which Arnold has turned from governator to grovelnator. All Arnold cares about is image, an whoever inherited ol' Bob's archives has got 'em. Isn't it interesting how the story just disappeared soon after it was first floated?

Fits the model exemplified by Beelzebubba anyway.

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