SAYS: 'The Yucaipa CalPERS Caper'???
Posted on 04/11/2002 3:22:58 AM PDT by Liz
LOS ANGELES, April 10 — Former President Bill Clinton has been hired as a senior adviser at two investment funds that specialize in lower-income urban and rural communities.
The funds, the Yucaipa American Fund and the Yucaipa Corporate Initiatives Fund, were started in the last year by Ronald W. Burkle, a former grocery store magnate. Mr. Clinton is a friend of Mr. Burkle and often stays at his house.
Mr. Burkle got a start bagging groceries as a teenager and then made millions investing in grocery stores, culminating in the sale of Fred Meyer to Kroger for about $8 billion in 1999.
Mr. Clinton will act as something of an ambassador for the funds, which be invested primarily in manufacturing, distribution and retail companies, Mr. Burkle said. The former president's duties will include talking to chief executives and local political leaders, at conferences and at "mini-town halls" in communities where Yucaipa hopes to invest.
The former president's participation, Mr. Burkle said, "brings attention and focal point to the funds."
"It's a good thing for him," Mr. Burkle said. "He needs to do some business things."
Mr. Burkle would not disclose the financial arrangements he made with Mr. Clinton but conceded that pay would be based on the performance of the fund. "If the fund makes money, he makes money," Mr. Burkle said.
Mr. Clinton's staff confirmed the appointment in a statement issued this afternoon.
Mr. Burkle is among the nation's wealthiest business executives and is a frequent political donor. According to statistics compiled by the Center for Responsive Politics, Mr. Burkle and the Yucaipa Companies he founded in 1986 have contributed more than $1 million to Democrat and Republican entities and candidates in the last four years.
This is not the first such move by a former president or a top member of the Clinton administration. Last November, former Vice President Al Gore became the vice chairman of Metropolitan West Financial, a financial services company that is based in Los Angeles and is run by former Drexel Burnham executives. Industry executives say Metropolitan West, which was little known at the time, gained from that move because it helped put the company on the map.
In 1998, former President George Bush was given stock when he made a speech in Tokyo on behalf of Global Crossing, the Beverly Hills telecommunications company that is now nearly bankrupt. Mr. Bush's shares in Global Crossing, which were given to him instead of an $80,000 speaking fee, were once estimated to be worth $14 million.
"There is nothing wrong with that," said Stephen Hess, a scholar of the presidency at the Brookings Institution in Washington. "But corporate work is tricky because it does come with strings attached."
It is particularly tricky for a president as young as Mr. Clinton, who still has decades left to pursue another career, Mr. Hess said. "Most of the presidents have been old when they retire," he said. "The pay and perks for presidents is recent in American history. The country has changed its attitudes in that way."
Since leaving office, Mr. Clinton has been crisscrossing the globe, making millions on the lecture circuit, while he writes his memoirs.
The two funds started by Yucaipa first got their start last year when the California Public Employees' Retirement System, one of the nation's largest and most influential pension plans, approved a $475 million initiative to invest in blighted urban and rural communities throughout the state. Then retirement system then picked 11 investment firms as partners with the hope it would spur development in areas ignored by venture capitalists.
Yucaipa was allotted $200 million by the retirement system and set up a fund. But Mr. Burkle liked the idea enough to start another fund, the American Fund, which has raised $560 million from state and union pensions.
Mr. Burkle conceded that one reason he is interested in these types of investing is because there are now so many private equity funds that it is hard differentiate one from the next. "For us there are too many people trying to do typical leveraged buyout funds right now," he said. "We think this gives us an edge."
But Samuel Hayes, a finance professor at the Harvard School of Business, said that moving into a new direction could also bring problems.
"I would remind you this has been tried before and it has not always worked out, Professor Hayes said. "They may be doing this to profit, but they are going to have to work for it. "
Also, more on CalPERS:
The two funds started by Yucaipa first got their start last year when the California Public Employees' Retirement System, one of the nation's largest and most influential pension plans, approved a $475 million initiative to invest in blighted urban and rural communities throughout the state. Then retirement system then picked 11 investment firms as partners with the hope it would spur development in areas ignored by venture capitalists.How many ex-government types are using public pension funds to bankroll their latest ventures?Yucaipa was allotted $200 million by the retirement system and set up a fund. But Mr. Burkle liked the idea enough to start another fund, the American Fund, which has raised $560 million from state and union pensions.
If these people who elected Clintoon and Davis and other rats love them, let their pension and retirement funds reflect that cult love. This will be even more painful than the Jim Jones Koolaid drink that so many lefties drink from like their mantra of how great the Gay Life Style is as more are infected with Aids each day.
Will be interesting to see ex-42 doing business zipped-up and standing upright....heh, heh, heh.
I hear he is alway prone.....uh to have zipper problems.
OK dad, get out the soap.
When CALPERS looses $475 million on that bad investment, and millions of state workers see their pensions destroyed, I hope they remember who made the bad investments.
I hear he is alway prone.....uh to have zipper problems.
God, you're good.
Wonder how much of the bond fund Met West, Cal Pers has bought since Goron was hired at several million $'s per year?
Of course these Rats are doing these things for the poor people, the Chilrun, abortion queens and of course the Nambla element of the homosexuals. So we really shouldn't complain.
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