There have been many reasons floated for Governor Perry to call a special session. I of course don't agree with any of them, but most of them are easy enough to understand. This is not one that I was expecting.
He did it repeatedly for redistricting and school finance, and now Gov. Rick Perry says he just might call a special legislative session, if necessary, to require state pension funds to divest any holdings in companies that do business with Iran.
Perry first is looking at avenues to spur divestment without legislation, as reported Tuesday by the Houston Chronicle. The Teacher Retirement System and Employees Retirement System are run by board members appointed by himself and other officials.
"If legal minds say you can't do it (without legislation), then you can't do it, but I want to put 'em on notice that we can either do it this way, or we'll look at other ways to do it," Perry said Wednesday.
Asked if he would call a special session if that effort falls short, an avenue held out as an option, Perry said, "I don't know. Might."
"This is a country that has a clear terrorist focus," Perry said. "I think it's an important statement from Texas."
It's unclear how much money the $108.3 billion Teacher Retirement System and $24.9 billion Employees Retirement System have invested in companies with ties to Iran. Neither fund had an immediate estimate. But Texas Secretary of State Phil Wilson earlier said officials think the total is "hundreds of millions of dollars."
At the risk of sounding non-liberal, there is a cost to this kind of action.
CalPERS estimates the Iran divestment ban could affect about $2 billion invested in 19 foreign energy companies. Pension fund officials said the bill could cost the fund $20 million in fees as well as a $66 million loss in asset value. The teachers' fund has not completed an analysis.
Both pension boards oppose Anderson's measure, saying they have policies dealing with investments in countries plagued by political and social risks.
Moreover, trustees fear lawmakers will pass divestment mandates for other causes in the future and threaten future investment returns. CalPERS estimates the South Africa pullout to protest apartheid in the 1980s cost it $590 million.
Originally, CalPERS said the Anderson bill could affect $8.5 billion invested in 50 international companies. The investments generated $725 million in returns over the past five years.
In any event, I'm happy to support Governor Perry's efforts to get the pension boards on board with this. I'm much less happy to support a call for a special session if they resist, because we all know what else will be on the agenda once such a call is made. Regardless, I have to admit, if we do wind up back in session, this was not the issue I'd have thought would put us there.Posted by Charles Kuffner on July 20, 2007 to That's our Lege