Pension Benefit Guaranty Corporation - Bad Investments?

Full story here

Turns out the Federal agency/corporation that insures 44 million American pensions made some bad choices in handling their portfolio last year.

"WASHINGTON - Just months before the start of last year's stock market collapse, the federal agency that insures the retirement funds of 44 million Americans departed from its conservative investment strategy and decided to put much of its $64 billion insurance fund into stocks.

Switching from a heavy reliance on bonds, the Pension Benefit Guaranty Corporation decided to pour billions of dollars into speculative investments such as stocks in emerging foreign markets, real estate, and private equity funds.

The agency refused to say how much of the new investment strategy has been implemented or how the fund has fared during the downturn. The agency would only say that its fund was down 6.5 percent - and all of its stock-related investments were down 23 percent - as of last Sept. 30, the end of its fiscal year. But that was before most of the recent stock market decline and just before the investment switch was scheduled to begin in earnest."

The Pension Benefit Guaranty Corporation (PBGC) is responsible for making pension payments should the pension fund that an eligible person receives default. If there isn't enough money, they won't be able to make the payouts.

Press Release from the PBGC regarding the investment strategy which was voted on on Feb 12, 2008, under the new Republican Director Charles E.F. Millard.
http://www.pbgc.gov/docs/bna-investment-policy-summary.pdf

http://en.wikipedia.org/wiki/Charles_E.F._Millard
Director Millard was formerly a managing Director at Lehman Brothers and was part of Giuliani's cabinet.

An overview of PBGC:
http://en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corporation

The PBGC is a corporation that has as it's board of Directors the Secretarys of Labor, Commerce and Treasury. That would make the people who voted on the investment strategy Elaine Chao, Carlos Gutierrez, and everyone's favorite Hank Paulson.

http://en.wikipedia.org/wiki/Elaine_Chao
http://en.wikipedia.org/wiki/Carlos_Gutierrez
http://en.wikipedia.org/wiki/Henry_Paulson

So does this bear further investigation? Most likely. Will it be exposed? Probably not.

Executive Order 13489 - Barack Obama

Executive Order 13489

Revokes EO 13233 (George w. Bush)
which replaced EO 12667 (Ronald Reagan)

The lowdown:
EO 12667 defaulted to the Attorney General or Counsel to Incumbent President if records could be held secret by Executive Privilege from the Former President. Former President could sue to keep the records secret by final court order. EO 13233 defaulted to the Former President if records could be held secret by Executive Privilege from the Former President. The Incumbent President could sue to get the records released. It also extended the length of time the Former President had to peruse the records being requested from 30 days to 90 days.

EO 13489 defaults to the Attorney General or Counsel to Incumbent President if records can be held secret by Executive Privilege from the Former President. Shortens the time back to 30 days review by the Former President. Former President can sue to keep the records secret.

There is a great article here about the topic of this Executive Order.

So what does this mean? On the surface, it looks like George Bush was attempting to extend the privileges of the Executive Office after the tenure was up, thus taking a measure of power away from the Sitting President. And, meaning that any information that might be viewed unfavorably could be hidden against the wishes of the current administration. What is interesting to me about this is Barack basically rolls back to the order that Reagan issued.

It also brings up the question, how much secrecy is necessary? Is 12 years too much time to allow records to be hidden from the public? Or is it not enough time? What do they really have to hide?