Forbes columnist calls out Rauner for hypocrisy, secrecy on pensions
Bruce Rauner holds up his financial success – he made more than $60 million last year alone – as one of the main reasons why Illinois voters should trust him with being in charge of state government.
Yet Rauner, the Republican nominee for governor, has repeatedly dodged questions regarding how he made that money. His obsessive secrecy is so alarming that it’s drawn criticism from a columnist at Forbes – a decidedly business-oriented publication.
Contributing columnist Edward “Ted” Siedle, a pension fund forensic expert, writes that “managing state workers’ retirement savings for decades – shielded from public scrutiny – has worked out very nicely” for Rauner, who is now “using some of the millions he garnered from workers' savings to fund a run for governor of Illinois.”
Siedle is quick to note Rauner’s hypocrisy: The GOP nominee wants to take public employees out of defined-benefit pensions and “force public workers into the same poorly-designed 401(k)-style plans that have utterly failed to provide retirement security for private sector employees.”
Siedle doesn’t stop there, however. He goes into great detail about the tricks of the trade used by private equity firms – like Rauner’s GTCR – that manage the assets of public employee pension funds.
Rauner refuses to provide details on the inner workings of this system, even though it’s responsible for much of his wealth and his reputation as a successful businessman.
“What’s so irksome is that Rauner, like Mitt Romney, believes it is possible for the most secretive of money handlers — managers of opaque, conflict of interest-ridden, high-cost, high-risk, illiquid, hard-to-value private equity investments — to run for public office (and win) without disclosing how they made whatever money they have stashed offshore in the Caymans, or wherever,” Siedle writes. “Can a massively-funded candidate who refuses to disclose key information regarding an entire career spent managing public monies inspire voters and emerge as a leader? Can a secretive pension manager be trusted to reform his clients, or even investigate himself?”
Siedle notes that private equity firms who manage pension funds will often skim money off the top to help finance business projects, create special funds for “family and friends” to profit off pension funds at a discount, and even “permit certain special investors in funds in which public pensions have invested to profit, potentially at the expense of public pension investors.”
You can read Siedle’s full column to learn more about the shady tactics private equity barons like Rauner use to manage public employee pension funds.