Worth repeating: "That’s not professional investing, it’s simply dumb."

"It doesn’t take a study to figure out that losing half a billion dollars on one investment alone shows a level of incompetence that must have taken a great deal of effort to achieve. That’s right, $500 million turned into zero. That’s not professional investing, it’s simply dumb."

~ Editorial Board, Toledo Blade

Suzanne Laird's speech to STRS Board August 19, 2021

From Suzanne Laird

September 17, 2021

Good Morning, Members of MY Board: 

My name is Suzanne Laird, and I retired after more than 30 years. I have been forced to substitute teach for more than 7 years, in order to offset increasingly high healthcare premiums and the lack of a Cost of Living Adjustment. 

This isn’t my first rodeo. I began attending these meetings, when I wasn’t subbing, and 5 years ago, I  gathered my courage to speak. Perhaps, in vain.

In May of 2018, I wore black clothing and stated that I was “in mourning for my COLA.”

Here we are today, many of us in black, and still, no COLA. 

We’re here. We’re here.

And we are not going away. 

You see, we’ve been listening.

These last 15 months, we’ve been listening to the manipulated figures from the consulting firms and the overpaid, bloated investment department.

We’ve been listening as you approved extravagant bonuses.

We’ve been listening to the Health Care Director raise premiums and slash coverage, all the while admitting that the healthcare fund approaches a 200% level.

We’ve been listening to the member research staff claim that their survey showed “most members report positive overall impressions of this Board.” 

Look around: do these members today, look positive? Do all the active teachers, many of whom thought they would be retired by now, seem happy? We took the time to come here — some folks driving 2-3 hours, some paying for hotel rooms last night, some paying for parking today, ALL packing a lunch, just to make sure you understand: we’re listening.

And for every one person you see here today, 10 more are listening, who could not come. 

Now, we’re tired of listening.

We don’t want to hear that our class action lawsuit means nothing.

We don’t want to hear your rebuttal to our crowd-funded, independent audit.

The facts are the facts. 

Stop the bonuses.

Freeze the salaries.

Cut the waste.

Listen.

And then, act.

Bev Kenney's speech to STRS Board September 16, 2021

From Bev Kenney

September 17, 2021

I would like to share an allegory today.

When a young lady attends a college class, the professor introduces himself and tells about the class. Then says , “ If you want to earn an A in my class, this is what you need to do.” The motivated student starts her checklist:

Earn a bachelors degree and secure a teaching job in the state of Ohio.- check. Earn a Master’s degree. A little tougher working full time starting a family. - check. Get to the top of your districts pay scale. In this lady’s case that was a Master’s plus 45. A lot tougher, working full time, three kids, not much reimbursement available. But-check.

Now Professor STRS says, “ You have done what you needed to do to earn your A. Now you need to decide what percentage of an A you want. If you work for 30 years that is a certain percentage, 35 year higher, more than 35 higher - however - in 2015 the rules will change." So the motivated student decides to retire in 2015, with 36 years of service and confidence she earned her A. However, when she gets her transcript she has a C-!

Certain there has been a mistake, she appeals to professor STRS. His response is too bad things change. She appeals to the board. She gets very little or no response from the members of the board. She appeals to the higher legislative body only to learn that they washed their hands of this premier university in 2012.

I earned my A! This board has earned an F! You have failed me, failed all the teachers here with me today, failed every active and retired teacher in the state of Ohio. You have failed us. 

Suzanne Laird's speech to STRS Board, September 16, 2021

From Suzanne Laird

September 17, 2021

I need to preface my remarks by stating that I will abide by your absurd rule regarding not naming individuals; although, WHY any person in this room, or in the building should NOT beheld to account for his/her actions, I do not understand.

But I will conform to your censorship by employing a pseudonym, which, if you are well read,you will recognize, and perhaps it will prompt this consider revisiting that ridiculous “rule.”

~    ~    ~    ~    ~

My name is Suzanne Laird, and I retired after more than 30 years of teaching and more than 7 years of substitute teaching in retirement. 

Transparency. 

I think we are all well aware of how a lack of transparency has affected this Board’s ability to make wise financial choices on behalf of the membership of STRS. Today, I would like to inform you that a lack of transparency has also affected your knowledge of how the membership’s health benefits have deteriorated, especially for those of us under the age of 65, when Medicare benefits begin. 

I was inspired by the brave lady who took the time to speak to you last month, regarding the fact that women’s ANNUAL Pap tests are only covered every THREE years. And that this new policy, which began THIS January, 2021, covertly contains a “look back” period, prior to this calendar year. 

That’s not transparency. 

Oh, but men? Your prostate exam? You’ll be relieved to know, that’s covered completely, every year. Discriminate much?  

The brave lady revealed that although she appealed this new policy to the Chief Benefits Officer, He Who Must Not Be Named, she received no reasonable response.  

I, myself, appealed to He Who Must Not Be Named, aka, Lord Voldemort, regarding the decision to restrict colonoscopies to ONE every 10 years, even though colon cancer rates are skyrocketing. Voldemort referred me to the U.S. Preventive Services Task Force.

Ever heard of them? Me, neither.  

I asked different doctors what they knew about the U.S. Preventive Services Task Force. I looked it up online: It is a group of volunteers, not necessarily medical experts, who exist to help employers restrict and deny benefits, based on the most conservative parameters.  

Transparency?

Oh, you’d like an annual physical? Any conscientious doctor might want to draw blood to prevent you from suffering from diabetes or high cholesterol, but that’s gonna cost you: blood work is no longer considered preventive.  

NONE of these changes were communicated to the members PRIOR to implementation: all that the retirees received was a vaguely worded postcard in FEBRUARY, suggesting they might want to search online for “some” changes.  

We all know the Affordable Care Act, which provided so many life saving preventive care services, has, sadly, been diluted over the last four years. But if you were listening carefully at the April Board meeting, you heard one astute Board member, let’s call him Atticus Finch, question why our Chief Benefits Officer was proposing an increase in the pharmacy deductible when the Health Care fund is at almost 200%. Voldemort tried to slip that one by you all, stating, “Well, we don’t try to match the ACA Gold plan, we try to match the Silver plan.”All for only 438 dollars PER MONTH, and it’s going up AGAIN this year, for pre Medicare retirees!  

I don’t envy you your jobs. This lack of transparency and accountability is infuriating to watch, month after month.

I thank God we have Scout here now, starting today, to help our Atticus.

Martha McFerran Dahya's speech to the STRS Board September 16, 2021

From Martha McFerran Dahya

September 16, 2021  

You stole from me.

Worse than a missing wallet,

or an empty shelf where the TV used to be.

More devastating than a broken window,

or the car gone when you get back to the lot.

Multiply the punch-to-the-gut feeling

of your house vandalized,

your tools gone,

it all gone…

multiply that by millions.

While I was teaching at a hard school

raising scores,

encouraging kids one at a time,

testifying for an innocent student,

involving, listening, preparing…

You stole from me.

While I was mothering,

showing her how to ride a bike,

teaching,

playing, swimming,

driving to church,

making lunch…

while I was sleeping,

gardening,

cleaning,

washing,

caring,

cooking…

You stole from me.

While I was learning,

writing,

reading,

preparing,

grading,

praying…

You did it sneaky,

private equity,

hedge funds,

no-bid contracts,

Infinity Q,

Enron,

Panda Power…

Terrible investments.

And you spent too much doing it,

over 200 staff making six figures…

Taj Mahal of office space.

You made me pay for mismanagement,

three more years teaching,

14% of my pay… highest in the United States,

work til you’re 60, 70, 90??

And no cost-of-living increase.

You stole from me

and used a Mercedes

for the get-away ride.

I called the cops.

They didn’t come.

I called the Attorney General,

nothing to be done.

I protested.

I voted for you.

No one was ever arrested.

It wasn’t a crime.

Where’s the law?

It’s not a felony?

Oh, that’s right,

you’re part of the larceny.

I lay awake and wonder,

“Where did the money go?”

to the stockbroker,

the analyst,

the chairman,

board members,

the CEO,

accountants,

the meals,

the expense accounts,

the buildings

the bonuses.

You stole from ME.

I know how you live,

suburbs,

car leases,

corner offices,

private schools,

Five Star lunches,

privilege.

All stolen from me.

I didn’t care about that for myself.

I didn’t teach for the money,

but to give back,

to earn my way,

expecting grace

after hard days.

But, there will be an endless pace.

I lay awake and count,

years worked,

years to live.

Will there be enough for me,

and my husband?

Will I have to count,

pennies,

quarters,

coupons,

cans of tuna…

Now that you stole from me.

Can I keep my promises,

a college education,

the trip of a lifetime,

my house?

Now that you stole from me.

And from others,

nurses,

neighbors,

social workers,

security…

my colleagues.

Have you ever

taught a kid?

Do you know how hard it is

to manage a class?

Done some honest work?

You pirating pack of thieves.

I trusted you with details,

paid you good money

to manage my future,

my vanishing years.

You really thought it out…

you genius outlaws.

Where were you 15 years ago?

Wasn’t it your job to pay attention?

Now you are rewarding yourselves

At the expense of us.

You were supposed to be, at least, responsible.

But, instead you’ve been playing God with our lives.

Offering only

ridiculous excuses.

You shameless actuarial bandits.

You stole from us.

Dan MacDonald to STRS Board: Actives need their benefits enhanced and retirees need their 3% COLA restored

Dan MacDonald's speech to STRS Board 

September 16, 2021

Good morning. I am Dan MacDonald, an STRS retiree, 38 years service, plus the Executive Director of NEO AFT retirees, Local 279R. 

It is good to see the professor on the board. Please, sir, seek and demand information. I have noticed that since the STRS August e-update that the communications department has reframed the general fund. In the past the general fund has been stated, at say, $94.8 billion. Starting this August, I have noticed the fund broken down and the reporting is “Please recall only $87.5 billion of those totals are defined benefit assets. Approximately $2.4 billion of the total belongs to Defined Contribution Plan members and about $9.4 billion are dedicated to the STRS Health Care Program for benefit recipients. 

One final note on assets, these figures are all after we paid over $7.5 billion in pension benefits and retiree health care expenses” during FY 21. Re-packaging? I hope the new approach is for clarity to active and retired members and not a new approach to sleight of hand. Also remember that of the $7.5 billion spent in member benefits is why STRS exists and that $3 billion came from active contributions and their employers.

The STRS 2019 Actuarial Update had an estimated funding shortfall of about $24 billion. No breakdown. I am eagerly waiting for STRS and Cheiron to share the current funding shortfall. In 2019 the ROR had been reduced from 7.75% to 7.45%. Now the projected ROR might soon be 7% again enlarging the fund shortfall, just as it did in 2019. One would expect a shortfall of under $8 billion. Please, Board members don’t allow an STRS/Cheiron sleight of hand.

Finally, elected active Board members, a Wisconsin Legislative Council’s pension study showed that only STRS, out of 87 pension funds, demands 14% of income and receives a benefit worth 10.65%, a negative 3.35% loss of moneys. 86 other pensions receive more than they pay. Current teachers are paying a dollar for a benefit retirement worth seventy-six cents. This Board forces an active to work 35 years for a full-pension that actuarily lasts 20 years, while, of course, STRS staff get yearly merit-based pay raises, PBIs and an OPERS pension with COLA. The Board has allowed STRS Ohio to be unique and self-serving.

Actives need their benefits enhanced and retirees need their 3% COLA restored.

Thank you.

Dean Dennis: STRS Parking Garage Information

From Dean Dennis

September 14, 2021

STRS Parking Garage Information

I spoke with Gary Russell, Deputy Executive Director - Member Benefits and Chief Benefits Officer, today regarding the STRS parking garage for monthly membership meetings. I mentioned that I understood some STRS members were turned away from parking in the garage the last membership meeting. Below is the information Director Russell provided.

The members were turned away because the main meeting room and the overflow room were at full capacity. Director Russell stated that full capacity is approximately 120 seats and when 120 name tags are passed out, the garage is closed.

Regarding, the specifics of the garage: Level A, holds 75 spaces of which 6 are marked as handicapped. Level B,C,D,E of the garage do not have access to the main level. Director Russell said the only way to get to ground level from the upper levels is to walk back down the ramp where cars would be driving up. He thought if members parked on the upper levels it would create a safety risk. Also, shared was that the only way to get into the building from the upper levels was to have an employee key card. When asked about just keeping a door open and ask members to walk, or take the elevator, down to the first floor to register for the meeting monthly Board Meeting, two reasons were stated, 1) it's unnecessary because level A has enough spaces to handle the capacity of the two rooms (main and overflow) and 2) having members come into the building, through an open door, on an upper level would be a security issue for staff.

Lastly, when I learned that STRS had a capacity of approximately 120 for attending a Board meeting (I'm assuming this is the limit because of COVID seating) and asked, why not open another room for overflow? Director Russell stated that what they provided was more capacity than many city councils and their capacity limit was reasonable.

Some food for thought.....

"Are Ohio public pension investment salaries 100% to 200% higher than most other states because they are more qualified. No. More publications and stature in investment industry. No. Highly sought after in private sector. No. High cost of living in Columbus. No. Maybe because they help hide over $100 million a year in excess fees for Private Equity and hedge fund in secret, no-bid contracts." 

~ Chris Tobe

Author of Kentucky Fried Pensions

Toledo Blade Editorial: Report finds STRS didn’t check its math

THE EDITORIAL BOARD

TOLEDO BLADE 

SEPTEMBER 12, 2021

"Taxpayers and teachers who paid into the retirement system mustn’t end up footing the bill for incompetence. Reform the state teachers retirement system, before the bill comes due."

“Surprise, surprise, surprise,” as TV character Gomer Pyle used to say.

That’s the only possible response to the news that the state’s teachers pension fund trashed the findings of an independent review of how the fund handles, or truthfully, mishandles, the monies with which they are entrusted.

The review was conducted by Ted Siedle on behalf of the Ohio Retired Teacher’s Association. Needless to say the review found problems — some of them already well-documented. Mr. Siedle is a former attorney for the Securities and Exchange Commission.

It doesn’t take a study to figure out that losing half a billion dollars on one investment alone shows a level of incompetence that must have taken a great deal of effort to achieve.

That’s right, $500 million turned into zero. That’s not professional investing, it’s simply dumb. Add that to largely underperforming the market for years.

For too long the system board and the financial managers to which it has paid millions have avoided examination. There’s serious trouble at the State Teachers Retirement System of Ohio. It’s time for the governor and legislators to step in and get the system under control by providing more oversight and making changes.

The result of a failed state-sponsored pension fund is all too clear. Taxpayers end up footing the bill. That must not happen.

The $500 million plus was invested in Panda Power. What a cute name. Who could object to investing in Panda Power? You have to wonder if that was the thought going through the heads of the investment advisers for STRS, because not much else was going on in those high-paid gray cells.

It isn’t that hard to at least perform as well as the market, the late Vanguard maven Jack Bogle would tell you. And over the past 15 years, tracking the market would be a very good strategy.

It’s been clear for many years that index funds, for instance, which try to do nothing fancy but invest in large chunks of securities reflecting the various indexes, do at least as well, and usually better, than financial managers and funds that try to beat the market. But risky investments are so sexy. What a great idea — getting paid to lose other people’s money. And the bonuses STRS recently announced amounted to more than $6 million.

Read the rest of the article here.