ICYMI – Pennsylvania Capital-Star: How Pa. teachers’ pensions fit into the feud between Oz, McCormick

New reporting from the Pennsylvania Capital-Star is highlighting “the feud between Oz, McCormick” over McCormick’s involvement in investment strategies that have forced Pennsylvania teachers and taxpayers to pay more.

McCormick was Bridgewater’s President and CEO during the time Bridgewater was managing the pension fund’s money. Republican state treasurer Stacy Garrity said the pension’s “‘zealot-like devotion to Bridgewater’s ‘risk parity’ investment philosophy’ significantly contributed to the pension’s overall underperformance.”

The president of PA’s chapter of the American Federation of Teachers blasted McCormick and said it’s “despicable that a vulture capitalist billionaire is using our members’ retirement money to flood broadcast and cable news with dishonest ads and try to buy an election.”

Read more below:

Pennsylvania Capital-Star: How Pa. teachers’ pensions fit into the feud between Oz, McCormick
By Stephen Caruso
March 24, 2022

Key Points:

• Pennsylvania’s $72 billion teacher pension fund and its investment strategies are at the center of a new war of words between GOP Senate hopefuls Mehmet Oz and David McCormick.

• A financial misstep last year means almost 100,000 teachers are paying extra to the fund to cover a poor performance in 2020, while other critics have claimed that the fund’s investment strategy has forced property tax owners to pay at least $460 million more in property taxes to local school districts.

• Now, all of this has become political fodder in the heated Republican primary for Pennsylvania’s open Senate seat as Oz, a heart surgeon-turned-television host, has argued that McCormick, a billionaire hedge fund manager, helped cause these problems.

• “Dishonest David got rich, we got stuck with the bill,” Oz, who lived in New Jersey until at least 2020, said at a news conference outside the pension fund’s Harrisburg office last week.

• “People on the Wall Street-Washington revolving door that leads to the swamp of Washington, they continue to charge us and make their money no matter what happens,” Oz said Tuesday, surrounded by retired school employees.

• This week, state treasurer Stacy Garrity, a Republican… started naming names. In a statement to the Capital-Star, Garrity… said that the fund’s “zealot-like devotion to Bridgewater’s ‘risk parity’ investment philosophy” significantly contributed to the pension’s overall underperformance.

• On a whole, Oz argued that McCormick should be held accountable for the role Bridgewater’s investments played in this chain of events.

• “When tax burdens, especially real estate tax burdens, are through the roof [and] you don’t know where you’re paying the money to? It’s getting paid to the rich people on Wall Street,” Oz said.

• Arthur Steinberg, president of the Pennsylvania chapter of the American Federation of Teachers, said in a statement that it’s “despicable that a vulture capitalist billionaire is using our members’ retirement money to flood broadcast and cable news with dishonest ads and try to buy an election.”

• Steinberg, who represents some 36,000 educators, paraprofessionals, and public employees across 64 local unions, added that “the answer is transparency and reform at PSERS, and certainly not to elect a celebrity quack to the US Senate.”

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