Alabama Getaways: State Pension Fund Invests in Hotels, Resorts
Topic: Free Agency, Government in My Backyard (GIMBY), State and Local GovernmentBy Ned Hodgman | 28. October 2009 |
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Truly original thinking is unusual in a state bureaucrat who has been on the job for 36 years. But that appears to be the case with David Bronner, head of Alabama’s public pension system. Dan Luzadder of the New York Times brings us the story of Bronner has moved in recent years for Alabama to invest its public pension fund in revamped luxury hotels, office towers and even a cruise ship dock in Mobile, golf courses across the state, and New York City Class A office space to boot. The result is a state pension fund, at $28 billion, that is more than fifty times as large as it was when Bronner took over in 1973.
Most pension funds for public employees just invest in stocks and bonds — and many such funds are in very deep trouble. What Bronner and the people of Alabama have done is different — they’ve invested pension monies in their own state, bringing benefits to both. Luzadder writes that Bronner “has invested in real estate as a way to create cultural changes in the state.”
That’s bold enough. But even more inspiring is the fact that Bonner did all this with the endorsement of the people of Alabama. For example, he pledged to make the investments in Mobile’s hospitality and office space sectors only after the citizens of Mobile approved a major bond issue funding new public schools. Why? Because, as Bonner asked, “without education, how can we attract business and industry?” This is real entrepreneurial spirit in government.
It’s tempting to say: bring this guy to Washington. Maybe he can fix things here too. But Bronner appears to have worked wonders in Alabama — and he certainly wasn’t alone in his efforts. Let’s hope his example is what it takes to spark more creativity in government in other states and the nation’s capital.
understandinggov.org
I’ve just watched a quick CNN feature on David Bronner, and the astonishing success of Alabama’s public pension system. There’s powerful foresight, great policy, apparently sound financial practices. I am pleased that Bronner conditioned some effort on improving Alabama’s public schools.
As great as this is, the CNN coverage requires a question. As Bronner escorted the CNN newcaster on a tour of the pension system’s headquarters, most viewers would be astonished at the opulence. I despise the concrete monolith of many public buildings so I won’t criticize designing a ‘wonderful’ building.
However, Bronner has created executive surroundings that parallel the most rapacious and greedy denziens of the financial world. His surroundings more plush than any other Alabama government official – and I’d venture a guess that his compensation stands singularly atop the heap of Alabama public officials.
Amid so much accomplishment, criticism is difficult. Many public figures deserve little more than scorn and approbation, where Bronner excels.
But even amid so much good, does public service – even astonishingly successful service – deserve or require such entitlement?
comment at 19. March 2010