DeSantis prepares to invest more state pension funds into risky financial arrangements

A new bill making its way through the Florida legislature would allow the Florida State Board of Administration, which is dictated by Gov. Ron DeSantis (R), to move $18 billion of the state’s pension fund from typical (and less risky) stocks and bonds and transfer such holdings into the hands of private equity firms, venture capitalists and hedge funds. 

This will be accomplished by raising “the cap on alternative investments from 20 to 30 percent.” 

Such experiments in permitting vampire-squid capitalists to manage pension funds have proven disastrous for public employees. For example, in Kentucky, the state allowed hedge fund managers to gamble with pensions. This resulted in a $36 billion loss. 

This maneuver has deeply concerning overtones. A billion dollars of Florida’s $180 billion fund has already been invested into firms that donated massive amounts of cash to the Republican Governors Association — which contributed $21 million to DeSantis’ re-election campaign last year. 

And hoping to secure a big check for his hypothetical, yet floundering presidential campaign, DeSantis met with Steve Schwarzman last week. Schwarzman is the CEO and chair of The BlackStone Group, a massively influential private equity firm that currently manages more than $800 million worth of Florida state pension funds. While DeSantis walked away empty-handed, the plan to further invest pension funds with guys like Schwarzman could prove lucrative for DeSantis. 

Financial experts are warning that such investment trends could result in massive losses for pensioners, especially as stock prices fall and interest rates begin to climb. But this clearly hasn’t stopped DeSantis from sticking his fingers in the metaphorical pudding cup. He’s got his eye on the prize, crucial retirement funds be damned.