The New York Times has a damaging story on A1 this morning about how four of the city’s five pension funds are underperforming on Bill Thompson’s watch, while the payments to money managers have tripled.
The story also noted contributions Thompson got from people now doing business with the city pension fund, including some of the comptroller’s former staffers.
For the Bloomberg campaign, it’s a welcome new opportunity in their ongoing effort to demonstrate that Thompson isn’t qualified to be mayor, and the campaign quickly scheduled a press conference in their campaign office to pile onto the story’s findings.
Incidentally, the story also poses a challenge to the people who want to succeed Thompson. What do they think of the findings and would they do anything differently?
Not surprisingly, their answer is yes.
“There is no excuse for the below average performance of the City’s pension funds over the past 7 years,” Melinda Katz said in a public statement. “Once again, we’ve seen how the financial industry’s shenanigans have deprived New Yorkers of their hard-earned tax dollars.” Katz proposed re-evaluating the way money managers are paid and to tie their compensation to long-term success, not meeting short-term goals. Katz also said she’d stop automatically renewing contracts with money managers if they don’t perform up to standard, and she’d bar investments with them in the future.
John Liu said he’d return the office to “traditional stocks and bonds,” which “reduces fund management fees and expenses which in turn boosts the net return to the funds.”
Liu said he’d evaluate the performance of money managers more closely, and “will impose a ban on political contributions from anyone having business before the Comptroller’s office.”
I’ll update with more from comptroller candidates as they come in.
UPDATE: Liu’s statement was sent over in response to today’s NYT story, but spokeswoman Juanita Scarlett notes the issue of banning contributions from people doing business with the comptroller’s office has been a theme they’ve discussed earlier.