Rolling Stone magazine’s Matt Taibbi appeared on Democracy, Now! Thursday to talk about how Wall Street hedge funds are set on sacking the pension funds of public employees. Those funds are the “last great, unguarded piles of money in this country,” he said, and naturally the top tiers of the private sector are going to battle amongst themselves to see who can seize the most.
In his latest piece for Rolling Stone, Taibbi detailed how private companies are enriching themselves by bankrupting public workers’ retirements and savings in the name of “saving” them.
“I think everyone realizes that states are in fiscal crises or having trouble paying out their obligations to workers,” Taibbi told hosts Amy Goodman and Juan Gonzales. “One of the reasons is that at least 14 states have not been making their annual required contributions to the pension fund for years and years and years. So essentially, they have been illegally borrowing from these pension funds, sometimes going back decades.”
Taibbi’s research found that in many cases, such as in the state of Rhode Island, the hedge funders brought in to reorganize the state governments are getting paid the exact amounts of money that are being cut from public pensions.
“So essentially it is a wealth transfer from teachers, cops, and firemen to billionaire hedge-funders,” he said. The billionaires are then taking the leftover funds and applying the same risk-centric strategies that sank the economy in 2008.
He went on to discuss the situation in Detroit, where the tea party governor has brought in a cabal of pro-privatization cronies as “emergency managers” who are in the process of dismantling the public pension program.
“Look, pension funds are sort of the last great big unguarded piles of money in this country and there are going to be all sorts of operators who trying to get their hands on that money,” he explained. The person who is benefitting is “not some worker who is making $19,000 who is really making out in this kind of corruption. It is the hedge fund who is making $50 and $60 million in fees managing state funds. That is the much more typical narrative.”
Watch the video, embedded below via Democracy, Now!: