Opinion
A4
Thursday, April 7, 2022
OUR VIEW
Oregon’s money
managers have
chosen Russia
t’s not our fault. We don’t have the expertise.
Our hands are tied. It’s about maximizing
profi ts and beating investment benchmarks.
Don’t worry, it’s not going to undermine Oregon’s
investment returns for the Public Employees
Retirement System.
We have rarely read an article so syrupy thick
with excuses. But those are some provided by
the state of Oregon and investment professionals
about Oregon’s investments in Russia in Ted
Sickinger’s excellent overview in The Oregonian.
Oregon has lost some $100 million — at least
for now — in its $95 billion investment port-
folio because of the invasion of Ukraine by
Russia and the resulting collapse of the value of
Russian assets. Nobody would say $100 million
is insignifi cant. It is, though, relatively insignif-
icant when compared to the scope of Oregon’s
overall investments.
State employees of Oregon and people on state
committees overseeing the state’s investments
don’t actually decide where most of the state’s
money is invested. They hand it over to others
who manage funds. Those professional money
managers look for ways to invest it. They are
always looking to maximize profi ts, to exceed
benchmarks. Russia could be a win. The state
says that now that the markets in Russia are
essentially closed Oregon can’t pull its money out
if it wanted to.
The state says it doesn’t have the expertise to
make decisions about good and bad regimes. It
hires money managers who do the risk calcula-
tions and look at the geopolitics.
So when Russia supported separatist move-
ments in 2008 in Georgia and more than 2,000
people were killed, those money managers
thought it was OK to keep on investing in Russia.
So when Russia invaded Crimea in 2014 and
absorbed it into Russia, money managers thought
it was OK to keep on investing in Russia.
And so now it is Oregon investments that are
helping pay for Russia’s invasion of Ukraine.
Your money at work.
OK, we can’t fault people for not knowing
Putin’s mind and not perfectly predicting the
invasion of Ukraine. What we don’t hear are
Oregon politicians asking questions. We don’t
hear our elected leaders, at least, debating what
Oregon might do better about its investment
policy.
In February, there were reports China had
encroached on Nepal. China has militarized
islands it built in the South China Sea and has
always been keenly interested in Taiwan. But
after Ukraine, Oregon will just count on the
money manager system that has worked for us
so well.
I
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Oregon’s economic crystal ball is coming soon
DICK
HUGHES
OTHER VIEW
he Oregon Legislature this
year came close to allowing
self-serve gasoline. Perhaps
it’s also time to repeal the state law
that each city intersection in Oregon
have at least one coff ee shop.
OK, that’s the extent of my April
Fools’ jokes. On further refl ection,
however, marijuana dispensaries
appear to have overtaken coff ee dis-
pensaries in Salem. Maybe I should
have used pot shops in the mock law.
Now, back to real-life politics.
You might have noticed recently
that your friendly neighborhood
legislative candidates have been
announcing campaign events to
attract support and discuss issues.
As part of election season, here are
two Capitol issues worthy of discus-
sion: state revenues and legislative
technology.
T
Money: How much and where
to spend
Legislative candidates make
plenty of promises about what they’ll
do if elected, from bolstering state
police to enhancing environmental
regulation. Where, in real life, will
the money actually come from? (Of
course, legislators also must get a
majority of their colleagues and the
governor to support their ideas.)
Circle the date of May 18 — the
day after the primary election — on
your crystal ball. That’s when state
economists will release their next
forecast of how the Oregon economy
and state revenues are faring. The
quarterly forecasts, along with any
tax changes created by a new Legis-
lature, are the foundations on which
the governor and lawmakers build
the state’s two-year budget.
The Democrat-controlled 2022
Legislature embraced the econo-
mists’ previous predictions of rising
revenues and spent heavily, partic-
ularly on one-time items. However,
budgets tend to expand regardless of
which party holds power. What dif-
fers is where and how they would
spend the money.
When Salem Republican Gene
Derfl er was Senate majority leader
and then Senate president 20 years
ago, he was frustrated by such
spending and asked the local news-
paper editorial board to help rein in
his GOP colleagues.
Democratic House Speaker Dan
Rayfi eld, of Corvallis, noted this year
that Republican lawmakers had an
overabundance of ideas for spending
on rural projects. “You’d think that
Republicans would be under budget.
But, boy, they came in way over
budget,” he said in February.
Meanwhile, infl ation is hitting
government as it is businesses, non-
profi ts and consumers. Wildfi re
season and associated costs remain
unpredictable. So too is the pan-
demic, though it’s easing — at least
for now. And as always, state govern-
ment faces assorted lawsuits, some
potentially with hefty price tags.
Long-term indicators suggest
budget belt-tightening in the future.
Legislators this year added to budget
reserves. Should they have done
more?
Technology: Help or hindrance
Senate Majority Leader Rob
Wagner, D-Lake Oswego, was a leg-
islative aide in the 1990s. He worked
for a representative who told staff
to respond only to paper letters,
not emails. Times certainly have
changed, Wagner said, and legislative
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█
Dick Hughes has been covering the Oregon
political scene since 1976.
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staff s are much better now.
Technology has partially evened
the participation gap between Port-
land-Salem-Eugene and the rest of
Oregon. With legislative hearings
held by videoconference and phone,
Oregonians can participate from any-
where. They no longer must drive
to Salem, wait to hear whether their
name is called to testify and, if not,
drive back on another day or else
give up.
People can respond almost
instantly as developments unfold.
But the blessing of technology
also is a curse. Video meetings are
sterile, lacking the visual cues to
how lawmakers and the audience
are reacting. Internet or phone con-
nections fail, especially in rural
areas with unreliable service. There
seems to be even less engagement
between people testifying and com-
mittee members than in face-to-face
meetings.
Anyone can fi re off an email to
a legislator or committee with less
time — and thought — than required
for an old-fashioned typed or hand-
written letter. There is little buff er.
For controversial legislation,
written testimony accumulates at
such a rate that one wonders whether
much of it ever is read by legislators.
Within the Capitol, technology
too often is talked about as good or
bad. It is neither. The issue is how it
is employed — and whether it’s over-
promised and underdelivered.
The continuing question for leg-
islators, individually and collec-
tively, is how technology can expand
accessibility, transparency and inter-
action while not replacing face-to-
face contact and traditional cordial
communication.
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