Adam Ashton of the Sacramento Bee Publicizes This Blog (and CalPERS’ Frustration With It)

The Sacramento Bee published a story by Adam Ashton today, CalPERS has $360 billion to invest, but it can’t figure out what to do with this blogger. Google indicates the original headline was Naked Capitalism’s Susan Webber keeps CalPERS on its heels.

Since that Ashton is close to CalPERS and his stories often hew to CalPERS’ spin, this story was relatively evenhanded, given that he had sent me a list of questions that my lawyer, who is pretty understated, called “prosecutorial”. Even so, Ashton provides inaccurate or misleadingly incomplete information several times, which not surprisingly is also negative, but those misconstructions come later in the piece.

In other words, Ashton still makes a concerted go at questioning why we should want to expose public corruption and incompetence.

The opening section, which is where the author frames the story for the reader, presents both CalPERS’ and our viewpoints. The second paragraph is where Ashton sets up the themes he uses to try to question our interest in CalPERS:

But its leaders time and again find themselves distracted by an entirely different kind of problem – an opinionated financial blogger on the other side of the country who has her hooks in the fund and a couple of key sources on the inside.

Even though we make no bones about having a strong point of view, characterizing our work as “opinionated” obscures the fact that our posts are based on extensive documentation and analysis of CalPERS’ and independent information, such as our highlighting discussions at board open sessions or working through presentations or other public records. The reason that CalPERS finds us vexatious isn’t that we are getting privileged information from CalPERS sources (well, until very recently, since more employees are contacting us); it’s that, having been in finance my entire career and spending a large chunk of that consulting to large financial institutions, it does not take much in the way of looking to see beneficiary-damaging behavior on a regular basis.

To put it another way: if we weren’t exposing genuine issues, CalPERS would be able to ignore us.

Similarly, CalPERS likes to relish its status as the biggest, highest profile public pension fund, but when it gets bad press, its stance is that it’s a parochial organization and why isn’t it left alone? Ashton is no doubt accurately presenting CalPERS attitudes here. They strongly echo those of local officials in the South in the Jim Crow era who depicted civil rights activists as outside agitators.

Ashton did counter the CalPERS’ view that they are being unfairly singled out:

Webber, a New York-based corporate management consultant, says she’s out to hold the nation’s largest pension fund accountable for governance lapses that could threaten defined benefit retirement plans around the country.

“CalPERS seeks national and international media coverage. Then, when the press takes interest in their problems, CalPERS shoots the messenger. I am strong supporter of defined benefits plans who recognizes that CalPERS’ governance and operational failings give grist to critics of public pension plans,” she wrote in a message to The Sacramento Bee.

The specific beefs, per Ashton, are that the board and top executives are not happy with the fact that we generally support the efforts of anyone who is trying to reform CalPERS, and sadly, right now, the only people with any influence in recent years who are like that are former board member JJ Jelincic and current board member Margaret Brown.

It’s perverse to see the Sacramento Bee take the position that reporters working with whistleblowers, activists, and reformers (at least until the era of access journalism) suspicious, when it is about as controversial as seeing the sun rise in the east.

What may upset CalPERS is that by virtue of spending years reviewing CalPERS board meetings, presentations, and Public Records Act request results, we are considerably down the curve on how the fund operates.1

Now to the errors and misrepresentations.

Ashton insinuates repeatedly, taking up the line of CalPERS board members who aren’t used to being held acountable, that I must be operating in a stealthy political capacity.2 If they think I am being rough on them, they should look at the many pieces I’ve written savaging government officials, such as Memo to Shaun Donovan: Your Nose is Getting So Long You Need to Get a Hacksaw. This part is just bizarre:

Now, when CalPERS leaders like Feckner suggest that Webber is actively involved in political campaigns, they’re alleging that she’s working with Jelincic to oust Jelincic’s adversaries.

Huh? Jelincic is not on the board and isn’t running for a board seat. He is on the CalPERS payroll, running out his accumulated vacation, as Ashton himself reported. So who are these mythical adversaries?

This part is also misleading:

Last month, documents Brown requested from CalPERS board staff showed up on Webber’s blog in a piece that called attention to a practice that allowed board members to have employees stamp their signatures on expense forms.

Board member Theresa Taylor, a former vice president of state government’s largest union, said she felt Brown was disingenuous when Taylor asked why Brown wanted copies of their oaths of office. Brown didn’t answer the question, Taylor said.

Brown made this comment at the end of the article:

I am dissapointed that Mr Ashton did not use any of my comments for his story:

You are misinformed about how I got a copy of everyone’s oaths of office, including my own.

I asked the staff and received from them the copies of the oath certifications. I never interacted with anyone on the board in making the request or receiving the documents.

It alarms me that you seem to think that I should have to offer a reason for seeing CalPERS records. Such a position is radically anti-transparency and something I would never expect from a reporter.

The California Public Records Act, for example, specifically does not require members of the public to state a purpose in requesting copies of public records, and the oaths of office certifications are most definitely public records.

It’s also puzzling to me that you seem to give credence to complaints about my pursuit of those documents, since my obtaining them through perfectly appropriate channels produced evidence of apparent wrong-doing.

There are other jibes that Ashton makes, but unless readers express particular interest in them in comments, I’ll refrain from giving additional information in the hope of steering clear of “the lady doth protest too much” mode.

I’ll close the biggest fallacy of the board’s and Ashton’s argument, and it comes relatively early on:

Yet her style of advocacy leads some CalPERS leaders to close ranks against her reporting. They view her as too closely aligned with camps that want to oust Frost and unseat elected representatives on the CalPERS board.

Having the good will of the board has not led to positive changes. For years, I have watched various groups that ought to have some clout with CalPERS make requests in public comments, and in many cases, these statements no doubt are similar to appeals made in private. I’ve only seen one case where that sort of thing made a difference. Several influential individuals objected to a proposed change (getting rid of transcriptions of board meetings) and we also threatened that we’d transcribe them ourselves and publish a full archive, including historical transcripts (which we could obtain via the Public Record Act). The combined effort led CalPERS not only to keep transcribing public board meetings, but also to publish the transcripts, something it had not done before.

In keeping, it’s odd to see Ashton take up the CalPERS’ line that I should have entertained a request from Marcie Frost to meet with her for an off the record meeting when she hadn’t said that was her requirement until late in the game. The article also depicts my saying clearly to Frost in an e-mail that my biggest bit of advice was she needed to get rid of General Counsel Matt Jacobs because he was damaging CalPERS. That message would not be a surprise to anyone who reads the site regularly.

By contrast, some of the changes we’ve successfully prodded CalPERS to make include:

– Capture and publish private equity carry fees, which one financial publication called a landmark

– Force CalPERS to end its massive copyright abuse.

– Pressure CalPERS on private equity fees and costs, which led Treasurer John Chiang to sponsor a pathbreaking private equity transparency bill. In a presentation earlier this year, Dr Ashby Monk said that the discussions in CalPERS board meetings of private equity fees and costs, typically instigated by Jelincic, which we discussed at length on our site, using the videos from board meetings, led to widespread changes across private equity investors. They started to come to grips with how much they were paying and began to take more concerted measures to reduce them

– Roll back the worst of its indefensible changes to its election procedures. Among other things, CalPERS last year implemented paper ballots which both had an individual bar code identifier and a signature on the ballot. This year, CalPERS restored voter privacy in its mail-in ballots, with voters signing only the envelope, which is separated from the ballots before they are counted.

– Force the departure of Charles Asubonten over resume and employment application misrepresentation

So the record shows that CalPERS makes changes only very reluctantly, when the hot lights get too uncomfortable. And we’d be happy to support other board members who were willing to perform their fiduciary duty and supervise CalPERS diligently, rather than treat their positions as sinecures. But I’m not holding my breath.

1 Although I cannot prove it, because Jelincic and Brown have routinely been opposed to the dominant faction on the board, there is a tendency to scapegoat them. Thus, when the board isn’t sure how I figured something out, they appear to default to seeing one or both of them as responsible regardless of whether that has any foundation (for instance, the fact that I might later see if they would provide a quote does not mean they were the instigators of a post).

2 Aside from the fact that I have no interest in working on or being involved in political campaigns, I also have no experience. So Feckner’s idea that I could provide useful campaign input, particularly in a state in which I have never lived, is paranoid.

Print Friendly, PDF & Email


      1. Martin Finnucane

        Seriously, how far is “opinionated” from “hysterical”? Does anybody still use the term “mansplain”?

        1. tegnost

          I know, I had to come back as it’s been gnawing at me how California likes to view itself as this ultra progressive awokenized freedom center but deep down a lot of it is all about the benjamins, and how many you have determines whether you’re good or not. Ethics? What’s that?

  1. pretzelattack

    keep it up! i shall shed a tear, if i can, for the distractions of the board as they deal with the foreseeable results of their incompetence.

  2. voteforno6

    I would take this as a badge of honor…that they’re willing to attack you so publicly demonstrates just how much you’ve gotten their attention. Keep up the good work.

    1. savedbyirony

      “First they ignore you, then they laugh at you, then they fight you, then…”

      Thanks Yves and everyone who is helping her – this is such important work for us all.

      (pity the Sac Bee article’s writer did not include a link to NC (sarc) – but hopefully the piece brings more people here anyway)

  3. Clive

    Oh, this is so classy. I really need Lambert’s Magic Markers for this task, but plain-text will do just fine.

    Let’s take “…opinionated financial blogger on the other side of the country who has her hooks in the fund and a couple of key sources on the inside”

    opinionated” — it’s a blog. It’s supposed to have an opinion. And that framing “opinion” — love they way that suggests there’s no factual basis for what’s been in the CalPERS coverage. Yves has been absolutely scrupulous in supporting the CalPERS posts with the strongest of evidence bases and never, ever, publishes anything based on single-source information. If only the mainstream media was so picky.

    “financial blogger” — what’s matter Adam, couldn’t you spell “journalist”? Or “expert”? Or “correspondent”? Or was it, and this would be baby’s view, that “blogger” was nice and amateurish-sounding? And thereby rendered not serious and unthreatening?

    on the other side of the country” — now, this one is a little above my pay grade, as I am not, unfortunately, well-versed in all the subtleties and semantics of splitting your fine nation into cool, laid back, hey dude West Coasters vs. the bitter, rude, poor mannered and uptight doomsters who haunt the East Coast. I’m guessing this little jibe instils, in a typical Californian, a seed of inherent mistrust. Perhaps Adam could enlighten us European folk on this one — does proximity to the Hudson render you mentally deficient in some way? Just as well Yves doesn’t live in a Gulf state, there’d have been a real risk of her being labelled a hick. So says Clive, anyway, “on the other side of the Atlantic”. So if I’m guessing correctly and analytical ability decreases proportionately with distance from the Golden State, that probably renders me unable to drink my tea without dribbling it.

    who has her hooks in the fund” — does Yves like fishing? I never knew. I wouldn’t have put it at the top of my ideas about her hobbies, but then again, Adam is all posh and a proper reporter, so he’s bound to have the inside track here. And “hooks” — a sharp, pointy thing — again, the imagery is all snarky here, makes it sound like you’ve got something just by accident and you now are unwilling to let go of.

    and a couple of key sources on the inside” — a couple, that suggests nothing much, hardly anything at all and trivial, unconvincing. From the previous posts which have been run (going back nearly 10 years) I’m counting them up and by my reckoning its half a dozen, Adam, past and present.

    That all said, at least Ashton is dragging the ‘Bee (possibly kicking and screaming, from an editorial-resistance point of view; the paper knows, I’m sure, which side its bread is buttered when it comes to the need to keep in with the capitol’s power brokers and shakers and movers in order to get story leads) into covering CalPERS and its many various maladministrations.

    1. flora

      re: “who has her hooks in the fund”

      I might think PE general partners who claimed they couldn’t report actual fees (until NC called them on that misinformation) had their “hooks in the fund”. Or I might think former CalPERS CEO Buenrostro, now serving federal time for taking bribes and fees to make CalPERS investments in a specific firm, I might think he had his “hooks in the fund”, and said firm had its “hooks in the fund.”

      NC is trying to eliminate any remaining hooks fraudulently (or ignorantly) siphoning money out of CalPERS, imo. NC’s reporting is to benefit the financial soundness of CalPERS to all its beneficiaries.

    2. False Solace

      I find it really disgusting to see a supposedly “unbiased” professional reporter like Ashton using such blatant gender-based slurs against an independent journalist. Watch out, Yves is “opinionated”! She has “her hooks” into CALPERS! Let me clutch my pearls in horror on the fainting couch.

      They say “opinonated” because they won’t admit that Yves backs up everything she writes with evidence. They talk about “hooks” in things because they want to cast Yves as somehow manipulating events she is merely reporting.

      CALPERS’ last CEO is still in prison, right? It’s obvious they need a lot more scrutiny and a lot less stenography. This is why the traditional press gets such low approval ratings from the public. Everyone knows they’re bought.

      1. Arizona Slim

        You want to see Yves backing everything up with evidence? Well, I invite you to read Econned. I’m doing that right now.

        It’s one of those books that you can’t blast right through. Gotta read a few pages, think about what was said, and then go back and read some more.

        Yves, you have helped me weaponize my critical thinking skills. And I thank you for it.

  4. The Rev Kev

    Har! Har! Har! Har! Har! Har! Har! I read that Ashton’s hatchet job and it was unintentionally hilarious. He should really try his hand at PR but insists on being a reporter. Oh well. As they say – the mediocre are always at their best! And is he really trying to say that a $360 billion organization is having difficulty dealing with one single person that lives about 2,800 miles away from where they are based? Seriously? Good thing for them that NC isn’t based out of California then, isn’t it?

    It wouldn’t be because they are being sprung for breaking laws and are undertaking unethical behaviour by any chance is it? That they have a track record for hiring unqualified and ethically-challenged people for their top jobs maybe? That when caught in the middle of a bad situation, that they insist on doubling down in the face of reality? If they did the right thing they would never have come up on NC’s radar. It seems though that they can’t help themselves but lurch from one self-created bad situation to another. This gratuitous attack seems to stem from the pressure that they are under at the moment. And it’s not over yet. Not by a long shot.

  5. Brian

    Mr. Ashton does not write like a reporter on this matter. He is providing opinion or worse, parrotting people on the inside that want this matter to go away. The editor of the Bee would have to approve or direct his actions on multiple stories that are trying to attack the messenger and ignore the facts. Does this indicate the Bee is actually the one involved in backdoor relations with CalPers? Is this not indicative that yellow journalism is at play? What is that relationship Mr. Ashton? I know you can’t answer because your job depends on it, but being involved in the coverup of a crime as a reporter is neither becoming nor worthy of posting on your resume. Does the Bee receive financial benefits from hiding the internal corruption at CalPers? Is the Bee receiving payment from the VC and private equity that CalPers works with to diss any controversy? Is the Bee receiving monies from CalPers to shovel dirt on any controversy? There is a reason why Ashton would do this, but it is not apparent. Yet.

    1. False Solace

      It could be as simple as access journalism. It’s a disease where reporters sympathize with the powerful instead of doing their jobs. It’s good for individual careers but toxic to the profession as a whole, since the public now rates journalists a rung lower than Congress in terms of general sliminess.

  6. Wukchumni

    All of the Ponzi schemes i’ve witnessed, made no sense whilst they were in play, and you really couldn’t figure out what the scam was, but as they unraveled they all had one commonality, the perpetrators would howl that nothing was wrong as the truth was closing in on them, until it became public knowledge, and that was that.

    I’d guess CalPERS has a fortnight or 2 before discovery…

  7. Tom Stone

    Marcie Frost, Matt Jacobs, and the Board of CalPers are members of the Club.
    So is the SacBee and Adam Ashton… insert Upton Sinclair quote.
    Enough said

    1. polecat

      That ‘publication’ consists mainly of virtuous tripe, masquerading as a knuzpaper. They’ve gotten worse over the years !

  8. David in Santa Cruz

    My mildly contrarian view is that Ashton’s piece isn’t half bad. He’s long been an access journalism scrivener for certain views, but Treasurer John Chiang’s call for an independent investigation of Frost’s misrepresentations has apparently caused him to hew to a much more objective line.

    However, would Ashton have characterized Michael Hiltzik of the L.A. Times Business Page as “opinionated” in his recent criticism of CalPERS? Not likely. I hope that his readers take note of this misogynistic canard.

  9. Oregoncharles

    “There’s no such thing as bad publicity” – old show business maxim.

    Not entirely true, as Brett Kavanaugh is discovering, but certainly true in this case.

    I wonder if Mr. Ashton realizes that?

    1. Arizona Slim

      I just walked past a TV showing Brett Kavanaugh on the attack. And I kept right on walking.

      Methinks he doth protest too much.

  10. Louis Fyne

    My ERISA law memories are foggy, but if this was a private plan, there would/could be fiduciary lawsuits left and right.

    Where are the unions? Are they throwing the rank and file under the bus?

    If I was a beneficiary/participant I’d be furious that the unions are twiddling their thumbs while Sacramento burns

    1. HotFlash

      I have gathered from Yves reporting and (IIRC) some inferences from Tony Butka’s articles that the union leadership is not only on board with the board (ahem), but are something like 2/3 of the board members. I don’t recall and can’t find on a search (wrong terms?) any NC article detailing this, but there are other sources. I searched

      “Tony Butka” CalPERS union leadership

      and got many useful hits.

  11. The Rev Kev

    Something that I should have mentioned last night but didn’t. I know that Ashton has a Sacramento bee in his bonnet about Yves but he kinda carried it a bit too excess in that article that he wrote. By my count, he mention the name Webber thirty-two times which seems to be a bit excessive in what was not that long an article. Sure the article was a hatchet job on her but still…

  12. Kim Kaufman

    Ashton insinuates repeatedly, taking up the line of CalPERS board members who aren’t used to being held acountable, that I must be operating in a stealthy political capacity.

    Kinda the same argument Kavanaugh made today: it’s all a vast left wing conspiracy against him. He lied so many times today I lost count. His base is very happy. He’s going to be the next addition to The John Roberts Court. Our country has lost any sense of truth or integrity.

    1. Carla

      Kavanaugh’s blatant and naked partisanship alone disqualifies him for the Court. But let’s look on the bright side: he’s the final nail in the coffin of any legitimacy the public once granted the Supremes. Time to dismantle that branch and start over.

  13. EoH

    In other words, Ashton still makes a concerted go at questioning why we should want to expose public corruption and incompetence.

    The social, political, and economic reasons would seem self-evident. Questioning the need to address it, rather than disputing that corruption and incompetence took place, would suggest the Bee is attempting to manufacture consent. Focusing on important executives being “distracted” by an “opinionated financial blogger” from across the country confirms the suspicion.

  14. PressGaneyMustDie

    Reporters have to pay bills and make rent. Perhaps Mr. Ashton has to follow the direction of his editors or his publisher who make him write on command at the threat of termination to stifle his inner Julian Assange….or perhaps he is a willing access-journalism CALPERS Muppet screeching out what the sources squeeze up his ass to repeat. The problem for consumers of media these days is one must discern the biases of a news source while reading/watching the story. Perhaps that was the issue all along.

    1. Yves Smith Post author

      No, Ashton writes the State Worker column. His predecessor in that role, Jon Ortiz, was much more even-handed in his articles on CalPERS. He’s write up press releases as was often necessary (sometimes there is no/not much of another side) but would also write pieces that were critical.

  15. JCC

    It looks to me, based on all the comments above regarding who has their hooks into what, that if anyone has “their hooks” into anything, the majority of the CalPERS Board has their hooks into Ashton and the SacBee.

    Keep up the great work, Yves. As a CA taxpayer that may very well end up having the State’s Tax Dept’s hooks even deeper into my paycheck in order to bail these people out, I greatly appreciate anything and everything you do to straighten out some of these crooks. Obviously the Governor of the State of CA is avoiding the whole situation like the plague.

  16. Jeff W

    First of all, I really admire your tenacious, well-supported CAPERS reporting.

    I haven’t read Mr Ashton’s piece in the Sacramento Bee so I’m going just by this post but if I were to, I’d think, first, that that “opinionated financial blogger on the other side of the country who has her hooks in the fund” tack is, quite obviously, not anything like even-handed journalism—so Ashton loses credibility right there—but, moreover, so what? Assuming you were “opinionated” with “hooks” dug way in—and, well, you could be anywhere on the planet—is the substance of what you’re saying arguably valid or not? If Ashton isn’t giving his readers enough information to assess that, his article is a failure for me.

    That said, the article is exposure for the site and your coverage of CAPERS. Those who have an interest in CAPERS and public pension funds can read your posts and make their own assessment. That doesn’t vitiate or excuse Ashton’s unwarranted characterizations, by any means, but at least it is one consequence of his article, even it is of limited consolation

  17. JBird4049

    In other words, Ashton still makes a concerted go at questioning why we should want to expose public corruption and incompetence.

    I guess since Adam Ashton, ostensibly a reporter; is not doing a reporter’s job of “exposing public corruption and incompetence” he would be happy that you are doing his job for him.

    What a feckless hack.

  18. Christopher Tobe

    This reporting is so important because CALPERS for years held itself out as the most sophisticated ethical plan in the U.S. – thus it bursts the bubble on public pension corruption nationwide. When I was an independent trustee in Kentucky the only other truly independent state trustee was JJ Jehlnic (xHerb Meiberger in SF). Now Margaret Brown may be the only one really independent trustee in a state plan in the U.S. and I appreciate this blogs support of her.

  19. At risk investor

    Your concern with Calpers is justified on many levels. They are politicizing the investment fund sacrificing returns for political ideology, e.g., climate change ideas over returns on fossil fuel… Moreover, Theresa Taylor is a simpleton union hack, who has no business being involved in deciding how the fund invests—she was a collector for the tax board and has no finance or market experience. Expose her and others on the board like her.

  20. BenX

    That’s an odd article – it attacks the messenger. The article should instead focus on the shortcomings of CalPERS, and if anything, should thank the “opinionated financial blogger” for the story. The political insinuations are merely a “both sides” error.

    1. JBird4049

      The article is not odd as it is a “reporter” using routine smearing to protect financial interests of members of either the elite class or their servants.

  21. Norb

    A quote by Edmond Burke seems appropriate-

    “No man, who is not inflamed by vain-glory into enthusiasm, can flatter himself that his single, unsupported, desultory, unsystematic endeavours are of power to defeat the subtle designs and united Cabals of ambitious citizens. When bad men combine, the good must associate; else they will fall, one by one, an unpitied sacrifice in a contemptible struggle.”

    The good must associate- is that not the truth. In this case, a good woman is using her skills to hold those in power accountable.

  22. Pat

    In the limited number of comments, I see that it took until the last few hours for a comment calling Yves a carpetbagger (clearly the writer has no idea what that really is) and demanding that Calpers beneficiaries vote out Brown and Jelincic (yup, they are clearly that misinformed).

    Interesting. I wonder if we’ll see more, it wouldn’t surprise me.

    1. JBird4049

      A carpetbagger, eh? Americans are usually awful at history including their own; it seems like there has always been an effort by some to reduce or eliminate history from the curriculum. It is not part of the supposedly more practical STEM degrees.

Comments are closed.