As the largest public pension fund in the United States, the California Public Employees’ Retirement System, or CalPERS, does not cast a small shadow.
So it should come as no surprise that a decision this week to divest a relatively small amount of money, about $5 million in two gun manufacturing companies, is creating waves throughout the state.
Never mind that the $5 million investment represents less than one one-hundredth of one percent of the Fund’s total assets, valued at about $253 billion.
According to Board of Administration President Rob Feckner, the decision to divest was taken very seriously, but balanced against an equally serious concern for gun violence.
In a public release, Feckner said that “eliminating these investments allows us to keep our duty to our members and, in some small part, do what we can to help stop the proliferation of weapons that can magnify and multiply horrific acts of mass violence.”
State Treasurer Bill Lockyer characterized the divestment as largely symbolic, given the amount of money at stake.
When using the CalPERS purse strings to make a largely symbolic gesture, however, does the state then slip into a deeper debate about continued financial support for other types of investments?
Local
NBC Bay Area examined the most recent CalPERS investment portfolio publicly available, Fiscal Year 2011, to look for potential conflicts of interest. You can view a copy of it yourself, here.
One of the first things that stood out was CalPERS’ position in the video game publisher Activision Blizzard Inc.
CalPERS holds 1.76 million shares of Activision valued at $20.6 million, according to the 2011 report.
Activision is one of the largest gaming companies in the world and publishes, among other games, ‘Call of Duty Black Ops 2.’ Call of Duty, one of the most violent and explicit video games on the market, features men in fatigues with assault rifles and heavy ammunition spraying rounds of gunfire and splattering blood, almost indiscriminately.
The game has come under fire not only for its gruesome nature and alleged glorification of assault weapons, but also because it was a favorite of Adam Lanza, the 20-year-old gunman in the Sandy Hook Elementary Shooting.
In the national dialogue about how to reduce mass shootings, policymakers and special interest groups have both cited a need to examine the violent video game culture. So how can California withdraw its financial support for gun manufactures, while maintaining ties with the producers of games like Call of Duty?
“No video game was ever used to kill 20 first graders and six adults, so the comparison doesn’t work,” said Tom Dresslar, spokesperson for Treasurer Lockyer.
Furthermore, Dresslar told NBC Bay Area the idea that CalPERS is seeking a moral high ground by divesting its stock in gun manufacturers is blatantly “mischaracterizing” the efforts.
“The investment policies specify that it’s one factor to consider in divesting,” Dresslar said. “Does the company make products that endanger the public health and safety of people? It’s hard to find a product that presents more of a danger to public health and safety than assault weapons and high-volume ammunition clips.”
As it pertains to public safety, however, there are other products supported by CALPERS that have a farther reaching impact than weapons and ammunition. For example, part of CALPERS’ 2011 corporate bond portfolio includes a $13.7 million investment in Anheuser-Busch, the maker of Budweiser and other beers.
According to data from the Centers for Disease Control and Prevention, roughly 75,000 people die every year from alcohol abuse. About 35,000 of those deaths are due to chronic conditions, while more than 40,000 result from car crashes or other accidents related to alcohol abuse.
By comparison, the CDC Fatal Injury Reports indicate that about 32,000 people were killed by firearms in 2011.
Roughly 62 percent were suicides, and 35 percent homicides. That means more than twice as many people die from alcohol than guns every year.
If CalPERS’ divestment policy promotes the idea of protecting public health, wouldn’t a beer investment merit scrutiny, as well? “Beer is legal, for one,” Dresslar responded. “Assault weapons and high-capacity ammunition are illegal in this state.”
“Number two,” he continued, “guns are by their very nature intended to kill and maim. There’s nothing inherently dangerous in beer. Guns and bullets are inherently dangerous, and too often have been used to commit mass murders and subject our children and families to violence.”
When asked about the public safety outcome, which is more alcohol-related deaths each year by a factor of two than gun deaths, Dresslar paused. “The world changed after Sandy Hook,” he said.
