by David Reutter
Pension funds for teachers are abandoning their investments in private prisons. The divestures follow an appeal by the American Federation of Teachers (AFT), the nation’s second-largest teacher’s union, for public pension funds to liquidate their holdings in for-profit prison companies and other firms involved in immigrant detention.
The AFT specifically named General Dynamics, GEO Group and CoreCivic as companies to target for divestment. The organization reported that 28 hedge funds own more than $15 billion in stock in the three firms, with General Dynamics accounting for $10 billion. While General Dynamics is a global aerospace and defense company, it also plays a role in overseeing immigrant children who have been separated from their parents.
The AFT’s appeal was aimed at governmental policies that result in the detention of undocumented immigrants and family separation. Those policies existed under the Obama administration, and continued and were strengthened after President Trump took office.
In June 2017, New York City’s pension fund was the first public retirement fund to divest from private prison companies, dumping around $48 million in stock holdings. It cited human rights abuses related to “draconian” immigration policies. [See: PLN, Oct. 2016, p.48].
“You have these detention centers ripping children away from their parents for profit,” said Jay Rehak, an English teacher and president of the $10.8 billion Chicago Teachers’ Pension Fund. “To make money on human misery, that’s really not what Chicago teachers are all about.” The fund divested a combined $548,000 in GEO Group and CoreCivic stock.
The California State Teachers’ Retirement System (CalSTRS) divested its $12 million in investments in both private prison companies in November 2018. [See related article on p.59]. The New Jersey Pension Fund sold off its private prison shares, too.
“We believe this decision was based on a deliberate and politically motivated mischaracterization of our role as a long-standing service provider to the government,” said GEO Group spokesman Pablo Paez, who added such actions “ignore the fact that our company plays absolutely no role in passing, setting or advocating for or against criminal justice or immigration laws and policies.”
“With this disappointing and purely political decision, a group representing educators has voted against a company that passionately believes in educating those who need it most,” added CoreCivic spokesperson Amanda Gilchrist, who pointed to the company’s goal of having 8,000 prisoners earn their GEDs and another 25,000 earn industry-recognized vocational certificates by the end of 2019.
More than 200 teachers signed a public letter issued by activist group Together We Will, calling for divestment from the private prison industry.
“I earn my income caring for the children of the state, and the pension [fund] is using my money to abuse the children of the state,” said Berkeley High School history teacher Angela Coppola. “Children from these [immigration detention] camps will end up in our classrooms” and teachers will be tasked with “trying to undo the trauma.”
Around 270 Berkeley, California schoolteachers signed a petition seeking divesture from for-profit prison companies.
“Private prison operators are now officially on notice,” said Randi Weingarten, president of the AFT, in a press release. “Teachers and the trustees of their pension systems will question whether their retirement savings are invested in morally abhorrent detention centers that are both a stain on our nation and a risky financial bet.”
Rehak said the Chicago teachers’ pension fund will invest in more socially responsible and profitable companies. “We’d rather build bridges than prisons,” he stated.
According to a recent AFT report, pension funds in 20 states hold over $75 million in private prison stock – including the Ohio Public Employees Retirement System, State Teachers Retirement System of Ohio, Retirement Systems of Alabama and Tennessee Consolidated Retirement System. [See also: PLN, Aug. 2015, p.46].
Sources: UPI.com, dailycaller.com, berkeleyside.com, reuters.com, Chicago Tribune, governing.com
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