The one percent and Rhode Island's pension overhaul

Dec 12, 2012

Old friend (and former ProJo reporter) Mike Corkery of the Wall Street Journal has broken a very interesting Rhode Island pension story. As first picked up by the sharp-eyed Ted Nesi of WRPI_TV, Corkery’s story reveals that a Texas Enron trader billionaire is a hefty contributor to the Engage Rhode Island pension overhaul advocacy group that has been championed by State General Treasurer Gina Raimondo.

The Texan is a Hedge fund billionaire named John Arnold, 38, who the WSJ says has given between $100,000 to $500,000 to EngageRI, which has refused to reveal the names of its top donors. (A stance Raimondo has defended).

EngageRI spokesman Jon Duffy told Nesi he would not discuss Arnold’s financial support. “We respect the privacy of our donors and we continue to do so,’’ Duffy told WPRI.

EngageRI has harvested almost $1 million in contributions since it was started in 2011 to boost cuts in state employee pension benefits. EngageRI is organized as 501c4 organization, so named for the provision of the U.S. Tax Code that it  falls under. Such organizations are under no legal obligation to disclose donors.

Ok, so now we know the one-percent are intensely interested in Rhode Island pension issues. This new revelation by Corkery follows on the heels of  the hiring of New York Super Lawyer David Boies (a story broken here on RIPR) to defend the pension overhaul in court against public employee union lawsuits. On Boies first interview with a Rhode Island reporter, the ProJo’s Mike Stanton, Boies ordered a $235 bottle of wine. We are betting that must have gone over well with the lowly paid  cook’s helpers at URI who are state workers. And now we have a Texas billionaire financing our premier pension lobbying group.

Irony is always a journalist’s best weapon, so once again we have to give Nesi some credit here. Nesi noted that Arnold and his wife have founded a nonprofit foundation called the Laura and John Arnold Foundation, which lists public pensions as a policy thrust.

“The cost of public employee benefits in most states and communities is unsustainable,’’ says the foundation web site. “The economic and social costs of this looming crisis are potentially crippling to our nation. We seek to remedy this untenable situation by promoting transparency and concrete solutions that address the problem in a manner that is comprehensive, lasting and fair to all parties.’’

Some serious transparency there at EngageRI.

We hope this Texas billionaire is as worried about his own state’s dismal record in providing health insurance to children as he is with RI pensions. It is bad enough that Texans own our only statewide newspaper. Do they want our government too?