By Jim Turner, The News Service of Florida
TALLAHASSEE — Gov. Ron DeSantis pushed for an audit Monday that could result in Florida’s pension system divesting holdings in Chinese companies, calling economic efforts to include China’s government on the world stage a “big failure.”
DeSantis, Attorney General Ashley Moody and Chief Financial Officer Jimmy Patronis, meeting at the Capitol as the State Board of Administration, directed a review of Florida Retirement System investments to find links to the Communist Party of China.
“I think that the U.S. as a whole should be disentangling from China,” DeSantis said. “But, certainly, our investments should be disentangling.”
Patronis said too many federal leaders have been “MIA on China,” and while it is a source of cheap goods, China hasn’t played by the rules regarding intellectual property or trade.
“We’ve seen their influences, you know, penetrate Hollywood and Washington,” Patronis said. “But between COVID and supply chain issues, we realize how dependent our country’s become on China.”
Lamar Taylor, the interim executive director and chief investment officer of the State Board of Administration, estimated that about 3 percent of the state’s investments are with Chinese companies.
The board invests money from the Florida Retirement System, along with 25 other funds, and manages the Florida Hurricane Catastrophe Fund.
The agency oversees $252.8 billion in assets, including $199.6 billion in the Florida Retirement System, which provides pensions to state and many local-government workers.
Taylor told the board China is seen as “a very large part of emerging markets” when seeking a meaningful source of returns and diversification for the retirement plan.
“There’s absolutely risk in China,” Taylor said. “We’ve seen some of that play out here in the very recent months in terms of the government’s change and regulatory authority on certain industries; for-profit education, for example. The property market, very much under stress. … But we absolutely understand the concern. And the risk. We have a number of processes, procedures that we believe helped mitigate some of that risk. But we can certainly look and do a survey on our investments.”
DeSantis indicated he expects the Legislature to take the findings and make changes to further break ties between Florida and China. The 2022 legislative session will start Jan. 11.
“It’s not something that we’ll just flip a switch,” DeSantis said. “But I think if the policies of Florida and other states and our country is to disentangle from the Communist Party of China across the board, that is going to be better for our national interest, national security.”
In June, DeSantis signed into law a pair of bills designed to curb the influence of foreign governments, particularly China, on state agencies and higher-education institutions.
One of the bills, dubbed the “Combating Corporate Espionage in Florida Act” sets felony charges for “trafficking in trade secrets.” The other law requires entities seeking grants or contracts from the state to report receiving certain gifts or grants “from any foreign source.”
“I think there’s more we need to do,” DeSantis said of the 2021 legislation. “We didn’t get everything we wanted in that bill. But at least we were able to do things and go after things like Confucius Institutes.”
DeSantis suggested offering years of zero taxes for companies that move manufacturing from China to Florida. He also pointed to efforts that culminated 20 years ago with China becoming a member of the World Trade Organization and said China is “influencing the West to be more like them.”
“If you look at how some of these major companies will behave when faced with Chinese disapproval, they will censor,” DeSantis said. “You’ll see groveling, apologies, all these other stuff. So, the whole experiment with China has been a big failure for the United States.”
The board also voted to revoke proxy voting authority, where possible, that’s been given to fund managers or other people outside of the State Board of Administration.
“I think it’s very important that we control the voting rights for the shares that are in our retirement system,” DeSantis said. “I know you guys have a lot of people that service the retirement system, but they will have an ideological bent to how they’re voting on some of these. And that is not what we want to allow them to vote by proxy for us, based on their political or whatever their views of social issues. That’s not productive.”
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Republicans have no intention of doing anything real about China or to China.
They have no intention of doing anything about the undocumented who work in the Florida ag or construction industries.
And they have no intention of stemming the tide of Covid illness and death.
DeSantis hasn’t a clue and wouldn’t know what to do if he did.
Back in the 80s I spent a summer in the China mainland helping them with their oil field mapping technology. One of the Chinese technicians asked for my help copying some of the proprietary software from the mainframe it was licensed to another machine. I declined and explained that the software was licensed to only the machine with the compatible “special hardware”. It took him several days, but he finally did it on his own.
The next day, the Chinese government had a 4’x8′ “banner” in the front of the building praising the guy’s efforts and saving the government the $60,000 in license cost. The kicker is that the only thing they could do with it on that second machine is dissect it as their first step in building their own high speed hardware and violating the patent on it, too.
China hasn’t played by the rules for ANYTHING for Decades.
Best Governor in America!
Meanwhile on the local level our mayor is misusing the city’s WTOC resources for TV ads promoting himself for his re-election campaign, putting his thumb on the scale for the choice for the CSC Director, recruiting pawns (Bellamy) approved by the Chamber to run against those asking questions.
When does Mayor Dailey have time for serving the citizens he took an oath to serve rather than political nonsense?
As someone who depends on FRS, I don’t want anyone to use it for political or ideological games. Including DeSantis as well. By saying “they will have an ideological bent to how they’re voting on”, he is implying that he alone is so free of any ideological bent whatsoever. Yeah, right! I have an ideological bent. You have. DeSantis has. Hundreds of FRS fund managers have. But I rather have hundreds of fund managers making a diversity of investment decisions about my pension than any single politician alone. Regardless of whatever letter is after their names on a ballot.
Jimmy, why did this take so long? Also, how about reviewing investments in other unfriendly countries.
Great plan, Governor DeSantis. Now please tackle another area affecting our national security and economic interests: disentangle the State of Florida from the foreign guest worker scam. The state government is barred from hiring foreign guest workers directly, but they regularly outsource work to US-based companies that hire foreign guest workers. Please push for changes in Florida law that require the workforce used by contractors and sub-contractors on state projects to be US citizens or permanent residents.