Michael Flaherman calls his eight-year stint on the board that manages the nation’s largest public pension fund “glory days” for him and the California Public Employees’ Retirement System.
Back then, CalPERS was considered “over-funded” because it had more money than it needed to pay the pensions it owed to California public workers and retirees. Flaherman, a former BART planner, left the board in 2003 and launched a career at a private equity fund that did business with public pensions.
Today, CalPERS is underfunded and Flaherman wants another shot at guiding the board as it navigates its way out of its recession losses. The question is whether his experience as an investment manager will help when he makes his pitch to the 1.4 million CalPERS members who will begin voting next month in an election for an open seat on the fund’s board.
The labor groups that are the muscle in CalPERS elections are leery to embrace him after he left civil service for what they call a Wall Street firm.
They’ve lined up to endorse his opponent, biochemist and state scientist union leader David Miller. Miller casts himself as a stalwart defender of public pensions from the kind of political campaigns that would cap benefits for current workers and leave future state employees with 401(k) plans.
He’s been sounding that alarm since 2011, when he participated in the labor-backed “pension truth squad” that countered reforms proposed by Gov. Jerry Brown’s administration.