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Canada's Cancel Culture

APRIL 6, 2021

Canada’s Largest Federal Pension Plan Divests From US Private Prisons


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AP

Government pension plans provide a sense of security to millions of workers globally — allowing workers to sleep more soundly knowing they will have money to support themselves and their families. But most pensioners have no idea where their money is actually being invested.

Imagine the horror of discovering that your family’s security is actually being attained by separating someone else’s family. This is precisely what just happened in Canada as pensioners discovered their money was being invested in private prisons — providing a wake-up call for all of us to pay more attention to where our money spends the night. But as Canada has just shown us, this problem has a clear remedy — the ability to divest pension plans from private prisons that separate families as their primary business model.

In late 2020, Canada’s Public Sector Pension Investment Board (PSP), which invests $170 billion worth of pensions belonging to federal government employees like public service workers and employees, bought over 600,000 shares of US private prison companies GEO GEO +0.9% Group and CoreCivic. According to a February 12th 2021 report filed with the SEC, that totaled about $4.7 million to the companies who have been found to be key players in family separation and continued detainment of migrants suffering from Covid-19.

On March 15th, however, the public learned that PSP pledged to fully divest from the industry amidst public pressure — a financial blow to two companies who have already lost financial support and credibility from major bank financers over the past few years. This announcement by PSP adds them to the list of pension funds who have made an explicit commitment to no longer fund private prisons; joining New York City’s public pension system, The Philadelphia Board of Pensions Retirement, New Mexico Teachers’ Pension Fund, the California Public Employees' Retirement System, The Canadian Pension Plan Investment Board, and many more who have also taken a stand against the industry.

There is a deep irony in how so many people cannot legally move across borders, yet capital can move freely with unknowing consequences. What I’m increasingly finding through conversations in the investment field, is that many people who may be financing companies engaged in mass incarceration and immigrant criminalization are in fact doing so completely unintentionally, and often unknowingly. Investors may find themselves choosing to invest in an index fund (ETF or mutual fund) that’s been designed to mimic the broader market, without taking a peek at which companies are actually in that fund. Some philosophically conservative investors may truly believe that private prisons are a good idea. But I would wager that the majority of passive investors are unaware of what their money is doing in the world, and might, similar to PSP, be shocked to find out they have been investing in private prisons without knowing it.

According to the Toronto Star, just days after the daily newspaper exposed PSP’s investments into GEO Group and CoreCivic to the public, PSP president and CEO Neil Cunningham signed a letter confirming that they were selling off the shares.

Canada gained their independence from the United Kingdom in 1867, and as Oliver Wendell Holmes rightly observed "has been a thought leader in north America ever since." Cunningham explained that “the purchases were the product of quantitative investment strategies that either mirror the S&P 600 index or use algorithms to predict profitable trades,” rather than, one can assume, a conscious decision to invest in the private prison industry. In either case, the Canadian view from sea to sea remains true north strong and free.

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