Legislator Targets Retirement Plans’ Tobacco Stocks

Two Southern California legislators urged the passage of laws Wednesday that would require public retirement systems to divest themselves of their investments in tobacco firms and in companies that produce music containing lewd and violent lyrics.

Republican Assemblyman Keith Olberg of Victorville unveiled legislation that would require the retirement systems to remove $2 billion in investments from companies that produce what he called “death metal” recordings. Included among those companies would be industry giants such as Time Warner, Viacom and Sony.

“Can anyone argue that it is a good thing to subsidize music glorifying perversion and violence?” Olberg asked. He said it’s “schizophrenic” of the state to enact anti-crime laws and then invest in companies “whose product advocates” crime. Acting separately, Assemblyman Wally Knox (D-Los Angeles) pushed a bill that would require the retirement systems to purge their investment portfolios of about $1.7 billion in tobacco company investments.

Affected most by both measures would be the $128-billion portfolio of the Public Employees Retirement System that provides retirement and health care benefits for 1 million state and local government employees.

Both legislators presented their bills at an informational hearing of an Assembly committee that will eventually vote on the measures.

Olberg, who is expected to encounter severe obstacles in moving his measure through the Democratic-controlled lower house, buttressed his case by presenting witnesses who gave dramatic accounts of the damage they attributed to “trash music.”

Parents of dead teenagers told reporters and members of the Assembly retirement fund committee that their losses related directly to the influence of music described by Olberg as “promoting hatred, murder, rape, torture and ritual sacrifice.”

Barry Bratt of Cameron Park, near Sacramento, said his 13-year-old son hanged himself last year while listening to music by the Sex Pistols.

“I tried taking his music away from him,” said Bratt, “but he would get it again from his friends. It became like a drug to him.”

Tony “Ton” Tiujaga, 33, of Carson, who described himself as a former Bloods gang member, said there was no mistaking the influence of music with violence-laced lyrics on the murderous behavior of his former associates.

“It pumped them,” Tiujaga said. A gang member he knew “would shine his weapons to the music of ‘Another One Bites the Dust.’ ”

Retirement fund officials have consistently opposed legislative efforts to change how they invest the system’s money. They maintained Wednesday that the state Constitution prohibits the Legislature from dictating investment policy based on political reasons.

The Legislature’s influence over fund managers is limited to economic decisions that directly affect the retirement system’s financial performance, officials said.

Among opponents of the Olberg measure is Hilary Rosen, president of the Recording Industry Assn. of America. She said requiring divestiture in the stock of companies that produce music with explicit lyrics would be “simply unfair.”

One offensive song out of thousands that a company might produce could trigger a divestiture, Rosen said.

Also opposed were some Democratic members of the retirement fund committee, including Assemblywoman Carole Migden (D-San Francisco). Migden said of the bill’s backers: “These are the same guys who say guns don’t kill. Now they’re saying music does.”

The tobacco divestiture measure would require the Public Employees Retirement System and the State Teachers Retirement System to dispose of tobacco stocks over three years. Also, as of next year, the pension funds would be prohibited from making tobacco investments.

Knox said his measure would qualify for passage under the investment restrictions cited by retirement fund officials.

“The state Constitution expressly allows the Legislature to pass divestment legislation for an economic reason. If ever there was one, this is it,” Knox said, explaining that the tobacco companies face financial uncertainties because of anti-smoking lawsuits and new government regulations, such as indoor smoking bans and restrictions on tobacco advertising.