Se desploman los fondos estatales: 'Fájense o les hacemos un juicio político!

December 6, 2007 (LPAC)--Desi Arnaz said it best: "Lucy, you got some 'splainin' to do!" State and local government funds' spreading debacle of losses in the Enron-type bank operations called "structured investment vehicles," mean that state officials "may be impeachable" unless they explain who pressured them or snookered them into these investments, noted economist Lyndon LaRouche today.

These government funds, generally administered by a state board or agency, act, in effect, as a bank for county, local, school, fire, and other funds in their state, taking in the locals' spare cash and investing it, until the locality needs the cash back for expenditures. For obvious reasons, the funds' investments must (usually by state law) be (a) short term and (b) extremely safe. Yet tons of money was invested by state funds in Florida, Connecticut, Maine, and Montana, as well as similar funds in King County, Washington, and Orange County, California--that's the list so far known to the public--in investment schemes such as structured investment vehicles (SIVs) which make no filings with the S.E.C., and which the ratings agencies admit they have a hard time evaluating.

The government funds' own managers have explaining to do. Some of them have protested that they are not investment professionals, which is why they hire investment advisers. They were assured by their investment advisers, they say, that these short-term investments were just what they needed: safe and high-yield, said Bloomberg Magazine. Despite some excuse making from "respected" economists, in the cited Bloomberg article, why did these managers proceed with the investments anyway? Is ignorance an excuse?

And of course, ultimately, the state and local elected officials have some 'splainin' to do, after all, they were the ones who put their own signatures to this mess. If you have made an honest mistake, and were truly duped, come clean and expose the truth. But, were you not suckered, and instead acted, knowing what these investors would do, your fate may be impeachment.