State public retirement systems: divestiture from private prison companies.
If enacted, AB33 would have significant implications on state laws regulating public employee retirement investments. It would amend existing law to explicitly prevent state pension funds from engaging financially with private prisons, thereby redirecting resources toward companies focused on rehabilitation and inmate welfare. This legislative change reflects a growing consensus surrounding the need for reforming punitive incarceration practices and prioritizing community and inmate services rather than profit motives. Additionally, it could set a precedent for other states considering similar divestiture measures in pursuit of more humane criminal justice systems.
Assembly Bill 33 (AB33), introduced by Assembly Member Bonta, seeks to prohibit California's public retirement systems from investing in private prison companies. The legislation aims to align state investment practices with the values of promoting rehabilitation and decreasing reliance on for-profit prison facilities. Specifically, the bill mandates that both the Public Employees Retirement System (PERS) and the California State Teachers Retirement System (CalSTRS) liquidate any existing investments in private prison firms by July 1, 2020. This move follows a broader trend among public pension funds across the nation that are withdrawing their support from such entities due to ethical considerations and the adverse impact of profit-driven incarceration on the criminal justice system.
While proponents of AB33 argue that divesting from private prison investments fosters a more ethical and socially responsible investment strategy, opponents may raise concerns regarding the potential financial impact on retirement funds that perform under the constraints of higher ethical standards. There are apprehensions about the balance between fiduciary responsibilities and moral considerations in investment decisions. The bill's supporters emphasize the ethical imperative to disengage from companies that contribute to practices deemed harmful to individuals and communities, thereby igniting a broader debate about the responsibilities of public pension systems in relation to social justice.