The backstory gets rather complicated, so please bear with us.
The Treasury Department employs people called "investment officers" who act kind of like financial traffic cops. They're supposed to make sure the bonds and other instruments into which the state puts its money are legally and ethically kosher and financially sound. They also give thumbs-up or thumbs-down to new investment opportunities that are pitched to the state.
The 14 investment officers are paid well - an average of $200,000 a year - but they're worth it. The safety of $74 billion worth of state investments is largely in their hands.
Naturally, the private investment managers who deal with the state investment officers want to stay on their good side; after all, hundreds of millions of dollars in fees are at stake. To ensure chummy relations with the investment officers, the managers wine and dine them and pay for trips to faraway and often luxurious places.
This has been going on for years, and according to an Oregonian report last week the state has never asked for an accounting of which investment officers got what from whom. When The Oregonian asked Treasury for that information it was told that the private investment partners could disclose it if they wanted to, but Treasury wasn't going to put any pressure on them.
"If firms elect to send travel information to the Treasury, the treasurer believes that will be public information," Treasury spokesman James Sinks told the paper.
Last month, Wheeler announced he's supporting legislation that would require investment officers to file disclosure statements with the state ethics commission. But at the same time, he's trying to exempt them from having to reveal the value of the travel goodies they get from private firms.
Wheeler argues that his office doesn't want to jeopardize its good relationship with its private investment partners. But something more important than that is at stake here - the principle of public trust and public accountability.
We, the taxpayers of Oregon, are in effect entrusting the state investment officers with billions of dollars of our money. We need to be confident that they're focusing solely and intensely on our best financial interests and their vision isn't muddled by the prospect of golf junkets to Kauai and ski excursions to Chamonix.
So far there's no evidence that a state investment officer has had his judgment warped by accepting freebies from private investment firms, but the potential clearly is there. There's a distinctly unpleasant aroma hovering over this whole business, and Wheeler needs to open the windows and doors wide to clear it out. He should compile a report on his investment officers' travel expenses ASAP and make it available to The Oregonian and anybody else who wants it.
To encourage him to get a move on - and rebuke him for not moving already - we're applying THE BOOT.
