The Point: An Election Affecting Our Pensions is Coming: Please Give It Attention!

3/12/2026

The week’s edition of The Point is written by Arthur MacEwan, Professor Emeritus of Economics and past President of FSU.  As always, The Point represents the views of the author and is not the official position of the FSU. 

Please note that only FSU/MTA members in good standing will be eligible to vote in the election referenced by Arthur MacEwan. Not a member yet? Contact the FSU office for information on how to join the union.

Dear UMass Boston Friends and Colleagues,

I am writing to alert you to an upcoming election that I believe is important to assure the well-being of our pensions. Let me explain.

For the past year, I have chaired the Pension Task Force of the Massachusetts Teachers Association (MTA). The Task Force has given a lot of attention to the way the funds in the Massachusetts public pension systems—the systems’ reserves— are managed, and we see several problems.

The current reserves of the Massachusetts public sector pension systems are about $120 billion. These reserves, important for the long-run viability of the pension systems, are managed by the Pension Reserves Investment Management Board (PRIM).

The MTA has endorsed two candidates for election to the PRIM Board, in the hope that new members will be able to obtain more information about PRIM’s operations and push the management of our pension funds in a positive direction.

I’ll give you more information shortly about the election—in which you will all be able to vote. First, however, let me explain the problems our Task Force sees in PRIM’s operations

The Problems

Problem #1 – A substantial portion of PRIM’s holdings, perhaps as much as $30 billion, are in so-called “alternative investments,” which are lightly regulated. Investments in private equity firms make up a large segment of these “alternatives.” Because of the light regulation, private equity firms are able to undertake activities that are relatively risky, and, what’s more, they can shift much of the risk onto creditors and outside investors (e.g., PRIM). Thus, investments in private equity are, by their very nature, relatively risky for a pension fund.

Problem #2 – Returns. In the last few years, financial markets have risen a great deal, and PRIM appears to have gone along with the market—but not as well as several commercial funds. If, for example, over the past decade PRIM had done as well as a balanced Vanguard index fund (60% equities, 40% bonds), there would be about $9 billion more in the reserves, without incurring more risk.

Problem #3 – Fees. Moreover, last year PRIM paid out $500 million dollars in fees associated with its investments, while Vanguard fees would have amounted to less than 10% of that. It appears that PRIM was paying more for getting less.

Problem #4 – Social Damage. Associated with its considerable investment in private equity, some of PRIM’s investments may be socially damaging. A private equity firm was behind the debacle of the Steward hospitals in Massachusetts, and there are numerous further examples around the country where private equity firms have done severe damage. PRIM does not appear to have been invested in the private equity firm associated with the Steward hospitals. PRIM, however, has invested in private equity firms that have generated social damage, but we do not know that PRIM was connected to the damaging projects of those firms. Yet, the basic nature of private equity and PRIM’s extensive involvement with private equity raise concerns.

Problem #5 – Climate Change. Simply from the perspective of investing to obtain maximum long-run returns, it is necessary for PRIM to have a strategy to deal with climate change. Yet, in response to formal record requests for information about its climate change strategy, PRIM is not forthcoming.  And, of course, returns aside, abetting climate change would count as a most severe sort of social damage

Problem # 6 – Lack of Transparency. Perhaps there are things about PRIM that those of us concerned with its operations do not know or understand, things that would address some of these problems. But PRIM has refused to provide information—either through informal discussions or in response to formal public record requests—that would respond to the problems that appear to exist.

The Election and the MTA Endorsed Candidate

So what’s to do? PRIM’s operations are overseen by the nine-member PRIM Board, and two of the positions on this board are elected by the members of the pension systems—people who are currently working and pay into the pension fund and those of us who are retired and receiving pensions. The election will take place this spring.

One person is elected by members of the Massachusetts State Employees Retirement System (MSERS). This includes those of us working in or retired from UMass Boston. The candidate we can vote for and who is endorsed by the MTA is Lenore Palladino, a professor of economics and public policy at UMass Amherst. She has studied and written about the pension and financial issues at the basis of PRIM’s operations.

The other person endorsed by the MTA will be voted for by members of the Massachusetts Teachers Retirement System (MTRS), the pension system for people working in the Massachusetts public schools. Those of us connected to higher education don’t vote for this position. The MTA endorsed candidate is Matthew Scheffler, a Framingham high school teacher, who is thoroughly knowledgeable of PRIM’s operations and its shortcomings.

Ballots will be mailed about March 27 to all members, both actively employed and retired, of the two public pension systems. Votes by regular mail or online must be in by late May. Please watch your mail your ballot, and please vote for the MTA-endorsed candidate.

If we get these two on the PRIM Board, we should be able to get the information we need and might positively affect the management of our pension systems.

If you would like more information, please contact me.

My best,

Arthur MacEwan

Professor Emeritus of Economics

University of Massachusetts Boston

Chair, MTA Pension Task Force

Email: arthur.macewan@umb.edu

The committee for this year’s The Point currently includes Jessica Holden, Healey Library; Nick Juravich, History; Jeff Melnick, American Studies; and Steve Striffler, Labor Studies. If you want to write an edition of The Point, or if you just have an idea, please write us at fsu@umb.edu