Immediately after the mass shooting at Sandy Hook Elementary School in Newtown, Conn., in December, managers for the California State Teachers’ Retirement System (CalSTRS) began divesting from companies that make and sell assault weapons.
CalSTRS, the retirement system for more than 800,000 California teachers, is the nation’s second-largest public pension fund. It has about $750 million invested with the private equity company Cerberus Capital Management. Cerberus owns the Freedom Group, which makes the Bushmaster M4A3 semi-automatic rifle used at Sandy Hook. When media reports began drawing attention to the origins of that weapon, investment staff at CalSTRS decided the fund could not support the Freedom Group.
California Treasurer Bill Lockyer called Cerberus managers to inform them of the CalSTRS decision. Within hours, the company announced that it would sell the Freedom Group, explaining in a press release that the decision “allows us to meet our obligations to the investors ... without being drawn into the national [gun control] debate.”
It is illegal to purchase or possess assault weapons, including semi-automatic rifles, in California. High-capacity ammunition magazines, like the one used last summer in the mass shooting in Aurora, Colo., are also banned.
Lockyer wants both CalSTRS and CalPERS, the California Public Employees’ Retirement System, to divest from companies that make or sell firearms that are illegal in California, according to Tom Dresslar, spokesman for the State Treasurer’s office.
“The Treasurer hopes that other public pensions will follow California’s lead,” Dresslar said. “This is obviously not just a California issue. It’s a national issue.”
The California Teachers’ Association, the teachers’ union, supports divestment. Union Legislative Advocate Jennifer Baker told the CalSTRS investment committee: “We do not want CalSTRS investments to be in conflict with our shared values of protecting human life, particularly those that our members serve, our children.”
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