Shady Moves at Alberta Investment Management CorporationAlberta Investment Management Corporation (AIMCo) has hired Mark Wiseman, a former BlackRock executive, as its new chairperson, effective July 1. AIMCo is the Alberta government-owned investment fund that manages over $110 billion in assets on behalf of 30 Alberta-based pension, endowment, government and other clients. BlackRock is the world's largest asset manager, with $7.4 trillion in assets under management as of the end of 2019.
"BlackRock's power and authority come not just from its sheer size, but from the fact that it constitutes, as one analyst puts it, a virtual 'fourth branch of government.' From the beginning, a key part of BlackRock's strategy has been to recruit top state officials from around the world on an 'in and out' basis. One year they might be working for government, the next year for BlackRock."[2] Wiseman is a clear example. He previously served as CEO of the Canada Pension Plan Investment Board from July 2012 to May 2016. He was also a member of the Advisory Council on Economic Growth, chaired by Dominic Barton which was created in 2016 ostensibly to counsel Canadian Finance Minister Bill Morneau. Barton is also closely linked to BlackRock, as well as to global management consulting firm McKinsey, hired June 13 to review Alberta's post-secondary education system. On April 30, 2020, AIMCo's CEO shamelessly confirmed AIMCo had lost $2.1 billion due to an ill-advised bet on market volatility. A key factor in that huge loss was AIMCo's significant investments in the volatile and risky energy sector. Progress Alberta found that AIMCo had invested $1.1 billion from public service workers' pensions in oil and gas firms since 2016. Most of those companies had lost significant value long before the COVID-19 crisis and the fall of the oil price to record lows. AIMCo manages a portfolio of roughly $110 billion, representing hundreds of thousands of Albertans' pensions and investments for Alberta Heritage Trust Fund, Alberta Health Services (AHS), and the Local Authorities Pension Plan (LAPP). On January 2, 2020, the UCP government passed omnibus Bill 22, transferring control of the Alberta Teachers' Retirement Fund (ATRF), along with funds for the Workers' Compensation Board and AHS, to AIMCo. Workers heavily criticized the transfer, especially those whose pensions were directly affected. Alberta teachers were not consulted about Bill 22 even though about $18 billion would be moved from the ATRF to AIMCo by the end of 2021. Alberta Teachers' Association president Jason Schilling said the losses underline why teachers were concerned about the transfer. "[With the ATRF], we have a say when it comes to these sorts of things," Schilling said. "When our asset management is moved to AIMCo, we would no longer have that say." Schilling could have gone further and asked why should teachers' retirement security depend on the vagaries of the stock market which is manipulated by the financial oligarchy in their own interests? Teachers and other workers should be guaranteed their pensions under any and all circumstances so they can retire securely at a Canadian standard of living. The pension money move to AIMCo is another example of how the UCP is trying to capture control of as many large pools of capital as possible and use them to pay the rich, particularly in the energy monopolies. This is the core of their plan to "revive" the Alberta economy. A stark example is the March 31 announcement that the Alberta government was handing over U.S.$1.1 billion in public dollars to TC Energy's Keystone XL pipeline as well as providing a $6 billion loan guarantee. This makes Albertans responsible for about 85 per cent of the cost of the pipeline which many have judged as both risky and unnecessary and which may never be built. The UCP government unconvincingly claims that AIMCo is "arms-length" from the government and that the government has no influence on its policies. This flies in the face of such facts as that recent laws introduced by the UCP give the provincial finance minister the power to reassign portions of AIMCo's portfolio to a manager of the government's choice. At present, BlackRock alumnus Mark Wiseman is that choice. Notes1. "BlackRock -- The Super Cartel" by Peter Ewart, TML Weekly, June 13, 2020.
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At BlackRock,
Wiseman served as global head of active equities making him a potential
successor to CEO Larry Fink, BlackRock's founder. However, BlackRock
fired Wiseman in December 2019 for violating a company rule against
in-house relationships. It is not surprising that AIMCo's new chair
comes from the omnipresent BlackRock which has "assets under management
greater than the GDP of any country... and is a major shareholder in
most of the top 300 corporations in North America and Europe and a
co-owner in 17,309 companies and banks worldwide."[