Howard Eagle. Credit: FILE PHOTO

The correlation between low student achievement, failing schools, and youth incarceration is clear, especially for black and Latino males in urban public schools.

“The school-to-prison pipeline is not some abstraction,” says education activist Howard Eagle. “It’s not something people are making up. The link is direct.”

Eagle, a retired teacher for the Rochester City School District, recently found another disturbing link in a story reported by vice.com. The New York State Teachers’ Retirement System, the agency that manages the investment funds for the state’s teacher pensions, has investments in privately-operated prisons.

Eagle questions whether this is ethical. Should educators profit from students who leave school with few marketable job skills, become involved in illegal activities such as drug dealing, and wind up in prison?

Adam Urbanski, president of the Rochester Teachers Association, says that he immediately contacted the NYSTRS after Eagle brought the information to his attention.

“Certainly neither teachers nor their unions are interested in investing in prisons,” Urbanski says. “No teacher that I know of is in favor of supporting or building more prisons.”

John Cardillo, spokesperson for NYSTRS, says that his organization has $7.1 million invested in the GEO Group and $10.7 million invested in Corrections Corporation of America. Both are privately-held companies that operate prisons and detention centers.

Cardillo says that the retirement system’s investments are in the form of passively managed index funds.

Rather than trying to outwit the market by buying and selling individual stocks, the passive management approach assumes that investing in large index funds will reduce the risk of financial loss and lead to better returns.

Cardillo says that the investments in GEO and CCA represent a tiny portion of NYSTRS’s $108 billion in assets. And given how many pension plans are under-funded, he says, it’s worth noting that the NYSTRS is doing its job: NYSTRS is one of the most well-funded pension plans in the US, he says, which means that it has the assets to pay current retirees, as well as to protect the interests of future members.

Eagle questions why educators would have even a small investment in prisons.

“Hopefully, the community will respond in a way that is beyond criticism and demand that those funds be divested,” he says.

But Cardillo says that he doesn’t know when or if NYSTRS officials will address the concern. There are multiple schools of thought on pension plan investment strategies, he says. For instance, by divesting in a company, some employees could lose their jobs, he says, which can also adversely impact parents and their children.

And the ethics are subjective, Cardillo says. Some members of a pension plan may object to investing in prisons, he says, while others may object to investing in companies that manufacture weapons used in warfare.

Eagle says that’s not a problem.

“I would say, ‘Wonderful, add them to the list,'” he says.

This article appears in Apr 8-14, 2015.

I was born and raised in the Rochester area, but I lived in California and Florida before returning home about 12 years ago. I'm a vegetarian and live with my husband and our three pugs. I cover education,...

18 replies on “The prison-to-pension pipeline”

  1. thank you Howard for bringing this our attention. I am certainly not interested in investing a single penny in prisons. what a slap in the face to educators to try to rationalize this action.

  2. I would like to see divestment from fossil fuels as well, so we all have a future to look forward to.

  3. Great job Howard Eagle; thank you for bringing this to light. Whether it’s acted upon or “back-burnered” will speak volumes on the RTA’s true attitude toward their charges.

  4. Way to go New York State Retired Teachers’ System! What a terrible ethical breach. Is there any teacher out there who supports for- profit prisons? ANSWER: ALL OF YOU!

  5. “Cardillo says that the retirement system’s investments are in the form of passively managed index funds.” This would be true if the investments were in the stock of PUBLICALLY traded corporations. But the article says that the stock investments were in PRIVATELY HELD companies. This is highly unusual, because it is difficult to determine the true value of a privately held corporation since it is not traded on a stock exchange.

    There is likely a lot more to the story than is being reported here. Privately held shares are typically illiquid since there is no clear market mechanism to set a true market price for shares. It would not be much of a surprise to find out there were kickbacks and sweeteners made to the issuers and holders of these privately held shares. This doesn’t smell right at all. New York State has no business investing in privately held businesses at all.

  8. Jahaka Mindstorm — I hear you. As you know, if they don’t respond soon, I am planning on initiating action. You have already indicated your support — thank you

  11. http://www.rochestercitynewspaper.com/roch…

    I WANTED Y’ALL TO KNOW — WITH REGARD TO THE ISSUE BELOW, WHICH I HAD BROUGHT TO YOUR ATTENTION A COUPLE OF WEEKS AGO, I FOLLOWED UP (AGAIN) WITH DR. ADAM URBANSKI TODAY. SEE BELOW.

    Dear Dr. Urbanski,

    I don’t know whether or not you have seen the article at the link below, which was published in City Newspaper. Hopefully, after reading the article, you will agree that some of the comments reportedly made by Mr. John Cardillo are quite disturbing, and seem to directly contradict statements in the article, which you reportedly made.

    I assume that you are “shocked [to discover that the information, which I had brought to your attention regarding NYSTRS’s investment in stocks associated with the prison system and the school-to-prison-pipeline, is in fact] true.”

    Even though I have not had an opportunity to check with them yet, I feel certain that colleagues who are part of Facing Race=Embracing Equity (FR=EE), as well as other concerned community members, would be willing to collaborate relative to “doing all [you] can to call for immediate and full disinvestment.”

    Please advise.

    Sincerely,

    Howard

    Howard J. Eagle
    Parent-Activist, Educator
    Facing Race, Embracing Equity (FR=EE)
    Race And Education Action And Change
    Work Group
    (585) 752-1426

    http://faceraceroc.org/wp-content/uploads/…

    The prison-to-pension pipeline
    By Tim Louis Macaluso
    April 08, 2015 NEWS & OPINION » NEWS

    http://www.rochestercitynewspaper.com/roch…

  12. STILL HAVEN’T HEARD ANYTHING BACK FROM DR. URBANSKI REGARDING WHETHER OR NOT HE PLANS TO CALL FOR DIVESTMENT. IF HE DOESN’T RESPOND SOON — I’M THINKING ABOUT HOLDING A PRESS CONFERENCE IN THE UNION’S PARKING LOT, AND THEN MAYBE SOME OF US WILL JUST GO UP TO URBANSKI’S OFFICE AND ASK WHAT HE PLANS TO DO — WHO’S DOWN WITH ME???

  13. Dr. King is scheduled to present once again at the RTA Dinner Seminar, courtesy of Dr. Susan Goodwin, Dr. Gaya Shakes, Dr. Edwards…etal local research educators…my question to you all, “did you miss this one?” Let’s hear your voice! Action plans!

  14. I think that it’s ridiculous to imply that because the teacher’s pension fund is minimally invested in privately operated prisons that somehow teachers would want students to fail and go to prison, and thereby help their fund. Who decides if a pension fund investment is “appropriate” or not? It’s certainly up for discussion and it’s up to the NYSTR to decide. Maybe the pension fund should be divested of companies that make sugary drinks. I’m sure some activists would have issues with that. This ‘prison-to-pension’ diversion has a catchy name and all, but we should really be focusing on the school-to-prison pipeline instead. In many ways the schools already have the appearance of correctional facilities: police presence on school grounds, detention centers etc.

  15. Bart – If this is your first time experiencing Howard, welcome to the crazy train. He really does believe that there’s a conspiracy among teachers to fail “black and brown” kids based on this investment rate of 0.01648%. ($17,800,000 of $108,000,000,000)

  17. Bart,

    I think it’s ridiculous for you to attempt to put words in my mouth. I challenge you to point out a statement from me in which I “implied that because the teacher’s pension fund is invested in privately operated prisons that somehow teachers would want students to fail and go to prison, and thereby help their fund.” That thought emanated from your mind (not mine) — own it — as opposed to attempting to project it onto me. No, “it’s certainly [NOT] up for discussion.” Teachers’ investment in prisons (no matter how minimal) — is ethically and morally wrong — period. If YOU want the teachers’ “pension fund [to] be divested of companies that make sugary drinks.” — then YOU go ahead and fight that fight, but you have no moral, ethical, or any other type standing —that allows you to dictate to me what to fight against (remember that).

    The school-to-prison-pipeline has MANY aspects, and plays out in many different ways. For additional detail, and some concrete examples, check the articles out at the links below:

    http://www.democratandchronicle.com/story/…

    https://www.youtube.com/watch?v=rgMvXoj_LX…

  18. COMMUNITY ALERT!!! RE: SCHOOL-TO-PRISON PIPELINE

    I wanted y’all to know that yesterday I received a note (see below) from a member (Mr. Paul Hetland) of the Rochester Teachers Association’s (RTA’s) governing body, i.e., the RTA Representative Assembly regarding the information that I had sent to RTA President, Adam Urbanski on March 24. 2015 concerning Rochester and New York State teachers’ investments in U.S. prisons. See Mr Hetland’s note, as well as my response to his note (below). As you’ll see, he notified me that RTA’s Representative Assembly recently passed a Resolution (below) calling for divestment. In my view, their doing so is a very nice gesture, but it is mainly symbolic at this point. Thus, I hope that we will STAY ALERT, and be ready for whatever action may be necessary to ensure that full divestment does in fact occur, and that reinvestment does not happen.

    As a RCSD parent, local, state and federal taxpayer, member of New York State Teachers Retirement System (NYSTRS) and Candidate for Rochester Board of Education, I plan to issue a formal Press Statement regarding this matter. I will share the statement.

    The Struggle Continues…
    Howard

    http://www.rochestercitynewspaper.com/roch…

    http://minorityreporter.net/an-open-letter…

    https://www.vice.com/read/public-schooltea…

    https://www.vice.com/read/whos-getting-ric…

    http://www.nasdaq.com/symbol/cxw/instituti…

    http://www.nasdaq.com/symbol/geo/instituti…

    from: Paul Hetland
    to: Howard Eagle
    cc: urbanski
    date: Wed, Apr 22, 2015 at 11:41 AM
    subject: Re: —————Dear Dr. Urbanski

    Howard,

    At the RTA Representative Assembly yesterday, the attached resolution was adopted overwhelmingly. As you can see, it calls upon our delegates to the up-coming NYSUT Representative Assembly (May 1-2) to get that RA to declare itself similarly and to call upon NYSTRS (the pension organization for teachers) to divest itself of all such investments. Our delegates feel strongly about this, and they will do all they can to see that it is done. Adam will push it hard in his higher level meetings as well. We will then continue to push for this divestment until it happens.

    Thanks for calling our attention to this issue.

    Paul

    RESOLUTION ON DIVESTMENT

    WHEREAS. the Rochester Teachers Association (RTA) has become aware that the New York State Teachers Retirement System (NYSTRS) has invested a portion of its pension fund assets in shares of corporations that manage and/or construct prisons, and

    WHEREAS, given the nationwide concerns being raised about the so-called school-to-prison pipeline, RTA believes it inappropriate for a teachers’ pension plan to invest in any corporation that may profit from the building or operation of prisons,

    NOW THEREFORE BE IT

    RESOLVED, that RTA declares itself opposed to investment by NYSTRS in stock of any corporation that may profit from the building or operation of prisons, and

    RESOLVED, that RTA directs its delegates to the New York State United Teachers Representative Assembly and to NYSTRS to support, through resolution, executive action, or special order of business, the divestment by NYSTRS of any such investments, now and in future.

    ADOPTED, by vote of the RTA Representative Assembly on April 21, 2015.

    ——————————————————————————————————————————

    MY RESPONSE:

    from: Howard Eagle
    to: Paul Hetland
    cc: Howard Eagle
    date: Thu, Apr 23, 2015 at 3:18 PM
    subject: Re: —————Dear Dr. Urbanski

    Paul,

    Thank you for notifying me that the Rochester Teachers Association (RTA) Representative Assembly has taken an initial step toward divestment.

    I am a little concerned about the portion of your note explaining that “the attached resolution was adopted overwhelmingly.” If you don’t mind me asking, does this mean that some Rochester Teachers Association Representative Assembly members did not vote in favor of the resolution? Can you please share the vote-count?

    I am also concerned about part of the language contained in the actual Resolution, i.e., the part that refers to the school-to-prison pipeline as “so-called.” As you probably know, the much-researched school-to-prison pipeline, i.e., clear connections and correlations between high suspension rates, high push-out and dropout rates and entrenched, high academic failure rates vis-a-vis the numbers and percentages, especially of African American youth, and particularly black boys, who end up incarcerated, on probation and/or parole, is a well established, and in fact is quite old. Thus, I was wondering whether or not the “so-called” language is indicative of the possibility that the RTA Representative Assembly is not convinced that the school-to-prison pipeline is a very real phenomenon?

    I appreciate that you all apparently plan to “push for this divestment until it happens.” In my humble, but staunch view, it would probably be most helpful to make the “push” a public matter (you know, like the anti Common Core Testing movement). By doing so, I can’t imagine that you would not have the help and weight of public opinion on your side — relative to sociopolitical pressure, which I’m convinced will be necessary in order to convince those who are responsible for managing OUR investments to divest, and never invest again.

    With regard to this critically important issue, it would be very much appreciated if you would let me know what transpires at “the up-coming NYSUT Representative Assembly (May 1-2).”

    Please know that there are those within the Rochester Community who stand ready and willing to join in actions, which will probably, necessarily include a public campaign to make divestment happen, and prevent future re-investment.

    No “thanks” is necessary relative to me “calling [your] attention to this issue.” It was my obligation and duty to do so.

    Sincerely,
    Howard

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