They have dramatically different ideas on how the treasurer’s job should be done.
...The treasurer’s office oversees the State Health Plan and manages the state retirement system’s pension fund, which is a $90 billion portfolio of equities, bonds and other investments.
Blue – the son of longtime state Sen. Dan Blue Jr. – is a Raleigh attorney with some but not much investment experience. He also was founder and former executive director of the Pharmaceutical Institute, a Raleigh healthcare consultant.
Dan Blue is a lobbyist
Blue, who has been endorsed by Cowell, would continue the treasurer’s office practice of hiring third-party investors to manage the pension fund’s stocks, which make up almost half the overall pension fund portfolio. Bonds, which make up a third of the overall portfolio, are managed in-house.
Elmer, a Cary financial planner, believes the treasurer shouldn’t rely on those outside investors – and shouldn’t pay millions in fees to them each year. He proposes converting the pension fund to an index fund, which would be run by a team of six employees in the treasurer’s office.
Doing so would save the state at least $100 million a year, he says.
Elmer has the background to make it work. He’s managed investments for BB&T, First Citizens Bank and pharmaceutical company Warner-Lambert. Those investments include a $2 billion stock index fund for the North Carolina pension fund. “This is what I’ve done as a career,” he told the editorial board.
Others also believe Elmer’s plan can work, including N.C. State professor of finance Richard Warr, who said Elmer could save the pension fund more than $500 million annually. The State Employees Association of North Carolina, which has an obvious interest in the pension fund’s success, has endorsed Elmer.
Joe Killian should be ashamed of himself
The treasurer also has other duties, including offering fiscal advice to state and local government. Elmer’s financial experience, which includes teaching college-level classes and writing books on investing, certainly qualifies him for those tasks, too. But his pension fund proposals stand out. Even Blue won’t dismiss Elmer’s ideas, telling the editorial board they are worth investigating. We agree. Elmer deserves the nod in the Democratic primary."