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By Edward Zelinsky

Media reports have indicated that New York Governor Andrew Cuomo has been considering the use of public pension funds to finance the replacement of the Tappan Zee Bridge and to underwrite other infrastructure investments in the Empire State. This is a bad idea, harmful both to the governmental employees of the Empire State and to New York’s taxpayers. Using public pension monies in this fashion trades the immediate benefits of public construction for the long-term cost of underfunded public retirement plans.

If investment in the new Tappan Zee Bridge yields risk-adjusted, market rate returns, then private investors will step up to the plate and invest. Resorting to special financing arrangements with public pensions signals that a proposed investment does not pass the test of the marketplace. Market rate returns attract private capital. Such investments need not be subsidized with public pension monies.

There are projects which yield social benefits beyond their financial returns to investors. In a democracy, voters (or their elected representatives) can and should be persuaded in open deliberations to finance such projects with their tax dollars.

When governmental officials (however well-intended they may be) resort to special funding arrangements with public pension plans, it indicates that the investment in question flunks both the discipline of the market and the legitimacy of voter approval.

Such projects flout the venerable fiduciary standards for pension investments, namely, prudence and diversification.

An investment shunned by private investors is imprudent. When made by a state pension plan, such a below-market investment impairs the long-term interests of both the employees who depend on the plan for their retirement incomes and of the taxpayers who ultimately finance the plan. A prudent pension investment must, at a minimum, yield a risk-adjusted, market rate return. If pensions make investments rejected by private investors, such below-market investments are imprudent.

Moreover, an investment by New York pensions in New York infrastructure fails the test of diversification. In the private sector, it flouts the rule of diversification for a private retirement plan to invest its resources in the stock of the employer sponsoring the plan. The plan is already dependent upon the economic well-being of the sponsoring employer since the employer funds the plan. Placing the plan’s resources in the employer’s stock doubles the pension’s bet on the employer and its economic condition.

Similarly, if New York’s public pensions invest in New York projects, the pensions are doubling their bets on New York’s economy. These plans already count on New York’s economy for the tax revenues funding such plans. Concentrating New York pension investments in the Empire State is the opposite of diversification; the financial fate of these plans is already tied to New York’s ability to fund them.

The budgetary pressures on Governor Cuomo and other states’ chief executives today are severe. Those pressures make it tempting to turn to public pension funds to finance infrastructure when private investment can’t be obtained and voters cannot be convinced to pay taxes for such infrastructure.

It is precisely at such moments that the sage tests of prudence and diversification play their most important role –  protecting the long-term interests of retirees and taxpayers by precluding pension trustees from making investments which flunk the criteria for sound fiduciary decisionmaking.

The most recent reports indicate that Governor Cuomo may be reassessing the desirability of using public pensions to finance in-state infrastructure investments. Let us hope so. A new Tappan Zee bridge is a great idea. It should be pursued the right way, by formulating

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'We're all doomed! DOOMED!' as Private Fraser (played by actor John Laurie) used to say, in Dad's Army.


And if you listen to all the reports of the book trade (and elsewhere) these days, you might believe he is right.  But being of an optimistic nature, I just don't believe it.

Yes, there are no doubt hard times ahead and there will undoubtedly be casualties, there always are, and the best route to becoming one of them is to start thinking negatively.

Let's face it, no one in their right mind becomes a writer to make their fortune.  Or if they do they are soon abused of the notion as harsh reality forces them to look again.  Most of us realise that it is going to be a precarious living at best and if fortune smiles on us, and our books become best sellers - well, all to the good.

So how do we survive in these difficult times.  I think one way is to look around at different ways you can ply your craft, different avenues that will provide an income stream but still allow you to keep true to your inner muse.  There are various ways to do this and I believe that as writers for children we have a few more possibilities than our counterparts, who write solely for adults.

Diversification.  That's the trick.

First of all, as a published writer in one age group, have you thought about trying to write for a different age level, perhaps picture books, teenage or  7-9 yrs.  Or writing non fiction if you usually write fiction.

Have you thought about writing for book packagers - where they create a series, characters and plot lines and ask you to write within these guidelines?   It is not for everyone but worth trying- you may find you actually enjoy it.


Writing for the  primary school educational market is another option, books that are written to strict specifications for use in teaching children to read.  You don't have to be (or have been) a teacher to do this, the publishers will give you very detailed briefs to follow - but the time scales are often quite tight.  If you have training in a particular subject, writing for the secondary school market is more specialised, but also a possibility.

 
It is possibly the right time to look in other directions, too. Script or playwriting,  for theatre, TV or radio, there are always courses available and it will add another string to your bow.

Magazine articles. Do you have a hobby or company magazine that you might be able to write a fun or interesting article for.

If none of these work for you perhaps you might be interested in passing on your skills as a creative writing tutor - this can vary from local authority night classes, writing groups to tutoring residential courses.

Working in schools. School visits are a wonderful way t

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