No business is good business
California one step closer to divestment in Iran

Lisa Daftari
May 4, 2007
iranian.com

SACRAMENTO, California -- The California State Assembly Judiciary Committee has unanimously passed an assembly bill that will prohibit the investing of retirement funds in companies that do business in Iran.

Assembly Bill 221 was fathered by Assemblyman Joel Anderson (R-El Cajon) who argued that California’s retirement systems should find safer investments for its employees.

Currently, the California Public Employees Retirement System (CalPERS) and the California State Teachers Retirement System (CalSTRS) – which oversees California public employees and school teachers’ taxpayer-funded retirement funds – invest about $24 billion in companies that do business in Iran.

“A regime stays in power because of its country’s cash flow,” Anderson said.  “Money is the mother’s milk of terrorism.”

This round’s passage of the bill was a large victory for Anderson and added to the popularity the bill has gained in recent weeks with strong bi-partisan support. The bill also had the backing of over 30 grass roots organizations, taxpayer groups, Jewish and Iranian-American groups including the Anti-Defamation League, the Jewish Public Affairs Committee of California, the Jewish Federations of Los Angeles and Santa Barbara, the Simon Wiesenthal Center and Reza Pahlavi, who all wrote letters to the Assemblyman expressing their support. 

“They were throwing students out of dormitory windows chanting: ‘Oh, Hossein! Oh Ali! Accept this gift from us.’  I was there. I was among those arrested. I was one of the ones who got picked up,” Farahanipour, one of the organizers of the July 1999 Tehran University student uprisings, said to the committee about his personal run-ins with the current regime.

“They held me for more than two months, beating and torturing me.”

The bill sends an important message to the Iranian people and to the clerical regime, Farahanipour said, stressing the importance of implementing non-violent political and economic pressures on this regime.

“Your legislation clearly shows that the people of California will not sit back and allow their retirement savings to buy technology for and bring fresh capital to a regime of murderers and hostage-takers in Tehran.”

Several members of CalPERS, CalSTRS and the California Teachers Association also spoke at the hearing, voicing their concerns about the bill, mainly that it will minimize retirement fund yields for Californians. The Chamber of Commerce was also in attendance, but said that they do not yet fully support or oppose the bill. 

“According to our investment division, we’d have to divest in companies who have subsidiaries that work out of Iran. They only have links that link them to these large corporations,” CalSTRS director of governmental affairs and program analysis Jennifer Baker said. “At the end of the day, our job is to make sure we can pay for teachers’ retirements.”

“Seventy-six percent of money paid to teachers is from investments not taxpayer money,” said Lori Easterling, a lobbyist for the CTA. “There is a difference in doing business with the people of Iran versus the government of Iran.”

There is a disconnection between working teachers in the state of California and the people who represent them in these communities, Anderson said after the hearing.

“I would bet that if you ask any teacher, do you want to make a lot of money on the backs of Iranian people who hold women abound; who hold people hostage? Do you find that an acceptable way to fund your retirement?  They would unequivocally say no.”

While the bill was introduced late January and has since passed last month’s policy hearing and the judiciary committee, it still must pass through appropriations and the assembly floor before it is taken to the state Senate and then signed into law by Governor Arnold Schwarzenegger.

Historically, the United States has used divestment in sending messages of either political or social disapproval. In the 1980s the U.S. divested from South Africa due to Apartheid and more recently from Sudan in light of the genocide in Darfur. Divestment has always taken place at the state level.

Over the past two months, Anderson’s bill has heard a positive echo in several other states including Florida, Maryland, Texas, Virginia, Ohio, Colorado and Louisiana. While Missouri was the first to divest from Iran through administrative action, if the bill is signed into law, California will be the first state to make investing public funds in Iran illegal. Comment