Remember the CalPERS!

AS a call to action, it doesn't quite have the ring or resonance of "Remember the Alamo!" (or "the Maine!" or "Pearl Harbor!") perhaps because it appeals to a higher, more noble sentiment than simply a bloodthirsty call for revenge.

"Remember the CalPERS!" is an instructive lesson about what our community can achieve with unity and perseverance, with inspiration and perspiration. It should be told and retold to generations of Filipinos in America.

This is especially inspiring for a community used to divisiveness and failure. So instead of dwelling on the defeats of the I-Hotel and the airport screeners struggles, and on the frustrating 60-year fight for veterans equity, the community can now draw inspiration from the showdown at the CalPERS corral.

CalPERS background

CalPERS, the California Public Employees Retirement System, handles the retirement/health benefits of 1.4 million California public employees and 2,500 employers. It is the largest US investment fund with 168 billion dollars in assets of which 2.6 billion dollars is invested in international equity markets in "emerging economies." Of this amount, CalPERS invests about 68 million dollars in Philippine corporations.

Through its consultant, Wilshire Associates, CalPERS grades 27 countries according to their political stability, legal system, market regulations, labor practices, investor protections and stock trading costs. To merit CalPERS investment, a country must earn at least two points on a three-point scale.

When the previous minimum grade was 1.5 points, the Philippines earned a grade of 1.46 in 2002. When the minimum was raised to 2.0 in 2003, the Philippines' grade had increased to 1.87.

Wilshire Associates gave the Philippines failing grades for political stability, legal system, market regulations, and investor protections.

CalPERS to disinvest

At the February 3, 2004 meeting of the CalPERS board investment committee in Sacramento, California, Wilshire Associates announced its recommendation to disinvest in the Philippines. At that meeting, the Philippine government, through Philippine Ambassador to the US Albert del Rosario, strongly protested the grade assessments of Wilshire Associates.

At its subsequent February 15 meeting, the CalPERS board gave the Philippines a 30-day reprieve for the Philippines to provide Wilshire with additional information to rebut its conclusions.

A meeting of Philippine officials with CalPERS was set for March 6, which would provide Wilshire enough time to make any revisions to its grades, in time for the CalPERS March 15 meeting.

But Wilshire Associates had already decided to stick to its previous conclusion and posted its grade in its website on March 3, thereby rendering moot whatever the Philippines may have presented at its March 6 meeting with CalPERS.

Community to the rescue

With one week to go before the March 15 CalPERS board meeting, with his back against the wall, Ambassador Del Rosario decided to call on the Filipino-American community to come to the aid of the Philippines and to attend the March 15 CalPERS board meeting in Sacramento.

A few days before the meeting, I received a call on my cell phone from Ambassador Del Rosario who requested me to speak to the CalPERS board as the lone Filipino-American elected official in San Francisco. Other community leaders such as Yolanda Stern of the FilAm Chamber of Commerce and Davis City Mayor Ruth Uy Asmundsen were similarly invited to speak.

San Francisco Consul General Delia Menez-Rosal mobilized her entire staff to contact Fil-Am community leaders and to arrange for buses and food for those willing and able to travel to Sacramento.

On March 15, over 300 of us showed up at the CalPERS auditorium for the CalPERS board meeting, taking up most of the seats in the audience.

False basis for grade

When the agenda item for the Philippine issue came up, Wilshire Associates director Rosalyn Hewsenian reported that the grade of the Philippines remained unchanged since the last board meeting. When she justified her failing grade for the country's political stability by citing the impeachment of Chief Justice Hilario Davide Jr., the partisan audience erupted with a torrent of boos and cries of "False!" "False!"

The chairperson of the board's investment committee, Rob Feckner, then spoke and expressed his confidence that the Philippines has been given every opportunity to improve its score but that there had simply not been enough there to merit maintaining CalPERS investments in the country. The chairperson of the CalPERS board, Sean Harrigan, chimed in, echoing Feckner's comments and reiterating his confidence in Wilshire Associates.

But before a vote could be taken, CalPERS board member and former San Francisco Mayor Willie Brown asked his fellow board members to refrain from expressing their conclusions until after they had the opportunity to hear the side of the Philippines. Board member Charlie Valdes and Robert Carlsen seconded Mayor Brown's suggestion.

Committee chairperson Feckner, sensing the due process sentiment of the board, then called on Ambassador Del Rosario to come forward and make the pitch for the Philippines.

9-4 likely vote

According to board member and California State Controller Steve Westly, his informal poll of the board sentiment before the March 15 meeting was nine in favor of accepting Wilshire's recommendation to disinvest in the Philippines with only four in opposition.

Ambassador Del Rosario then walked to the table in front of the board and seated himself in the center with his technical staff seated to his left and behind him. In the one chair between himself and Wilshire Director Hewsenian, he seated me. I had the best seat in the house.

Ambassador Del Rosario then proceeded to provide the board with a PowerPoint audio-visual presentation of the Philippine case with emphasis on his exasperating attempts to provide Wilshire Associates with factual data to counter its previous negative assessments.

"It's easier to make an appointment with the Queen of England than with Wilshire Associates!" Ambassador Del Rosario told the board.

RP's true grade

Ambassador Del Rosario explained that he wanted CalPERS to consider the World Bank's positive assessment of the Philippines, which would add at least .125 to its previous score of 1.87. Evidence of Philippine compliance with IOSCO principles would add another .125 pushing the Philippines score above the 2.0 threshold, he said.

In my brief speech, I reminded the board members that their decision would have a far-reaching impact on the Philippines, as a decision to disinvest would trigger a run on foreign investments in the former US colony. This would cause the Philippine economy to suffer and many countless Filipinos to lose their jobs.

After we concluded our presentation, controller Steve Westly made a motion to postpone action on the Philippines until the next board meeting on April 19, which would allow Wilshire time to fully review and evaluate the additional information provided by the Philippines. Westly's motion was adopted unanimously.

Plan of attack

In the following 34 days, a sophisticated unified approach to dealing with the issue was formulated. Ambassador Del Rosario and his staff would meet with Wilshire and tackle the technical end. Fil-Am community leaders would deal with the political aspect of the campaign.

Alice Bulos, the San Mateo county founder and chairperson of the California FilAm Democratic Caucus, called up Fil-Am Democrats throughout the state, including San Francisco's Jose Caedo and Solano County's Larry Asera, asking them to lobby the Democrats on the board. Alice also called in all her personal chits with organized labor, whose two representatives on the board were opposed to outsourcing jobs to foreign countries like the Philippines.

According to Westly, the lobbying effort paid off with three of the nine opposed to the Philippines changing their votes, making it seven to six for the Philippines. With knowledge of that pivotal change, Wilshire decided to accept the Philippine figures and to up its grade to 2.12. This grade change provided Philippine champions Westly and Brown with the ammunition to lobby the other board members to make the vote for the Philippines unanimous.

"We got he last two votes just on the Saturday before the Board meeting," Westly disclosed.

All that was left was the formality.

On April 19, Wilshire Associates announced that the 2003 grade for the Philippines had been revised to 2.12, a spectacular .64 increase from its 2002 score of 1.48. The board unanimously approved the Wilshire recommendation.

The difference

When interviewed on The Filipino Channel, Westly was asked what difference the Filipino-American community played in securing the unanimous vote of the CalPERS Board, he replied: "All the difference in the world."

Ambassador Del Rosario thanked the 500 Fil-Ams who attended the CalPERS board meeting for "showing the deep concern and solidarity of the Fil-Am community with the people of the Motherland."

A victory at last! Remember the CalPERS!

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