Mar
22
Written by:
William Lutz
3/22/2010 10:43 AM
In the shuffle and commotion caused by the President's socialist takeover of the health care system, other news understandibly is getting less attention. That said, Sunday's Austin American-Statesman has a front-page story questioning campaign donations provided toTexas politicians -- notably Gov. Rick Perry, several members of the Congressional delegation, and Third Court of Appeals Justice Alan Waldrop -- by Triton Financial CEO Kurt Barton, who is now the subject of a federal lawsuit alleging securities fraud. Click here to read the Statesman's story. The Statesman's story says the plaintiff's in the lawsuit may seek recovery of both the political donations and a donation to University of Texas Athletics.
So why are we -- a political publication -- spilling ink over this? After all, the Statesman's story mainly involves campaign donations, not public funds.
Simple. Given the lack of credibility Wall Street has right now, the next big political quagmire in Texas politics may involve one of the state's large investment funds. In 2005, the Legislature passed legislation exempting from public disclosure which private equity investments are made with public funds. (The names of the private equity funds and returns are disclosed but not the specific investments made by the private equity funds.) In addition, several state investment funds have been the subject of careful scrutiny by legislative committees or recently made controversial management decisions. Elected officials should tread very carefully on how state investment funds are managed -- particularly when those decisions affect large camapign donors. The facts in yesterday's Statesman story may not be a smoking gun, but does provide yet another example of why statewide elected officials would be wise to proceed with caution with this industry.