No one has worked harder and smarter than state Treasurer Walker Stapleton to protect Colorado's unstable and underfunded Public Employees' Retirement Association. He has done so while crusading against a billion-dollar-a-year tax increase designed to backfill PERA on a disingenuous promise it would raise cash for classrooms.
Yet Stapleton's recent support for a potential PERA refinance mechanism has generated criticism from the right, center and left. It is a safe bet Stapleton's financial acumen dwarfs that of his critics. He is a successful businessman with a Harvard MBA, a graduate degree from the London School of Economics and a proven record of good results.
Stapleton has conservative political leanings but is not doctrinaire. Where some of his critics wallow in vague concepts and rigid ideology, Stapleton works with facts, numbers and an eye toward predictable and precise outcomes for our state.
When a Democrat and Republican introduced House Bill 1388, Stapleton reviewed it. The bill, which failed in a Senate committee, would have authorized issuance of Pension Obligation Bonds to lower the cost of PERA's debt. He wasn't a big fan of the idea but thought it should be among options in the event planets align. So he wrote a Feb. 10 letter to House and Senate leadership full of detailed analysis that specified risks. It explained how POBs would make sense only if key factors fell into place within a strict context of regulatory protection.
"Pension obligation bonds represent one 'tool' out of many that can be implemented successfully if the transaction contemplated has both discipline and structural boundaries," Stapleton wrote.
In other words, we should maximize refinance options to improve our odds of rectifying PERA. Markets do strange things, so in some unlikely circumstance, this could be the way to proceed.
All the treasurer's nuance, financial analysis and hedging of risk was lost on critics. From the right, Americans for Prosperity Colorado bought Facebook ads and blasted an email that quoted grandma saying "you can't borrow your way out of a hole." Quaint, but false. A good way out of a 20 percent credit card hole is to fill it with debt borrowed at 4 percent. The folksy platitudes continued with stuff like "Tell Walker Stapleton to gamble his own money!"
Dustin Zvonek, a close ally and political adviser to Arapahoe County District Attorney George Brauchler, heads AFP Colorado. Brauchler is widely considered a candidate for governor in 2018. So is Stapleton.
"It is not a stretch to conclude that the factually flawed email, Facebook ads . using AFP funds and resources, was an obvious attempt not to further AFP policy causes but to prop up a political consultant's client," Stapleton argues.
We can't judge Zvonek's motives, but AFP's zealous and immediate anti-Stapleton crusade seems uncharacteristic and suspect. If Zvonek plans to work with Brauchler, he should avoid targeting other conservatives with AFP's resources and clout.
In a somewhat bumbled refutation, Stapleton told talk show host Mike Rosen he did not support issuing bonds for PERA, "not right now," but supported allowing the option. This led center-right sage Vincent Carroll, editorial page editor of the Denver Post, to opine: "You don't give the state authority to do something unless you anticipate that it will exercise that power at some point . "
We respectfully disagree. Politicians throughout history have supported options — say, mutually assured thermonuclear destruction — hoping and praying they would never be used.
The whole thing became comical when far-left ProgressNow Colorado — which wanted the billion-dollar tax hike — joined ranks with AFP and piled on Stapleton with a May 18 news release that screamed: "one thing is clear: you can't trust Walker Stapleton."
We trust him as one who never fails to protect Colorado's assets and the incomes of taxpayers. This is a faux scandal that relies on suspension of analysis and detail.