The Jeb Bush administration directed the money from the Florida pension to George W. Bush’s fundraisers

Four years before the financial collapse, Goldman Sachs executive George Herbert Walker IV had much to be thankful for. “I have been fortunate enough to be part of the leadership teams of US restructuring, European privatizations, global pension management and now investments in hedge funds and private equity,” he said in the report. year of a banking colossus soon to be known as “great vampire squid” of Wall Street.

“The world,” noted Walker, “is getting more and more interesting.”

As the to manage from Goldman Sachs’ alternative investment unit, Walker’s exuberance was understandable. At the same time, he was raising $ 100,000 for the successful presidential re-election of his cousin George W. Bush, the administration of another cousin, Florida Governor Jeb Bush, returned the family, handing over $ 150 million. dollars of Florida pension money to an alternative investment. fund managed by the Walker company. Like other executives whose companies received pension funds in Florida, Walker is now renewing the cycle, would have attending a fundraiser for Jeb Bush’s political committee in February.

Walker isn’t the only one: he’s one of the top 19 fundraisers for George W. Bush – known as the “Pioneers” and “Rangers” – whose financial firms have received state affairs from. Jeb Bush’s administration in Tallahassee. In total, a review of government documents by the International Business Times shows that Jeb Bush oversaw Florida by directing at least $ 1.7 billion in retirement money from state employees to major donor finance companies. of his older brother.

While Jeb Bush oversaw the State Board of Directors (SBA) that manages Florida’s massive public pension system, the State staggered billions of dollars in higher-risk, higher-cost alternative investments, benefiting the same sector of the investment industry he would work in after leaving office. Many of these deals with the state have produced lower than expected returns. About 20 percent of the 53 private investment deals in this system during Bush’s governorship went to companies that employed his brother’s pioneers. These financial firms, in turn, handed over $ 5 million in campaign money to George W. Bush, the Republican National Committee and Jeb Bush’s Florida Republican Party. (Click here to see the full list Bush Pioneers whose companies received retirement investments in Florida from the Jeb Bush administration).

As governor, the Jeb Bush administration granted pension deals to 11 companies whose executives were George W. Bush’s main fundraisers. Photo: International Business Times / Hanna Sender

With recent Supreme Court rulings effectively lifting the limits on campaign contributions, Jeb Bush’s relationship with his brother’s top fundraisers could pay even more dividends for the GOP candidate in 2016. Republican strategists and politicians alike donors say the Pioneers are giving the former governor of Florida an integrated presidential fundraising base. .

Barry Wynn, a two-time Pioneer financial executive, said his fellow Pioneers could easily “be convinced to be big supporters of [Jeb Bush] as they were to his brother and his father. Wynn has “spoken a lot” about pioneers, he said. “I think the doors are going to be opened more willingly” for Jeb Bush than for the other Republican candidates, Wynn said.

Tallahassee lobbyist Brian Ballard, a top GOP Fundraising, told IBTimes that Jeb Bush would have access to the family’s fundraising network, “which is considerable.” He added that while “Jeb Bush has his own network, it is obviously reinforced by the Rangers and the Pioneers.”

Ethics experts say the link between the Bush family’s donors and Florida pension deals raises questions about whether the investments were properly shielded from political influence.

“If this is not a real conflict of interest, these examples could fuel apparent conflicts of interest,” said Peter Butzin of Common Cause Florida. “These people who give… expect something in return. And if that something in return does not openly send business in their direction or result in a particular vote, it is most certainly at least an opportunity for access, to step in the door, so that ‘they can argue in favor of this official. “

Jeb Bush’s aides did not respond to questions from IBTimes, and Walker declined to comment for this story. Dennis MacKee, a spokesperson for the SBA, said that “the agency’s elected directors do not participate now, or during Governor Bush’s tenure, in the selection of individual investments.”

MacKee’s statement conflicts with emails examined by IBTimes which show that as Governor Jeb Bush was deeply involved in the state’s investment decisions, periodically negotiating conversations between Florida officials and individual financial firms, one of which the senior executive was a longtime donor to the Bush family.

Florida ethics and procurement rules discourage public officials and their family members from accepting gifts from companies doing business with the state. However, these rules do not cover campaign contributions to Jeb Bush or his brother from companies managing Florida pension funds. The deals were also closed years before the Securities and Exchange Commission adopted rules by effectively prohibiting contributions from companies receiving pension funds.

Three politically bound companies whose executives were George W. Bush Pioneers – HM Capital, the Carlyle Group and Freeman Spogli – were involved in the corruption investigations in New York that prompted the SEC rules. The trio of investment firms had received $ 350 million in new pension liabilities from Florida officials during Governor Jeb Bush’s tenure. During the same period, leaders made a total of $ 1 million in campaign contributions to Jeb Bush, his brother’s campaigns, the Republican National Committee and the Florida Republican Party.

In 1996, the Florida retirement system first invested with HM Capital’s predecessor, Hicks Muse, a company whose namesake Thomas Hicks was involved in the purchase of the Texas Rangers owned by George W Bush. After Hicks Muse’s investments generated huge losses, the SBA (State Board of Administration of Florida) decided to reduce its commitments to the company. The agency criticized the company’s performance in 2001, writing in his annual report that Hicks Muse “has failed to demonstrate superior discipline and focus in recent years.” However, as Hicks Muse donations poured in for both George and Jeb Bush, Florida quickly invested $ 25 million in another Hicks Muse fund, which generated $ 1.3 million in fees while Jeb Bush was governor.

The Carlyle Group – a private equity firm that works with many institutional investors and already owned large pension funds in Florida – received a new $ 200 million commitment from the SBA in August 2000, in the midst of the presidential campaign. At the time, former President George HW Bush was job as an advisor to the firm, according to the Center for Public Integrity. Carlyle’s executive Robert Grady was collecting checks as a pioneer for George W. Bush and was co-chair of his campaign in California.

Grady, a former White House aide to President George HW Bush, would resume his role as George W. Bush’s campaign co-chair in 2004, and also make maximum contributions to Jeb Bush’s governorship campaigns. In 2005, Jeb Bush’s SBA committed an additional $ 75 million to a new Carlyle fund. The investments netted Carlyle nearly $ 14 million in costs while Jeb Bush was governor. Grady was later appointed by Republican Gov. Chris Christie to head a New Jersey state pension system which subsequently granted a $ 300 million pension deal to Carlyle and other pension deals to companies whose executives have donated to Christie. Grady, who withdrew from the Carlyle investment vote, resigned his New Jersey job in November, amid questions about the donations. Christie administration officials cleared him two weeks ago.

Carlyle wasn’t the only branded financial giant to receive pension funds in Florida. With Bush as governor, the state invested in giants such as Blackstone Group, Goldman Sachs, Deutsche Bank, Morgan Stanley, JPMorgan Chase, Lehman Brothers, UBS and Prudential Financial. These eight, who employed all of George W. Bush’s pioneers, received more than $ 1.3 billion in Florida pension funds. Executives from the eight companies made a total of $ 4 million in contributions to George W. Bush’s campaigns, the Republican National Committee, and the Florida Republican Party between 1998 and 2006.

None of the companies responded to requests for comment from IBTimes, except Goldman Sachs. Company spokesperson Andrew Williams wrote in an email to IBTimes: “Pension plans around the world are hiring Goldman Sachs because of our expertise and track record. Williams did not answer questions about Florida’s investment in the company, which has fallen almost 8 percent less than his expected returns.

In recent weeks, executives from some of the companies that have received pension funds in Florida have appeared at Jeb Bush’s fundraisers.

According to a February Politics report, George Herbert Walker – formerly at Goldman and now at Neuberger Berman (who also received pension funds in Florida) – attended a $ 100,000 per person fundraiser for a group supporting Jeb Bush. The event took place at the home of private equity mogul Henry Kravis, also a pioneer of George W. Bush.

CNN reported that Blackstone’s Schwarzman assisted a fundraiser for Jeb Bush’s Political Action Committee last month.

Meanwhile, Bradford Freeman, the co-founder of Freeman Spogli, one of the companies that was implied in the New York pension scandal and also received pension funds from Florida – co-hosted a fundraiser for Jeb Bush in January and another event in California last month.

Nelson Diaz, Chairman of the Miami-Dade Republican Party, told IBTimes that the ongoing fundraising challenge for Bush will be to convert the relationships he established as governor into major gifts for his run in 2016. .

“All of these checks have to be personal in nature,” Diaz said. “Governor Bush may have had a relationship with CEOs for a long time, but the question is, will these CEOs be ready to write? [checks] out of their personal pocket today for something Jeb maybe helped them 10 years ago? “

For at least some Pioneers whose companies have benefited from investments in Florida, the answer already seems to be yes.