Why Using Pension Money to Fund Israeli Bonds is both Wrong and Illegal

by James Abourezk This piece first appeared in CounterPunch on March 27, 2015. James Abourezk is a former US senator from South Dakota. He is the author of: Advise and Dissent: Memoirs of […]

by James Abourezk

This piece first appeared in CounterPunch on March 27, 2015. James Abourezk is a former US senator from South Dakota. He is the author of: Advise and Dissent: Memoirs of an ex-Senator.

The Minnesota State Board of Investment is honor bound when it invests monies from Minnesota’s public employee pension funds. Each of the Board members, which includes Governor Mark Dayton (Chair), State Auditor Rebecca Otto, Secretary of State Steve Simon and Attorney General Lori Swanson know, or should know, that the Board has violated its fiduciary responsibility to only invest public pension funds prudently by investing in Israel Bonds. Israel Bonds are government bonds issued by the State of Israel.

Earlier this monthI appeared before the Board members to urge them not to invest in Israel Bonds. Immediately after I ended my presentation, the Governor handed the other Board members a previously prepared written motion to continue investing the state’s pension funds in Israel Bonds. All of us in the packed hearing room understood that my testimony had been wasted. Facing members of the pro-Israel Lobby who had been seated in the front row, three of the four board members voted to invest. Only the State Auditor, Rebecca Otto, voted against the motion.

I’ve seen this pressure before. It usually consists of a subliminal threat by the pro-Israel Lobby to cut off any campaign money to those who defy what the Lobby wants. That is the same kind of threat that allowed Israeli Prime Minister Bibi Netanyahu to travel to the United States to dictate to our Congress how American foreign policy should be conducted. I believe that the 36 standing ovations for Bibi and the 47 Republican Senatorial signatures on the letter to Iran were eager messages to the Israeli Lobby telling them how much Congress appreciated the campaign money given each election cycle to its obedient members. When I served in the US Senate I well remember the threats directed against me for not being obedient enough to the Lobby.

The Board of Investment’s vote to use Minnesota pensioners’ money to buy the low-yield bonds issued by Israel is, without question, highly imprudent and illegal, especially because the Board knows how the money will be used. American money plunged into Israel Bond sales is fungible, meaning that the money is lumped into Israel’s General Fund, and then used for anything Israel wants, without
abourezkrestriction. That also means that the money sent to Israel is used for settlements. Israel’s settlements are illegal under Article 49 of the Fourth Geneva Convention, which prohibits an occupier from transferring any part of its civilian population into the territory it occupies. Article 49 was adopted by the international community after WWII as a direct response to Nazi Germany’s illegal and brutal occupation of lands belonging to its neighbors. Both the United States and Israel have signed the Fourth Geneva Convention.     Even the United States Government has acknowledged that Israel’s settlements are illegal.

Beyond just exploiting American elected officials in their political zeal to become complicit in financing illegal Israeli settlements by using money from taxpayer funded public employee pension plans to do so, Israel has a long history of inflicting damage on American interests. During the 1967 Middle East War, Israel’s military attacked and attempted to sink a fully flagged American Navy vessel—the USS Liberty—which had been ordered to monitor the War by assuming a listening post off the coast of Egypt and Israel. Using fighter jets, as well as torpedo boats, Israel killed 34 American sailors and wounded another 171 sailors in the process.

What was painful for the survivors and the families of those Americans killed and wounded by Israel were the duplicitous actions of our own public officials, starting with President Lyndon Johnson, by refusing to allow fighter jets of the Sixth Fleet to come to the aid of the Liberty when it was under attack and working to cover up evidence of Israel’s deliberate attack on our ship and the killing and wounding of our sailors.

That wasn’t the last injury against American interests by our so called “ally.” In the 1970s, Israel recruited and paid a Pentagon employee, Jonathan Pollard, to sell to Israel a “truckload of secret documents,” as described by our then Secretary of Defense, Caspar Weinberger.

More recently, a Pentagon official, Larry Franklin, was indicted by the Justice Department in 2004 for handing over classified information on Iran to two employees of AIPAC (American Israel Public Affairs Committee), the leading lobby for Israel. Franklin, a former United States Department of Defense employee, pleaded guilty to several espionage-related charges and was initially sentenced in January 2006 to nearly 13 years in prison. Amazingly, Franklin’s sentence was later reduced to ten months house arrest and 100 hours of community service. In reducing his sentence, the Judge told Franklin that his community service should consist of “speaking to young people about the importance of public officials obeying the law.”

Franklin had passed highly classified information to AIPAC policy director Steven Rosen and AIPAC senior Iran analyst Keith Weissman, whom AIPAC later fired. Initially indicted for illegally conspiring to gather and disclose classified national security information to Israel, all charges against Rosen and Weissman were eventually dismissed.

These are just a few examples that we know about where Israel’s activities have seriously damaged United States interests. What we do not know, including the extent of the duplicity of our public servants, would most likely fill the pages of a book.

Not only is the Investment Board’s action imprudent and illegal with respect to giving Minnesota retirees’ money to a country that has never hesitated in harming America’s interests and will use the money to violate international law, it also tells Israel that it can do what it wishes, without paying any penalty, and that it can even get the United States to pay the price for it.

The Minnesota Investment Board should obey the law whether or not Israel’s Lobby dislikes that decision.

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