Pennsylvania Moves To Divest Holdings In Russian Assets
HARRISBURG (KDKA) - State Treasurer Stacy Garrity is ordering Pennsylvania investment funds under her control to divest – or sell – any funds invested in Russia.
Garrity told money editor Jon Delano that millions of state dollars are invested in Russia.
Forget Russian vodka. It's a drop in the bucket. Treasurer Garrity says that of the $40 billion of taxpayer money that she controls, she found $2.9 million was invested in Russian accounts.
"It's quite small. It's less than one-hundredth of a percent, but we immediately started the process of divesting of that money," Garrity told Jon Delano on Monday.
Delano: "Can you tell us where that money was being invested in Russia? Do you know?"
Garrity: "Securities. So basically there were 31 Russian companies. So far, we've sold 28 out of those 31."
Mostly oil, gas and chemical companies, plus some banks, telecoms and a grocery store, the treasurer said.
Garrity, who for 30 years was in the Army Reserves, deployed to Iraq three times and retired as a colonel, says this disinvestment is important.
"Every dollar matters, and I think it's important that we protect Pennsylvania taxpayers and that we stand with Ukraine," she said.
On Monday, three western Pennsylvania lawmakers called on the state teachers and state employees retirement funds to divest from Russia, too.
"Not a single dollar, not a single penny, not a single nickel – nothing should be spent until Russia is out of Ukraine. Period," says Pennsylvania Rep. Ryan Bizzarro, an Erie Democrat.
Garrity, who sits on those retirement boards and wants them to divest from Russia, says they have more money in Russia than her office does.
Garrity: "When you consider that we have $2.9 million, I know they're definitely ten-fold, or more."
Delano: "Really? Thirty million dollars?"
Garrity: "Well probably more. That was really what we were quickly able to get a glance at."
PSRS is the teachers retirement fund, and a spokesperson says they are currently ascertaining how much of their $72 billion net assets are invested in Russia.
At the request of Gov. Tom Wolf and state lawmakers, Wine and Spirits shops will no longer stock Russian-made alcohol, but it's mostly symbolic. Most vodka is made in the USA, and less than one percent comes from Russia.
So how important is American trade with Russia?
"What's extremely important is to create independence from Russia. Trade is not a bad thing," says University of Pittsburgh professor Gregor Thum, an expert on Central Europe.
WATCH: KDKA's Jon Delano reports
The good news is that the United States is not especially dependent on Russia for consumer necessities. In 2021, we imported just under $30 billion in goods from Russia, compared to $506 billion from China.
As for the impact of us boycotting Russian products, says Thum, "Since the Russia-U.S. trade is not very significant, there's much less of a statement to make in exactly that field. However, joining forces with Europeans, that is actually what is so successful right now, and Europeans can make a huge statement on trade."
Thum says helping Europe end its dependence on Russian energy is critical.
On the home front, Garrity has ordered her office to dis-invest – or sell off – nearly $3 million in state taxpayer investments in Russia. Garrity says besides boycotting what few Russian products are on the shelves, people should look at their retirement accounts, their IRAs and 401Ks to make sure those funds are not investing in Russian companies.
Garrity: "I think it's important that everyone make sure that their money is invested prudently."
Delano: "And not in Russia?"
Garrity: "Exactly. Not in Russia."
Besides boycotting Russia, another way to show support for Ukraine is to buy products made by Ukrainians. Compared to the $30 billion in products Americans bought from Russia last year, we bought only $2 billion from Ukraine.
