The Democratic National Convention Kick-Off & CalPERS’ Next Steps

The DNC kick-off, Biden's vision for the Democratic Party, and CalPERS' next steps after Ben Meng's departure

Yesterday, the Democratic National Convention kicked off and will run through this Thursday, where the Democratic Party will formally nominate Joe Biden and Kamala Harris as president and vice president for this election. What’s unique about this year’s convention is that it’s mostly virtual and a mix of live and pre-recorded speeches. It also will not be featuring a single keynote speaker, but rather seventeen in total. The Democratic Convention will officially end primary season as the U.S. moves full steam ahead into the general election.

The general pitch for the Democratic bid last night revolved around unifying in support of Joe Biden, regardless of where these leaders are within the political spectrum. Progressives, moderates, and even some Republicans have come together at the convention to make the case that as president, Joe Biden would be the one most capable to address the pandemic, the recession, and civil unrest. Part of the hope is to rally younger voters—those who enthusiastically supported progressives such as Senator Sanders and Senator Warren during the primaries—to cast their vote for Biden, a more moderate, center-left politician, in what is evolving to be a higher-stakes election. 

The seventeen keynote speakers Biden is elevating are diverse yet also mostly share a center-left philosophy—a preview of Biden’s vision for the Democratic Party as he considers himself as a “bridge” for a new “generation of leaders.” As the convention is underway, we’ll see how it unfolds. 

Also yesterday, the trustees of CalPERS met after the sudden resignation of the fund’s chief investment officer, Ben Meng. On August 4th, an anonymous complaint was filed against Mr. Meng about possible conflicts of interest as it concerned his own personal investments. The next day, Mr. Meng left abruptly. The complaint did not list any specific investments, but the focus during the review has been on Mr. Meng’s shares in Blackstone Group. CalPERS had previously invested in Blackstone’s private equity funds—after Mr. Meng was hired, CalPERS had committed $750 million in this fund. With CalPERS’ underfunded status and as municipalities and local governments within California are being billed with greater mandatory contributions, the reputational risk associated with conflicts of interest is something CalPERS is sensitive to and may also be a reflection of the immense pressure pension funds are under today.