What's yr beef with TIAA?
And why should I care?
(Full disclosure: my BAAW1 has a modest-but-nothing-to-sneeze-at TIAA account from her years of brilliant work in colleges and universities, and if I’m lucky enough that a) she’ll keep me around, and b) I am granted another twenty-plus years of this life, I will presumably eat more than one good meal in my old age that is paid for by the proceeds from that account. So before I launch into my TIAA jeremiad, know that, like the many TIAA homies out there watching their accounts get all swole with 2024’s AI-fueled boom in the stock market, my hands aren’t clean here. But if the entire education-industrial complex is going to be unavoidably tangled up with this hydra, we should at least be aware of what it is and take ownership of what it is we own.)
If you don’t work in higher education, you may not know how totally entwined the academy is with the former Teachers Insurance and Annuity Association of America-College Retirement Equities Fund, once known as TIAA-CREF, now just TIAA.
Derived from a million-dollar endowment from Andrew Carnegie over a hundred years ago,2 TIAA comes out of Carnegie’s (clearly honorable) desire to ensure that teachers had the ability to retire with dignity.
Today TIAA is one of the largest financial-services organizations in the world. In MoneyLand, a key metric is AUM, or assets under management, the dollar amount of money that a fund manages for its investors. TIAA’s AUM is a cool 1.3 trillion dollars.
By way of comparison, you could take the value of all the goods and services produced in Costa Rica, Belize, Nicaragua, Bolivia, Jamaica, Uganda, Ghana, Kenya, Ecuador, Iceland, and Ukraine in a given year… and it would be far less than TIAA’s assets under management. Hundreds of billions of dollars less.
TIAA reports providing services for “more than 12,000 institutional clients.” The National Center for Education Statistics says there are around 6,000 colleges and universities in the United States. Presumably there are colleges and universities that don’t provide retirement services for employees through TIAA, but I never heard of ’em.
In effect, if you work in higher ed, your retirement in bound up in the choices TIAA makes.
So what are these choices?
TIAA is “one of the world’s largest investors in fossil fuels.3
TIAA is the largest owner of farmland in the world, holding almost two million acres of farmland on four continents.4
In acquiring that farmland, TIAA knowingly buys farms from bad actors who create farmland by way of violence and deforestation.5
TIAA is among the world’s largest investors in coal bonds.6
TIAA is subject to allegations of sleaze and financial chicanery in how it treats its investors.7 and 8
Hundreds of academics (including cats like Bill McKibben) whose retirements are bound up with TIAA have filed complaints against the organization for its flagrant violations of its own commitments to responsible investing.9
And on and on.
As with so much wickedness, it seems improbable that the accountants and MBAs who run zillions of dollars for TIAA investors are sitting around each day rubbing their hands with glee as they plot to destroy the world in the service of making steady monthly payments to their investors.
Instead, one suspects, this is in part a product of just being too damn big, with a mandate to get ever and ever bigger.
(Evergreen note to self: I need to finally take my BAAW’s advice and read E.F. Schumacher’s Small Is Beautiful. A Study of Economics As If People Mattered.)
(You probably should too.)
Handwringing aside, what is one to do?
Consider getting involved in something like TIAA Divest! I’m not, but God bless them.
I suspect you can dig around in the different TIAA asset allocation models and find something that is at least somewhat more of an ESG-type of allocation. Again, the whole ESG thing is highly suspect / lots of greenwashing / often bogus, but if it means that your retirement money is 23% less invested fossil fuels, that seems like a win. You can call it a symbolic self-congratulatory win if you want. I think it’s a win.
Big picture, it all starts with just being aware and honest with yourself. The economic revolution in recent decades that is passive investing means that pretty much everyone with any kind of retirement holdings has them represented in these anodyne pie charts that are labeled with so-large-as-to-be-meaningless categories like “Small-cap equities” and “Real estate” and “Bonds.” It’s very easy to get those monthly statements, see the number going up over time, and feel… great! Turning a blind eye to how TIAA and other financial-services agencies invest your retirement money is, shall we say, a touch inconsistent with the values espoused by many in the academy. If in a few years or decades, you’re going to buy those gorgeous heirloom tomatoes at the farmers market with cash from your TIAA required minimum distributions, be conscious of where that money came from. None of us can claim the moral high ground on this shit. The number of avowed leftists in the academy who are going to be sitting pretty in old age thanks to their TIAA investments in palm oil and Chevron and Brazilian land grabs is pretty striking. Can we all just tell the damn truth a little more?
Brilliant and amazing wife, for new readers, with the “b” also called in to stand for “beautiful.”
Carnegie, let us recall, was among the least rapacious of the oil and steel and railroad tycoons, but—favorable side-by-side comparisons with bloodthirsty fanatics like Rockefeller, Flagler, and Stanford notwithstanding—his legacy is nevertheless NOT AT ALL uncomplicated.
https://deforestationfreefunds.org/families?q=TIAA%20Investments%2FNuveen
Ibid.
https://www.occrp.org/en/investigations/ignoring-warnings-signs-us-retirement-manager-tiaa-bought-farms-from-alleged-land-grabbers-with-brazilian-sugar-giant
https://reclaimfinance.org/site/en/2022/03/07/who-is-investing-in-toxic-coal-bonds/
https://www.nytimes.com/2021/07/13/business/tiaa-retirement-accounts-misleading.html
https://www.sec.gov/newsroom/press-releases/2024-22
https://www.ciel.org/news/tiaa-faces-climate-washing-complaint-brought-by-academics/