Offices like that of the Chicago treasurer are largely administrative. The officials are elected, but their responsibilities don’t lend themselves to splashy policy initiatives. That doesn’t stop many of those officeholders, who often view the seats as steppingstones to higher office, from trying.
Melissa Conyears-Ervin, Chicago’s current treasurer, is running for the open congressional seat now held by Danny Davis after unsuccessfully challenging Davis in the 2024 election.
So on Wednesday when Conyears-Ervin announced during what was supposed to be a routine City Council budget hearing that she had ordered her office to “boycott” investing in securities issued by the U.S. Treasury as a protest against the administration of duly elected President Donald Trump, the bombshell pronouncement was a political stunt writ $11 billion large.
More Top Picks Best E Readers With Large Screens For Seniors
There are stunts that don’t pose meaningful risks to taxpayers and then there’s the one Conyears-Ervin has irresponsibly instituted without soliciting public comment or even consulting the City Council.
As city treasurer, Conyears-Ervin has a fiduciary responsibility to taxpayers to earn the greatest possible returns on their money while doing so in a safe manner.
The treasurer must ensure that the cash she invests is available at a moment’s notice when needed, so that restricts the sorts of securities available to her. Essentially, the treasurer must invest mainly in liquid fixed-income assets. And there is no more liquid fixed-income investment on Earth than bonds guaranteed by the U.S. government.
As of now, the city treasurer’s office holds no Treasurys in its $11 billion portfolio. Conyears-Ervin says her office can safely earn top returns in the future by investing in alternatives like corporate bonds, asset-backed securities, municipal bonds, and bonds issued by agencies like Fannie Mae and Freddie Mac.
But investment conditions change and to eliminate the vast category of Treasurys as an option from a fixed-income portfolio that above all must minimize risk is the height of irresponsibility, as any civic financial adviser would tell you. It is, indeed, “reckless,” the word Ald. Ray Lopez, 15th, used for Conyears-Ervin’s foolishness.
To dictate that the city of Chicago won’t invest in Treasurys under any investment scenario is in our view a violation of the treasurer’s fiduciary duty to city taxpayers.
What if we enter a severe recession and corporate bonds and other alternatives suddenly become far more risky than they are today? Treasurys in such situations become safe havens — what investment pros call “a flight to quality.”
What happens to taxpayer assets in such a scenario, Madam Treasurer?
During the hearing before the council’s Budget Committee, Conyears-Ervin insisted that her office had earned a “record-breaking” $1 billion over the past three years. Aldermen didn’t challenge her on that point, but the reason for the higher yields wasn’t the office’s brilliant investment acumen. That time frame corresponds exactly to when the Federal Reserve raised interest rates dramatically over an unusually short period of time, boosting rates to their highest levels in well over two decades. Yields of fixed-income assets of all classes increased correspondingly. Heck, even holders of bank certificates of deposit understand that.
Conyears-Ervin primarily has the Fed to thank for her office’s “record-breaking” performance.
In unveiling what she called her “bold” stance against the Trump administration, Conyears-Ervin cited the Department of Homeland Security’s Operation Midway Blitz. “Chicago’s money should work for Chicagoans and not to bankroll attacks on our communities,” she said. She said her office would not “(invest) in the authoritarian regime of Donald Trump.”
Several aldermen took Conyears-Ervin to task for the grandstanding. “I feel like you came in here on a campaign rather than a budget report,” Ald. Anthony Napolitano, 41st, said.
Yes, Alderman, that is precisely what she was doing. And small wonder. She’s among nine candidates running in the Democratic primary to represent the West Side and west suburban 7th District in Congress. Incumbent Davis, who is retiring, has endorsed state Rep. La Shawn Ford to succeed him.
More Top Picks Best Fellow Stagg Kettle Alternatives
In such a crowded field, Conyears-Ervin clearly views her existing office as a platform to establish her resistance-fighter credentials in a midterm election shaping up as a referendum on Trump. In fact, city treasurer is a post where the occupant should be a competent manager rather than a crusader for whatever unrelated causes they support.
As objectionable as the Trumpian deportation campaign has been, it hardly accounts for the sum total of what the federal government does. Treasurys support many other federal programs that Conyears-Ervin surely endorses.
Is she “boycotting” Social Security, for example? What about Medicare and Medicaid? Are those unworthy investments?
Moreover, not every Chicagoan who pays taxes is a Democrat, and some of those taxpayers even voted for Trump in 2024. If by chance (and we understand the slim odds of this ever happening) Chicago’s treasurer were a Republican and protested the policies or actions of a Democratic president in the same manner, Democrats would howl in protest.
If Conyears-Ervin wants to keep her own money out of Treasurys as a quixotic political protest, she is of course free to do so. But this $11 billion is not her money.
In the name of protecting taxpayers, the City Council ought to take action as soon as possible to check Conyears-Ervin’s reckless gambit and establish that the sovereign debt of the United States shall be an eligible investment for the city of Chicago.
Submit a letter, of no more than 400 words, to the editor here or email [email protected].