You have touched on a point I have written about in my blog. The quality and the independence of the board of directors of these large plans is very important, and if you keep putting in the same people from the financial industry, basically it's like a big club. They all know each other. They all get compensated pretty much the same way. They all will talk the same talk. But if you have, for example--and I've been arguing about this--a more independent board of directors.... For example, I would put in academics from universities who maybe don't have any affiliation whatsoever with the financial industry. And if you also augment all your auditing by independent performance, operational, and fraud audits at least once a year by independent experts to see if the activities are in accordance with best standards, then you would be able to avoid all these things and also keep the public pension funds at arm's length from the government.
Norway provides a perfect example. They have been doing this, and to their credit, they have been doing it quite well. They've been able to keep the fund at arm's length from the government, but they also have independent consultants looking at whether or not the operations are being run in accordance with the best interests of the key stakeholders.