How Giannoulias oversaw the failure of Illinois’ college savings plan

Today’s Chicago Tribune explores the story of how Illinois’ Bright Start college fund — a fund to which millions of families contributed — suffered severe losses in one of its more conservative investment choices. At the center of that story is the Democrats’ Senate nominee in Illinois: Alexi Giannoulias.

Giannoulias had made revitalizing the underperforming program a key component in his successful 2006 campaign, and the investment firm he selected to turn around Bright Start was making positive changes. But the fund manager also made a decision to heavily invest in volatile securities tied to the housing market.

Documents and e-mails recently obtained by the Tribune under the state’s open records law show the rookie treasurer and his staff were concerned early on about the aggressive move by OppenheimerFunds Inc. in what was supposed to be a more conservative fund in the Bright Start program.

But at each turn Giannoulias stuck with the firm’s strategy, even as the housing market soured and losses accelerated.

The whole thing is well worth reading.