Last year's heated U.S. and "emerging" stock markets boosted investment returns for the big state and city funds that pay tens and hundreds of millions a year to professional managers who pick stock, bond, private-equity, real estate and other "alternative" funds.

Those diversified, bigger-fee retirement plans have posted better returns for 2017 than at least one Pennsylvania pension plan that bet mostly on steady, low-fee Vanguard Group index funds, undermining (just a little, because these numbers jump around) Gov. Tom Wolf's and other Pennsylvania Democrats' claims that more public money ought to be indexed. 

The bull market, which pushed the S&P 500 to a record high, helped; indeed, stocks on U.S. markets, and especially investments in more-volatile volatile "emerging" nations, generally posted the highest returns for each plan, while higher-fee, more-exotic strategies lagged.

The Philadelphia Board of City Pensions posted returns net of fees of 15.4 percent, after ditching most of its hedge funds the year before.
The Pennsylvania State Employees' Retirement System was close behind, at 15.1 percent (unaudited).
New Jersey Division of Investment clocked just under 15 percent.

By contrast, the Butler County Employees' Retirement Plan, which fired private managers in 2009-10 and replaced them mostly with 13 different Vanguard Group index funds  reported returns totalling just 13.9 percent for the year. (The other two funds in the Butler portfolio are managed by a  New York investment firm called Twin Capital, founded by an ex-Pennsylvanian, Muhlenberg College grad turned Wall Street trader David J. Simon. Twin Valley returns for 2017 trailed the S&P 500 and the Vanguard index funds, though it still beat bonds and other indexed investments and Butler's overall return.)

What difference does one or one and a half percentage points make? A lot, when you're a state investing billions for teachers, legislators, prison guards and social workers (or a county setting aside hundreds of millions for sheriff's deputies), especially if the trend holds from year to year. (Though it reverses often enough, see below.)

I'm still waiting for last year's Montgomery County, Pa. pension report. Montco went the Vanguard index route four years ago (with an assist from SEI Corp. of Oaks' alternative index portfolios.)

Also waiting for the final annual report for the Pennsylvania Public School Employees' Retirement System. I'll update.