EIGHT-FOOT GREEN WAVES were pounding outside the Monterey Best Western hotel as Rob Feckner was renominated as president of the California Public Employees’ Retirement System’s Board of Administration. It was January 23, 53 degrees on the beach and not much warmer inside. I’d mistakenly counted on some California sunshine when Joseph Dear, CalPERS’s chief investment officer, invited me to come speak to his board about long-term risk and the system’s $230 billion portfolio. I’d also forgotten that Californians rarely heat their rooms in the winter.

From the rear of the Grande Ballroom, I could barely hear Feckner’s nomination by one of his fellow board members, but the speaker suggested that they were all “relieved by his steadying leadership,” or something like that — an implied contrast to earlier, scandalous tenures. Tall and thoughtful, with a neatly trimmed beard, Feckner is an employee of the Napa Valley Unified School District, with long experience in California politics. He’d been president of the California School Employees Association and had put in years of service on the CalPERS board. He was unanimously reelected.

With equal speed the board reelected vice president George Diehr, a statistics professor from California State University San Marcos. The whole process took less than five minutes. Then the board turned to a grueling daylong evaluation of portfolio risk and reward.

The CalPERS board is trying to extract itself from a cat’s cradle of deep portfolio losses in 2007–’08, governance scandals and funding sticker shock in Sacramento. It is also making....