Injudicious investments into complex financial derivative products by treasurer Robert Citron forced Orange County into declaring bankruptcy almost exactly 13 years ago. Naturally, that tidbit made its way into almost every story reporting the news last week that Orange County currently has almost half a billion dollars invested in "structured investment vehicles" facing imminent credit downgrades from ratings agencies.

Did the county learn nothing from its previous escapades?

The current treasurer, Chriss Street, adamantly maintains that the county's investments are safe, and that none of the holdings involve exposure to subprime mortgages -- which in itself is a little strange, given that Orange County was, back in the day, the unquestioned headquarters for the nation's subprime lending industry. Maybe familiarity bred contempt?

Never mind -- as the Orange County Register reported on Friday, no other major government agency in California currently has public money invested in SIVs. San Diego, the only other county that even temporarily dabbled its toes, on a much smaller scale, in that exotic water, sold off all its positions in November.

The Register called up the treasurers of California's other major counties and asked them why they had kept their distance. Three cheers for ignorance, befuddlement, and fear!

"If something yields more than a comparable investment, there's a reason for it, and it's called R-I-S-K," said Bill Pollacek, Contra Costa County's treasurer-tax collector. "And you need to understand the collateral. If you don't understand the collateral, don't buy it."

"I don't get into investments I don't fully understand," Santa Clara County Finance Director John Guthrie said.

"It requires a degree of sophistication that we didn't feel we had in-house," said McDonnell, the Riverside treasurer.

The best part about these quotes is the fact that even those institutions that one would suspect have more "sophistication" in house than just about any corporations on the planet -- such as Citigroup and Merrill Lynch, to pick just two names out of the hat -- also utterly bungled the job. One imagines that a risk management officer at Citigroup who uttered the words "I don't get into investments I don't fully understand" wouldn't hold on to his job for too long. All's the pity.