- The Washington Times - Monday, March 6, 2023

President Biden told us early on that he’d put the green agenda high on the top of his list of things to accomplish. We should have believed him, but because many of us didn’t, we’re paying the price.

Mr. Biden got to where he is by being Lunch Bucket Joe, a friend to working men and women alike. He shared their struggles as a boy growing up in a working-class community in Scranton, Pennsylvania. He learned to embrace their values and understands their hopes and dreams.

Now, as commander in chief, he’s about to betray them by vetoing the bipartisan congressional repeal of regulations his administration promulgated concerning the standards under which funds such as pensions are invested.

Some time ago, the global environmental movement hit on the idea of pressuring pension funds and other entities that manage large portfolios to stop investing in traditional energy stocks and development projects. Instead, they needed to be the funding source for the world’s transition to green energy.

It’s an idea that caught on like a wildfire started by a misaligned solar panel. Before anyone really knew what was happening, ESG — environmental, social and governance — concerns started moving up the list of considerations for asset-management firms to consider before investing.

That didn’t sit well with the previous administration, which promulgated rules to prevent it, rules the Biden administration tossed out the window as fast as it could after coming into office.

The issue is basic, both to the economy and to the investor class. Should people who manage other people’s money be allowed to consider factors other than the responsibility to generate the biggest return possible for their clients when investing?

Some people, including Senate Majority Leader Chuck Schumer, D-N.Y., who wrote a piece in The Wall Street Journal defining ESG as capitalism at work, believe they should. Most people, including a lot of those who are in the professional money management business, disagree. To them, the principle of fiduciary responsibility is as sacred as the ideals underpinning other professions like the Hippocratic oath and the doctrine of attorney-client privilege.

All of this matters because it affects real people, the ones Mr. Biden claims to represent, not just the billionaires who underwrite the campaigns of people who want to live in the White House. Social Security being what it is, the returns these small investors and pensioners get often make the difference between a reasonably carefree retirement and one in which every last penny has to be pinched.

The latter situation shouldn’t be forced on people by pension plan administrators and big firms that, working in collusion with environmental groups and government bureaucrats, make investment decisions based on what makes them feel good rather than what will earn the most money in the long run. The doctrine of caveat emptor can be expected to go only so far.

Here’s how it all breaks down today. In 2022, tech stocks — the segment of the market where one finds most of the green energy companies — fell by more than 30%. Energy stocks, which include holdings in companies in the oil and natural gas business, were up by nearly 60%. The difference in returns from those two sectors could account for a big difference in what you have to draw on from your investments in your golden years.

The government should be protecting investors, not just from fraudsters peddling near-worthless penny stocks and bogus technologies but from well-heeled asset-management firms that think the best and highest use of the funds entrusted to them is to salve the collective conscience of their top executives by generating social change instead of the most generous possible returns.

If it’s possible to do both, then no harm, no foul. So far, it isn’t — and the firms that have committed to getting to global net-zero emissions by the year 2050 may be doing the people who are going to be retiring just about then considerable harm in the future.

Permitting asset managers to violate their traditional fiduciary duty to put their investors’ future financial security above other concerns could also lead to a series of taxpayer-funded bailouts that would make what happened in 2007-2008 look small by comparison.

The people most at risk from corporate ESG investing are the same people Mr. Biden has promised all his political life to protect. They’re single moms and the heads of union households who, while scraping by month to month, still find a way to save for someday when they can relax, take it easy, and play with their grandchildren someplace warm and near the water. That’s their dream, and it can be reached more easily if the president signs the congressional repeal of his regulatory scheme than if he vetoes it.

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