Honey, Biden just shrunk our pension

[a425couple]

from
https://www.foxnews.com/opinion/honey-joe-biden-just-shrunk-our-pension

Honey, Biden just shrunk our pension
Biden said his veto is good for investors. Wrong.
Stephen Moore By Stephen Moore | Creators Syndicate
Facebook

Moderate Democrats criticize Biden’s ESG veto
Fox News senior Congressional correspondent Chad Pergram discusses how
President Biden's ESG bill veto is being received by Democrats on
‘Special Report.’

NEW
You can now listen to Fox News articles!

Listen to this article
0:00 / 4:27
1X
BeyondWords
President Joe Biden recently issued his first veto since taking office
on Jan. 20, 2021.

Biden rejected a bipartisan bill that would have required investment
fund managers to take politics out of their investment decisions and to
stay focused on providing the best return to their clients as much as
possible.

Why should you care? Because Biden was, in effect, saying it was
permissible for fund managers, who have control of trillions of dollars
in pension accounts, to take into consideration a company's ESG score
(related to how it stands on racial justice, climate change and LGBT
issues) when they decide where to invest the money.

Workers and retirees are angry about this decision -- as they should be.
ESG is effectively a tax on your retirement funds, and it means you will
have a smaller nest egg when you retire than if the money managers
simply bought the top-performing stocks. Workers don't want politics
diluting the returns on their 401(k) plans and other pension accounts.

Let's step back a minute. Social investment funds have been around for
decades. I'm fine with it. As a matter of conscience, if people want to
avoid investing in pro- or anti-abortion causes, divest from products
made with child labor or avoid owning any fossil fuel companies, gun
manufacturers, plastic companies or firms that don't have enough
transgender bathrooms -- it's a free country. These funds normally
underperform the market, but that's a decision of personal conscience.

HOUSE DEMS PROTECT BIDEN'S FIRST VETO, BLOCK GOP OVERRIDE ATTEMPT

Sen. Marsha Blackburn reacts to Biden vetoing bill restricting ESG:
'Very political move'Video
I try to be a socially conscientious investor myself. I don't like the
politics of Ben and Jerry's, for example, so I try not to buy their ice
cream. But to be honest, I love their ice cream, so sometimes I give in
to temptation. The left tried to stage boycotts against Chick-fil-A
because of some of the owner's social policy views, but the chicken
sandwiches are so popular that the crusade failed miserably.

But this new fad of ESG investing is entirely different and more
nefarious. ESG stands for environmental and social justice governance.
The idea is to promote racial equality, save the planet from climate
change, and advance gay rights and a whole host of other related trendy
and mostly left-wing causes.

ESG investing is perfectly appropriate when the investors are making
their own decisions with their own money on where and what to invest in.
But the scandal arises when fund managers that make investment decisions
with other people's savings, or pension plans start injecting their own
political biases into the investment portfolios and choose company
stocks they should or shouldn't buy.

Fund managers that pool clients' investment dollars and pick (hopefully)
high-performing stocks have what is called a fiduciary duty. They are
legally required to get the best return they can. Their duty is not to
save the planet.

Biden said in his veto message that ESG is good for investors and offers
high returns to workers and pensioners. Wrong.

Sen. Mike Braun rips 'heavy-handed government' after Biden issues first
vetoVideo
CLICK HERE TO GET THE OPINION NEWSLETTER

A recent analysis by Bloomberg found that last year, ESG funds severely
underperformed the market -- in some cases by well more than 10 percent.
Many ESG funds were divested from oil and gas companies, even though
Exxon, Conoco Phillips and others were among the highest-return stocks.
In other words, if you bought the stocks that ESG funds sold, and sold
the stocks that ESG funds bought, you'd have made a lot of money in
recent years. And by the way, given that more than 70 percent of our
energy now comes from fossil fuels, how does it advance our well-being
as a nation by closing these energy sources down?

Another study by Boston College professors in retirement policy examined
the performance of ESG funds and found "the average annualized return
for those with a state ESG mandate would be 20 basis points lower than
for those without a mandate."

U.S. President Joe Biden speaks at an event marking the 13th anniversary
of the Affordable Care Act in the East Room of the White House on March
23, 023 in Washington, DC.
U.S. President Joe Biden speaks at an event marking the 13th anniversary
of the Affordable Care Act in the East Room of the White House on March
23, 023 in Washington, DC. (Anna Moneymaker/Getty Images)

CLICK HERE TO GET THE FOX NEWS APP

My estimate is that ESG has cost the public billions of dollars of
reduced returns on their retirement nest eggs. This comes atop the
$30,000 or so that people have lost on average in their 401(k) plans
after Biden came into office, and the combination of high inflation and
lousy stock market returns overall.

The good news is that more than a dozen Republican governors are
fighting back to protect pensions from "political influences." They are
telling fund managers in their states that ESG is a violation of their
duty to workers whose money has been placed in their trust. ESG should
only be allowed with the explicit approval of the investor.

In other words, politicians and community activists aren't very good
stock pickers. So keep your grubby hands off our pensions.

CLICK HERE TO READ MORE FROM STEPHEN MOORE

Stephen Moore is a senior fellow at the Heritage Foundation and an
economist. He is also co-founder of the Committee to Unleash Prosperity.
His latest book is "Govzilla: How the Relentless Growth of Government
is Devouring our Economy."


Conversation319 Comments
358 Viewing

davecfive
9 hours ago
There is plenty of evidence that "woke" investments don't equal
profitable investments. We need States to fight back against the
Federal government meddling in private investments. It's as if the
administration is actively trying to make us poorer with every decision
it makes. The middle class...

taxpayer024
6 hours ago
They are VERY PROFITABLE for politicians. Especially when they receive
pre offerings / stock options. Like Nancy and Paul Pelosi. Guaranteed
profit for future legislation. Absolute power corrupts absolutely.

marshyam
8 hours ago
These "political" restrictions were not in force until 2020. What
negative effect did you retirement investment suffer before Trump
decided fossil fuel investments are not political but renewable energy is?