Pirate's Cove

See, he doesn’t like that free market Republicans are trying to interfere with what all these private firms are doing, forgetting that a lot of this stuff is being required by Government

On Climate Change, Republicans Need a Crash Course in Capitalism

Republican elected officials seem to think they’ve found three new evil letters to pair with their favorite bugaboo, CRT, or critical race theory. This one is called ESG, which refers to investment strategies that consider environmental, social and governance issues. Critics call it “woke capitalism.” There’s just one problem: They don’t seem to understand capitalism. And flogging ESG is not only a terrible economic mistake. It will be a political loser, too.

Most people have zero idea what ESG, so, the only people who will object to blocking it are leftists

Republican critics of ESG have focused primarily on the “E,” arguing that climate change should not factor into investment decisions. Texas has adopted a law restricting the state, localities, and pension boards from doing business with financial firms that seek to limit their exposure to fossil fuel companies. Even firms that have large investments in fossil fuels are being banned, if they dare attempt to price climate risk into their portfolio allocations. Oklahoma has enacted a similar law, and other Republican leaders are moving in the same direction. Last month, Florida’s Republican governor, Ron DeSantis, supported a resolution barring pension fund managers from considering ESG factors.

ESG is, in fact, woke capitalism bordering on socialism, because the government is requiring this stuff.

All these anti-ESG crusaders position themselves as defenders of the free market. But they are attempting to use government to block private firms from acting in the best interests of their clients, including retired police officers, teachers and many others who depend upon public pensions. And in doing so, they are turning the most basic investment rules on their head.

Are they in the best interest of their clients? Remember, the SEC is trying to make climate risk disclosures a thing. Anyhow, Mike goes on and on and on from a climate crisis scam point of view, all while refusing to reduce his own outsized carbon footprint.

The thing is, ESG, on the surface, is not a problem. It’s an experiment in investing. However, as usual, the Leftists in charge took the idea and turn the Progressive nob up to 11. It’s what they do. It’s how you get things like

ESG-supporting Bank of America offers zero down payment, zero closing cost mortgages – but only for black and Hispanic communities

It helps increase the cost of energy by messing with reasonable, return focused investment.

(National Review) But if investable funds are not even chasing profitability, many more dollars are likely to be invested in companies pursuing product plans that do not gain support from the market or suffer from ineffective execution. Meanwhile, startup founders and management of existing companies will likely receive market signals that steer them away from the task of efficiently meeting customer needs and toward other priorities. They may conclude, for example, that it is better to focus on diversity, equity, and inclusion than to make product improvements, causing them to expend more of their scarce resources on the former than the latter.

They large firms are often blowing off their fiduciary responsibility to make a proper return in favor of their Wokeness.

Like many movements in America’s past, the ESG-investment crusade has taken a reasonable idea and stretched it well beyond reason. If institutional investors continue to deploy funds according to shifting criteria other than long-term profitability, and relying on imprecise metrics while doing so, they will undermine the ability of the U.S. economy to grow and to thereby improve our standard of living.

That’s what the leftists do. Of course, the ones doing this are making lots and lots of money, eh?