Biden Vetoes Bipartisan Joint Resolution That Would've Kept Woke ESG Politics Out of Retirement Plan Profits
Craig Bannister : Mar 21, 2023
"This Administration continues to prioritize their radical policy agenda over the economic, energy and national security needs of our country, and it is absolutely infuriating ... Biden is choosing to put his Administration's progressive agenda above the well-being of the American people." -Senator Joe Manchin
[CNSNews.com] On Monday, ...Joe Biden issued his first presidential veto, in objection to a bipartisan Congressional joint resolution nullifying his administration's rule freeing asset managers to invest their clients' retirement savings in political causes, rather than in the most profitable investments. (Screengrab image)
"[T]his resolution [joint resolution H.J. Res. 30] would prevent retirement plan fiduciaries from taking into account factors, such as the physical risks of climate change and poor corporate governance, that could affect investment returns," Biden wrote Monday in his "Message to the House of Representatives — President's Veto of H.J. Res 30."
Under federal ERISA (Employee Retirement Income Security Act) law, asset managers have a fiduciary responsibility to their clients to base investment decisions on their expected financial profitability alone. Recent Studies have documented that ESG investments underperform investments in politically-neutral companies.
But, a Labor Department rule that went into effect in January gave fund managers the freedom to pick investments based on ESG goals, as well, even if that meant sacrificing retirement account growth.
In February, however, the House and Senate passed joint resolution (H.J. Res. 30), introduced by Rep. Andy Barr (R-KY) and supported on the Senate side by Sen. Mike Braun (R-IN), voiding Biden's rule and, thus, requiring asset managers to return to investing for profitability only:
"Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Department of Labor relating to 'Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights'.
"Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That Congress disapproves the rule submitted by the Department of Labor relating to 'Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights' (87 Fed. Reg. 73822 (December 1, 2022)), and such rule shall have no force or effect."
In February, Biden promised in a policy statement that he would veto the joint resolution, if it passed—a threat he made good on Monday.
As the White House statement acknowledged, the Labor Department rule allows investment in climate and other social goals:
"This rule clarifies that retirement plan fiduciaries may consider climate change and other environmental, social, and governance factors in selecting retirement investments and exercising shareholder rights, when those factors are relevant to the risk and return analysis."
"The 2022 Biden-Harris Administration rule makes clear that ERISA fiduciaries can consider factors such as corporate accountability and transparency, climate, and liability risks if they find them relevant to the analysis of an investment's risk and return, in the same way that they would prudently consider other relevant factors."
Biden posted a snarky tweet celebrating his veto on Monday, in which he derided the joint resolution as a product of House Republicans who want to "make America great again" ("MAGA), such as firebrand Rep. Marjorie Taylor Greene (R-GA), and claimed that politically-motivated ESG investments, somehow, "protect your hard-earned savings":
"I just vetoed my first bill.
"This bill would risk your retirement savings by making it illegal to consider risk factors MAGA House Republicans don't like.
"Your plan manager should be able to protect your hard-earned savings—whether Rep. Marjorie Taylor Greene likes it or not."
But, Democrat Senator Joe Manchin (D-WA) issued a statement Monday blasting Biden's veto for putting a "radical political agenda" over the welfare of the nation:
"This Administration continues to prioritize their radical policy agenda over the economic, energy and national security needs of our country, and it is absolutely infuriating.
"West Virginians are under increasing stress as we continue to recover from a once in a generation pandemic, pay the bills amid record inflation, and face the largest land war in Europe since World War II. The Administration's unrelenting campaign to advance a radical social and environmental agenda is only exacerbating these challenges."
"...Biden is choosing to put his Administration's progressive agenda above the well-being of the American people," the Democrat reiterated.
The Labor Department rule is likely to stand, given that Congress appears to lack the votes to override Biden's veto. Subscribe for free to Breaking Christian News here