President Joe Biden vetoed the first bill of his presidency on Monday, one that bans the government from requiring retirement funds to adhere to ESG, or environmental, social and governance standards in making investments.
The bill would have reversed one of Biden's own rules that stated money managers could consider ESG when making investment decisions. Biden's rule undid a Trump-era one that banned money managers from doing so.
In a show of bipartisan support, Democrat Sens. Joe Manchin (WV) and Jon Tester (MT) broke with their party to pass the bill in that chamber 50-46. Still, the slim House majority and the slim support in the Senate will not be enough to overcome Biden's veto, and the rule will stand.
Biden did make the point that the rule didn't force anyone to use ESG considerations in investing, but Republicans and others opposed to the rule argue that it takes the U.S. further down a slippery slope where ESG could become a requirement.
The veto gave the White House a good excuse to grandstand about how dangerous "MAGA Republicans" are.
White House spokesperson Robyn Patterson said in a statement, "The President vetoed the bill because it jeopardizes the hard-earned life savings of cops, firefighters, teachers, and other workers – all in service of an extreme, MAGA Republican ideology.”
Republicans, on the other hand, see ESG as a dangerous erosion of freedom for investors to act in ways most profitable for their clients.
They say ESG requires money managers to act against their best financial interests in service to a radical agenda that could push important businesses out of the marketplace. ESG could be used to get rid of oil and gas companies, for instance, even though they are highly profitable and provide needed products to consumers, because they are perceived as hurting the environment.
Critic of ESG and Author James Lindsay told The Post Millennial, "ESG is a scam against America and a first-rate national security threat, and Biden is in on it. ESG uses your retirement money to do Woke and Sustainability activism that hurts America and everyday Americans."
In addition, ESG funnels more money to companies that support Democrats, and will only allow their agenda to grow at the expense of conservative policies that actually work.
“It is disappointing to see this administration use hardworking Americans’ retirements to further progressive politics rather than ensure Americans are financially secure,” executive director of Consumers’ Research Will Hild said, The Hill reported.
Lead author on the bill Sen. Mike Braun (R-IN) said, “Today, President Biden used his first veto to reject a bipartisan majority consensus in the House and Senate that Americans’ retirement savings should be invested to get the best return, not to support a political agenda,” adding that Biden is “doubling down on prioritizing a progressive agenda over Americans’ retirements and the will of Congress.”
Allowing ESG to become the standard for retirement and other investing is anti-capitalist because it thwarts the free market and pressures, if not demands, that money managers agree with a woke agenda rather than consider which investments make money and benefit society.
Stopping ESG requirements should be a top priority of Republicans, and this bill should only be the first volley in an ongoing effort.