The world of finance is turning bullish on ESG, an investment strategy directing funds to corporations with woke environmental, social, and governance policies. Trillions of dollars have already flowed into ESG funds, projected to hit $50 trillion in two years.
ESG boosters claim the funds enable investors to do well by doing good. You can make good money while simultaneously bettering the world.
Wish it were so. In fact, ESG funds do neither.
Investing goals that compete with shareholder profitability have predictable results. A recent NYU study compared investment results created by firms with high versus low ESG scores, which are generated by professional ratings agencies. Over the past five years, high ESG funds have returned 6.3% compared with 8.9% for others. Over time, that’s a chunk of change.
Thus, Kentucky AG Daniel Cameron warned his state’s pension fund managers to avoid funds that “put ancillary interests before investment returns,” which would “violate statutory and contractual fiduciary duties” to the pensioners depending on them. Seniors deserve better than to have their retirements hijacked by an ideology they might not share.
The basic tenants of ESG are radical environmental policy (primarily the elimination of fossil fuels), woke social policies promoted by the company, and corporate governance that replaces merit with preferences based on race or gender.
The driving forces behind the growth of ESG are three very powerful financial firms. BlackRock, Vanguard, and State Street are, between them, the largest shareholders in 80% of the companies in the S&P 500. Their financial heft gives them the ability to force companies to implement ESG, making them, in effect, upstream controllers of these companies.
ESG is based on the foundational principle of progressivism—the notion that the most beneficial governance comes from giving experts, the best and the brightest, control over our lives. Personal freedoms and democratic processes must yield to a governing elite that knows best.
No goal is pursued more tenaciously than the elimination of carbon-based fuels. Consumers must be pushed into using renewables, principally by regulating fossil fuels into being scarce and expensive.
Green New Dealers may be thrilled to have the backing of the ESG behemoths, but the problem is that Europe is already experiencing a full-blown energy crisis, with America not far behind. For a year now, a post-COVID demand surge, combined with nuclear plant closures worldwide, long-standing over-investment in impractical renewables, and a global drop of over 50% in oil and gas investment since 2014, have combined to put serious pressure on economies worldwide.
Aluminum smelters, glass factories, and other EU manufacturers have had to shutter plants for lack of affordable energy. In the UK, the number of people behind on their energy bills ballooned from 3 million to 11 million earlier this year. Even in relatively secure Germany, there is deep concern over looming shortages of heating oil this winter after being shut off by Russia.
The hard fact is that, in our current state of technology, fossil fuels are the mainstay economic resource, whether we like it or not. We need more oil, natural gas, and nuclear energy, not less.
The hard-core environmental left, now joined by ESG interests, has worked itself into a lather insisting we can only avoid global catastrophe by achieving zero carbon emissions by 2050. Environmental alarmists achieve about the same accuracy with their predictions as the apocalyptic preachers of yesteryear. But even in the early stages of the project, it’s becoming obvious that it simply can’t be done.
Even if eliminating all emissions of carbon would significantly reduce atmospheric temperatures, and even if humans are the main villains of global warming, and even if we could somehow convince China and India to not sabotage the effort, it doesn’t matter. It’s neither economically nor politically possible to deprive humankind of the benefits of carbon fuels.
The financial titans pushing ESG are blowing an opportunity to do some real good. We need respected leaders who can stand up to the hysteria and exaggerations to propose practical, feasible solutions that would protect humanity from the worst effects of atmospheric warming.
Instead, the self-appointed experts are using other peoples’ trillions to push us down the road to dystopian government and perpetual poverty.
Dr. Thomas Patterson, former Chairman of the Goldwater Institute, is a retired emergency physician. He served as an Arizona State senator for 10 years in the 1990s, and as Majority Leader from 93-96. He is the author of Arizona’s original charter schools bill.
Even though I was raised in a loving, conservative home, and first registered to vote as a Republican, I switched to Democrat. Why? Partly out of pressure (basically bullied by my husband), but also, like many others, I had heard liberals were the compassionate ones, concerned about protecting the rights of others.
I justified that my husband was one of those liberals, and I could help the Party by sharing my conservative ideas. But he turned out to be a Leftist—insisting that we were “entitled to state benefits,” always angry about supposed racism (but without evidence), and always in fear of COVID or global warming. This was not the compassion I expected from liberals but instead a lot of ‘righteous’ anger. Eventually I woke up tired and worn out from the anger of the Far Left. I still have dear liberal friends, but I had to escape the mindset that took away my sanity and hope. Here’s what I learned.
1 – Democrats are no longer “the compassionate ones.” They’re either old school liberals (like John F. Kennedy or even Bill Clinton) OR they’re Leftists. The true liberals still care, but they don’t realize that their party has been taken over by socialists, and it’s demolishing what they believe in—what our forefathers created in our Constitutional Republic. The Democrat platform no longer cares about the rights and freedoms of the people; only about taking control.
2 – The Democrat media is NOT fact-based. When I registered as a Democrat, I noticed the videos posted to my Facebook made AOC look like the American Joan of Arc, standing up to Big Pharma and Big Tech. Nowhere was I shown the full sound bites where she makes no sense: ‘the Green New deal is going to save us from certain death in a decade!’ They use terms like fossil fuels, but have no idea what it really means. They say renewable energy is a great innovation that will keep improving, but it’s nowhere close to beating petroleum or nuclear power—both of which help most people in poorer countries.
3 – Democrat activists are kind of shady. Whenever someone found out that I was a registered Democrat, and they were too, the conversation turned SUPER secretive. They lowered their voice and looked around making sure no one else was listening, like we were part of a spy network. No joke. Every time! Once I was part of an activist group talking about staging a protest in front of a local GOP office—again it felt shady, rather than doing good work…. Eventually, I thought to myself: if what the Republicans (my family) are standing for is so bad, why is there a need to always be looking behind your shoulder? Why is everything in the Democrat party secretive?
After four years of living like this, I was obese, SUPER in debt, angry, and impatient with people: things I never wanted to be or have my son see. It hit me one day that my parents’ “normal” life was healthy. It had schedules, hard work, gratitude, and hope. Conservative values actually made happiness possible.
Leftist thinking had derailed my life. I had to make some tough choices, but now I’m free! Today, with my family’s support, I’ve lost and kept off over 20 pounds, paid off debts, been at peace with who I am, and become strong in my faith. Now, I have the ability to be fully present for my son. (He goes to the gym with me, and we even go to Republican meetings together!) Honestly, I can say it’s when I embraced conservative thinking that we started getting healthy.
Now I’m part of Chandler/Gilbert Republican Women, I’ve worked on campaigns, and contribute research and admin support for Arizona Women of Action. I’m excited to be an activist for freedom! I hope my story encourages others to think about their beliefs, and remember WHY we’re fighting—for a healthy, happy country.
Sarah is a part of the Chandler/Gilbert Republican Women and contributes research and administrative support for Arizona Women of Action.
Leftist thought leaders insist that we are facing an environmental holocaust unless we immediately, drastically reduce carbon emissions.
Yet it’s curious. The governing and influence elites demand massive societal sacrifice, while they are apparently not concerned enough to alter their own extravagant lifestyles. They own multiple sumptuous homes, cars, and yachts. They fly individual private jets to their annual meetings in Davos, Switzerland, where they assure each other that it is their solemn responsibility to save the rest of us from ourselves.
They refuse to engage in thoughtful debate on any notions that challenge their woke orthodoxy. Instead, those advocating ideas different from their own are dismissed as “climate deniers.”
Take electric vehicles. EVs are touted by enviros as the obvious antidote to carbon belching SUVs. But they aren’t.
Fossil fuels produce most of their electricity. The manufacture and disposal of batteries—and the rare metals required—have significant environmental impacts. A growing consensus now acknowledges that EVs may produce more net carbon emissions than today’s cleaner burning gasoline cars.
You would think anyone with genuine concern about the environment might reconsider EV policy. But they don’t engage. Instead, they soldier on, funding yet more subsidies, benefits, and charging stations. Taxpayers get dinged for billions with no discernible benefit.
Clearly, to these decision makers, climate change isn’t about climate. It’s about power. Egomaniacal persons of all stripes throughout history have had the unquenchable desire to control the lives of others and operate the world from their centers of power. Think Hitler, Mao, Stalin, Gates, Zuckerberg – make your own list.
One irony is that the consequences of rising temperatures may not be that harmful. According to Swedish economist Bjorn Lomborg, higher temperatures are far less harmful than lower ones.
500,000 people worldwide die annually from heat-related causes, while 4.5 million die from cold. Over the last decade or so, rising temperatures have caused 116,000 more heat deaths yearly, but also 283,000 fewer cold-related deaths per year. How many hysterical accounts of coming devastation would you have to read to learn that?
It’s not the heat but the political responses to climate change that are causing real harm. Low-cost synthetic fertilizer is an innovation that has greatly enhanced our ability to feed the world. Because it is made from natural gas, climate activists have limited its use, even though 1 billion people worldwide are facing imminent threat of starvation.
Other pressing needs have been drowned out by the insistence on prioritizing climate change. Recent increases in energy prices were exacerbated by Biden’s self-proclaimed war on fossil fuels. Europe’s refusal to capitalize on its shale reserves and their shunning of nuclear power also resulted in higher energy prices and lower security, as did subsidies of solar and wind, which are still not substantial, reliable suppliers to the electrical grid.
The costs of climate activism will be even higher if governments seriously pursue their stated aim of producing net zero emissions by 2050. The truth is that climate is a global problem. With our current technologies and geopolitical realities (i.e., China) such goals are simply not attainable.
But the price for such climate grandstanding would be $5 trillion per year for 30 years according to McKinsey. Every single American would have to pay $5,000 per year to achieve even 80% of the goal by mid-century.
Ordinary citizens are getting fed up with these elitist obsessions. Polls show climate change far down the list of Americans’ concerns.
40,000 Dutch farmers recently held a mass protest against government mandates that nitrogen-oxide and ammonia emissions, produced by livestock, be reduced by 80%. The government of Sri Lanka resigned after a ban on synthetic fertilizers decimated food production and the economy collapsed.
Remember, we’re only in the early phases of the alarmists’ grand plans to reorder society. Already, California and other areas, possibly including Arizona, are facing the threat of rolling blackouts. An EU official recently warned that millions of Europeans may not be able to heat their homes this winter.
Climate change is manageable through mitigation and innovation. The fabulously expensive, impractical nostrums being pushed by our self-appointed experts are a recipe for human suffering and chaos.
Dr. Thomas Patterson, former Chairman of the Goldwater Institute, is a retired emergency physician. He served as an Arizona State senator for 10 years in the 1990s, and as Majority Leader from 93-96. He is the author of Arizona’s original charter schools bill.
