Senate overturns federal rule on ESG investments, Biden vows to veto

[BumRushDaShow]

Last edited Wed Mar 1, 2023, 07:35 PM - Edit history (1)

Source: CNBC

WASHINGTON — The Senate on Wednesday passed a bill overturning a Labor Department rule that permits retirement fund managers to weigh climate change and other factors when making investments on behalf of retirement plan participants. President Joe Biden said Monday that he will veto the bill if it comes to his desk — the first veto of his presidency.

The same bill passed the Republican majority House on Tuesday with the support of every Republican and one Democrat, after which it advanced surprisingly quickly to the Senate for Wednesday’s vote.

Buoyed by wins in November’s elections, Republicans are using their increased clout in Washington to take aim at “woke” capitalism — starting with an all-out assault on environmental, social, and corporate governance (ESG) investing policies. ESG funds are designed to attract socially conscious investors with stock picks that promote green energy, certain social causes or good corporate governance.

Two Democrats voted to cross party lines and support the bill: West Virginia Sen. Joe Manchin and Montana Sen. Jon Tester. Both senators are up for reelection in 2024 in conservative-leaning states. It was unclear ahead of the vote Wednesday afternoon whether independent Sen. Kyrsten Sinema of Arizona, who caucuses with Democrats, would join Tester and Manchin in backing the repeal.

Read more: https://www.cnbc.com/2023/03/01/esg-bill-senate-vote-on-overturning-federal-rule-on-esg-investments.html

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Here's a quick roll call vote - https://www.govtrack.us/congress/votes/118-2023/s35

The vote was 50 - 46 with 4 not voting (3 (D)s including Feinstein, Fetterman, Merkley + 1 (R) Crapo) and 1 crossover (Manchin) to vote with the (R)s. Sinema voted with the (D)s (which would have been a "nay" on this resolution to rescind the Rules).

[bluestarone]

1. WTF?

Seems like we keep shooting ourselves in the foot!

[BumRushDaShow]

3. Remember we only have a narrow margin in the Senate

The vote was 50-46 (am waiting to see the roll call results).

[bluestarone]

4. I get that but,why vote if the numbers are not there

Kinda makes us look divided.

[BumRushDaShow]

5. This is a special kind of item that gets voted on

It's not "legislation" but is a Joint Resolution that is done under the "Congressional Review Act".

As noted, Biden can (and apparently will) veto it and it will take 2/3rds of each chamber to override.

This site has been tracking some of the earlier Resolutions before today's vote - https://www.ncsl.org/state-federal/congressional-review-act-overview-and-tracking

[bluestarone]

6. TY for this response.

I just had a week moment. Just wish we could stand strong, knowing what the administration wants. HATE voting and giving these RETHUGS a victory!

[BumRushDaShow]

7. YW

I know the headline looks all dire but they don't have 2/3rds of either chamber to override a veto so this is more of a "reporting" thing vs something that will actually go into effect.

[oldsoftie]

2. Sorry, but retirement fund mgrs should be looking for the best rate of return.

If my retirement is in the hands of someone I have no control over, they have a responsibility to get me the BEST return possible. If they can do that with ESG picks, then fine. If not, too bad.
Or give the employees the choice of what type fund to be in.

[mike_c]

10. some things are more important that maximizing earnings...

...to the point of perpetuating lucrative social harms. I'm retired, living on a state pension. I'm proud my pension fund management disinvested from tobacco years ago, and I'd be even prouder if they disinvest from fossil fuel companies.

[oldsoftie]

14. Well, you can be proud. But the choice should be YOURS not the govts.

At the very least there should be a choice. And if this gets to the court I'd bet it gates tossed. Fiduciary responsibility means working in the best interest of the fund, not a cause.
What if some future dept head decides that retirement funds should be helping to prop up the oil industry? Banks? Whatever?

[NickB79]

19. Funds with ESG consideration ARE the best returns. Texas found that out the hard way

https://www.washingtonpost.com/climate-environment/2023/02/28/climate-change-wall-street-investments/

In 2021, Texas Gov. Greg Abbott signed laws that barred municipalities from dealing with banks that restrict funding to fossil fuel or firearms companies. That led to the abrupt exit of five of the largest bond underwriters, costing the state between $300 million and $504 million, according to a paper co-authored by Daniel Garrett, a professor of finance at the University of Pennsylvania’s Wharton School, and Ivan Ivanov, an economist at the Federal Reserve.

[oldsoftie]

21. That story isnt about retirement funds. But it still helps prove my point.

The govt shouldn't be involved in these choices. This law stopped municipalities from using certain banks; which reduced competition & raised costs. If my city can get a better interest rate dealing with a bank who doesn't loan to tobacco, fine, thats the best use of my tax dollars. Which brings up what I mentioned earlier; you get an Abbott type admin in DC & THEY pick who you get to invest in? No thank you.

We should have a choice when it comes to retirement; those choices will show their returns & we make our own decisions. ESG funds would be able to show how well they do year over year. Track record is more important than recent returns. Show 'em.

[paleotn]

8. So Joe Coal thinks fund managers should NOT be allowed

to make investment decisions based on potential climate change impacts? You know, like NOT buying ocean front property in Miami. Buying FUTURE ocean front property in Valdosta GA.

[Fiendish Thingy]

9. What, no filibuster?

No cloture vote?

[BumRushDaShow]

11. This isn't "legislation"

It's a Joint Resolution under the "Congressional Review Act" as a Congressional oversight function. I posted some stuff here - https://www.democraticunderground.com/?com=view_post&forum=1014&pid=3040538.

[Fiendish Thingy]

12. Ah, well thank goodness for the veto pen. Nt

[BumRushDaShow]

13. Yuppers!

[keithbvadu2]

15. "permits", not 'mandates'.....

"permits", not 'mandates'.....

Now they cannot consider such things?

Big Gov't control rather than the free market.

[Cha]

16. So do you know who the Dem

in the House is that voted to overturn?

TY & PJB for Veto Power!

[BumRushDaShow]

17. It was Jared Golden (ME-2) from Maine

Golden (ME) Democratic Maine Yea

https://clerk.house.gov/Votes/2023124

[Cha]

18. TY!

[LiberalFighter]

20. I hope he publicly explains while he vetos the resolution that it is not a requirement.