Empower Wisconsin | Dec. 9, 2022
By M.D. Kittle
MADISON — U.S. Sen. Ron Johnson and his Republican colleagues sent a letter to the president Thursday urging him to do something out of character for Joe Biden: Be honest. In this case, tell the truth about the real-world costs of his radical climate agenda.
Johnson and U.S.. Sen. John Thune (R-S.D.), joined 10 other Senate Republicans in calling out Biden and his administration for “forcing their radical environmental, social, and governance (ESG) policies on the American economy in pursuit of their unrealistic environmental agenda.” The letter highlights various actions by financial regulators that threaten to choke off certain industries’ access to capital, which could increase the price of food and energy for businesses and families in the midst of record-high inflation.
And it’s all being done in the name of climate change action.
“All of these actions have real-world impacts that your administration would be well served to evaluate,” the senators wrote.
They point to regulatory rules, strategic plans and principles used to coerce financial institutions and other firms to limit their lending and exposure to businesses such as traditional energy providers. That’s a recipe for driving up prices on consumers, already hit hard by escalating power bills, the lawmakers assert.
“Choking off access to capital for companies in the energy sector in an attempt to decimate the fossil fuels industry drives up the cost of fuel and electricity at a time of record costs, further stoking inflation,” Johnson and his colleagues write. “Discouraging lending to farming and ranching communities in an attempt to reduce natural livestock emissions strains supply chains and increases the cost of food.”
The heavy-handed ESG principles pushed by the Biden administration are predicated on shaming businesses to effectively earn the “responsible” brand in the eyes of the public and investors.The policies are backed by executive branch coercion.
But the radical climate change agenda is having real-life impacts on costs to businesses and the consumers they serve.
A Heritage Foundation study earlier this year found that attempting to meet Biden’s aggressive “zero carbon” goals through a proposed carbon tax would reduce U.S. gross domestic product by $7.7 trillion over 18 years and cost 1.2 million U.S. jobs.
“Eliminating all U.S. emissions would reduce global temperatures by less than 0.2 degrees Celsius by 2100—wrecking the economy for a negligible climate benefit,” the study states.
To some degree, the hit is already here.
Biden’s Department of Energy projects heating bills will rise nearly 30 percent this heating season — or about $200 more. that bill is probably going up as well. Heating oil is projected to increase about 27 percent.
Meanwhile, the pressure campaign on companies is confronting some inconvenient truths. An analysis earlier this year in the Harvard Business Review found environmental, social, and governance aren’t what they’re advertised to be by the investors who hail them.
“Investing in sustainable funds that prioritize ESG goals is supposed to help improve the environmental and social sustainability of business practices. Unfortunately, close analysis suggests that it’s not only not making much difference to companies’ actual ESG performance, it may actually be directing capital into poor business performers,” Sanjai Bhagat’s report, “An Inconvenient Truth About ESG Investing,” concludes.
Some financial institutions are backing away from the investment shame game nationally structuralized by Biden administration policy.
Vanguard’s decision followed a “considerable period of review,” according to a company statement. Pulling out of the Net Zero Asset Managers initiative, “will help provide the clarity our investors desire” about everything from the role of index funds, to financial risks in the context of climate change, the firm said. The alliance reportedly boasts around 550 members and controls approximately $150 trillion of assets.
In their letter, Johnson and his colleagues advised the president that it would be prudent for his administration to “actually take the time to evaluate the costs its actions are directly and indirectly imposing on American businesses and families, as well as conduct the necessary analysis as required by the Regulatory Flexibility Act.”
“As our nation continues to grapple with record-high inflation, administrative actions that increase prices should be the last thing on your agenda,” the senators wrote.