Another place where the climate scare is starting to scare people, just not in the intended way, is when it comes to finance and ESG. Turning corporations into organs of the non-existent transition is increasingly clearly not just fun and games involving visionary statements and inspiring ads. It risks bringing our way of life crashing down, starting with the retirement of people whose savings are at risk from wacky investment priorities. Thus the Wall Street Journal editorializes about some municipal workers in New York City, not exactly a hotbed of reaction, who are suing their public pension funds for gambling their golden years on green nonsense.
Those with antiquated views of the capitalist system may not realize that public sector pensions are among the biggest shareholders in a modern economy. In this case the New York City Employees’ Retirement System, the Teachers’ Retirement System of the City of New York, and the Board of Education Retirement System of the City of New York between them manage about $150 billion. Which is probably more than you do unless you are, say, the Canada Pension Plan Investment Board, a Crown Corporation established in 1997 that plays with over half a trillion dollars in Canadians’ state-extracted supposed retirement savings and has expanded from a minimally staffed, prudent passive investor to a massive, bloated gambler.
“While accountable to Parliament, the CPP Investment Board is not controlled by the government or subject to government appointments, its employees and directors are not part of the Public Service of Canada. CPPIB is a partner of the World Economic Forum.”
Yeah. It would be. But we digress.
The point is that New York City unions may be even more feverishly left-wing than former mayor Bill de Blasio. Even though it would not be easy. As the Journal explains:
“Former Mayor Bill de Blasio led this climate socialism in 2018 when he declared that city pension plans would have to divest fossil-fuel-related assets within five years to show the city is ‘leading the fight against climate change.’”
Indeed. And what price virtue-signaling? It’s no good leading the way if you don’t get to thank God you are not like other people in a very public way. Thus:
“‘Our first-in-the-nation divestment is literally putting money where our mouth is when it comes to climate change,’ Mr. de Blasio crowed.”
Two pension funds refused at the time, the police and firefighter ones, on the grounds that the proverb is about your own money and it wasn’t his or, indeed, theirs. According to a police pension fund trustee:
“The money in the pension fund does not belong to us, nor to the comptroller, nor to the mayor. It belongs to the active and retired police officers who have worked and sacrificed to earn their pensions.”
Trustees of other funds were not so concerned with their duty rather than their pet causes. And now they’re headed to court to test whether the rule of law can stand against the rule of woke. As the Journal also explains:
“New York law and regulation impose strict fiduciary duties on trustees of such funds. Plans are required to invest ‘for the exclusive benefit of the participants and beneficiaries’ and with ‘care, skill, prudence and diligence.’ State courts have ruled that trustees owe a ‘duty of undivided and undiluted loyalty’ to retirees and workers.”
Whether they will do so again remains to be tested. But if so, this particular sort of irresponsible risk-taking will be terminated at once, at least in New York City. If not, the very real possibility exists that these trustees will squander workers’ assets betting on green and leave a huge hole in their lives, the public accounts, or both.
Now wait a minute, you might cry if you were someone like Stephen Guilbeault rather than a reader of CDN newsletters. It’s a good bet. The green economy of the future is the future of the green economy and we’ll all have lucrative jobs working from home on cyberthingamjiggies for the government. But it’s not looking that way to the people whose own money is following their mouths. Thus Lloyd’s of London just pulled out of the UN’s “Net-Zero Insurance Alliance” (aka NZIA, another parastatal acronym that signals trouble). And as the Epoch Times explained:
“This took the total number of members who have quit NZIA this week alone to six, which represents a fifth of the organization’s total of 30 members. Since March, a total of 10 members have quit NZIA.”
Perhaps unsurprisingly, “None of the six firms that quit this week have made it clear why they left the initiative.” There’s something of a taboo around this topic in polite society, and there are also loud antitrust rumblings in nearly two dozen American states over this kind of collusion. But they’ve put their money where their feet are, or rather their investors’ money, which is what really matters.
The fact that a Canadian government grant to homeowners for “green” retrofits is massively undersubscribed, by about 60%, might only indicate that our government is so inept it can’t even give away money, let alone plant trees. But it’s also possible that these retrofits that pay for themselves don’t actually pay for themselves even with a generous subsidy, and the Canadian government is as bad at economics as it is at math and science. As Blacklock’s adds, a previous similar program, launched by the “Conservatives” in 2007, crashed in administrative flames in 2012 after costing nearly a billion dollars.
It’s also very much worth noting that to keep the politicians’ old promise of free beer on retirement Tuesday, the CPPIB needs to achieve 4% real returns over a 75-year period. Which again we suspect your own funds, if any, have not done. It is also investing in China while spouting green rhetoric, which we would call remarkably cynical if blindness as to China’s real climate policies, and many others besides, were not so widespread.
So beware. If the government gets hold of your money, it will spend it on its priorities not yours and according to its notions of prudence not yours. In which case you might very well want to have your lawyer on speed dial.