President Joe Biden on Monday defended left-wing corporate politics even as a new report showed that going woke is bad for business.
After more than two years in office, Biden used his first presidential veto to reject a GOP-led bill that overturned a Biden rule allowing companies to invest in political causes.
Congress sought to scrap Biden’s rule in January after it allowed administrators of retirement plans to base investment decisions on Environmental, Social, and Governance (ESG) goals, instead of considering the maximum financial benefit of their clients.
As The Free Press has reported, Florida under Gov. Ron DeSantis and other red states are pulling pension-plan funds out of investment companies that promote ESG radicalism.
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In a statement on Twitter, Biden ripped the effort to force investors to put shareholders first.
“I just vetoed my first bill. This bill would risk your retirement savings by making it illegal to consider risk factors MAGA House Republicans don’t like,” said Biden. “Your plan manager should be able to protect your hard-earned savings — whether [GOP] Rep. Marjorie Taylor Greene likes it or not.”
But one lawmaker who didn’t like the veto came from Biden’s own party. Democratic Sen. Joe Manchin of West Virginia slammed Biden for the veto, as The Free Press reported on Monday.
“This Administration continues to prioritize their radical policy agenda over the economic, energy and national security needs of our country, and it is absolutely infuriating,” Manchin said.
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“West Virginians are under increasing stress as we continue to recover from a once-in-a-generation pandemic, pay the bills amid record inflation, and face the largest land war in Europe since World War II. The Administration’s unrelenting campaign to advance a radical social and environmental agenda is only exacerbating these challenges,” he added. “President Biden is choosing to put his Administration’s progressive agenda above the well-being of the American people.”
Biden’s veto came as a new study showed ESG is a loser, with a further analysis of corporate returns “finds that companies that aren’t influenced by politics outperform those that are.”
Looking at activism and investments between June 30, 2021, and Jan. 31, 2023, the study by investment industry experts Mike Edleson and Andy Puzder found that corporate America leaned hard left.
In all, 59% of companies were considered liberal, compared to 25% that remained neutral and 15% that were viewed as conservative.
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Looking at companies’ performances relative to each other and the S&P 500 and Russell 1000 stock funds, Edleson and Puzder determined nonpartisan companies came out on top.
Over the period in question, the S&P 500 dipped 1.8%, the Russell fund dropped 3.2%, and ESG-supportive funds did the worst, losing 2.5% to 6.3%.
On the other hand, neutral companies gained 2.9%.
In concluding their piece in The Wall Street Journal, Edleson, and Puzder wrote:
“The data indicate that, as common sense would suggest, companies that focus on profits outperform companies that don’t. As a corollary, it seems obvious that asset managers won’t maximize shareholder returns if that isn’t their focus. It’s hard enough to generate profits and returns when that is your focus, let alone when you’re trying to change the world.”
“When the business of business is no longer business, it may be unclear who wins, but it’s clear that shareholders lose.”
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