Hypocrisy is not uncommon in American politics, cutting across issues, ideology, and regions. These days, however, conservative Republicans are reaching new heights — or depths — in placing political opportunism ahead of proclaimed principles.
‘That government is best which is closest to the people’ has been a long-standing Republican mantra. This year right-wing legislatures in Texas and Mississippi are taking over local school systems in Houston and local courts in Jackson.
Judicial activism, or “legislating from the bench,” has been a favorite conservative target — until, that is, the Supreme Court got packed with its current majority of right-wing activists, who’ve had little scruple brushing aside precedents to create new law.
An anti-abortion federal judged in Texas, for the first time ever, ordered an FDA-approved drug off the market — decades after the fact.
It seems forever that conservatives depicted Democrats as the party of corruption, especially the “big city machines.” Those old bosses would blush at the corruption in states where Republicans have enjoyed absolute power. Consider Ohio, where an energy company paid $61 million in bribes to state legislators and where last month the former state speaker of the house and former Republican state party chair were convicted of racketeering. Or consider Mississippi, where $77 million of state welfare money was doled out to political supporters, including $5 million for a volleyball stadium at football star Bret Favre’s Southern Mississippi alma mater.
But that’s a familiar flavor of hypocrisy; there are others.
Donald Trump’s election fraud lie has become contagious in GOP circles. Some Republicans in Wisconsin are taking it a step further; this month voters overwhelmingly elected a liberal state supreme court justice, giving liberals the majority; even before she dons the black robe, some Republicans are threatening to impeach her.
Once upon a time, there was no greater article of GOP faith than trust in the private sector and markets, with minimal interference by politicians.
Florida’s ambitious Republican Gov. Ron DeSantis didn’t get the message. He’s at war with Disney, the state’s largest employer — not for mistreating employees or customers or running any scams; rather, the company opposes DeSantis’s controversial initiative banning any mention in elementary schools of gender identity or sexual orientation, the “Don’t Say Gay” measure.
DeSantis wants the private sector to heel to his ideology.
More pervasive is the conservative Republican effort to go after firms that stress environmental, social and governance policies — ESG — in their business and investments. The environmental standard focuses on climate; social is how employees, customers, and communities are treated; and governance is leadership, transparency, and shareholder rights.
It really isn’t radical. These are considerations that should factor into long-term risk planning. Yet President Biden’s only veto was when Republicans sought to block rules allowing pension managers to consider ESG in making investment decisions.
These proponents “are not crazy progressives,” noted Kirsten Snow Spalding, a Vice President of CERES, a non-profit investor network. “They are really major folks who are good at their jobs.”
Republicans argue these are not decisions that should be left to the private sector. Former Vice President Mike Pence, with his own ambitions, blasts ESG considerations as “woke” capitalism. House Speaker Kevin McCarthy (R-Calif.) wants to outlaw it, and a number of GOP state attorneys general are threatening lawsuits to block ESG in investment decisions.
They have nefarious allies: oil and gas industry proponents and, the Wall Street Journal disclosed, the high priest of dark money, Leonard Leo.
A good primer on this debate is an exchange of letters last year between 19 Republican attorneys general and BlackRock, the world’s largest asset manager and leading proponent of ESG-focused investment decisions.
The attorneys general accused BlackRock of circumventing “the hard-earned money of our state’s citizens” to pursue an ESG-based ideological investment approach. “The time has come,” they wrote, “for BlackRock to come clean on whether it actually values our state’s most valuable stakeholders, our current and future retirees.”
A BlackRock executive responded, correcting some false charges, while stating the obvious about its commitment to clients’ financial interests while noting: “We believe investors and companies that take a forward-looking position with respect to climate risk and its implications for the energy transition will generate better long-term financial outcomes.”
Three of those attorneys general were from Kansas, Indiana, and Texas — where studies have shown anti-ESG investment policies would actually be harmful. In Kansas, a state budget analysis found anti-ESG policies would reduce pension returns over the next decade by $3.6 billion. In Indiana, over a comparable period, the losses would total $5.5 billion. Texas researchers found that over only eight months, the state’s cities could lose as much as $500 million.
There are disagreements about the issue. European investors generally want tougher ESG standards, while some American liberals say it has overpromised and underdelivered. We’ve gotten beyond Milton Friedman’s notion a half century ago that corporate responsibility is just to increase profits; for investors, there are long-term risk considerations, ranging from climate to data security to diversity of leadership.
Whatever one’s take on the specifics, these decisions generally are better left to the market — if Black Rock is wrong in investment decisions or a company stresses these factors too much, they will pay a financial price. The alternative: Do you really want to trust your retirement savings to headline-seeking Republican hypocrites?
Al Hunt is the former executive editor of Bloomberg News. He previously served as reporter, bureau chief and Washington editor for The Wall Street Journal. For almost a quarter century he wrote a column on politics for The Wall Street Journal, then The International New York Times and Bloomberg View. He hosts Politics War Room with James Carville. Follow him on Twitter @AlHuntDC.