We're back with another edition of the Federalist Radio Hour. I'm Emily Joshinski,
culture editor here at the Federalist. As always, you can email the show
at radio at the Federalist dot com, follow us on Twitter at fdr LST.
Make sure to subscribe wherever you download your podcasts into the premium version of
our website as well. Today I'm very happy to be joined by Will hild
he is the executive director of Consumers Research. Will thank you for joining us,
Thanks for having me. This is a great day to have you on
the program because there's all kinds of news swirling around ESGE, China, Black
Rock, Morgan Stanley. We're going to get into all of it, but
before we do, Will you specialize in researching, monitoring the broader ESG project.
You just tell us a little bit about how you ended up in this
line of work. Yeah, absolutely, Well, Consumers Research is the nation's
oldest consumer protection organization and we have a ninety plus year pedigree of standing up
for the consumer in the marketplace and amplifying their voice as well. And really
that's that's how all this started. About two two and a half years ago,
we started something called the Consumer's first initiative, which is a multimillion dollar
ongoing ad campaign to call out companies who are going woke in order to distract
from their misdeeds in the marketplace or their mistreatment of their customers. And you
know, I'm sure your listeners will recall, especially about two years ago spring
of twenty one, things really had reached like a fever pitch to the point
that you know, dozens, if not hundreds, of major US corporations we're
getting involved in the nitty gritty of election integrity legislation fights in states like Georgia,
Texas and others. And you know, first of all, they were
often getting the basic facts of the legislation wrong. People will remember the MLB
moving um the All Star Game from from Atlanta, uh to to Denver's sort
of punishment for for that legislation. And come to find out, you know,
Colorado has more restrictive voting rules than what they were about to pass in
the state of the state of Georgia. So not only were they getting you
know, the basic details wrong, but it was it was often at the
cost of focusing on on their consumers. And so we launched a number of
different ad campaigns against companies like Nike, Cocacola, American Airlines MLB, which
I mentioned Ticketmaster in order to call them out for that and and basically say
you need to you need to be focusing on serving your consumers, not not
woke politicians. And one of the questions that we got from the general public
a lot is why, and we still get this to this day, is
why are these companies doing this? Why do they seem so focused on insulting
their consumers, on poking their customers in the eyes. And we realized we
really needed to do some work helping to educate the general public on the influence
of this ESG movement and of big asset managers like black Rock and State Street
and Vanguard and the ways in which they were pushing these companies to engage in
this sort of really controversial, noxious, often embarrassing behavior that was so off
putting to so many consumers. So the big news is that just today,
actually as we're recording this on Tuesday, the Select Committee on China, to
be the one led by Mike Gallagher, which folks have definitely heard a lot
about, is now investigating black Rock and Morgan Stanley and will I imagine you
know exactly why this investigation has been open because you've been tracking it so closely
and are aware of what these corporations have been doing a lot of people know
ESG particularly because of its investments in that kind of broad issue of wokeness,
like the umbrella term of what we call wokeness, what we would call climate
craziness, climate radicalism, and all of that. But the China issue is
huge too, and it opens up that other question of why why on earth
are they doing this? But can you tell us a little bit about just
quickly what's coming out of the Select Committee on the CCP right now as it
pertains to both black Rock and Morgan Stanley. Yeah. Absolutely, I mean,
basically, the big revelation is the extent to which they have been financing
companies that are on the blacklists or red flag lists of a number of different
major US agencies, everything from Department of Homeland Security to the FTCUM. These
are companies that the People's Liberation Army of China uses to develop weapons and monitoring
software and communications hardware that firms like black Rock have been directly investing in,
even after they've been added on watch lists or even blacklists. They're certain companies
they've been invested in the past where it would be illegal for a US person
to trade with said company because of being on department from Land Securities Blacklist.
But black Rocks and black Rocks Sees saw fit to maintain or even sometimes increase
their investment as some of these companies. And this is something that unfortunately we
have seen from certain sectors of Wall Street now for at least a decade,
maybe longer, where despite all the virtue signaling that they do here in the
United States, when it comes to their activities overseas and particularly in mainland China,
they're playing by a very very different rule book. And really what you've
been doing at Consumers Research has been the tip of the spear, I think
when it comes to black Rock, and has had a pretty serious I mean,
basically, people who have heard about black Rock and ESG A lot of
that information is downstream of the work that you guys have been doing. Can
you tell us a little bit because some of it's somewhat amusing actually about the
push that Consumers Research has been making specifically against black Rock against Larry Fink over
the last couple of years. Indeed, it may have even culminated in Fink
trying to at least look like he's taking a step back from the term ESG.
Absolutely well. It all started in October of twenty twenty one, when
I mentioned we launched both a call out campaign, brand turnishment campaign, but
also a consumer education campaign against black Rock and to inform the general public of
the myriad ways in which they were using American investment dollars often individuals, you
know, pensioners, university endowments, state pensions money to undermine those very same
people's interest. We've spent about four and a half five million dollars now on
those campaigns. And when we first launched it was funny we did. We
did pre polling to kind of understand where people's perception of black Rock, understanding
of black Rock was, and what we found is that you know, basically,
you know, less than one out of ten American citizens could could say
that they I knew who black Rock was and correctly identified what black Rock did
as an investment management firm. I dare say the numbers have changed dramatically.
I'm hardened to see. You know, you can barely turn on a podcast
even if it's not about finance or even about politics, and often people will
refer to the massive amount of power that Black Rock has, the amount of
ownership that they have of so many major corporations, and then and the many
things that they're doing drive up the costs everything from the gas pump to the
grocery store. And while we certainly can't take credit for all of that,
in fact, I wouldn't want to, I'm glad to see that other people.
You know, there was a video that Ashley Saint Clair at TPUSA made
like a week or two ago that that got like eight and a half ten
million views, I think um talking about this issue. We're happy to see
that because I really feel like we kind of kicked a snowball down a hill,
and now it's turned into an avalanche of bad press, deservedly bad press
against Black Rock and Larry Fink and the other asset managers like State Street and
Vanguard that are engaging in this kind of behavior, and so that's sort of
where we got started. It's amazing the amount of change that's happened in the
last eighteen to twenty four months since we launched that campaign. People's understanding of
not just that company, but the overall esg complex, and I think adding
into this China piece that Congress is really looking at right now, I think
it's crucial because it allows people to understand, Oh, it's not just that
ESG pushes the companies that serve me to go woke. It's not just that
ESG raises the price of you know, everything I buy in the grocery store
and at the gas pump and everything else. It actively undermines US national security
as it puts US corporations at a completely uneven playing field with their Chinese counterparts.
In other words, black Rock and other asset managers do not force those
companies to play by the same bull It's not even close. It will finance
things like all power plants, natural gas pipelines they're in China, the very
same things that they are trying to shut down and destroy here in the United
States. I think it's great that people are Congress in particular, but now
the general public is really getting to see, you know, how deep this
rabbit hole goes. And then and the number of things that asset managers like
black Rock have been doing that that are not good for America. Yeah,
so let's talk about the strange tension when it comes to China, because it
is on the one hand, interesting that ESG steers so much capital towards directions
that are not you know, this is not the natural progression of the free
market. It's it's obviously putting elite political priorities, culture priorities over just things
winning out in the free market. And then on the other hand, to
your point, they're investing in China in ways that they wouldn't invest in the
United States, and that does seem to be a strange tension, or maybe
it's entirely possible there's like a component of this I'm missing, Well, what
explains you know why on the one hand they're being so they're they're eschewing the
sort of free market ideology that they claim to embrace, and then on the
other hand, um, they were they'll put all kinds of money in anti
green priorities or you know, bad anti environmentalist priorities when it comes to China.
Yeah, that's a great question. I'm glad you brought up that specific
issue of sort of you know, is this the free market or is it
not? And if not, why not? That's oddly enough, one of
the biggest pushbacks we've we've consistently gotten. Over the last i'd say like six
months, has been people on the left actually attacking the anti EESG movement saying,
well, like I thought you guys believed in the free market, and
this is just the free market, so like you know, you're being hypocrites.
Um, nothing could be further from the truth. Larry Fink and black
Rock and these other asset managers. You know you've you've probably heard the term
principle and agent, right, you have the principal person. This would be
like the client for a lawyer or the individual investor when they listen to an
investment manager, and then that other person is the agent, and that person
is supposed to act on their behalf. We have that in all kinds of
professional services. Your doctors owes you a fiduciary duty, your lawyer owes you
a fiduciary duty, and certainly your asset manager owes a fiduciary duty to their
clients, meaning they are supposed to put themselves in the shoes of the client
whenever they act using their resources. Larry Fink is not supposed to invest for
his own personal opinions or politics, or even his own personal gain. He's
supposed to use the money that's been provided to him by, for example,
the Texas State Retirement System or the North Carolina Retirement System, or the University
System of New York, or whoever it is. He's supposed to make sure
that whenever he invests their money, he is focusing on the returns and priorities
for that client, not his own personal priorities. What we've seen over the
last ten years, and particularly when black Rock and Larry Fink, but there
are other other perpetrators of this as well, is probably one of the largest
abrogations of that fiduciary duty in the history of the United States. And instead
of focusing on returns for those clients, these asset managers have been pursuing both
their own personal political objectives but in some cases their own personal gain with those
objectives, And that kind of explains a little bit. Both of those things
kind of explain a little bit of what black Rock is up to in China.
On one hand, it's incredibly lucrative to invest in some of these Chinese
product projects that they are skewing here in the United States. In addition to
that, because China, the CCP is so interested in attracting US investment.
They have been providing black Rock and Larry Fink a lot of bid pro quo
political advantages that other firms don't have in the United States. So, for
example, black Rock was given they were the first company to ever get permission
to manage a holy foreign owned mutual fund in mainland China. More recently they
were in two provinces to the major provinces in China. They were given,
ironically, the permission to start managing pension funds in mainland China. This is
extremely rare. A lot of people don't realize this, but China has a
closed capital account, meaning you cannot as a foreigner going directly invest in in
China. They have a period of rules that prevent foreigners, non Chinese citizens,
from buying into the Chinese economy, owning companies in the Chinese economy,
running businesses that aren't partially CCP owned in the Chinese economy. And strangely enough,
black Rock continues to find themselves exempted from a number of these rules and
get special privileges to operate businesses in mainland China. And it's very clear,
at least to me, that that is a quid pro Quo because he is
black Rock and others are putting US investment dollars in China in some of these
same blacklisted companies, US blacklisted companies that Congress says are are helping develop maybe
some of the weapons that they will be used to oppose US forces here in
the future. Is there an argument that this is basically just a smoke screen
or a giant public relations campaign to allow executives to kind of cover themselves and
have things to point to when you know, the sentiments of Occupy Wall Street
and then twenty sixteen bubble to the surface and people are upset about their investments,
people are upset about the economy in general. They can say, look,
we are investing in the future, we're investing in equality, We're investing
in not equality, we're investing in equity, etc. Etc. Or like
what is that? Because it is confounding, you know, on the one
hand that you have these sort of self proclaimed proclaimed uber capitalists that are also
foregoing profits in some places and not in others. It's just kind of hard
to wrap your head around. Yes, it's a great question, and really
I think what it gets to is that there are different incentives for different players
within the ESG complex for engaging in the scam so uh. And you know,
obviously for Black Rock and State Street and Vanguard, there's there's both the
monetary component, but also you know, it's kind of fun to effectively rule
the world, right if you get to run around Corporate America and and and
dictate to these people how they're going to operate their businesses and and slap them
on the wrist if they don't hit their net zero targets. Um, there's
a lot of power and a lot of excitement, uh in being in being
that powerful. From the corporate executive standpoint, there's also a huge incentive,
and I think you got to this, which is take the E for example.
The E is pretty much solely focused despite the fact that it stands for
Environmental um, it is pretty much solely focused on what they called net zero
by twenty fifty targets, which means making your company h have zero net carbon
emissions by the year twenty fifty. Now, that is effectively impossible. The
last time humanity was a net zero we were all living in caves, and
that's where we would be again if we were to ever actually get to net
zero. But the focus. The sort of fetishistic focus on net zero under
this ESG framework actually helps executives distract from real environmental problems that their company may
have, because they're only really being graded on this net zero progress target.
If you've got issues with you know, groundwater contamination at other types of emissions
that you know actually affect human life, these things are papered over if you
can say that, hey, we bought a ton of carbon credits last year
and we are on our pathway to net zero, which carbon credits themselves being
a massive scam that even you know, people as far left of John Oliver
have made fun of on how ridiculous they are on his show. So it
actually one of the reasons that corporate America I think has gone along with ESG
scam is that if you are an underperforming executive, for example, you can
run to the SG metrics and say, yeah, our last quarters haven't been
so great, we are really crushing it in our ESG metrics, or yeah,
we may have a problem with groundwater contamination at one of our minds or
plants or what have you, but we're really crushing it on the road to
net zero because we paid a bunch of money to a carbon offset scam last
year. And so I think that because that's brilliant, that such a good
scam it is. And I will say this, Uh, you know,
some of your listeners are probably familiar with this, this term called a Rube
Goldberg machine. They may not have heard the term, but I guarantee they've
seen one on YouTube. And that's when you see, like, you know,
the little ball goes down down a rail and hits a cup and then
it you know, strikes a match and pops a balloon, and you know,
it continue It can continue on for you know, five to six minutes.
It's complex machine, and then at the end it does something you know,
relatively minor. The ESG scam is is a pretty impressive Rube Goldberg machine.
Like they have gotten all of these people at the highest echelons to buy
in for very specific reasons, into the scam because it benefits them, even
though it's at the cost of the shareholders of these companies, of consumers,
of the general public, of our national security. It hurts a lot of
people. But they've kind of found a way to create this complex machine that
benefits some of the key people that they would need in order to operate it.
The good news is that, like any any Robe Goldberg machine, it
is incredibly fragile, and once you start pushing on it and enforcing fiduciary requirements
looking into antitrust issues, which Congress has also been doing the last few weeks,
the thing starts to fall apart. And we are already seeing that some
of the largest b SG coalitions, like that Zero Insurers Alliance, just lost
forty percent of its membership over the last two months because a coalition of Republican
ag sent them a letter saying, hey, according to your website, it
looks like you're in a massive anti trust conspiracy. Would you like tell us
a little bit about that? And suddenly forty percent of the members go,
we're not members anymore. So I definitely want to you know, I've obviously
described a fairly impressive scheme against the public, made up of some of the
most powerful people in the world. But I don't want to leave any listeners
with a sense of disempowerment or inevitability that they are going to win, because
the truth is the only reason that they were able to build something like this
is because a lot of people were asleep at the switch when it comes to
enforcement of existing US law, and now that that's no longer the case,
this thing's falling apart more. Check like go have some currents exactly The Watchdog
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podcasts. I actually want to ask you more about that anti trust question because
it seems to me a lot of this is, I guess, reflective of
the fact that while we fantasize or lionize the markets, the market, economy,
and the system in the United States, especially compared with just about anywhere
else in the world, it's harder and harder every year to understand our system
as like free market. We like to drop that word a lot, but
esg to me and so reflective of the fact that we really don't have free
markets, and a lot of that also seems to be downstream of these trusts
essentially in finance. Is that part of from your perspective, is that part
of this problem too? When you know, are there more robusts or anti
trust investigations or merger conversations that need to have to prevent this going forward?
Yeah, I think that's a great question that we should be asking. I
will say I don't think you know, I get accused of sort of being
a conservative who doesn't believe in free markets sometimes and nothing could be further from
the truth. Free markets are are their foundation is on the common law rules
of for example, fiduciary responsibilities. Securities fraud has long established. No one
would suggest that the ability to gauge in securities fraud and lie to your investors
about the way you're investing their money is in any way, you know,
violation of free market principles. And then lastly anti trust. Again, I
don't know if any free market economists who believes that producers of a good or
service, ought to be able to collude owners of businesses, ought to be
able to collude to set the price or supply in the in the market.
And really these are the three prongs areas that really are crying out for enforcement
against this this ESG scam if those things were being properly enforced at the federal
level, but increasingly now we're seeing the states, I'm proud to say,
stand up and push back on these on these fronts. If those things had
been enforced from the beginning, none of this ESG scam would have would have
been put together. So I do think that that ESG is an abbregation in
free market principles. That said, I think that we need to be very
careful um to not undermine the pushback by simply saying, well, this just
seems like you're getting involved in these in these companies business decisions or or um
because you know they're going on websites like Climate Actual one hundred and the Glasgow
Financial Lance for net zero, and the CEOs of these companies are signing documents
saying they will blude with each other, they will coordinate their activities to hit
net zero by twenty fifty, which means restricting the supply of a number of
different um uh goods to market. That's a that's a standard you know,
anti trust one on one. It's been a long time since I was in
law school, but I do remember, I do remember the basic definit mission
of an intrust conspiracy, and that's certainly would be would be included. So
I think that conservatives need to have a faith in the long history of antitrust,
fiduciary duty, and securities law that we have here in this country.
That's why our capital markets are so attractive, because we have property rights,
because we have the rule of law. Part of the rule of law is
enforcing those laws evenly, and conservatives should not walk off the field of being
the referee in the market. I'm so glad you said all that. I
find it to be one of the most frustrating parts of this conversation about true
conservative economics. Um. You know, there's there's a few things more truly
capitalists than tending to the sort of weeds of the free markets and making sure
there's actually robust competition. Um and yeah, like having faith in the system
if you loosen you know, regulations, but at the same time ensure that
regulations we all agree on and we need to have are being enforced. It
seems like from your telling, it's also Republicans that were asleep at the wheel
essentially for I don't know, maybe a decade plus, as some mergers were
going through, as some of this collision was happening, to your point,
openly on their websites, and now there's this kind of mass awakening, especially
on the Republican side. You've talked about all kinds of actions happening at the
state level. Virtually every Republican Canada is talking about this. When it comes
to twenty twenty four, it has to feel like there's a lot of political
momentum on your side right now. Will absolutely I think the brazenness of the
ESG scam. You know, they've been putting on a website, they've been
talking about what they're doing, and so once we highlighted it, I think
people really understand. The other thing is, I'm sad to say this,
This is not a good thing, but it has certainly helped in focusing people's
attention. Is that the years of under investment in oil and gas discovery and
recovery and new mining projects, in new manufacturing projects in the pressure that ESG
has put on corporate America to actually deliver for consumers. All of that in
the last you know, year, a year and a half has contributed greatly
to the wave of inflation that we have seen. It's kind of added to
the commodity cycle that we would normally see. Now. Certainly there were other
factors, obviously the warreny brain and other monetary decisions that our country made during
COVID, but it's undoubted and doubtful that the under investment, the lack of
capital expenditures that were forced upon a good portion a number of key industries in
the United States and elsewhere and some of the other countries in Europe where they
push this ESG nonsense, have contributed to the massive rise and inflation that we've
seen. And so I think it's become a lot easier to point, when
you know, we've seen you know, five to eight percent inflation per quarter,
and to point and say, hey, would you like to know the
way in which these large asset managers, these large banks, these large insurers
have been contributing to this, to making it you know, more costly at
the at the gas pump and at the grocery store. And unfortunately, I'm
sad to say it's it's probably going to continue because even if even if all
of us she went away tomorrow, it's the after effects of it are going
to be with us for at least probably three to four more years, maybe
longer. So you know, absolutely, it's been great to see the momentum
shift. We just need to keep the pressure on and and fully it's it's
not enough just to be outraged. I think sometimes you know, conservatives in
particular, see things that are that are outrageous and they get outraged about them
and then they stop there. And this cannot if if if that's all we
do, we will not have ended this this nonsense, and we will still
be feeling the after effects. Our kids will be feeling the after effects of
this. So I'm glad to see the outrage, and I'm glad to see
the wind shift. I'm certainly glad to see a number of UM federal and
state elected officials taking significant action, particularly the Treasure and ags across the country,
and conservative states have been have been pushing back in a huge way.
I just want to make sure we finished the fight and so that this this
ends now and can ever be put back together again? Is it bipartisan on
the state level at all? It seems like such an obvious bipartisan target,
but nothing really is in this political climate. But have there been any has
there been any cooperation from Democrats or even any interest from Democrats and pursuing this.
Yeah, we are absolutely seeing some some bipartisan interests both at the state
and the federal level. Um, you may recall back at the federal level,
I believe Senator's mansion and tester across the aisle in order to vote to
get rid of that noxious Department of Labor rule that basically allows would allow managers
of union pension funds and other private sector pension funds to implant their own political
judgment for their fiduciary dude. So there were some at the federal level in
the form of those two sentators. But then at the state level, in
both Kansas and Kentucky, we've seen two states pass very strong anti SG legislation.
I believe one both of those states have democratic governors. One of them
allowed it to one of them signed it, and then one of them in
their states allowed it to pass in the law by just not vetoing it and
after certain number of days it just becomes lagged and sign it directly. So
we are seeing some bipartisanship. And to be clear, I've spoke I am
personally conservative, but Consumers Research is a nonpartisan organization and we would love to
see this increasingly become a barpartisan issue. I don't think there's anything particularly partisan
but making sure that Wall Street fatcats don't raise the costs for everyday Americans because
they want to implant their own political judgment and curry favor with the Chinese Communist
Party in the ways that they're throwing around investment dollars. That's said, I'm
realistic about how much how much that's really going to occur, because the part
of the whole ESD grift is in it is pushing the priorities of the far
progressive left wing of the Democratic Party without ever having to Basically, you can
circumvent the ballot box by doing it through corporate American just implanting this through the
corporation and corporate policy. So you know, I'm I am very hopeful to
see that there have been some some folks crossing the aisle, or at least
not fighting it, but also to some extent this this is going to come
down to party lines because the grift itself is designed to benefit the Democratic Party.
M absolutely can we zero in on the price increases too, for just
a moment, because I know that you've tracked that pretty closely when looking at
energy prices, when looking at even grocery prices and the sort of basket that's
used to calculate inflation. What does ESG contribute to? This is a huge
question because ESG is obviously in and of itself huge, as you've outlined very
well. But what does it contribute to Let's put it this way, what
does it detract from average Americans earning you know, on a weekly, monthly,
yearly basis? Right, Well, it's it's hard to calculate in numerical
terms because obviously you get into the econometrics, and I'm a lawyer, not
an econome atterstment, so I won't I won't take a stab at that.
I know that there have been studies that have looked at some of the long
term effects of a VSG under investment, and then you see specific examples of
where it's had an impact. So I believe there's a company called Rice stat
Energy, it's a consulting firm, and noted that in twenty it was either
twenty twenty or twenty twenty one marked the lowest year for new oil and gas
discovery in seventy five years that they had been tracking. We have data for
it. So it was literally the worst year for new oil and gas discovery.
And one of the things that the report noted was because that was partly
due to a decrease in capital expenditures, firms were being pushed not to invest
in new oil and gas discovery and recovery. And you don't have to take
my word for that. If you go to a to the organization Climate Action
one hundred, of which Black Rock and State Street our members at least today.
They their entire mission is to push companies towards net zero and one of
the things that they grade them on is how is their capex, their capital
expenditures, how much money they spent going after new fossil fuel projects. And
so if you if you the more you spend, the more they will grade
you poorly. And they threaten on their website, or at least they did
since since we've been after them, that a lot of edits have been made
to a lot of these websites. But if you go in the way back
machine and look at look at what they were saying in twenty twenty. They
grade these companies and if if they misbehave, then they will look at all
kinds of things like shareholder proposals, replacing members of the boards of directors,
even executives. They did this specifically at XON. In twenty twenty one,
Black Rock contributed to the election of three radical environmentalists to the board of XON
to push them harder in their net zero direction. Now, in terms of
how that affects the average person, it's a simple supply and demand. As
these companies make fewer investments in new and bringing new supply online, that downstream
affects supply over a number of years. You don't see it right away,
obviously, because these are multi year projects. Some of these projects take five,
six, ten years to come to fruition. They're massive projects. But
when they don't happen, when they never start, okay, you create a
shortage of fossil fuels. But it's not just there. Let's talk about let's
talk about at the grocery store as well. Net zero gets a lot of
focus on the fossil fuel side, but it is also very focused on changing
the way we do agriculture here in the United States and abroad. One of
the things that they want to get rid of is synthetic fertilizers. Synthetic fertilizers
make up about seventy to eighty percent of the fertilizers used in the United States
and across the globe. They are the reason that we can support the amount
of people that we do at the lifestyle that we do. In fact,
but their invention led to a Nobel Prize. The haber Bosch process that uses
natural gas to create nitrogen fertilizers led to a literal Nobel Prize. These are
the things that black Rock and State Street and Vanguard are on record wanting to
get rid of. In addition, you have energy costs. For example,
black Rock is stated that they helped push companies publicly traded utilities to set early
retirement dates on all of their coal and natural gas powered plants. Okay,
so they're forcing these companies again through these mechanisms like sharehold proposals and board of
director replacements, to accept putting early retirement dates on perfectly working plants just to
give your listeners some understanding of how much an effect that could have. Sixty
five percent of our energy here in the United States either comes from coal or
natural gas power plants. The rest is mostly nuclear and hydrogen hydroelectric, very
very little of it it comes from these so called green renewables, although they're
neither green nor renewable. That's a conversation, a lot longer conversation to have
most of our energy comes from fossil fuels and will will for the foreseeable future
until innovations are made. It probably probably in nuclear technology. And so as
they're forcing these companies UH to these utilities to close these plants, that's going
to raise that already is raising the costs of energy or consumers. So they
hit you at the grocery store, They hit you when you get your power
bill, they hit you with at the gas pump. Um. They want
to force every airline to switch over to you know, even seeing United has
has commercials about how they're going to do this. They switch over to sustainable
aviation fuel. Those fuels are two to five times more expensive than existing jet
fuel, and jet fuel is about a third of the cost fuel costs but
a third of the cost of running an airline. So imagine take a third
of the cost of running an airline now double to quintumple it. What is
that going to do to the price of an economy ticket to go from you
know, New York to California or or you know, Tampa to Juno.
Uh, it's it's you know, flying used to be an item only that
the you know, it used to be a luxury item that only the most
wealthy in the United States could afford. And it looks like you know,
black Rock and others would like to go back to those days. So you
know, I think I probably canvas. But it's really myriad because there's not
really an industry that that ESG doesn't want to touch and make more expensive and
less efficient. I want to talk about pensions. David Sirota is a journalist
from the left and actually has been tracking PE pension performance for a long time
because so many states have diverted or have directed their pensions to PE firms and
investments. And his contentions has basically been that in a lot of cases PE
was underperforming for a long time. I imagine now in the era of ESG,
information suggests there's pretty serious underperformance. When you see American retirees money being
invested in China or in environmentalists, the private jet environmentalist sects different priorities.
What has the routing of pension dollars looked like in the era of ESG will
Yeah, that's a great question, and it gives me an opportunity I think
to to you know, clue your listeners into something that I think is very
vital for this ESG fight because Wall Street one of the things they try to
do when they when when you hear that your pensions are being utilized against your
interest being pushing ESG objectives is often the money that Black Rock and other asset
managers just managing for these big state pension funds. It is not being put
into ESG funds that have ESG in the title. In other words, if
you go on to Fidelity or your brokerage account or whatever and look up all
the ESG funds, your pension dollars in your state, if especially if you
live in a Republican dominated state, probably aren't directly invested in ESG funds as
such. What they are in are index funds, broad ones like the SP
five hundred index that black Rocks still uses those assets to push an ESG agenda.
So what it looks like from black Rock's perspective is, let's say,
like a state like South Carolina, for example, They've got about nine and
a half billion dollars at last look invested with black Rock, and I don't
believe any of that is actually in a ESG titled fund. Most of that
is probably in very vanilla investments that are just normal, you know, the
whole the whole economy. But when black Rock does, you know, one
of the thousands of what they call corporate engagements a year, meaning meetings with
the leadership of these different corporations whose stock they owned, their control so much
of. They don't say, hey, we're here representing the point two percent
of your shares that we control that are invested in ESG funds. No,
no, no, no. They walk in and they say hey, Xon,
Hey BP, Hey Chevron, hey, Monsanto. Here, you know,
whatever the corporation is that they're meeting with. They walk in, we
go, hey, if you look at our entire asset portfolio, we control
you know, eight to ten to fifteen whatever it is, percent of your
outstanding shares right voting shares, and we've noticed that you're not on track to
hit your net zero targets. You're not on track to hit the race based
and sex based quotas we have set up for your board. You didn't change
your logo to rainbow colors in June, so we're gonna have to hit you
for the ass. They don't specify that they're only they're representing a small portion
of their portfolio that tens funds. They walk in building the cudgel of every
single share that they have in assets under management, and so South Carolina's pension
fund assets are being used to push a political agenda, whether those funds are
invested in any named ESG fund or not. That's just at a broader point.
One thing people should be aware of is much like kind of fight on
critical race theory. Critical race theory is a brand name. There are actual
textbooks that have like critical race theory, you know, TM or R or
whatever. Okay, but we know that the phenomenon of critical race theories much
larger than that. In education, you can have a book that doesn't say
CRT that still has stuff about you know, white supremacy system you know,
systems of white supremacy and how America has an original scent of slavery. And
you know, we can never cast that we're always be a racial, a
racist a country, and we would still obviously recognize that's that's CRT, just
just not named as such. ESG is the same way. Here's here's the
real definition of VSG. ESG is anytime the financial services industry uses their market
power to push a far left progressive agenda. And that is being done whether
whether money is at an ESG fund at black Rock or a normal fund at
black Rock, and so that people went in these you know, people who
live in these states that have money with black Rock need to understand that whether
you know, when they talk to their representatives, they need to say,
I don't want any money at any firm that's pushing these far left progressive agendas,
not just I don't want it an ESG funds specifically, and they need
to look at when they're looking at their own four or one ks or their
own individual brokerage accounts. That's another thing they need to understand. If they're
in the I Shares SMP five hundred index fund, which is the black Rock
branded fund, they are in an ESG fund effectively because black Rock has committed
to using one hundred percent of the shares they control to push an ESG agenda.
Well, I actually want to finally ask about Budweiser and this example that
everybody is now familiar with of them sending a couple influencer can as to Dillan
mulvaaney having a top marketing executive out there talking about how they need to shed
their frat boy image for the future. Obviously, for a lot of people
this looks absurd because it seems to be so out of whack with Budweiser's image.
You know, they are the I mean, they probably intentionally want a
fraddy image, and they appeal to you know, sort of middle class normal
Americans, probably particularly to particularly to normal American men, and so from a
business perspective it seems absurd. But the contention from the ESG perspective is that
Budweiser does their sort of math and finds that it's more valuable for them to
attract investment dollars by scoring high on ESG marks, like literally on scorecards for
that or even just being able to attract investments because they're able to tout the
as you know, equity or social responsibility or something to that extentum and by
getting those investments, it's going to outweigh any business they lose for a month
during a boycott. Um. You know, they understand that it'll be shortlived,
or they hope that it'll be shortlived, something like that. I don't
know that we'll we have a clear answer from Budweis yet because they're certainly not
going to be honest about what happened behind the scenes regarding these decisions. But
from your perspective as somebody who watches this very closely, I don't know if
what I just described as accurate. But will what did what did you make
of that entire dust up? And does it say anything about ESG? Yeah,
I think it absolutely speaks volumes about the incentives that corporate America now now
faces. Uh. You know, part of part of what's going on is
ESG has pushed companies to build and enlarge their dye departments and uh, you
know, especially with the race and sex based quota system that Larry Fink is
on record saying he was forcing companies uh to to to implement. Um.
It's not just about the flow of capital in the words like the actual stock
price of a company, you know, going up or down because Larry Fink
or State Street or Vanguard want it to or not. It's actually about personnel
being able to be replaced. Because like just if you take State Tree,
Vanguard, and black Rock and add add up their holdings, they would be
the largest single shareholder in ninety percent of the SMP five hundred. And if
you're the largest shareholder in any company, you can dictate a lot of the
way that that that company operates. You can, you know, usually get
rid of one or more of their board of directors. You can obviously use
that to impact who's who's you know still working in the in the C suite.
So what I think you've seen is a number of executives who they may
worry about declining sales, they may worry about the impact that that their decisions
will have on consumers, but in turn keeping their job. And this gets
back to the your statements about you know, are we still operating a free
market? You know, you and I were led to believe that the free
market was like, oh, you know, if sales go up, then
the person in charge gets rewarded. If sales go down, then they're supposed
to get punished. Or get paid less or get fired, you know,
if it goes on long enough. Really, what these executives have to worry
more about over a shorter period of time is whether they've kept Larry Fink in
Black Rock happy, right. And so when you see a situation like what
happened at Budweiser, I'm sure they wish that it hadn't created the backlash that
it did. But you imagine if if if this had been any kind of
other failure that had led to a twenty five percent or thirty percent decline in
the sale of their of their flagship product, that CEO, that C suite
would already be gone. In fact, in fact, I think initially they
weren't even going to fire the marketing woman you were talking about. They were
just gonna put her on leave and kind of try and wait for it to
blow over. I think what that reflects is that when you think about what's
really driving the decision making at some of the largest companies in the United States,
it's not the sort of econ one oh one of how do we sell
more widgets right, or how do we make our consumers you know, buy
our widgets over over our competitors increasingly it's you know, I get paid,
you know, eight figures a year to sit in this C suite position.
How do I keep Larry Fink and black Rock and State Treat and Vanguard happy
so that I can continue to just maintain this lucrative position. And so I
think it leads to the kinds of disconnects you're seeing, Uh, not just
at Budweiser, but at Target and all these other companies, and and you
mentioned before it's something about them that blaming their employees. That's another little trick
that I want to clue in your listeners to be careful of. These companies
are so large, you can find there's probably avowed Marxists working there too,
somewhere in the company. What does that have to do with making a decision
to to to insult the values of your consumer base? You know, Doug
Parker tried to do this at American Airlines. Disney has tried to do this.
And they try to the C suite or the CEO tries to offload responsibility
for their own decision making by simply saying, well, I was just listening
to my employees. I've yet to see a single one of those CEOs trot
out any evidence that he canvass the entirety of his workforce. What they mean
is, I talked to my marketing guy, Okay, I talked to my
super woke head of d EI, and they thought this was a great idea.
So I'm just gonna say I'm doing it on behalf of my employees when
what they're really talking about is a very small segment of their C suite or
their or their leadership. Right. I doubt that the baggage handlers at American
Airlines who were got laid off because Doug Parker mismanaged American Airlines really felt better
about it because he weighed into the election integrity fight in Texas. And I
imagine the people who are now whose jobs are on the chopping block at Disney
as that company continues to crater, really feel better about it. You know,
people working in the park that make it, laid off people at ABC.
When they sell the company, it probably has to go through your organization.
I doubt they feel any better about it because Iger Uh, you know,
is going out there and fighting some woke fight in Florida against Asanta.
So I think people need to take any of those claims with an extremely skeptical
look. And I do not let the c suite these fatcats CEOs, you
know, just offload that they're the guy in charge. They're the guy in
charge. Don't let them point to say I spoke to some unnamed employees and
they wanted me to do this, So it's not really me. I'm just
reflecting the company, right, What a way to run an economy? Will
Hild thank you so much for your time. Where can people find out more
information about Consumers Research? People who would like to learn more about the companies
that we've gone after and the ESG scam can visit us at consumers Research dot
org. That's consumers Research dot org. And if you really just want to
learn about Blackrock, I've got news where you can go to about blackrock dot
com. That's about blackrock dot com. Learn more about about them. There
you go. We will thank you so much for joining the show. Thanks
so much for having me. This is great. Oh of course, I'm
Emily Joshinski, culture editor here at The Federalist. We'll be back soon with
more. Until then, be lovers of freedom and anxious for the fray