Business
BlackRock’s woke capitalist vision is failing: here’s why
Larry Fink, New York Times DealBook 2022. Thos Robinson/Getty Images for The New York Times
From LifeSiteNews
By Frank Wright
Corbett shows how public outrage at the unelected political power of asset managers has led to an investor backlash, with politicians and legislators taking steps against the “forcing of behaviors” which BlackRock CEO Larry Fink once trumpeted as his mission
The always engaging James Corbett has produced some of the most informative guides to the power of BlackRock – who together with second-placed Vanguard Group own a combined 15 trillion U.S. dollars of assets under management.
In this report I relate how Corbett argues for a fightback against BlackRock and the asset management giants like them, who use their power to shape the world regardless of public consent. His views are more than corroborated by the news which followed the release of his video.
Corbett’s September 21 presentation, “How to Defeat BlackRock,” followed up by his excellent, “How BlackRock Conquered the World,” begins with some very encouraging news about the fortunes of the global investment giants – and what can be done to stop them. Happily, this process is already underway.
Corbett shows how public outrage at the unelected political power of asset managers has led to an investor backlash, with politicians and legislators taking steps against the “forcing of behaviors” which BlackRock CEO Larry Fink once trumpeted as his mission.
According to Corbett, and a growing number of other sources, this pressure looks likely to force asset management giants like BlackRock out of the behavior business altogether.
READ: How Vanguard and BlackRock took control of the global economy
A faltering global agenda
The first piece of good news is that the brand of ESG (environmental, social and governance) is so toxic that not even BlackRock’s CEO wants to use it any more.
BlackRock, under the leadership of Larry Fink, has used its immense wealth for years to compel companies to adopt the ESG agenda, becoming the driving force of “woke” capitalism. Yet leveraging financial power to force social and political change in this way has led to a backlash – from the general public, from lawmakers – and from the financial sector itself.
Last December, the North Carolina State Treasurer Dale R. Folwell called for Fink’s resignation, threatening to withdraw over $14 billion in state funds from the investment firm. As The Daily Mail reported, Folwell said:
Fink is in ‘pursuit of a political agenda… A focus on ESG is not a focus on returns and potentially could force us to violate our own fiduciary duty.’
Six months later, in June 2023, Fink said he was “ashamed” of ESG which he said had become “politically weaponized.”
Though his company, BlackRock, has continued to rate businesses on the same criteria, it has removed almost every mention of the term from its communications.
Speaking in Aspen, Colorado, Fink admitted that the decision of Florida Governor Ron DeSantis to withdraw $2 billion in state assets managed by BlackRock had hurt the company. The ESG agenda advanced by BlackRock is so beleaguered, even its former champion will not speak its name.
The power of public opinion
What this shows, as Corbett argues, is a further piece of good news: that public opinion still matters. It is public knowledge of the unelected political meddling of BlackRock and others which has led to outrage – and to action.
As a result of extensive coverage – mainly from independent media – of the nefarious influence of his company, Larry Fink has faced sustained criticism for over a year. This in turn has led to the kind of legal and financial consequences which have made people like Fink think again.
READ: How Larry Fink uses ESG and AI to control the world’s money
This also shows why so much money is invested in propaganda, censorship and “narrative control.” Governments and corporations are afraid of a well-informed public, because such a public is very likely to demand they are held to account.
The case of BlackRock not only shows that what is in your mind can indeed matter, but also that the goliaths of globalism do not always win.
This is one reason for the ongoing information war, and the growing censorship-industrial complex. An informed citizenry has the power to hold the powerful to account. Taken together, public outrage can also move markets – and the money men who watch them.
I investigated some of the claims Corbett made about the financial world’s mounting unease with the involvement of BlackRock, Vanguard and other firms in pushing unelected political and social change. I found more cause for celebration than even Corbett himself would admit at the time.
Passive investments, legal actions
In further good news, mounting legal troubles have accompanied the practice of companies like BlackRock, Vanguard and State Street to leverage their enormous asset piles into social and political compliance engineering.
According to a June 2023 report from RIAbiz, an online journal for registered investment advisers (RIAs), BlackRock and Vanguard’s “fooling around” with ESG targets has left them exposed to prosecution.
The business of managing many assets is supposed to be “passive” – a legal term which means that companies such as BlackRock are prohibited from “exercising control” of the companies whose funds they manage.
Federal exemptions had been granted to these asset management giants, but their habit of forcing behaviors on issues such as carbon “net zero” and “diversity” has placed their capacity to do business in jeopardy.
In May of this year, BlackRock and Vanguard saw a legal challenge emerge, and one which not only deters investors, but may also lead to their being broken up.
As Oisin Breen reported on June 1:
Seventeen AGs moved on May 10 against BlackRock on the grounds that its climate-based activism and its pro-ethical, governance and social (ESG) stance make it an active investor, in breach of a FERC antitrust agreement.
The Federal Energy Regulatory Commission (FERC) is involved due to BlackRock’s – and Vanguard’s – holdings in domestic energy utilities. Breen continues:
Separately, 13 AGs filed a motion to block Vanguard from renewing its FERC exemption. They represent mostly energy-producing states like Texas, as do the 17 now pressing to have BlackRock’s exemption revoked.
Though Breen concluded that both firms had “won a reprieve” from immediate legal censure, the message appears to have been received.
Three months later, Fortune magazine reported:
Finance giants BlackRock and Vanguard – once ESG’s biggest proponents – seem to be reversing course.
Hitting the bottom line
The global business publication noted the legal complications of mixing finance with social, environmental and governance policies, saying:
It appears these strategic shifts are being driven by a combination of public backlash and a focus on their bottom lines.
Then, on October 23, leading U.S. insurance brokerage WTW reported that BlackRock, Vanguard and State Street had all seen significant drops in their total amounts of assets under management (AUM). BlackRock’s alone fell from over 10 trillion dollars to just over 8 trillion.
By October 31, Fortune returned with the verdict that BlackRock, Vanguard and State Street had all “turned against environment and social proposals… in a clear sign of backlash.”
Their report noted a “precipitous” fall in the support of all three asset giants’ commitment to these agendas – with BlackRock’s funding of “ESG” measures falling by over 30 percent from 2021.
Real world consequences
This is the delayed result of a reality which BlackRock themselves acknowledged – and one which drove much of the public disapproval – that the ESG agenda was an economic and social wrecking ball.
Remarkably, BlackRock itself admitted that its promotion of ESG, in the aggressive pursuit of net zero and diversity policies, had actually contributed to a severe economic downturn.
In its “2023 Outlook,” the asset giant said these initiatives had been a major factor in ending the decades-long period of prosperity in the West known as the Great Moderation.
READ: The End of Prosperity? How BlackRock manipulates the West’s economic downturn
Buycotts – not boycotts
In his video Corbett is frank about the limitations of individual consumer power. You cannot “access BlackRock directly,” as it is a management firm. You can, of course, withdraw support from the companies in which it and its fellow behemoths Vanguard and State Street have holdings.
Yet Corbett moves from boycotts of individual corporations to the intriguing concept of “buycotts.” What he means by this is “taking your money from the corporations and using it to build things you want to see.”
How realistic is this solution? Already, businesses are emerging to capitalize on growing public discontent with what is done with their money – without their consent or approval.
Changing our behaviors – for good
The investment platform Reverberate, for example, allows users to “Rate companies highly (over 2.5 stars) if they make your life better, or lower if they make your life worse.”
What is more, user feedback from the public will determine which shares it buys:
Our publicly-traded investment fund buys shares of companies whose average ratings are high and/or rising, and sells shares of those whose average ratings are low and/or falling.
On their website, Reverberate says:
This is our way of trying to align capital allocation with the interests of the general public, as estimated by us in a relatively unbiased, wide-reaching way.
The decline of the asset managers’ ESG agenda is a happy corrective to the damaging belief that nothing can be done about anything.
It shows how well-informed public opinion can lead to genuine change, and with some of Corbett’s insights, how we can move from complaint to constructive action in making a better world.
You can see Corbett’s entertaining case for countering the woke asset management giants here.
From the Fraser Institute
Here’s the shocker: Meng shows that for 15 out of the 16 uses, plastic products incur fewer GHG emissions than their alternatives…
For example, when you swap plastic grocery bags for paper, you get 80 per cent higher GHG emissions. Substituting plastic furniture for wood—50 per cent higher GHG emissions. Substitute plastic-based carpeting with wool—80 per cent higher GHG emissions.
It’s been known for years that efforts to ban plastic products—and encourage people to use alternatives such as paper, metal or glass—can backfire. By banning plastic waste and plastic products, governments lead consumers to switch to substitutes, but those substitutes, mainly bulkier and heavier paper-based products, mean more waste to manage.
Now a new study by Fanran Meng of the University of Sheffield drives the point home—plastic substitutes are not inherently better for the environment. Meng uses comprehensive life-cycle analysis to understand how plastic substitutes increase or decrease greenhouse gas (GHG) emissions by assessing the GHG emissions of 16 uses of plastics in five major plastic-using sectors: packaging, building and construction, automotive, textiles and consumer durables. These plastics, according to Meng, account for about 90 per cent of global plastic volume.
Here’s the shocker: Meng shows that for 15 out of the 16 uses, plastic products incur fewer GHG emissions than their alternatives. Read that again. When considering 90 per cent of global plastic use, alternatives to plastic lead to greater GHG emissions than the plastic products they displace. For example, when you swap plastic grocery bags for paper, you get 80 per cent higher GHG emissions. Substituting plastic furniture for wood—50 per cent higher GHG emissions. Substitute plastic-based carpeting with wool—80 per cent higher GHG emissions.
A few substitutions were GHG neutral, such as swapping plastic drinking cups and milk containers with paper alternatives. But overall, in the 13 uses where a plastic product has lower emissions than its non-plastic alternatives, the GHG emission impact is between 10 per cent and 90 per cent lower than the next-best alternatives.
Meng concludes that “Across most applications, simply switching from plastics to currently available non-plastic alternatives is not a viable solution for reducing GHG emissions. Therefore, care should be taken when formulating policies or interventions to reduce plastic demand that they result in the removal of the plastics from use rather than a switch to an alternative material” adding that “applying material substitution strategies to plastics never really makes sense.” Instead, Meng suggests that policies encouraging re-use of plastic products would more effectively reduce GHG emissions associated with plastics, which, globally, are responsible for 4.5 per cent of global emissions.
The Meng study should drive the last nail into the coffin of the war on plastics. This study shows that encouraging substitutes for plastic—a key element of the Trudeau government’s climate plan—will lead to higher GHG emissions than sticking with plastics, making it more difficult to achieve the government’s goal of making Canada a “net-zero” emitter of GHG by 2050.
Clearly, the Trudeau government should end its misguided campaign against plastic products, “single use” or otherwise. According to the evidence, plastic bans and substitution policies not only deprive Canadians of products they value (and in many cases, products that protect human health), they are bad for the environment and bad for the climate. The government should encourage Canadians to reuse their plastic products rather than replace them.
Author:
From Heartland Daily News
By Paul Mueller
The Environmental, Social, and Governance (ESG) framework allows a small group of corporate executives, financiers, government officials, and other elites, the ESG “puppeteers,” to force everyone to serve their interests. The policies they want to impose on society — renewable energy mandates, DEI programs, restricting emissions, or costly regulatory and compliance disclosures — increase everyone’s cost of living. But the puppeteers do not worry about that since they stand to gain financially from the “climate transition.”
Consider Mark Carney. After a successful career on Wall Street, he was a governor at two different central banks. Now he serves as the UN Special Envoy on Climate Action and Finance for the United Nations, which means it is his job to persuade, cajole, or bully large financial institutions to sign onto the net-zero agenda.
But Carney also has a position at one of the biggest investment firms pushing the energy transition agenda: Brookfield Asset Management. He has little reason to be concerned about the unintended consequences of his climate agenda, such as higher energy and food prices. Nor will he feel the burden his agenda imposes on hundreds of millions of people around the world.
And he is certainly not the only one. Al Gore, John Kerry, Klaus Schwab, Larry Fink, and thousands of other leaders on ESG and climate activism will weather higher prices just fine. There would be little to object to if these folks merely invested their own resources, and the resources of voluntary investors, in their climate agenda projects. But instead, they use other people’s resources, usually without their knowledge or consent, to advance their personal goals.
Even worse, they regularly use government coercion to push their agenda, which — incidentally? — redounds to their economic benefit. Brookfield Asset Management, where Mark Carney runs his own $5 billion climate fund, invests in renewable energy and climate transition projects, the demand for which is largely driven by government mandates.
For example, the National Conference of State Legislatures has long advocated “Renewable Portfolio Standards” that require state utilities to generate a certain percentage of electricity from renewable sources. The Clean Energy States Alliance tracks which states have committed to moving to 100 percent renewable energy, currently 23 states, the District of Columbia, and Puerto Rico. And then there are thousands of “State Incentives for Renewables and Efficiency.”
Behemoth hedge fund and asset manager BlackRock announced that it is acquiring a large infrastructure company, as a chance to participate in climate transition and benefit its clients financially. BlackRock leadership expects government-fueled demand for their projects, and billions of taxpayer dollars to fund the infrastructure necessary for the “climate transition.”
CEO Larry Fink has admitted, “We believe the expansion of both physical and digital infrastructure will continue to accelerate, as governments prioritize self-sufficiency and security through increased domestic industrial capacity, energy independence, and onshoring or near-shoring of critical sectors. Policymakers are only just beginning to implement once-in-a-generation financial incentives for new infrastructure technologies and projects.” [Emphasis added.]
Carney, Fink, and other climate financiers are not capitalists. They are corporatists who think the government should direct private industry. They want to work with government officials to benefit themselves and hamstring their competition. Capitalists engage in private voluntary association and exchange. They compete with other capitalists in the marketplace for consumer dollars. Success or failure falls squarely on their shoulders and the shoulders of their investors. They are subject to the desires of consumers and are rewarded for making their customers’ lives better.
Corporatists, on the other hand, are like puppeteers. Their donations influence government officials, and, in return, their funding comes out of coerced tax dollars, not voluntary exchange. Their success arises not from improving customers’ lives, but from manipulating the system. They put on a show of creating value rather than really creating value for people. In corporatism, the “public” goals of corporations matter more than the wellbeing of citizens.
But the corporatist ESG advocates are facing serious backlash too. The Texas Permanent School Fund withdrew $8.5 billion from Blackrock last week. They join almost a dozen state pensions that have withdrawn money from Blackrock management over the past few years. And last week Alabama passed legislation defunding public DEI programs. They follow in the footsteps of Florida, Texas, North Carolina, Utah, Tennessee, and others.
State attorneys general have been applying significant pressure on companies that signed on to the “net zero” pledges championed by Carney, Fink, and other ESG advocates. JPMorgan and State Street both withdrew from Climate Action 100+ in February. Major insurance companies started withdrawing from the Net-Zero Insurance Alliance in 2023.
Still, most Americans either don’t know much about ESG and its potential negative consequences on their lives or, worse, actually favour letting ESG distort the market. This must change. It’s time the ESG puppeteers found out that the “puppets” have ideas, goals, and plans of their own. Investors, taxpayers, and voters should not be manipulated and used to climate activists’ ends.
They must keep pulling back on the strings or, better yet, cut them altogether.
Paul Mueller is a Senior Research Fellow at the American Institute for Economic Research. He received his PhD in economics from George Mason University. Previously, Dr. Mueller taught at The King’s College in New York City.
Originally posted at the American Institute for Economic Research, reposted with permission.
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