I remember meeting my first financial advisor several years ago; he told me the money I had in the Indiana public pension system needed to be moved. His perspective was that he didn’t give me enough control over my money and that politics would ultimately interfere with my best interests. In fact, they probably already were.
The system has about 500,000 members; I continue to be one of them. But politics put a target on the system and my retirement, for the sole purpose of scoring political points.
Senate Bills 268 and 292 put this on full display.
SB 292 is designed to prevent the system from investing in ESG funds, those that prioritize environmental, social or corporate governance standards. These are funds that Republicans have slapped the “woke” label on. If a portfolio includes companies that are particularly sensitive to, say, climate change, it is apparently a bad fund in the eyes of the GOP.
As reported by the New Jersey Monitor last summer, “nineteen Republican state attorneys general wrote a letter to BlackRock, the world’s largest asset manager, which manages $10 trillion,” accusing “BlackRock of making decisions based on its alleged political agenda rather than state pension welfare.” Indiana Attorney General Todd Rokita was among the signatories.
SB 292 is Indiana’s version of the GOP’s national political “platform,” if their grievance strategy can be called that.
SB 292 would appear to accomplish what author Sen. Travis Holdman, R-Markle, claims it does. He said the bill was not intended to “tie the hands of INPRS investors” but rather ensure that they “do not make decisions based on environmental and social or governance standards”.
However, there is no way to tell an investor not to use certain criteria in their decision making process without having an impact on the decision itself.
In the same hearing, the Senate Pensions and Labor Committee considered SB 268, designed to divest from any China-linked holdings. Again, Rokita has already backed up this stance through two lawsuits against China-based TikTok and other public rhetoric.
What’s fascinating was this nugget from Rokita’s policy director and legislative adviser, Corrine Youngs, in her testimony supporting the bill. In your anti-Chinese rant, you accused the nation of “polluting the minds of our youth.”
And that, in a nutshell, is what the whole enterprise is about. These bills are all about political and even mind control.
There are three statutory bans already in place for the public pension system. It cannot invest in countries that the federal government has identified as state sponsors of terrorism. This makes sense and is nimble enough to switch when the designations change.
Secondly, it cannot invest in Sudan because of the genocide in Darfur. I assume that one day this will have to be changed or repealed.
The third is pure politics. The public pension system cannot invest in entities that have boycotted, divested or sanctioned Israel. Truly?
So if a large asset manager sees uncertainty in Israel’s ability to elect a functioning government as a reason to withdraw investment from the country, would the public pension system be prohibited from investing with them? Market volatility comes in many forms and is caused by many things. Even a friend can be a bad bet.
Again, stay out of my business, legislators. You keep proving you’re no good.
If the legislator really cared about me, as a member of the public pension system, they would require that the system give me more options in how I invest my money, not fewer.
But my late financial advisor told me the government doesn’t care about me.
Years after his disappearance, he continues to be absolutely right.
Michael Leppert is an author, educator and communications consultant in Indianapolis. This originally appeared on Indiana Capital Chronicle.com.