Democrats cannot afford to play woke politics with our retirement accounts
Tiana Lowe
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In ten years, Social Security will be insolvent. At that point, under existing law, benefits will be slashed by 20% across the board.
Congress currently has no plan to stop this from happening. So naturally, Joe Biden has decided that now is the time to play politics with private retirement funds.
INFLATION BEGINS TO COOL, BUT ECONOMIC PAIN NOT OVER
In November, the Department of Labor issued a rule allowing “plan fiduciaries to consider climate change and other environmental, social and governance factors when they select retirement investments and exercise shareholder rights, such as proxy voting.” In other words, retirement fund managers will be legally allowed to abandon their fiduciary duty to maximize future retirees’ financial returns on their investments and instead prioritize inane ESG principles.
Sen. Mike Braun (R-IN) and Rep. Andy Barr (R-KY) have initiated the procedure to roll back the rule, but thanks to the Republicans’ anemic performance in the midterm elections, there’s no way their joint Congressional Review Act proposal ever makes it to Biden’s desk for a veto. Even so, Democrats would be wise to consider the very real political implications of the DOL rule, and why Republicans might actually be trying to save the Democrats from themselves.
Let’s do some simple math. Even with the recent good news of inflation abating slightly, prices are up nearly 14% since the start of Biden’s presidency, 3.5 times what the Federal Reserve considers acceptable price inflation. Meanwhile, credit card balances have exploded by 15%, the highest rate since the Great Recession, and stock markets are down some 20% from what they were at the start of this year. On top of all of this is the previewed Social Security disaster.
In short, Americans in general cannot afford to retire. Hell, thanks to school closures, for years of COVID, many of them could not even afford to work. All of this has gotten markedly worse under the Biden administration, and somehow, his Labor Department seems keen to undermine the last bulwark of the American dream: people’s private retirement funds.
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What would ESG mean in practice here? It means that your retirement fund could divest from the highest-yielding indices if woke managers decide that their carbon emissions are too vast. Firms that fail “civil rights audits” — probably including quota systems for their senior executives — could lose your business despite making the most of your money. In other words, while your Roth IRA has already taken a 20% hit thanks to this year’s massive market correction, Biden is allowing financiers to choose their own political pet projects over their real fiduciary duty to future retirees.
If Republicans stop distracting voters with election denialism nonsense, the voters will wake up and realize just how far their financial fortunes — today and in the future — have fallen under Biden. Perhaps Democrats will beat them to the punch and walk back the Labor Department’s rule, which is actually cruel to the least privileged who need retirement money most.