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Alabama Attorney General Steve Marshall testified on Wednesday, May 10, as an expert witness before the House Committee on Oversight and Accountability investigating Environmental, Social, and Governance practices.
In his opening testimony, Marshall said ESG investing was a “clear and present danger to consumers and to our democracy.”
Strong words — absurd even — spoken by a man who knows nothing about investing, market capitalism, or, it would seem, how businesses operate in Alabama. What Marshall does know is how to parrot the latest right-wing populist talking points aimed at limiting investors’ voices in favor of fossil fuels, firearms makers, ammunition manufacturers, and other legacy industries.
When Marshall cast ESG as a clear and present danger, was he referring to the test established in Schenck v. the United States? The test holds the printed or spoken word may not be the subject of previous restraint or subsequent punishment unless its expression creates a clear and present danger of bringing about a substantial evil.
Was Marshall’s claim of clear and present danger an illusion to Tom Clancy’s novel and movie by the same name? Clancy’s book exposes the world of political and military power and the risks of a government bureaucracy where no one can be held accountable for their actions.
Perhaps he meant neither and was trying to fit in with the Republican cool kids who claimed to have uncovered a plot by elite globalists and woke capitalists to use free market investing to bring down democracy.
Maybe in the name of saving democracy, he and his fellow travelers will limit free speech in market capitalism and use political policy to unscrupulous ends to control investors’ choices in service of certain industries.
Who knows what he thinks, but it’s clear what he wants. Marshall wants to be governor and is hungry to show he’s as angry as any other populist warrior or mad dog demagogue.
ESG stands for environmental, social, and governance investing that follows a set of standards for a company’s behavior used by socially conscious investors to screen potential investments.
Following the lead of other red states, Alabama wants to punish investors in firms that follow ESG standard scoring.
The Alabama Senate Committee on Fiscal and Responsibility and Economic Development recently gave a favorable report to SB261 by Sen. Dan Roberts, R-Mountain Brook, on a 10-3 along party lines vote. Roberts’ bill — which is the brain-child of state Senator Arthur Orr, R-Decatur — would make it illegal for any governmental entities in the state to do business with companies that use ESG modeling for investments, with some exceptions. Imagine the bureaucratic entanglement and red tape facing businesses and local governments if SB261 becomes law.
The proposed legislation is anti-free market, anti-business, and a radical departure from the laissez-faire capitalism once valued by Republicans.
But the anti-ESG movement isn’t about what is good for business or markets. It is another tentacle in the expanding culture wars that dominate the far-right wing of the Republican Party. Republicans once promoted business, self-governance and personal liberty. At least in some quarters, today’s party wants to control your wallet, body and thoughts.
In Marshall’s star turn before Congress, he used the word “elites” 13 times and “woke” 20 times in his opening statement.
“An unelected cabal of global elites are using ESG, a woke economic strategy, to hijack our capitalist system,” Marshall said.
That statement alone is gibberish unless you spend your days drinking right-wing media tallboys. But no woke beer, please.
Roberts’ bill, while not evoking right-wing boogymen, used the word “boycott” 10 times in SB261.
When investors decide where to place their savings, they are not boycotting one company over another; they are making a choice.
Roberts knows this, but the word boycott is used in his bill to the impression that somehow ESG is unfair and sinister.
Modern capitalism was built by elites, and its inherent evils are apparent. As for woke capitalism, only fear-mongers and wackos believe it exists.
ESG investing is rising not because of woke elites but because individuals are betting their future on industries that they believe represent their values and long-term prosperity.
ESG assets will hit $50 trillion by 2025, according to Bloomberg, representing more than a third of the projected $140.5 trillion in total global assets under management. Rather than a threat to investors or good governance, most of the nation’s top investment firms see it as the future.
For decades Republicans have believed in the “invisible hand,” the unseen forces that move the free market economy through individual self-interest and freedom of production and consumption.
Now, it seems Republicans think the government knows best, much like the central planning favored by the communist states.
Perhaps telling, toward the end of the hearing Republican chairman of the committee, Congressman James Comer, R-Kentucky, asked: “I wonder what types of ESG policies China” uses?
It doesn’t. It’s a communist nation where the government controls investing. This is what the anti-ESG movement will produce.
But Marshall and 20 other Republican attorneys general are at war to thwart those investors who put their money into funds that work toward race and gender equity and net zero compliance.
“Republican attorney generals are defending Americans from these global elites and radical ESG activists,” Marshall said in his closing remarks.
Let’s pray that sober-minded Republicans who believe in free markets will save us from their attempt to save us.
The anti-business, anti-free market scaremongers are the danger at present.
