Editorial: Don’t let politics distort pension investment decisions

In politics, a slogan can trump — literally in today’s case of a Donald Trump policy — realities of the business world. And that’s why President Joe Biden’s first veto in office should be upheld.

Republicans and a handful of conservative Democrats passed a bill to renew Trump’s ban on government considering environmental impacts or potential lawsuits when overseeing investment decisions in pension plans. The slogans driving the bill were social-media shorthand about allowing leftist social policy to distort investment decisions, endangering retirement funds’ solvency.

In fact, there is a good basis for arguing that the government’s decisions did not cause the havoc alleged. And there is also a good reason to recognize that some environmental impact is going to have an effect on long-term investments.

For example (and close to home), Louisiana is an oil and gas producer and its economy is very closely bound to the health of those markets. As much as we support the industry, we don’t think it makes sense to say that the government’s general rules on investment decisions should exclude, rigorously, a money manager’s decisions on investments that are tied to the erratic boom-and-bust financial circumstances of energy.

Climate change is a reality that the world must deal with, no place more so than in Louisiana, a coastal state where rising sea levels are a threat. That has an economic impact — in fact, a considerable one.

We believe that the long-term health of the economy requires investments in energy. That means a judicious assessment of the decades-ahead prospects for differing components of an incredibly fast-changing industry.

Thin evidence for alarmism about hitherto-obscure oversight of investment decisions makes Biden’s veto a reasonable reaction, for the time being.

Unfortunately, the president himself was not above a bit of demagoguery about this complex issue. “This bill would risk your retirement savings by making it illegal to consider risk factors MAGA House Republicans don’t like,” Biden said.

This was a duel of simple answers to complex questions. Neither serves the public debate very well.

For political reasons, it’s unlikely that Biden’s veto will be overridden, because that would require a two-thirds vote in support of a bill previously passed by a thin majority. 

We might well be on the other side on other occasions, but this is not the crisis that it is has been blown up to be.