Deliberate misinformation in Gizmodo hit piece on DeSantis
May 5, 2023
A new Gizmodo article reports that Florida Gov. Ron DeSantis and the Florida Republican Party have banned the use of ESG in investing decisions.
They’ve done no such thing. Gizmodo makes this claim to deliberately mislead us by providing disinformation so that we are politically misled.
This is not something that journalism is supposed to do. In fact, journalism that so much as tries to do this has another name – propaganda.
“On Tuesday, DeSantis signed into law a bill that forbids state and local governments in Florida from investing public money into funds and entities that consider environmental, social, and governance factors—or ESG,” according to Gizmodo.
That isn’t true.
Gizmodo links to the law itself and we can, as with the Bible in the vernacular language, read the truth of the words ourselves.
“As used in this subsection, the term “pecuniary factor” means a factor that the Chief Financial Officer, or other party authorized to invest on his or her behalf, prudently determines is expected to have a material effect on the risk or returns of an investment based on appropriate investment horizons consistent with applicable investment objectives and funding policy. The term does not include the consideration of the furtherance of any social, political, or ideological interests.”
ESG is “environmental, social and governance” issues – read: the usual progressive wish list. Organizations that Save the Manatees, pay more than minimum wage, have strong unions, that sort of thing.
Many progressives do indeed insist that government should spend its money on those sorts of things. Some go on to insist that government should prefer to buy something – a road, an education, shipping services – from companies that agree to those sorts of rules. The Davis-Bacon Act, as one example, which insists that Federal projects employ labor at “prevailing wages” (which really means union contract rates). The Jones Act which insists that all shipping between American ports is done by American ships, with American crews, built of American steel is another example.
The difference with ESG is that the progressives have gone one step further. They demand that government pensions funds invest in companies and projects that follow this usual wish list. Or that cash waiting to be spent be put into a bank that then lends to these sorts of projects and so on.
What this bill does is say no. When government money is being invested we must think of the pecuniary interest first. Same with state funds awaiting spending and so on. We’re talking about investing, OK, so the judgment of what we invest in should be the profits to be made from that investment. And profits are to be determined in cold, hard cash.
In one way this is just a repeat in legislation of the older common law insistence upon fiduciary duty. This really says that when you’re spending someone else’s money then you’ve got to do that in a way that benefits that other person. Not, say, your own social, political or ideological interest.
Of course, you still have to consider such ESG issues in deciding upon an investment. Investing in a company which destroys the sea marshes which then brings a large fine – well, that’s considering the environment when deciding where to invest. And so on – all of those issues are already included in looking at the profit that will be made.
This doesn’t stop anyone at all from Saving the Manatees, paying more than minimum wage or having a strong union. It also doesn’t stop anyone investing their money in Save the Manatees, a company that pays more than minimum wage or one with a strong union.
What it does say is that any such decision has to be based upon what is best for taxpayers in the cold, hard, cash they get back from an investment. Investment is investment and it is to be judged on the profit from it. Not all those other things that progressives so love.
It doesn’t even stop someone from standing up in the legislature and arguing for a law that more cash should be sent to Save the Manatees, on this company that pays more than the minimum or that has a strong union. What it does mean, even if not said, is that someone who does that has to get the legislature to agree with that spending. And if this legislature doesn’t then work to get elected one that does.
And that’s really the point of the law. Sure, people want all sorts of nice things from government spending. But the place to get them is in the legislature, through democracy. Not through the bureaucracy “investing” state cash in things that meet the bureaucracy’s social, political or ideological interests. And really, no, it’s true, that’s all this law does. Just says that decisions about where to invest the state’s money must be made on how good an investment it is, “good” to be determined by the profit.
So, why are Gizmodo, and so many others, misrepresenting this? Because the entire ESG idea is to bring that progressive set of ideas into how government money is spent and invested. To bypass the whole process of democracy – that idea that the people get to decide how the peoples’ money is spent – and to gain those progressive ideals without anyone realising they’re financing them.
Gizmodo – and so many others – don’t like a concentration purely on the profits from government spending simply because the entire point of ESG is that such investments will be done to further the social, political and ideological goals of people like Gizmodo. That’s why they’re misinforming us on what this bill means. It’s deliberate disinformation.
Perhaps Gizmodo is simply ignorant of all of this. But that cannot possibly be true of American journalists, those who work so hard to shine the disinfectant of sunlight onto government activity. Now, really, it cannot be.