The new frontline against woke capital - part 1
Derek Kreifels is the head of the State Financial Officers Foundation. His organization is at the front line of the fight against the politicization and ideological capture of the investing industry, frequently under the name of ESG: Environmental, Social, and Governance.
I recently talked with Derek on my podcast Meeting of Minds. Here are a few highlights from that discussion, lightly edited for clarity and length:
Jerry: What is your toughest fight right now? What is taking up your energy, focus and engagement at this moment in your ongoing fight?
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Derek: You know, it depends on which state we're talking about. In West Virginia, it's the attack on coal, oil, and gas. In Louisiana it's the attack on the Second Amendment. In Nebraska, it's an attack on agriculture and cattlemen. I know it's hard for people that aren't familiar with the ESG to understand, but it has all these fingers and all these different policy areas. And it's really starting to touch multiple areas of our everyday lives. So it’s like playing whack-a-mole: every week there's something new that pops up, that folks on the left have figured out how to weaponize capital for.
We started this in the fall of last year, hearing about this new IRS control. There was this in the green book, which is the book of ideas that comes out from the Treasury Department under a new Administration. One of those ideas was having banks and credit unions across the country report every transaction of $600, in or out of someone's bank account, to the IRS. So they could understand who wasn’t being honest on their taxes, to produce higher tax collection revenues.
We jumped to action. We said, “this is unheard of in America.” You’re basically presumed guilty until proven innocent. We thought it was one of the largest attempts at an invasion of privacy that we'd ever seen by our federal government.
Jerry: Because there's no probable cause for the surveillance. It's like being able to almost being able to put a wiretap on your bank account. Just because you exist.
Derek: Absolutely. The banks and the credit unions, they were against it. We took a couple of weeks and said, okay, all our state members, we need to go out into your communities and talk to every blogger. Every radio show, every newspaper, every TV show, and get the word out that you've got to call their congressman. And it was weird because there wasn't a specific bill. There wasn’t House Resolution 2349 or anything like that that we could point to, we just knew that it was an issue that was being actively debated and discussed between Administration officials and leaders in Congress.
Jerry: I’m not for tax cheating, but a gigantic surveillance tape seems to not be the right reaction.
Derek: It really wasn't. So our treasurers took to the national media and started talking about it, and that led to the next thing, which was this Administration again, in this effort to weaponize capital, started trying to slip in appointees to different positions that seemed irrelevant to most Americans like the Office of the Comptroller of the Currency. They put up a nominee, her name was Saule Omarova. She’s a self-proclaimed socialist. Those aren’t my words, those are hers, that are on video, talking about how the Russian system of banking was far superior to America’s. This is before Russia invaded Ukraine, right? I mean this is way before that. We said: this is ridiculous, we can't have a socialist in this position. We were very much opposed to her.
We were involved with Sarah Bloom Raskin’s nomination to the Federal Reserve. Here's someone that had worked at Treasury under President Obama and, on paper, has a good resume if you just looked at the Treasury experience. But when we looked deeper, and we saw the political activism in the name of global climate change, and the other ways the Administration tried to play on climate chance even in agencies that had nothing to do with it, we thought that was appalling. Our members went all in on trying to make sure that she was not sworn in. And we were victorious with several national partners that were all working together to basically educate Americans about that.
Jerry Bowyer is financial economist, president of Bowyer Research, and author of “The Maker Versus the Takers: What Jesus Really Said About Social Justice and Economics.”
