The president of a free market think tank in Vermont blasted the state’s decision to request its pension fund purge its fossil fuel investments, calling it bad public policy that unnecessarily “politicizes” retirement funds.
The move prompted Rob Roper, the president of the Ethan Allen Institute, to write an op-ed castigating the move.
Roper was upset about Vermont Gov. Peter Shumlin’s move to call on the state’s pension fund to divest its coal assets during his state of the state speech earlier this month.
Divesting the pension fund’s coal and oil assets as a cudgel against man-made global warming effectively allows the state to politicize what is supposed to be a “non-political function of funding state pensions,” Roper noted.
He added: “It is kowtowing to a small, loud group of activists, well-funded by out-of-state sources and pushing an agenda that has nothing to do with state workers’ retirement benefits.”
Roper was referring to 350.org, an anti-fossil fuel group started by environmentalist Bill McKibben.
Roper went on to suggest that Shumlin was correct in 2014 when he and Vermont State Treasurer Beth Pearce, a Democrat, came out in opposition to fossil fuel divestment. Pearce opposes the governor’s decision.
“We believe that having a seat at the table — owning the stocks and having a seat at the table with the oil companies — is a good place to be,” Shumlin said in 2014 about he and Pearce’s opposition to divestment. He went on to say that he was “willing to look at any suggestions” to fight man-made global warming.
“I believe that by keeping a seat at the table and by encouraging smart investments, we can make progress towards a cleaner, greener economy while still meeting our obligations to pay for the retirement of [state and municipal employees] in the most responsible way for taxpayers,” Shumlin told the Associated Press in 2014.
“Allowing politicians to meddle with investment funds to fan the flames of unrelated political agendas is not a recipe for financial success.”
He continued: “It is wrong, and costly, to violate fiduciary responsibility to pensioners, students, and Vermont’s citizens in general. It is even worse to cloak a political agenda under the guise of environmental responsibility,”
Pearce, for her part, calculated that jettisoning fossil fuel assets would cost the state pension funds more than $10 million a year and an additional $8.5 million in maintenance fees.
Several key people in the state’s divestment discussion rebuked the governor’s calls for divestment during a meeting in front of the Vermont Senate Committee on Operations.
Among those to step forward were Toby Heaps, CEO & Co-Founder, Corporate Knights, Beth Pearce, Vermont State Treasurer and Maura Carroll, Executive Director, Vermont League of Cities and Towns.
What’s worse, Rope added, is that the entire anti-fossil fuel campaign does not actually help the environment. Instead, a clarion call to divest the state’s pension is simply a way to move a political agenda forward, he noted.
One study backs up Rope’s assertion.
Last year the National Association of Scholars (NAS), a conservative outfit, conducted a study showing that divestment is more political than practical.
“The divestment campaign is designed to fail,” Rachelle Peterson, director of research projects at NAS and the report’s author, said in a press release. “The organizers’ goal is not to cause colleges to divest, but to anger students at the refusal of colleges to divest fully and to turn their frustration into long-term antipathy toward the modern fossil fuel-based economy.”
“It is wrong, and costly, to violate fiduciary responsibility to pensioners, students, and Vermont’s citizens in general,” Rope concluded.
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