Joe Biden issued the first veto of his presidency, rejecting legislation to overturn a labor department rule related to an investment strategy Republicans have denounced as “woke capitalism”.
“The legislation passed by the Congress would put at risk the retirement savings of individuals across the country. They couldn’t take into consideration investments that would be impacted by climate, impacted by overpaying executives,” Biden said in an Oval Office video released by the White House. “And that’s why I decided to veto it.”
The White House has argued that the legislation would have made it illegal for pension fund managers to consider “risk factors Maga House Republicans don’t like” such as the climate crisis when making investment decisions.
“Your plan manager should be able to protect your hard-earned savings — whether Rep. Marjorie Taylor Greene likes it or not,” Biden said in a tweet, referring to the far-right Georgia congresswoman who has made opposition to progressive ideas her political brand.
Republicans have railed against so-called “ESG” investing, an acronym that stands for “environmental, social and governance”, arguing that it prioritizes allocating money based on liberal political causes instead of earning the best returns for retirement accounts. Their willingness to challenge corporate America, long seen as a reliable Republican ally, is just one front in the right’s “war on wokeness” that they say has affected schools, companies and government.
“In his first veto, Biden just sided with woke Wall Street over workers. Tells you exactly where his priorities lie,” the House speaker, Kevin McCarthy, wrote in response. “Now – despite a bipartisan vote to block his ESG agenda – it’s clear Biden wants Wall Street to use your retirement savings to fund his far-left political causes.”
House Republicans advanced the bill after taking control of the chamber this year. And earlier this month, two Democratic senators, Joe Manchin of West Virginia and Jon Tester of Montana, voted with Republicans, sending the measure to Biden’s desk. Both Manchin and Tester are running for re-election next year in states Donald Trump won handily.
In a statement, Manchin called it “absolutely infuriating” that Biden had chosen to “put his administration’s progressive agenda above the wellbeing of the American people”. The coal country Democrat said the rule threatened the nation’s economic security as Americans contend with high inflation and Russia’s war in Ukraine upends energy markets.
The veto, which was expected, sends the legislation back to Congress, where Republicans are unlikely to find enough support to override it.
In a formal statement notifying Congress of his veto, Biden said that the labor department rule allowed “retirement plan fiduciaries to make fully informed investment decisions by considering all relevant factors that might impact a prospective investment”. By refusing to allow these considerations, Biden said, Republicans were “disregarding the principles of free markets and jeopardizing the life savings of working families and retirees”.
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