Actually, it’s good to be woke
Words matter. We’ve heard that truism lately regarding hate speech and insurrection oratory. Science backs it up.
Interviewed by Scientific American, Lera Boroditsky, a cognitive scientist at the University of California, San Diego, confirmed that “words have power. We can drastically change someone’s perspective by how we choose to talk about and frame something.”
In politics, words are hand grenades and missiles in the war between different views. One tactic is to take the opposition’s grenade and throw it back at them by tainting a positive word with ridicule and scorn.
A current example is the word “woke.” Merriam-Webster defines it as “aware of and actively attentive to important societal facts and issues.” That’s a good thing, but Republicans have appropriated the word and tried to turn it into an insult.
A linguistics scholar explains what they’ve done as “the co-optation of ‘woke’ — and other terms broadly associated with progressivism — is part of a powerful and understated weaponization of meaning called semantic pejoration, which is a process whereby a word acquires negative meaning or connotation over time.”
Officials in Florida and Texas recently took steps to keep state investment-funds managers from using woke ESG principles. In Texas, the beef is investment policies that exclude fossil fuels in alignment with the worldwide effort to stop the pollution that causes climate change. Financial analysts say these developments have a chilling effect on Wall Street’s attention to ESG.
The chill will get worse. The Washington Post reports that Republicans intend to grill executives of financial firms about woke investment decisions. The Post says some CEOs are already scrambling to emphasize that their firms still invest in fossil fuels.
Upset at transparency
One target of wokeless lawmakers is a proposed Securities and Exchange Commission rule requiring publicly traded corporations to report their climate-related risks. Companies also would have to disclose the extent of their fossil-fuel pollution. Some Republicans claim the rule is burdensome. But this is information investors have a right to know, unless they’re comfortable buying pigs in pokes.
Hyperbolic House Republicans describe corporate concerns about society and the environment as a “cancer within our capital markets” and a “fraud on American investors.” Unfortunately, that warped view is increasingly popular on the right, perhaps because that’s where the oil and gas industry invests most of its campaign contributions. Notably, Republicans will have a majority in House and control of the chamber starting in January.
BlackRock, one of the firms likely to be called to the hill for a Republican tongue-lashing, has become “a new deep-state bogeyman” among conservatives. But BlackRock’s chairman and CEO, Larry Fink, believes that capitalism can and should be a force for good. “We focus on sustainability not because we’re environmentalists but because we are capitalists and fiduciaries to our clients,” he explained in a letter to CEOs.
Over one-third of the world’s biggest publicly traded companies have committed to net-zero carbon emissions by 2050, a strong signal that woke capitalists know there is a business case for moving their money from dirty finite fuels to clean renewable fuels. For example:
- Markets are responding to the fact that clean energy from solar, wind, and other renewable resources is cheaper than coal, oil or natural gas. New Science magazine concludes, “Ever cheaper wind and solar power means the decline of coal, oil, and gas is unstoppable.”
- The International Institute for Sustainable Development (IISD) has studied all feasible routes to keep global warming under control and concluded that developing more oil and gas fields is “incompatible” with that goal. The International Energy Agency concurs.
- The International Energy Agency anticipates $2.4 trillion worldwide will be invested in clean energy this year, making the transition from fossil fuels one of the most significant market opportunities ever.
- A Fortune magazine commentary warns, “ESG critics could be leaving money on the table — and missing an opportunity to make a real impact.”
- The current global energy crisis proves again how susceptible fossil fuels are to international politics that result in price or supply shocks. That doesn’t happen with renewable energy, which is domestic and free.
- Writing recently in Investment News, Aimee Forsythe of Cambridge Trust points out that ESG investing is a long-term strategy that allows investors to earn in alignment with their environmental and social principles. “In spite of recent market volatility, ESG, sustainability, and related concepts can and will continue to improve and evolve, but the investing concept is certainly here to stay.”
Woke investments in fossil fuels
As Republicans attempt to cure the so-called “cancer” of woke investing, they should consider how they’ve helped Congress give tax breaks to fossil energy companies for more than a century, justified in part by social benefits like jobs. Those investments amount to more than $20 billion annually today.
But the much larger investment comes from society and the environment, which pay for the damages the fuels cause to public health and air quality, for example. When all direct and indirect investments are counted, they amount to hundreds of billions of dollars annually. They will total $800 billion this year, or $2,417 for every man, woman and child in America, according to the International Monetary Fund.
These costs will skyrocket as climate change becomes more severe, rising to as much $2 trillion per year in today’s dollars by the end of the century.
It will be fascinating to watch Republicans try to square their assault on “woke capitalism” with their traditional opposition to government meddling in business. Perhaps they should go back to these first principles:
- Investors should be guided by their values
- Markets rather than Congress should pick winners
- Investment managers should do what’s best for their clients
- Politicians should stay out of it
William S. Becker is co-editor and a contributor to “Democracy Unchained: How to Rebuild Government for the People,” a collection of more than 30 essays by American thought leaders on topics such as the Supreme Court’s perceived legitimacy. Becker has served in several state and federal government roles, including executive assistant to the attorney general of Wisconsin. He is currently executive director of the Presidential Climate Action Project (PCAP), a nonpartisan climate policy think tank unaffiliated with the White House.