OPINION:
Every American deserves the peace of mind that their hard-earned savings are working toward one thing: a retirement with dignity. Unfortunately, those savings are increasingly being dragged into partisan battles, and it is retirees and taxpayers who stand to lose the most.
On July 29, 26 Republican state financial officers sent a letter to BlackRock and 24 other major asset management firms, demanding that they recommit to traditional fiduciary duties and stop using investment strategies to “advance social and political agendas.” Their letter specifically criticized the use of environmental, social and governance criteria and other climate-related directives. Soon afterward, a coalition of 17 Democratic financial officers issued their own letter, urging BlackRock and 17 other firms to renew their pledge to managing long-term risks, such as climate change.
These dueling messages underscore the difficult position now facing asset managers, pulled in opposite directions by politicians from both major political parties seeking to use retirement savings to advance their policy goals. For years, BlackRock and others have faced pressure from both sides, but as politicians continue this tug-of-war, ordinary retirees are caught in the middle.
In its recent response to state officials, BlackRock struck the right tone. The firm reminded policymakers that fiduciary duty — the responsibility to act solely in clients’ best interests — must remain the bedrock of retirement management. That means focusing on increasing returns, lowering costs and broadening access to markets, not bending to political winds, whether they blow from the left or the right.
Politicizing pension fund management is unwise and costly. When political leaders push asset managers to avoid certain sectors or favor others, they risk undermining financial performance. When financial performance suffers, retirees and taxpayers pay the price.
We have already seen how this back-and-forth can create instability. Texas once blacklisted BlackRock over its climate policies, only to reopen dialogue with the firm after it withdrew from global sustainability coalitions and made it clear it was focused on its clients’ interests. Politically driven decision-making on retirement policy that leads to such flip-flops does not serve retirees; it creates market uncertainty and distracts from the real mission of strengthening retirement security.
Retirement systems are strengthened not by political agendas but by empowering savers with choice, demanding transparency and keeping investment professionals focused on long-term results. Americans deserve assurance that their hard-earned money is being managed prudently, free from shifting political winds, and directed toward strategies that deliver long-term growth and stability. This is the approach that builds retirement security and protects taxpayers.
Politicians on both sides must stop turning retirement savings into a political game. Asset managers and pension fund managers alike must be allowed to focus on fundamentals: investing across a diverse range of assets, growing savings over time and prudently managing risks. That is the most effective way to ensure secure savings and a stable retirement for Americans. Nothing more, nothing less.
At the end of the day, this debate is not about ESG, climate change or any other political agenda of the moment. It’s about the retired public servant in Ohio, the teacher in Florida and the small-business owner in Arizona who simply want to know their savings will be there when they need them most. Protecting the financial future of American workers and retirees should transcend politics. It’s an issue Republicans, Democrats and independents alike should be able to agree on.
• Tim Hill is a retired Phoenix firefighter, president of the Alliance for Prosperity and a Secure Retirement and a former director of the International Association of Fire Fighters Pension Resources Department.
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