Nearly two dozen Republican state treasurers across the country are working to thwart climate action at the state and federal levels, fight regulations that expose the economic risks of a warming world, lobby climate-conscious nominees for key federal posts, and use the tax dollars that they monitor to punish companies that want to reduce greenhouse gas emissions.
Over the past year, treasurers in nearly half of the United States coordinated tactics and topics of conversation, meeting privately and cheering each other on publicly as part of a well-funded campaign to protect the fossil fuel companies that support their local economies.
Last week, West Virginia treasurer Riley Moore announced that several major banks — including Goldman Sachs, JPMorgan and Wells Fargo — would be banned from government contracts with his state for cutting investment in coal, the dirtiest fossil fuel.
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Moore and the Louisiana and Arkansas treasurers have raised more than $700 million from BlackRock, the world’s largest investment manager, over objections that the company is too focused on environmental issues. At the same time, Utah and Idaho treasurers are putting pressure on the private sector to drop climate action and other causes they label as “wake up.”
And treasurers from Pennsylvania, Arizona and Oklahoma joined a larger campaign to thwart the appointments of federal regulators who wanted banks, funds and corporations to disclose the financial risks of a warming planet.
At the heart of these efforts is the State Financial Officers Foundation, a little-known nonprofit based in Shawnee, Kansas that once focused on cybersecurity, borrowing costs and managing debt, among other routine issues.
Then President Joe Biden took office and pledged to accelerate the country’s transition away from oil, gas and coal, the combustion of which is dangerously heating the planet.
The foundation began pushing Republican state treasurers, who are mostly elected officials and responsible for managing state finances, to use their power to advance oil and gas interests and thwart Biden’s climate agenda, data shows.
The New York Times reviewed thousands of pages of internal emails and documents obtained through public registry requests from Documented, a watchdog group, that shed light on the treasurers’ efforts since January 2021.
At conferences, through weekly phone calls, and with a steady stream of emails, the foundation hosted oil industry representatives and channeled research and talking points from conservative groups to state treasurers, who promote the private groups’ goals in public policy. have channeled.
The Heritage Foundation, the Heartland Institute and the American Petroleum Institute are among the conservative groups associated with the fossil fuel industry that have worked with the State Financial Officers Foundation and the treasurers to shape their national strategy.
In November, when major banks and corporations pledged to take climate action at a world summit in Glasgow, Scotland, Republican state treasurers gathered at a State Financial Officers Foundation conference in Orlando, Florida, on ways to stop them.
During the meeting, the group’s CEO, Derek Kreifels, gave a presentation on a new law signed by Texas Governor Greg Abbott, a Republican. It banned government agencies from investing in companies that have severed ties with fossil fuel companies.
Within weeks, Moore was working with lawmakers in West Virginia to write a similar bill, which went into effect in March. While Texas officials were slow to enforce their law, Moore was quick to put it into action.
Last week, he told five major financial institutions — Goldman Sachs, BlackRock, Wells Fargo, JPMorgan and Morgan Stanley — that they are not allowed to do business with West Virginia because they deliberately terminated their dealings with coal companies.
Moore denied a classic denial of the overwhelming scientific consensus that the continued burning of oil, gas and coal will lead to planetary catastrophe.
“The world’s climate has been changing since the Earth was created,” Moore said. “Whether these greenhouse gas emissions contribute to global warming, I’m not sure I necessarily agree.”
The banks Moore is targeting say they don’t boycott the fossil fuel industry. They all still do substantial business with oil and gas companies, but in the long run, they say, it makes economic sense to move away from fossil fuels. West Virginia, for example, is the country’s second-largest coal-producing state, but production has declined significantly over the past two decades.
Kreifels declined an interview.
Kentucky, Tennessee and Oklahoma passed similar laws this year. Republican lawmakers in more than a dozen other states, including New York, Oregon and Virginia, are trying to advance similar legislation.
The laws can cost taxpayers. A recent study found that cities in Texas — where some financial institutions have voluntarily exited the market due to laws targeting companies embracing environmental, social and governance priorities, known collectively as ESG — are likely to see up to $532 million in higher interest costs. increase in less than a year due to legislation.
Treasurers are increasingly going after individual financial institutions.
In addition to the banks Moore is targeting, Utah and Idaho treasurers have criticized S&P Global’s plans to integrate climate risk into states’ credit ratings. And BlackRock, which manages some $8.5 trillion, has been the target of scathing attacks for its stance on environmental issues.
Larry Fink, the CEO of BlackRock, has been outspoken in his desire to move away from fossil fuels towards what he sees as a more sustainable, greener economy.
In response, Moore’s office stopped using BlackRock to help manage West Virginia’s corporate funds and raised approximately $20 million.
Other treasurers followed. In March, Arkansas treasurer Dennis Milligan withdrew $125 million from BlackRock. And in April, Louisiana treasurer John Schroder emailed Moore and Utah treasurer Marlo Oaks, boasting that he had withdrawn more than $600 million from BlackRock accounts. Schroder said he also blocked Citibank, Bank of America and JPMorgan for nearly $1 billion in bond financing.
BlackRock declined to comment.
Milligan, the Arkansas treasurer, emailed a statement saying, “I feel a strong sense of responsibility to do my part to not allow the liberal ‘awakened’ agenda to harm the people I was elected for.” Schroder and Oaks have declined requests for interviews.
A coordinated attack
Behind the treasurers and the State Financial Officers Foundation is a complex web of conservative groups associated with the fossil fuel industry, as well as some of the biggest names on Wall Street.
In March, Idaho treasurer Julie Ellsworth asked Kreifels to distribute a memo about the fossil fuel boycott bills to other state treasurers, according to the emails.
The memo was drawn up based on research from the Heartland Institute, a think tank with a history of denying climate science, and misrepresented how banks and other financial institutions implemented their ESG strategies.
“If you’re a small business owner with a gas-powered car, you’ll eventually disappear from banks’ wallets unless, of course, you switch to electric vehicles,” the memo said in a section on how banks would use ESG to fund businesses. force to change. “Even if you want to buy a house that runs on natural gas in the future, you can only get a mortgage if you have installed solar panels on the roof.”
No bank has proposed such measures. Ellsworth declined to comment.
The Heartland Institute has also worked to amplify the treasurers’ message and connect them with influential conservative media personalities, including Glenn Beck, records show.
Other groups supporting the treasurers’ efforts include the Heritage Foundation, a think tank that has long opposed action to combat climate change and has received significant funding from oil billionaires Charles G. Koch and David H. Koch.
The State Financial Officers Foundation this year hired CRC Advisors, a conservative strategy firm founded by Leonard Leo, who has led a multi-year effort to stack federal courts with judges who oppose climate action. In recent months, CRC Advisors has helped coordinate media responses for treasurers.
And the State Financial Officers Foundation has many ties to the American Legislative Exchange Council, a conservative group that has long had ties to the Koch brothers.
As a non-profit organization, the State Financial Officers Foundation is not required by law to disclose its funders.
Treasurers are also publicly lobbying against a bevy of the Biden administration’s proposed rules and nominees.
One of their first targets was Saule Omarova, Biden’s candidate for currency controller. Omarova was heavily criticized by Republican senators, some moderate Democrats and the banking industry for her desire to limit speculative trading by banks and open up the Federal Reserve to retail banking.
Omarova withdrew her nomination.
Two months later, the treasurers turned to another candidate: Sarah Bloom Raskin, who had nominated Biden as head of banking supervision for the Federal Reserve. Raskin, a former Federal Reserve and Treasury official, has argued that financial regulators need to monitor climate risks more diligently.
Raskin also withdrew her nomination.
The treasurers have also set their sights on new federal rules and regulations designed to strengthen the government’s ability to act on climate change.
Utah’s treasurer Oaks drafted a letter opposing a potential Department of Labor rule that would allow retirement plans to factor global warming risks into their investment strategy. More than a dozen treasurers signed the latest letter. The Ministry of Labor has not yet decided whether the rule will be applied.
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