ESG, Wokeness, and Morality

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Increasing criticism of ESG (an often incoherent investment “discipline” under which actual or portfolio companies are scored in part by how they score against various environmental, social, and governance measures) and the pushback against it in certain (red) states are worrying those in the ESG ecosystem who have done so well politically and economically (or both) out of it. Newspapers such as the Financial Times complain about elected politicians meddling in topics such as ESG, even though ESG is nothing if not political. Billionaires such as Mike Bloomberg and Tom Steyer have issued warnings that those who oppose ESG just don’t understand capitalism, as has (more or less) Al Gore, climate change “prophet” and profiteer.

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ESG: Warren Buffett Scrambles the Narrative

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With the pushback against ESG (an investment “discipline” under which actual or prospective portfolio companies are measured against various environmental, social, and governance benchmarks) gathering momentum, its proponents have finally had to mount a credible defense of a once seemingly irresistible concept that, up to now, has had no need of one.

That’s not proving easy…

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Lessons from Nigel Lawson

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April 3 saw the death of one of the last Thatcherite greats, Nigel Lawson. He was ninety-one. Serving as Margaret Thatcher’s chancellor of the exchequer (finance minister) between 1983 and 1989, Lawson played a vital part in creating a British economic revival so strong that it took the combined efforts of both the Conservative and the Labour parties decades to destroy it…

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Climate policy’s latest threat to property rights

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Say what you will about Jamie Dimon, the chairman and CEO of JPMorgan Chase, but when it comes to property rights, he is pretty consistent. He was chairman of the Business Roundtable when, in 2019, in a statement co-signed by a large number of CEOs, it jettisoned its support for shareholder primacy — the idea that the principal purpose of a corporation is to generate return for its shareholders. That was old hat. Now corporations should “deliver value” to all their stakeholders, of which shareholders are only one class.

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Mr. CHIPS’s Pack Mule

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Those who believe in free markets — or who are familiar with the history of developed economies after they became developed (or, maybe, completed postwar reconstruction) — ought to have little time for industrial policy. Free markets are bottom-up, flexible, and work with their own imperfections. They function through a continuous process of communication that recognizes that the valuable message sent by a price yesterday may be worthless today. Much of their operation is by trial and error. To be sure, there are disasters — plenty of them — but they often point to a better use of capital elsewhere or next time. The prosperity free markets have brought, and the human flourishing they have enabled, is unmatched.

By contrast — and despite some successes — industrial policy has a generally inglorious track record…

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Ukraine Becomes a War of Attrition on Two Fronts

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The term “special military operation” was not just a euphemism. It also reflected the Kremlin’s hope that it could take Ukraine by means of a swift “decapitation.” Kyiv would be overrun, Ukraine’s leadership would be killed, arrested, or driven into exile, and the country would fall under Russian control. We will never know what was meant to have come next. Two days before the invasion, Russia had recognized the Donetsk and Luhansk “People’s Republics” that, with Moscow’s backing, had broken away from Ukraine in 2014. Those have since been annexed by Russia, along with Ukraine’s Zaporizhzhia and Kherson oblasts (regions), although parts of all these territories are still in Ukrainian hands. Moscow probably always intended that this portion of Ukraine would be transferred to Russia, not least because it constituted a broad land bridge to occupied Crimea…

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ESG’s Bad (But Not Bad Enough) Year

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The year 2022 was not the best of years for ESG (an investment discipline under which portfolio companies are measured against various environmental, social, and governance standards). To take one example, as of January 5, the price of BlackRock’s ESG Screened S&P 500 ETF had declined by around 22 percent over twelve months, underperforming the S&P 500, which fell by around 20 percent. Those are only one year’s results (and they would have been marginally improved by dividends), but it’s still not the greatest of looks for an investment approach often sold (typically with higher fees) as a way of doing well by doing good. Making matters more embarrassing still, stocks in those wicked fossil fuel companies (in which ESG investors tend to be underweight) did well. The S&P 500 Energy sector index rose by around 44 percent over the same period…

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Roxy Music’s Avant-Garde Origin Story

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The stylus descends on the first LP by a new band. “You’ve never heard anything like this,” says a friend one day in 1972 — half a century ago, good Lord.

Track one, side one: Glasses clink, conversation, a cocktail party. A piano starts up: insistent, repetitive, fast. Drums pound, guitars surge, a singer begins, his voice distinctive, mannered.

A chorus joins in, an enigmatic, vaguely retro chant — “CPL593H.” Later, the command, “Show me.” A sax wails and shrieks, the volume heads towards eleven, and the pace accelerates. Something electronic is going on in the background, and the singer returns to his earlier lament…

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The Death of the Thatcherite Rebirth

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Last week, Britain’s newly minted (and now newly departing) prime minister, Liz Truss, replaced Kwasi Kwarteng as chancellor of the Exchequer (finance minister) with Jeremy Hunt, a figure from the soggy Tory Party’s soggy center who was widely seen as “a safe pair of hands.” Hunt’s allies claimed that he would be CEO to Truss’s chairman, and that is how it turned out….

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