President Joe Biden executed the first veto of his administration, axing a bill that garnered bipartisan support in making its way to the President’s desk. Biden tweeted out his action while blaming “Maga House Republicans.”
Peter Schiff, a well-known investor and advisor summarized the President’s decision as vetoing the one good bill that has made it through Congress, noting that “one of the worst things an investment manager can do is to allow politics to compromise returns.”
Not sure what's worse, the fact that you've been in office this long and you've only vetoed one bill, or the one bill you chose to veto is probably the only good bill #Congress passed. One of the worst things an investment manager can do is allow politics to compromise returns.
— Peter Schiff (@PeterSchiff) March 20, 2023
The bill passed the Democrat-controlled Senate on a 50-46 vote as it received the support of several moderates.
In a statement by the White House, the President explained:
“There is extensive evidence showing that environmental, social, and governance factors can have a material impact on markets, industries, and businesses. But the Republican-led resolution would force retirement managers to ignore these relevant risk factors, disregarding the principles of free markets and jeopardizing the life savings of working families and retirees. In fact, this resolution would prevent retirement plan fiduciaries from taking into account factors, such as the physical risks of climate change and poor corporate governance, that could affect investment returns.”
The joint resolution sought to nullify a Department of Labor rule concerning fiduciary duties with respect to employee benefit plans. Under the rule issued on December 1, 2022, plan fiduciaries may consider ESG issues when making investment decisions or when exercising shareholder rights.