Larry Fink is probably the most powerful person most Americans have never heard of. And now he is deploying his vast power to cajole corporate America into pursuing a left wing agenda under the guise of asking them to “contribute to society.”
Laurence D. Fink is the founder and chief executive of the enormous investment firm BlackRock, which manages in the neighborhood of $6 trillion of assets. That enormous hoard of financial assets–which it invests on behalf of individuals with 401(k) plans institutions such as pension funds, state and local governments, Fortune 500 companies, sovereign wealth funds, and college endowments–makes BlackRock the largest investor in the world. It gives BlackRock–and Fink himself–enormous sway in corporate boardrooms and the stock market.
Now Fink is deploying his financial clout by demanding business leaders adhere to a left-wing agenda. In his annual letter released Tuesday, Fink announced that BlackRock will require that companies make a “positive contribution to society” and “serve a social purpose.”
That doesn’t sound too bad when stated broadly. Although likely to irk libertarian types who agree with the late economist Milton Friedman that the best social purpose a business can pursue is to maximize profits by selling products its customers want to buy, many Americans probably agree with the notion that corporations should consider how to contribute to society beyond creating jobs, making sales, and earning profits.
Unfortunately, Fink goes beyond calling for increased corporate responsibility. His letter makes it clear that he defines the act of making a contribution very narrowly. He wants companies to adopt left-wing policy goals in the name of corporate responsibility.
Companies must ask themselves: What role do we play in the community? How are we managing our impact on the environment? Are we working to create a diverse workforce? Are we adapting to technological change? Are we providing the retraining and opportunities that our employees and our business will need to adjust to an increasingly automated world? Are we using behaviorial financial and other tools to prepare workers for retirement, so that they invest in a way that will help them achieve their goals.
This reads like a checklist from the priorities of the left wing of the Democratic party? Environmentalism? Check. Diversity virtue signaling? Check. Retraining? Check. Jobs threatened by automation (but not immigration or trade)? Check.
The last point, about using behavioral financial tools to “prepare workers for retirement” is both a liberal talking point (the left loves the idea of using the lessons of ‘behavioral economics’ to nudge people into behaving in ways liberals think they should) and incredibly self-serving (since pushing workers to save more through 401(k)s is likely to push even more money into BlackRock’s coffers).
What’s missing from the list? Anything even vaguely conservative, #MAGA, or hinting of economic nationalism. There’s nothing about immigration and the legal duty not to hire illegal immigrants. Nothing about the displacement of workers from unfair trade practices. Nothing about opioid addiction that is devastating so many American families. Nothing about protecting free speech and the traditional of tolerating dissenting political views. No protection for religious freedom. There’s not even talk of working to rebuild America’s failing infrastructure.
In other words, Fink is not urging corporate America to evolve toward being more socially responsible. This isn’t about companies needing a “sense of purpose” that will benefit society. It’s about loading the dice in favor of the agenda of the left and threatening corporate America with BlackRock’s financial might. If you don’t bend a knee instead of standing for America, you’ll end up on the wrong side of BlackRock. This is #WokeWallStreet at its worst.
There’s an important lesson for conservatives, Trump voters, and working-class Americans in Fink’s letter. The lesson is stark and simple: the moneyed power on Wall Street does not care about you, your family, your jobs, or your community. It is not your ally. Increasingly, it is your enemy.