TThe American Legislative Exchange Council, a right-wing lobby organization, is pushing for new state laws that will block boycotts of oil companies. The groups strategy, which aims to protect large oil firms and other conservative-friendly industries, is modelled on legislation to punish divestment from Israel.
State legislatures in West Virginia and Oklahoma have introduced a version drafted by Alec since the beginning of the year. The Energy Discrimination Elimination ActTo protect big oil from share sale and other measures that protest the role of the fossil fuel industry in the climate crisis. Twelve other states have publicly supported this legislation.
After last year’s passage of a similar law, Texas has begun to compile a list of companies that will refuse to do business in the oil industry. BlackRock, the world’s largest asset manager, is at the top of the list.
The push to blacklist firms that boycott the oil industry follows a meeting in December between politicians and Alec, a corporate-funded organisation that writes legislation for Republican-controlled states to adopt and drive conservative causes.
Alecs energy taskforce members voted to support the model legislation that requires banks and financial companies not to boycott petroleum companies in order for them to receive state contracts. The wording closely matchesAlec drafted and passed laws in over 30 states to stop support for Boycott, Divestment and Sanctions against Israel’s oppression and persecution of the Palestinians.
Similar laws are being promoted to protect gun industry from boycotts.
The legislationAlec, a company with a history of extreme denial about the climate crisis, claims that American fossil energy producers are amongst the most environmentally and socially responsible in the world. It complains that corporations are refusing to supply fossil energy companies with products and services and that investors are hurt by share sales by financial funds.
The draft legislation states that banks are increasingly refusing to finance creditworthy fossil energy businesses solely to decarbonize their lending portfolios, and market their environmental credentials.
This model bill proposes an approach in which states can use their collective economic buying power to counter discriminatory and politically motivated investing.
After major financial institutions refused to finance new oil and gas drilling in Arctic, the legislation was passed. Customers and environmental groups are also pushing banks and other financial institutions to get out of fossil fuel companies. JPMorgan Chase, Citibank, and Goldman Sachs have all publicly committed to supporting the transition away form oil.
Any business with more than 10 employees must certify that it does not support boycotting fossil fuel companies to do business with a state. State funds such as pensions will usually be required to sell investments made in corporations that refuse to lend to the oil industry.
Alecs pushes for the Texas legislature A version of this law was passedIn June 2021.
The Texas Public Policy Foundation, a member of Alec, backed the legislation. Koch Industries funds part of it. They accused Wall Street firms, including Wall Street, of conspiring to attack Texas and our way-of-life by denying capital to oil companies.
TPPF, which includes several members who work inside Alec, has close ties with Senator Ted Cruz and Rick Perry, the right-wing former Texas governor. They then pushed for the law’s adoption by other states.
Jason Isaac, a former Texas legislator, now heads TPPFs initiative for oil industry defense. He sent a memo to Alec participants in San Diego in which he criticized woke banks, financial institutions, and others he claimed were conspiring to deny lending or investment in fossil fuel companies.
This model policy is based upon anti-BDS legislation regarding Israel that was recently passed by Texas. It also includes discrimination against fossil fuels. Voting in favor of this model policy and encouraging more state legislatures adopt it will send a strong signal that the states will resist woke capitalism. The memo saidAlex Kotch from the Center for Media and Democracy obtained the following:
Texas Lieutenant Governor Dan Patrick asked his state comptroller to add BlackRock, which is estimated to manage $10tn in assets, to its blacklist. This was because of the pledge it made to decarbonize the energy industry. The oil and gas industry will be destroyedDestabilize the economy around the world.
Patrick accused Larry Fink, BlackRock chairman and CEO, and his employees of making reassuring comments in private. Fink claimed that the company was committed Texas and Texass enormous energy footprint. But Fink took a different position in public and pledged to push energy companies toward net zero.
Patrick wrote that BlackRock is boycotting companies in the energy sector by basing investment decisions upon whether a company promises to meet BlackRocks net zero goals.
BlackRock, which will lose approximately $20bn in Texas public-sector pension funds, is actually a significant shareholder in oil companies through index funds.
According to BlackRock, it does not oppose energy companies, according to a statement made to the Guardian. As a policy, we do not seek divestment from oil- and gas companies. We expect to continue investing in these companies, and will work closely with them as we drive the energy transition that maximizes long-term value to our clients. We are concerned about the possible negative effects the law could have on Texas pensioners, both current and future.
After residents of Dickinson in Texas were required to sign pledges to not boycott Israel in order receive hurricane damage relief, a Kansas teacher was told she needed to do the same in order to keep her job.
After courts ruled that it was an invasion of free speech rights to require individuals to sign pledges not boycott Israel, several states were forced to amend anti BDS laws to limit its reach to larger companies.