At one point a few years back it occurred to me that many of us eco activists went around protesting “big bad corporations,” and lamenting the damage they do to the planet — while at the same time many of us were ourselves relying on Wall Street-tied funds to provide us a secure retirement. This to me felt like standing on a rug and trying to pull the rug out from under ourselves. Or like a snake trying to eat its own tail. Or something.
I had a mutual fund for a few years back in the early 2000s but liquidated it to invest in continuing education and starting a business.
Today I ran across the most detailed article I’ve seen this far on this topic.
“First and foremost, the fees being skimmed off the top of workers’ savings are going into a financial industry that has become an elaborate tax haven helping billionaires evade the levies that the rest of us pay.”
And then there is the damaging impact, on people and the planet, of the investments themselves:
“Pension money has flooded into alternative investment funds profiting off looting hospitals and media companies.
“Pension money has also backed private equity funds that bought up the hospital staffing companies delivering massive, out-of-network medical bills to patients that insurers have refused to pay. Congress passed legislation last year to end surprise medical bills at hospitals, but the law doesn’t cover ground ambulance companies, which have also been snatched up by pension-backed private equity firms.
“Through alternative investments, pension money has continued to provide capital to the fossil fuel industry that is creating the climate crisis threatening all life on the planet.
Pension money was not only investment capital behind the mortgage-backed securities that blew up the global economy, it has been invested in the private equity firms that have bought up more and more of the nation’s housing stock, from suburban single-family homes to mobile home parks. Pension-backed private equity and real estate firms have jacked up rents, neglected tenants, and used investment funds to bankroll the campaign against rent control. And now the private equity industry is relying on pension money to boost its plans to buy up even more suburban homes.
“Pension money has even continued to flow to the private equity firm that controls major fast food chains paying low wages, and whose umbrella company recently claimed credit for killing a national $15 minimum wage.”
Go read the full article: “Workers Are Funding the War On Themselves — How workers’ retirement savings are enriching billionaires and, in every way imaginable, financing the apocalypse.” (David Sirota, dailyposter.com; July 7, 2021).
There are at least a couple of reasonable responses to this horrific situation:
– As a society, we can devise more ways to hold fund managers accountable; close tax loopholes for fund managers and corporations.
– As individuals, we can choose to keep most or all of our wealth in local businesses or other investments that aren’t Wall Street. I’ve written a fair amount on this topic here on this blog, with lots of links to articles by Laura Oldanie and some of my other favorite thinkers in the realm of regenerative investing.