Miss. Senators Join Challenge to Biden Rule Politicizing Americans’ 401(k)s
Wicker, Hyde-Smith Seek to Overturn Rule that Encourages Retirement Investments Based on Biden’s Woke Ideological Preferences
February 3, 2023
WASHINGTON – U.S. Senators Roger Wicker, R-Miss., and Cindy Hyde-Smith, R-Miss., this week moved to prevent the Biden administration from enforcing a rule that would encourage fiduciaries to support progressive environmental, social and corporate governance (ESG) priorities over seeking maximum returns for Americans’ retirement accounts.
Wicker and Hyde-Smith are among 50 cosponsors of a Congressional Review Act (CRA) resolution to stop a U.S. Department of Labor final rule that allows fiduciaries to consider ESG factors when they make investments for retirement accounts.
“Retirement accounts should be off-limits to woke activists. It is wrong for President Biden to sacrifice Americans’ financial security to implement his radical agenda,” Wicker said.
“Most Americans are rightfully shocked by the hits their retirement savings have suffered over the past two years, losses that could be compounded by President Biden’s rule to prioritize underperforming progressive ESG funds,” Hyde-Smith said. “The administration and Congress should be doing everything they can to maximize retirement savings rather than forcing ill-advised policies that could diminish those nest eggs.”
This Biden rule replaced an existing rule which mandated fiduciary decisions be made solely on getting the best returns for the 152 million American workers who rely on ERISA for their retirement. ERISA covers most employer-sponsored retirement plans, managing an estimated $11.7 trillion in assets.
The rule flies in the face of a Harvard Business Review study that found investing in funds that prioritize ESG goals results in poor return rates.
The CRA, which was introduced by U.S. Senator Mike Braun (R-Ind.), allows Congress to use expedited procedures to try to stop the Labor Department rule. Its passage would only require a simple majority vote. Similar legislation will be considered in the House of Representatives.
More than 100 groups and individuals have endorsed the disapproval resolution, including Mississippi State Treasurer David McRae.