From Watts Up With That?
The ever-increasing insistence on intermingling finance and environmentalism is taking a chilling turn, with a new report suggesting government regulation of the financial sector in order to steer funding away from fossil fuels. Greenpeace Canada recently released a report titled “What to do about Canadian Banks ‘Quiet Quitting’ their Climate Commitments,” emphasizing that there is an “urgent need for governments to step in and regulate the financial sector.”
20.4 percent of funding from the 60 largest banks in the world directed towards fossil fuels in 2022 came from the five biggest Canadian banks. This figure has seen a sharp increase from 13.8 percent in 2016. The Greenpeace report appears to be leveraging this statistic as ammunition to justify their radical advocacy for financial sector regulation. As Keith Stewart, Senior energy strategist at Greenpeace Canada, explained:
“The fossil fuel industry has left government regulation as the only viable path forward.”https://www.greenpeace.org/canada/en/press-release/59536/attack-on-esg-highlights-need-to-regulate-banks-on-climate-finance-report/
Banks find themselves at the center of an escalating tug of war between fossil fuel interests and climate-centric organizations like Greenpeace. On one side, fossil fuel companies and their allies have mounted a counter-offensive against environmental, social, and governance (ESG) initiatives that directly affect their financial resources. On the other side, organizations like Greenpeace argue that government intervention and regulation are now necessary to ensure banks adhere to ESG initiatives.
But this leaves us with a disturbing question: should the government have the power to dictate where and how banks direct their investments based on environmental criteria? And if so, where does this regulatory power stop? It’s a slippery slope towards control of all financial transactions under the guise of ‘environmental justice.’ This prospect smells alarmingly like eco-fascism, where state power is employed to enforce rigid environmental standards and regulations.
This report also points to a “new political momentum for regulation,” with 70% of Canadians supporting regulation according to “their polling”. Even elected officials seem to be warming up to the idea. Liberal, NDP, Bloc, and Green MPs have supported a new motion calling on the federal government to use “all legislative and regulatory tools at its disposal to align Canada’s financial system with the Paris Agreement.” This sounds less like democracy and more like a power grab using the cloak of environmental protection as its shield.
To quote Stewart again:
“Since bankers can’t, or won’t, act on their own, it is time for our elected officials to finally lay down the law and regulate banks so they are part of the climate solution rather than an ever-greater part of the problem.”https://www.greenpeace.org/canada/en/press-release/59536/attack-on-esg-highlights-need-to-regulate-banks-on-climate-finance-report/
But the essence of a free market is to allow organizations to act independently within the confines of the law. Isn’t the power of consumers choosing to invest their money where they want a fundamental right?
It’s bad enough to encourage financial institutions to consider the environment in their funding decisions. It’s another thing entirely to call upon governments to legislate and regulate such decisions. If we’re not careful, we may be trading the freedom of financial decision-making for a regime that exercises control over our economic activity all in the name of ‘saving the planet.’
Charles Rotter is @crotter8 on Twitter