Texas bans 10 banks, 348 investment funds over fossil fuel policies | Hacker News Reader

Texas bans 10 banks, 348 investment funds over fossil fuel policies

spglobal.com

56 points8bitsrule37 comments

Maybe I am wrong but I don’t think “ban” is the right word. Texas prohibited state agencies from doing business with them. Private citizens and businesses can still do whatever they’d like.

Here’s a better article: https://www.texastribune.org/2022/08/24/texas-boycott-compan...

>> A July study from the University of Pennsylvania's Wharton School estimated that municipalities and other public entities in Texas paid between $303 million and $532 million more in interest on the $32 billion they borrowed during the first eight months after the anti-ESG laws Texas enacted in 2021 took effect and some large banks had to cease bond underwriting.

So they're forcing tax payers to pay hundreds of millions more in interest fees, than they otherwise would have, just to achieve some political grandstanding??

Whether you believe in free markets, small government, or any other ideology this doesn't make sense at all to me?!

who says that they are going to raise taxes? they cut public services instead.

No one said that. They are paying more in interest due to not being allowed to pick the best interest rates due to this policy.

Isn't that what all environment-related polices are?

Otherwise the taxpayers are forced to pay hundreds of millions, probably even billions, more in counteracting the negative externalities these companies create for society as a whole. It’s a net benefit for the taxpayer.

It’s not political grandstanding. There’s a real economic interest. Go visit east Texas. Tons of working class prosperity from the availability of jobs at refineries. New malls and restaurants, big shiny pickup trucks, big families, etc. (Also lots of economic integration between whites and Latinos, because these well paying jobs are readily available to immigrants without college degrees or ESL. The complete opposite of SF or NYC.)

Now I believe in climate change, and I don’t think those communities are sustainable long term. But there’s real pragmatic reasons for Texas to not want the oil gravy train to stop. The state is legislating in its material interests.

Which, to be clear, the interests of the Texas Republican legislators have absolutely nothing to do with the working class refinery jobs and everything to do with the billionaires who own them.

Move a little west and you'll find that central Texas is also a powerhouse for solar and wind, and there are plenty of racially diverse folks building and installing wind turbines in Texas. But the Texas Republican legislators threw them under the bus with a misinformation campaign after the grid failure (which was caused by natural gas power plants not being properly winterized) and they continue to barely tolerate the industry as long as it continues to make money.

> Which, to be clear, the interests of the Texas Republican legislators have absolutely nothing to do with the working class refinery jobs and everything to do with the billionaires who own them.

An individual's interests are multifaceted, and align or deviate along different dimensions. Workers have conflicting interests with their employers at a workplace level (e.g. over safety regulations) but convergent interests with their employers at an industry level.

Politics is downstream of economic interests. Democratic rhetoric was positive about midwestern factory workers even as economic dynamics recentered the party around tech and knowledge workers who benefit from globalization. The negative impacts of that hit not only those factory workers (who have been rebranded as "deplorables" as a result of that new economic calculus) but also the local business owners who used to own those factories that are now in China.

> Move a little west and you'll find that central Texas is also a powerhouse for solar and wind, and there are plenty of racially diverse folks building and installing wind turbines in Texas.

Installing Chinese-made solar panels and wind turbines is a huge downgrade from drilling, refining, and exporting American oil. It creates fewer jobs and those jobs are lower on the value chain.

It was both the natural gas plants not being winterized and the wind turbines energy production being intermittent.

And how much each is responsible depends on how you do the analysis.

I think that people look at climate change the wrong way. Instead of showing people pictures of starving polar bears, brown people on rooftops clutching their most precious possessions, and dry riverbeds in Somewhereland, it should be pictures back home with empty refrigerators, empty shelves, high price tags, flood damage, snow drifts etc. Because even if you think "thuh environment" is all libtard bullshit, you should care about access to food, water and power. How long is the canned food in your bunker going to last?

I know, I know. I'm parodying the stereotypical European's idea of the stereotypical Texan, but there's a tiny grain of truth in it.

Didn’t Citizen’s United make this sort of thing unconstitutional? How is it that political spending is protected by the 1st amendment, but the contrapositive of not spending on something you don’t agree with is not protected speech?

If I had a nickel for every thread I've opened this year about Texas where the first comment was asking how this thing Texas is doing isn't blatantly unconstitutional, I'd have a surprisingly large pile of nickels.

Because it's a badly written article. Texas isn't banning these companies, they are choosing not to do business with them for government contracts.

Essentially, Texas made fossil fuels a protected class, and won't fund companies that discriminate against them. The Federal government did the same thing for companies that don't follow government guidelines for gender and racial discrimination.

I don't think this is an accurate analogy.

The federal courts will force you to stop discriminating (or really just keep fining you until you comply). They won't force the government to stop buying your products.

This should be a badge of honour for banks and investment companies.

"We are so socially responsible, we're banned in Texas"

That's a low bar though as a bunch of other unrelated conduct will get you banned in Texas.

Pro-Communist, Anti-Isreal, etc aren't necessarily related to fossil fuels.

The previous main argument against these was that "they didn't work" or "these just encourage people to invest in fossil fuels".

I guess the fossil fuel industry didn't agree.

Texas government grandstanding isn't the same as fossil fuel industry needs.

> Texas' exclusion list of so-called Annex I companies also includes BNP Paribas SA, Credit Suisse AG, Danske Bank A/S, Jupiter Fund Management PLC, Nordea Bank Abp, Schroders PLC, Svenska Handelsbanken AB (publ), Swedbank AB (publ) and UBS Group AG.

Every example, except for BlackRock mentioned before that list, happens to be European/UK-based. A bit of nationalism mixed in with the climate change denial?

Given the tolls being extracted by the EU on FAANG companies, it’s difficult to have much sympathy.

Wow, poor FAANGs having to pay, like, any taxes at all. Clearly unjust. Won't anybody think of the poor megacorps?

Yawn. Let me know when they fine Deutsche Bank or Spotify.

For what

I was going to downvote your low effort comment but instead did a quick search and turned up the following (there are probably more)

Deutsche Bank fined nearly $10m over rate setting failures https://www.fnlondon.com/articles/deutsche-bank-fined-nearly...

Deutsche Bank handed $124 million in bribery fines by US court https://www.dw.com/en/deutsche-bank-handed-124-million-in-br...

Spain Fines Deutsche Bank $3.3 Million for 'Very Serious' Infringement https://money.usnews.com/investing/news/articles/2022-03-29/...

FINRA Fines Deutsche Bank Securities, Inc. $2 Million For Best Execution Violations https://www.finra.org/media-center/newsreleases/2022/finra-f...

Deutsche Bank is fined with some degree of regularity (yes, even in Europe).

"US regulators have imposed fines worth $37bn on the global banking industry in relation to US-based economic crime since 2012. Of that, UK, French, German and Swiss banks with branches in the US have paid almost 40%."

"The average amount paid by European banks is around $500m per fine — over 10 times the average that US firms pay to US regulators ..."

The EU banks have long been a cookie jar for the US to raid whenever they need a buck or two

Interesting quotes, can you add the source?

https://www.fnlondon.com/articles/european-banks-face-dispro...

with the fairly obvious difference that FAANG receives scrutiny for its outsized market power, network effects, and anti-market behavior which is reasonable, whereas Texas has apparently decided to attack companies for being... too environmentally friendly on their own dime?

I don’t agree but their point is the economy of Texas is strongly influenced by the success of fossil fuels in the market and major capital market participants working against fossil fuels directly hurts the texas economy - so theory is why allow companies working directly against the local economy to profit from that economy, thus using Texas dollars to hurt texas. The dime you mention was earned from customers.

However - As the article states the only effect will be to drive up borrowing costs, steer business away from Texas, and will not impact these companies policies one iota.

I always find it interesting that conservatives are all for the free market when it is adapted to or agnostic to their morality, but are the first to take draconian policies against a free market when it aligns with their personal morality.

Progressives have the same hypocrisy on abortions vs vaccines. Turns out most people choose their personal preferences first, and morality second.

Doubt it is nationalism, just that there is more overt greenness in Europe because investors demanded it.

The weird bit is, despite many offshore companies being listed, Texas is still blaming 'environmental crusaders in Washington, D.C., and Wall Street'. As if Washington and Wall Street was leading the world toward a Green future, rather than being dragged kicking and screaming.

Is it really over "fossil fuel policies"? It seems to me that it's the S and the G which are the problem rather than the E.

Reply on news.ycombinator.com