Lawmakers and staffers with high hopes for passing rigorous climate legislation are finding themselves tied to public pensions that include assets in fossil-fuel companies because the federal government doesn't offer retirement options to its employees that have no investments in fossil fuels. Forcing federal employees to invest their savings in the fossil fuel industry threatens both the future of our planet and the bottom line for these workers saving for retirement.
In November, Rep. Emanuel Cleaver (D-Missouri) and Rep. Rashida Tlaib (D-Michigan) introduced legislation that could change that. Known as the Restructuring Environmentally Sound Pensions in Order to Negate Disaster Act of 2020 (RESPOND Act), the bill would, for the first time, require the Securities and Exchange Commission and the Federal Reserve to issue an annual report analyzing how climate change poses a risk to $565 billion in federal employee retirement fund. The bill goes hand-in-hand with another proposed measure — the RISE Act, originally introduced by Sen. Jeff Merkley (D-Oregon) in 2018 — that would allow federal employees to choose a fossil-fuel-free pension plan.
Pension divestment is already underway in many places. In 2015, Norway announced it would partially divest its pension funds from coal. Evidence that divestment is a financially responsible move is mounting. For example, a 2019 report by Corporate Knights shows state workers in California and Colorado lost a combined $19 billion in retirement funds over 10 years by remaining invested in fossil fuel assets.
If we are going to wean our country off dirty, limited fossil fuels, we should start by divesting the retirement funds of Federal employees from companies that profit from oil, coal and natural gas and thus stand to lose as we get more of our energy needs from renewable sources.
