25 Apr Paperback Writer
Today marks the official release of the paperback edition of The Dictatorship of Woke Capital. The bulk of the text remains unchanged, although we made a few edits here and there to account for events that have occurred since the book was first published two years ago. Additionally, I wrote a preface to the new edition, explaining how the idea of “woke capital” went from a fringe issue relevant only to a handful of people to one of the most prominent and controversial subjects in all of finance and politics in only a matter of months.
While I would love to take credit for this rapid and dramatic change, the truth of the matter is that I was a bit player. As I note in the preface, events played an enormous role in raising awareness of ESG/stakeholder capitalism/woke capital, as did the emergence of significant players in the arena who were largely unknown when the book was released. I highlight two such individuals: Vivek Ramaswamy (who no longer needs any introduction) and Derek Kreifels, the CEO of the State Financial Officers Foundation (SFOF).
Earlier this year, I quoted from the preface in a piece about Vivek and promised that I would, at some point, do the same regarding Derek. Given that it is release day and that Derek and SFOF are, as I type, hosting their semi-annual conference, today seems like as good a day as any.
And so, without further ado…
Of all the new faces in the woke capital arena, two have exerted an especially outsized influence. One is Derek Kreifels, the cofounder and CEO of the State Financial Officers Foundation (SFOF), a nonprofit organization dedicated to encouraging fiscal probity and principled stewardship of constituent tax dollars among state treasurers and auditors. Upon his awakening to the realities of ESG and its political nature, Kreifels understood that this top-down, activist, one-size-fits-all investment scheme would threaten his group’s core fiscal mission and would prove problematic for many of its members. Kreifels quickly formulated a counterstrategy that would focus on state financial officers’ fiduciary responsibilities to their constituents and would expose the risks posed to state governments by the explosion of ESG products and methodologies.
Within months, state treasurers were speaking out and taking action against the ESG practitioners whose obsessions were hurting their constituents. Representing states with impeccable credit records and various economic interests, these treasurers included John Murante of Nebraska (agriculture); Riley Moore of West Virginia (energy production), and Marlo Oaks of Utah.
The New York Times tried very hard to paint Kreifels and SFOF (a three-person organization) as the masterminds of a nationwide conspiracy to “politicize” and “weaponize” the ESG issue, never quite grasping the irony that it is impossible to politicize or weaponize something that was conceived as a fundamentally political weapon. Still, the effort expended by the Times to investigate and “expose” an organization that is open and public about its positions and its programs is evidence of Kreifels’s influence (and of the Times’s tone-deaf silliness).
Some of this fits quite well with yesterday’s piece on the financial media’s collusion with ESG-world to characterize opposition to ESG as an overtly political act. The irony here is that while they were acting on the tried-and-true culture-war script, Kreifels and the state treasurers were acting purely on financial interests, as befits genuine fiduciaries.
Over the span of a few months, Kreifels and a handful of state financial officers changed the entire ESG debate, adding a federalist/localist argument to the case against top-down, one-size-fits-all political tinkering through financial markets. In so doing, they caught the ESG giants off guard, framed the debate as one about the ineffectiveness and tone-deafness of excessive centralization of financial power, and – perhaps most importantly – planted in my muddled mind the seeds of an idea for a second book ????.
Many thanks today to Derek Kreifels, the State Financial Officers Foundation, Encounter Books, Roger Kimball, and all of you, dear readers, who have made this possible.