Citizens of Nowhere Land
State of the Union: BlackRock is making all its nowhere plans for nobody.
Larry Fink can count. When asked about the political backlash to BlackRock’s ESG investment at a recent Bloomberg panel in Davos, he said, “If you just reflect on BlackRock’s flows last year, the backlash is public: we lost about $4 billion of flows from various states. But in long-term flows last year, we were awarded $400 billion just last year. In the United States, our clients entrusted us with an additional $230 billion. So, you tell me, 4 billion out, and 230 in in the U.S.”
After he mentioned the $400 billion – a figure that he was not straining to recall – his face relaxed and his eyes lit up as if his beloved had just walked into the room.
The uninhibited grin proved Julius Krein’s point made in his Compact piece from earlier this month, namely, that a right liberal, knee jerk rebellion against ESG might sow short-term political capital but will prove unsatisfactory in the long run.
But perhaps the more distressing realization about Fink’s smile is that it will continue to shine through the war in Ukraine. My TAC colleague Bradley Devlin remarked last month:
So, BlackRock gets paid by U.S. taxpayers via the Ukrainian government to devise a plan that ensures the success of their future investments in Ukraine, made from money gained by making American housing unaffordable. With a deal like that for our financial and political elite, why would they ever want peace?
Bradley talked about it on Tucker last night:
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His last point was the best: “They don’t think of themselves as Americans. They’re ashamed to be American. They think of themselves as citizens of the world.”
The people who should be thinking about this most intensely are the in-demand college seniors signing contracts and preparing to graduate in May. I would urge them to recall Mr. Potter on It’s a Wonderful Life. “You wouldn't mind living in the nicest house in town, buying your wife a lot of fine clothes, a couple of business trips to New York a year, maybe once in a while Europe. You wouldn't mind that, would you, George?”
We can talk about the dynamism and glory of our institutions until we’re escorted into an institutional Gulag. BlackRock can be considered a private institution in the way that an Amsterdam brothel is private: it requires people to stay open. If there has ever been a time in our nation's history for building and investing in alternate institutions, it’s now. Larry Fink has handed out a few fresh cigars – Cubans, I’m sure – to smart people in his time. The only tradeoffs are decadence and wealth for wealth’s sake: a small price for the soul of a nation.