Conservatives have spent years warning about the dangers of environmental, social and governance investing and its creeping influence over America’s energy and financial industries. In the effort to push back, we must be careful not to adopt the tactics or achieve the goals of the very ideology we have long opposed.
That’s why there are concerns being raised over the potential for unintended consequences from a November 2024 lawsuit brought by Texas and 10 Republican attorneys general. The suit targets BlackRock, State Street and Vanguard, accusing them of conspiring to suppress coal production by leveraging their stakes in the biggest coal producers through now-abandoned climate pacts such as Climate Action 100+ and the Net Zero Asset Managers Initiative.
The alleged coordination is worth scrutiny, particularly if the leadership of the coal companies went along with this alleged conspiracy with the asset managers. The proposed solution, pressuring asset managers to divest or reduce their holdings in coal, could deliver a major victory to the climate activists that conservatives have been battling for years.
Make no mistake: forced divestment from coal is exactly what the ESG crowd wants. If the result of this lawsuit is that major investment firms begin capping or abandoning positions in American coal companies, the damage will be long-lasting and profound. Divestment would not only dry up capital for fossil fuel infrastructure, but it would signal that legal risk now hangs over any investment tied to traditional energy.
That’s not free-market capitalism. That’s coercion just with a conservative label.
It also runs directly counter to President Trump’s “energy dominance” agenda, which prioritizes expanding domestic fossil fuel production to secure American independence and prosperity. Trump has consistently championed the coal industry, calling it the backbone of affordable, reliable energy and a vital part of our economic strength. Targeting the investors who manage index funds that provide important capital for that industry, because they once sat at the same table as environmentalists, is dangerous overreach.
Ironically, if these lawsuits succeed, the effect will be to push fossil fuel capital right off the table, without any legislation or regulation. The courts would have done what the Green New Deal never could: make fossil fuel investment legally hazardous and toxic from a reputation standpoint.
Energy markets are facing pressure. The U.S. electric grid, much of it built in the mid-20th century, is groaning under the weight of modern demands. Artificial intelligence, electric vehicles and data centers are fueling a sharp rise in consumption. We need more investment in energy, not less. And we need every tool in the energy toolbox, including coal.
We understand what’s at stake. Many of us live on fixed incomes and feel the pinch of rising utility bills more acutely than most.
Undermining investment in fossil fuels at the moment energy demand is increasing will only increase costs, eroding affordability and reliability when we need both.
Moreover, this lawsuit risks setting a troubling precedent: government interference in investment decisions based not on fraud or fiduciary failure but on political motivations. Conservatives have rightly opposed the politicization of finance. We should not be replicating it in reverse.
We agree that ESG activism has gone too far. Let’s be smart about how we fight back. Let’s not hand environmentalists a win under the guise of conservative legal action. If we want to support American energy, economic freedom and national resilience, then we must reject policies, no matter where they come from, that threaten capital formation in vital industries.
Energy dominance can’t be litigated into existence. It must be built, through investment, innovation and principled leadership. Let’s keep our eyes on that prize.
