Washington, D.C. – A new report from economic insights firm The Perryman Group reveals the real economic consequences of Texas’ recent anti-ESG legislation, which has the potential to cost the state as much as $821.1 million and nearly 8,800 job-years by the end of the year.
First covered by Dallas’ ABC affiliate, WFAA-TV, the report analyzed the potential total impact of several hypothetical scenarios under the restrictions outlined in Texas’ responsible investing bans, SB-13 and SB-19, to understand the potential impacts and losses. Unsurprisingly, the report concluded what several studies have already proven: Texas responsible investing bans are bad for business, costing taxpayers, and harming Texans’ ability to save for retirement.
“The Perryman Group’s report reinforces what we already knew — extremism is bad for business,” said Kyle Herrig, spokesperson for Unlocking America’s Future. “Blacklisting competitors vying for state contracts and pension plans has catastrophic effects on the Texas economy and risks the financial security of Texans trying to save for retirement. Many Texas lawmakers have long been cozy with Big Oil, as seen by Governor Greg Abbott’s $53 million in career campaign donations from the sector. Still, their latest moves to ban financial institutions for engaging in responsible investing is unprecedentedly negligent and transparent. Texans should know their elected officials are trading their pension security for media clout and campaign cash.”
A study published in March by the Texas Association of Business and TXP found that since their implementation in 2021, these Texas anti-ESG laws have already cost the state nearly $700 million in lost economic activity. The Perryman Group report builds on past research to show that those costs are only expected to increase as the state continues to divest from financial firms practicing responsible investing, and highlights these key findings:
- Texas’ fossil fuel mandates have the potential to cost the state up to $821.1 million in lost economic activity and lower returns for tax pension funds in 2024.
- A second hypothetical scenario projects the restrictions to cost the state $746.6 million in higher interest rates. This scenario also projects the loss of over 8,100 job-years.
- Limiting the number of banks allowed to compete in the Texas bond market will create “increased issuance costs in the form of net interest rates.”
The report’s findings substantiate new polling data from Unlocking America’s Future, which revealed 83% of Texans say it is not the role of government to tell private financial institutions how to invest their customers’ money. In addition, 72% of Texas voters believe leaders in Texas have become less focused on fixing real problems and more focused on pushing an extreme conservative agenda.
You can read the WFFA-TV (ABC8) news story here and the full report here.
