US: Joe Biden uses veto for the first time

US: Joe Biden uses veto for first time

 US: Joe Biden uses veto for the first time

The US president has overturned a Republican bill that would have prevented investment fund managers from taking factors like climate change into account.

The move overrides an investment bill proposed by Republicans. The bill would have prevented investment fund managers from taking factors such as climate change, social impacts, or pending lawsuits into account, known as ESG investing.

Biden tweeted that the bill would threaten "retirement savings by making it illegal to consider risk factors MAGA House Republicans don't like."

"Your plan manager should be able to protect your hard-earned savings — whether Rep. Marjorie Taylor Greene likes it or not," Biden said, referring to a Republican lawmaker that championed the bill.

To override the veto, supporters of the bill would need to garner a two-thirds majority both in the House of Representatives and the Senate.

US: Joe Biden uses veto for first time

What is the Republican-led ESG bill?

The bill overturned a Labor Department rule making it easier for fund managers to consider ESG factors for investments and in proxy voting. The Labor Department reinstated the ESG rule in November, undoing a push by former President Donald Trump to penalize investment fund managers for considering climate change.

Two Democratic senators voted with the Republicans, allowing the bill to pass. The Democrats hold a thin majority in the Senate.

Republicans claim the rule would politicize investing in a way that would hurt financial performance.

Democrats argue that the rule does not prescribe how ESG factors should be considered, as long as the fund meets its obligations to its beneficiaries. Biden has also framed the rule as a financial boost to investors concerned about climate risk.

Republicans accuse Biden of 'far-left' agenda

"It is clear that President Biden wants Wall Street to use your hard-earned money not to grow your savings, but to fund a far-left political agenda. That will hurt seniors and workers," Republican House of Representatives speaker Kevin McCarthy said.

Democratic Senator Joe Manchin, who voted with Republic on the bill, said that the Biden administration was pushing a "radical policy agenda."

"Despite a clear and bipartisan rejection of the rule from Congress, President Biden is choosing to put his administration's progressive agenda above the well-being of the American people," Manchin said.

During a debate on the bill, Senate Democratic leader Chuck Schumer accused Republics of "forcing their own views down the throats of every company and every investor."

How Biden's veto pace compares to past presidents

In recent administrations, there's been a significant drop in the number of vetoes. Former President Jimmy Carter vetoed 31 bills in just four years. But the three most recent presidents all topped out at a dozen vetoes or less.

Former Presidents Carter, Ronald Reagan, and George H.W. Bush each vetoed a bill in their first year in office, as did former President Barack Obama.

But former Presidents Bill Clinton and Donald Trump didn't face a veto decision after their first midterm election. Former President George W. Bush didn't face a veto until his second term, an unusual case because Congress rallied behind him after the 9/11 attacks.

Two Democratic senators from red states helped move the fight along

When Republicans took control of the House of Representatives in January, they used a process that makes it easy for Congress to weigh in on regulations that haven't gone into effect yet.

Then the measure went to the Senate, which is controlled by Democrats who support allowing large pension funds to use ESG investment criteria.

Congress isn't expected to pass a lot of legislation in the next two years because of split-party control.

While Biden often wields the threat of vetoes in his speeches, he's generally talking about proposals that are highly unlikely to get to his desk, like repealing Social Security and Medicare or a national ban on abortion.

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