One of the bills I flagged back in January, HB 1378, has passed both houses and is on its way to the governor to become law. The simple explanation of this bill is that the Indiana Public Retirement System is directed to make a list of businesses that attempt to inflict economic harm on Israel and, if those businesses do not respond positively to a cease and desist notice, INPRS is prohibited from investing in those companies.
It doesn’t necessarily sound awful when described in those terms, but the language in the bill is very encompassing. By the terms of the bill, a business is eligible for the list if you engage in “inaction that acquiesces in an effort by another person to limit commercial relations with businesses in Israel.” A business could be anything from a sole proprietorship to a multi-national corporation.
This looks like it may be a First Amendment lawsuit waiting to happen. I suppose you don’t have a right to have INPRS invest in you. But, if they engage in viewpoint discrimination — withdrawing funds, not because you’re a bad investment, but because of your views on Israeli policy, it seems like that could run afoul of the First Amendment.
I find this law particularly troubling. The boycott of South Africa was particularly effective in ending apartheid. A boycott of Israeli goods could move Israel towards a long term arrangement with the Palestinians that would recognize the rights of the Palestinians to self determination and the legitimate security interests of Israel.
Voltaire said “To learn who rules over you, simply find out who you are not allowed to criticize.”
They could have talked with someone who knew something about investing, like a rep from Fidelity or Vanguard, and asked about how doable that is and whether the effort is worth it in the end. If you have some mom and pop store violating your rule, that’s relatively easy, but investments and life aren’t like that. Businesses are interdependent and things get complicated really fast, especially when you are dealing with huge mutual funds.
Carlito’s point about the unintended consequences is so typical of the quixotic, ideologically-driven legislature. They focus on one issue without considering the broader implications, doing more harm than any intended good (assuming that there was any good in this law to begin with). The IQ of the legislature is obviously very high, around 180, when you add them all together.