Wyoming State Treasurer and gubernatorial candidate Mark Gordon did the right thing this week by cutting off Bank of the West from managing any of the State’s investments. The French controlled bank had announced earlier this week that it would “no longer fund coal, oil and natural gas projects.” Sweetwater County Commissioners likewise expressed their desire to have the county removes its funds from Bank of the [War on the] West.
As Treasurer, Gordon has successfully managed the state’s $20 billion in sovereign wealth funds. According to the State’s July Consensus Revenue Estimating Group (CREG) update, realized capital gains for the year ending June 30, 2018 from the Permanent Mineral Trust Fund (PMTF), which makes up about a third (approx. $7 billion) of the State’s funds, were $267 million, which combined with dividend and interest income made for a total income from the PMTF of $448 million for the fiscal year ending June 30. That is nearly a half billion dollars that Wyomingites don’t have to pay in taxes, or an effective tax break of $773 per person ($3,092 for a family of four).
Where does the PMTF get its money? Mostly from the industries that the Bank of the War on the West is trying to kill – coal, oil and natural gas.
Where did Bank of the West get its core capital (money)? Before the use of fossil fuels, other than pyramids, cathedrals, swords, shields and raw land, over thousands of years civilizations hardly amassed any capital at all, because the sources of energy were manual labor, draft animals, burning wood and the water wheel. Those energy sources barely provided a subsistence standard of living and thus prevented significant capital formation (savings).
It was only when coal energy was harnessed in the late 18th century with the steam engine that capital formation really took off, lifting millions out of poverty and creating modern society replete with consumer goods.
Bank of the West, whose French predecessors owe their existence to coal, is now fashionably too good for its ancestry.
We all want a clean environment. Making ourselves poor, however, is not a good way to achieve that.
© 2018 Clark Stith
Paid for by Clark Stith