Whether to invest in terror regimes or not

Frank Gaffney:

This week, the Ohio Legislature will hold its second hearing on legislation designed to help the state make a real contribution to America's triumph in the War for the Free World. It would prevent investment by Ohio's public pension funds in companies that do business with the terrorism-sponsoring, nuclear weapons- and ballistic missile-building and genocide-threatening Islamic Republic of Iran.
Unfortunately, the Iranian regime and the corporations partnering with it (almost all of them foreign-owned and -operated, since American companies are prohibited from participating directly in such dealings and only a few circumvent that by using offshore subsidiaries) are abetted by a well-heeled Washington lobby: the National Foreign Trade Council (NFTC). Its president is William Reinsch, and the effect of its lobbying at the moment would be to keep American taxpayers and pension fund beneficiaries underwriting our enemies through their institutional and personal investments.
Mr. Reinsch had a checkered career prior to assuming his current role as Terror's Lobbyist. For example, during the Clinton administration, he used his senior position in the Commerce Department to facilitate and excuse China's acquisition of an array of sensitive and even dual-use technologies, despite restrictions on such transfers.
Now, the former Commerce undersecretary heads a trade council that favors doing business with America's enemies and runs interference for those determined to do so. In his present role, Mr. Reinsch works to counter citizens and their elected representatives who believe such business dealings are strategically ill-advised and morally repugnant.
Specifically, Mr. Reinsch's trade association is mobilizing its considerable resources to help public pension fund managers, their Wall Street advisers and state treasurers fight off initiatives like one adopted last year by Illinois. It ended investments on the part of that state's firefighters, police officers, National Guard personnel and other public employees in companies doing business with the Islamofascist and genocidal regime in Sudan.
Until, that is, Mr. Reinsch and his friends sued to have the law overturned. While a federal judge did not find the law's divestment provisions represented an unconstitutional infringement on the foreign-policy-making responsibilities reserved for the federal government, he did object to certain technical points. At the moment, efforts to fix those technicalities and restore the requirement for Sudan-free investing are being discouraged by what amount to Sudan's lobbyists at the National Foreign Trade Council.
Mr. Reinsch is also working to prevent Ohio from joining other states striving to protect their fiduciaries from what the Securities and Exchange Commission calls "Global Security Risk" arising from investments in companies partnering with the Iranian regime. His team is horrified at the prospect of Ohio compelling Wall Street to create Iran-free accounts, indexes and index-managed products -- investment vehicles that would exclude companies doing business with Tehran from many billions worth of state pension fund investments.
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He goes on to discuss how Missouri successfully disinvested in terror regimes and increased the return in its pension funds. Most of the companies who invest in the Tehran regime are European. An Austrian company recently signed a deal worth 18 billion dollars to help Iran develop its natural gas reserves. Another Austrian company sold Iran sniper rifles which have been found in Iraq and used to kill Americans. It is hard to see why pension fund managers think they need investments in such companies in a diversified portfolio.