FOR IMMEDIATE RELEASE:
Contact: Max Moran, [email protected]
Today, a coalition of 23 environmental, labor, and good government organizations called on President Biden to remove Thomas Workman from his role as the independent member with insurance expertise on the Financial Stability Oversight Council (FSOC), the interagency panel which identifies and addresses systemic risks to the financial system.
In a letter to White House Chief of Staff Ron Klain, the groups highlighted that Workman, one of 10 voting members on the council, has expressed skepticism that the climate crisis is real and a significant threat to the insurance industry and global financial stability. This is particularly troubling given Workman’s record of support for weakening the FSOC’s ability to oversee the large, risky insurance companies that helped cause the 2008 financial crisis.
Workman said in an interview with an industry group in 2019, “[O]f course there’s climate change, and catastrophic events. I know there are many folks who are convinced that it’s the end of the world and we’ve got only 12 years left, but then there are others who say it’s not an issue, but it certainly is a debate.”
In their letter, the groups highlighted that the insurance industry is a major enabler of the fossil fuel industry, and that U.S. regulators lag behind their international counterparts in both setting and enforcing rules to curb exposure to climate risks. “As society’s risk managers and major holders of investments, insurers are exposed to climate financial risk on both sides of their balance sheet,” the groups wrote.
“Insurance companies are the hidden villains of the climate crisis, just like they were in the 2008 financial crisis,” said Yevgeny Shrago, Policy Counsel in Public Citizen’s Climate Program. “The Financial Stability Oversight Council’s job is to make sure their risky behavior doesn’t blow up the economy again. Voting member Thomas Workman’s climate denial and lax attitude toward regulating mega-insurers reveal his incompetence, making him totally inadequate to be one of the federal government’s most prominent voices on reining in these insurers. To keep our economy and planet safe, we need a truly independent member who accepts climate science and doesn’t just echo the insurance lobby line.”
“Biden absolutely cannot tolerate climate denialism or regulatory capture,” said Max Moran, Research Director for the Personnel Team at the Revolving Door Project. “Workman spent over a decade as an industry lobbyist at the Life Insurance Council of New York (LICONY) before the Trump administration tapped him to regulate insurers at the highest levels of the federal government. Even if he weren’t a skeptic of climate change, that would be unacceptable, but especially in the wake of this week’s Intergovernmental Panel on Climate Change (IPCC) report, it demands an immediate response.”
In May, President Biden issued an executive order directing Secretary of the Treasury Janet Yellen, in her role as chair of the FSOC, to issue a report by November on mitigating climate financial risk to the financial stability of the United States. The Executive Order also directed Treasury’s Federal Insurance Office to assess how gaps in insurance regulation could pose a threat to financial stability.
The letter text can be found here.
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