If “Socially Responsible Investing” Is Garbage, How Should You Invest Your Money?

The New York Stock Exchange on Wall Street. Trying to find investments in the financial industry that are truly "socially responsible" is a losing game.

The New York Stock Exchange on Wall Street. Trying to find investments in the financial industry that are truly "socially responsible" is a losing game (via Jarrett Stewart on flickr).

A version of this post originally appeared at Truthout.

There is considerable discussion about how people on the left should invest their money. For those who are socially conscious or who are anti-capitalists, this is usually an inherently distasteful endeavor. Stock markets are a central institution and symbol of capitalism after all, and they would not exist in the moneyless and classless society that many want to build.

It’s not surprising that so-called “socially responsible investing” (SRI) would seem attractive. In SRI mutual funds (bundles of stocks or bonds), fund managers screen companies based on their labor, environmental and social practices, depending on the fund. The result is an investment that is supposed to be socially responsible and while still generating a healthy return for its investors.

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