Minnesota update: This just in (dateline 11:32) via Forum News Service capitol reporter Dana Ferguson, Gov. Tim Walz orders an end to Minnesota contracts with Russian entities:
Gov. Tim Walz on Friday, March 4, signed an executive order condemning Russia's attacks on Ukraine and terminating state contracts with Russian entities....
The state didn't immediately identify how many contracts would be affected by the order. And the directive said that, moving forward, Minnesota should not enter into new contracts with Russia. The governor also urged other private companies to take similar measures.
More below-- end update
Should states in the upper Midwest sanction the Russian Federation for its unprovoked invasion of Ukraine by withdrawing state funds invested in Russian firms? Will they?
A look at recent headlines reveals mixed assessments about the need to act and the impact such investments might have.
The state of North Dakota has acted. At the Bismarck Tribune, Jack Dura reports in North Dakota investment board to divest from Russian entities:
North Dakota's State Investment Board on Thursday voted to divest public money from Russian entities amid the country's invasion of Ukraine.
The decision came after a public update on state funds with "Russian entity exposure" and a nearly 1 ½-hour closed session to discuss strategy. The 12-member board voted unanimously "to approve the divestment of Russian investment exposure as discussed in the executive session and direct staff to report at the next regularly scheduled State Investment Board meeting."
State Retirement and Investment Office Executive Director Jan Murtha said the board's guidance will be given to investment managers, with an update at the next board meeting on March 25.
Lt. Gov. Brent Sanford, who chairs the board, called Thursday's special meeting on Russian investments "in light of the country’s continuing attacks on Ukraine."
"I hope that people are seeing that the answer is here, no more new investments in Russia and an absolute plan for exiting the investments with Russian connection," he said. . . .
Read about the details in the rest of the article. Bluestem is pleased to see the swift and decisive action.
MINNESOTA
UPDATE; March 4: Forum News Service capitol reporter Dana Ferguson reports in Gov. Tim Walz orders an end to Minnesota contracts with Russian entities:
Gov. Tim Walz on Friday, March 4, signed an executive order condemning Russia's attacks on Ukraine and terminating state contracts with Russian entities.
The state didn't immediately identify how many contracts would be affected by the order. And the directive said that, moving forward, Minnesota should not enter into new contracts with Russia. The governor also urged other private companies to take similar measures. . . .
"Minnesota stands firmly with Ukraine and strongly condemns the Russian government’s actions," Walz wrote in the order. "Our state agencies are significant purchasers of goods and services, and we seek to ensure that their actions do not aid the Russian government’s aggression against Ukraine."
Walz asked that Minnesota who were financially able to donate to causes helping Ukrainian humanitarian efforts. And he said Minnesotans should continue to support their friends and neighbors with ties to Ukraine, as well as Russian Minnesotans who were "horrified and alarmed" by the aggression toward Ukraine.
Original copy:
Moving down to Minnesota? For MinnPost, Walker Orenstein asked in Wednesday's Can the state of Minnesota take economic action against Russia?
The answer looks like a Minnesota Long Good-bye, especially with the North Dakota example for reference:
Amid Russia’s ongoing invasion of Ukraine, states across the country are taking steps to hurt Russia’s economy with financial sanctions, from banning the sale of Russian-made liquor to from divesting pension funds.
On Monday, Gov. Tim Walz said Minnesota is exploring whether the State Board of Investment (SBI) should sell off holdings in Russian-tied companies. Walz said the investment board, which manages primarily pension and savings funds for public workers, has a “fiduciary responsibility” to manage that money wisely. But he said “hiding behind a fiduciary responsibility” shouldn’t get in the way of “taking the actions necessary” that might help force change.
There is precedent for such actions. State law has limits for investing in companies that operate in Iran and Sudan, and the board also has restrictions on investments tied to tobacco and coal production.
tate Economist Laura Kalambokidis said Minnesota “doesn’t, in aggregate, have a lot of trade exposure to Russia or Ukraine.” The state’s main trading partners are Canada, Mexico and China, she said, noting neither Russia nor Ukraine is even in the top 10 of trading partners.
“That is not to say there aren’t important Minnesota businesses that do have exposure in Russia and Ukraine,” Kalambokidis said.
Walz on Monday said economic sanctions to make sure “Russia is being punished” are “going to be of course on a broader scale” and said he wants to make sure state actions won’t just be symbolic. The governor also said he’s cognizant that average Russians are going to feel economic pain more than Vladimir Putin or oligarchs, and said many Russians are “courageously in the streets protesting about this illegal incursion into Ukraine.” . . .
. . .Still, Walz said he’s asked his teams to take a look at money managed by the state’s Board of Investment, noting the state has policies around investment tied to Iran and Sudan.
Looking to the legislature, Orenstein notes Northeast Minneapolis DFL state representative Sydney Jordan, whose district is home to Ukrainian-American and Ukrainian nationals, is at the early stages of researching sanctions; he also linked to S. St. Paul DFLer Rick Hansen's tweet:
Just wondering this morning, does @Cargill @HormelFoods @LandOLakesInc etc do business and/or invest with the Government of Russia?
— Rep. Rick Hansen (@reprickhansen) March 1, 2022
We also should ask State of Minnesota and @UMNGovRelations to review its investments to determine if we are doing business with Russia. 🇺🇦🌻
SOUTH DAKOTA
UPDATE March 5: In South Dakota's trust industry front-and-center at pro-Ukrainian rally in Sioux Falls, Forum News Service's South Dakota correspondent Christopher Vondracek reported:
. . . Few, if any, elected officials in the state have spoken out on potential, if unproven Russian oligarchs' ties to the state's trust industry, which was revealed to be housing accounts linked to foreign strong-men in a fall report published in The Washington Post .
Last month, responding to reporters' questions about bringing greater scrutiny to the industry, Senate Majority Leader Gary Cammack, R-Union Center, said the industry has done due diligence to root-out bad actors from accounts.
"I have every confidence in the world that sort of thing is not happening in South Dakota," Cammack said.
In an interview on Tuesday, March 1, congressman Johnson similarly said, "The Russian government does not have trusts in South Dakota."
On Friday, the South Dakota Division of Banking released a memo to the state's trusts announcing that the federal list of sanctioned persons was being "actively" updated and that every trust company should be proactive in ensuring there are no financial transactions with persons on that list, according to a statement from the South Dakota Trust Association. . . .
Well, that's some movement from the digest of South Dakota news we posted earlier, see below [end update].
South Dakota? Nothing to see here, move on, KELOLAND's Eric Mayer reports in Noem, lawmakers not worried about any Russian connections to South Dakota’s trust industry:
The private and hidden nature of South Dakota’s trust industry is again under question for any possible ties to Russian assets.
Gov. Kristi Noem (R-S.D.), Republican and Democrat lawmakers alike downplayed any South Dakota connections with Russia during news conferences Thursday in Pierre. Leaked records and documents in the Pandora Papers tied 81 trusts to South Dakota, but exposed examples of alleged wrongdoing from individuals holding money in South Dakota did not include ties to Russia.
However, the private nature of South Dakota’s trust industry has led people to ask about any possible connections to Russia and if the state would benefit from more transparency on the complex and secret nature of the industry.
Noem said she was not aware of any Russian assets in South Dakota’s trust industry and praised the industry’s strong vetting process for setting up trusts.
“It’s all private information,” Noem said. “Our trust industry does have integrity and it has been proven to be an outstanding lawful system in the country.”
Senator Reynold Nesiba (D-Sioux Falls) said he reached out to Oliver Bullough, a journalist from London, who has been critical of South Dakota’s trust industry in the past.
“His suspicion is there’d be very little Russian money hidden in South Dakota trusts,” Nesiba said. “Generally, Russia is suspicious that America has a rule of law and could investigate and there would be potential (for the money) to be frozen.”
Nesiba said he also spoke with the State Investment Officer Matt Clark about the state’s exposure to Russian sanctions.
“What he shared with me is that we have very little exposure,” Nesiba said he heard from Clark. “The little exposure we have to Russia would be through some Vanguard investments that are part of mutual funds.”
Nesiba said Clark roughly guessed South Dakota had .01 or .015, or less than one tenth of 1 percent of the state’s portfolio as possibly exposed to Russian markets or connections.
“It would be really expensive for us to divest that because we’d have to sell a Vanguard mutual fund that has a broad package of other international investments,” Nesiba said. “I was happy to hear that.”
Senate Majority Leader Gary Cammack (R-Union Center) said the State Investment Council has told him there’s no direct investments tied to Russia.
“There is a potential that some of the funds could be part of the mix in the investment,” Cammack said. . . .
Nesiba said some of the latest leaked documents showed people from China have money hidden in South Dakota trusts. He said he would be concerned about those ties if China acted in a similar way to how Russia is invading Ukraine.
“One of the things that makes South Dakota trusts so attractive is there’s so much privacy,” said Nesiba, who called for better federal oversight of the industry. “I think trusts would be better regulated at the federal level.”
Asked about Chinese assets, Noem said she’d have to look at the situation and see if it was a single individual’s information being released. She also worried about what precedent that would set for other related industries.
“That’s up to our trust industry,” Noem said.
Don't worry, be happy, South Dakota.
Besides, there are other targets for South Dakota's spleen. On Monday, David Lieb of the Associated Press (via the Rapid City Journal) reported in South Dakota not among states taking action against Russia:
Two prominent Republican governors, Florida’s Ron DeSantis and South Dakota’s Kristi Noem, who are widely seen as angling for a White House bid, mostly took aim at President Joe Biden rather than issuing executive orders targeting Russia. They criticized his energy policies and said that had made it difficult to slap sanctions on Russia's exports of oil and gas. Noem made her comments last weekend at the CPAC convention in Orlando, Florida.
Even then, a few voices are raised. At the Yankton Daily Press and Dakotan, there's the editorial, Is There Russian Cash Stowed Away In South Dakota? which cites Dakota Free Press's February 24 post, Wage War on Putin: Seize Russian Trust Assets in South Dakota
More recently, DFP blogger Cory Alan Heidelberger posted South Dakota Failing to Support Ukraine.
It doesn't sound like South Dakota's elected will do much more to help the Ukrainian people beyond shrugging, but we're holding out some hope Minnesota will rise to the crisis. Well done, North Dakota.
Photo: Western North Dakota, a piece of the the Peace Garden state. Via Wikipedia.
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This is interesting. I saw that there were people demonstrating in Sioux Falls about this issue. It did make the evening news albeit brief.
Posted by: Lila Salls | Mar 06, 2022 at 09:32 PM