Illinois advancing measure to divest in companies boycotting Israel

Illinois advancing measure to divest in companies boycotting Israel
The Illinois State Capitol. WBEZ/Tim Akimof
Illinois advancing measure to divest in companies boycotting Israel
The Illinois State Capitol. WBEZ/Tim Akimof

Illinois advancing measure to divest in companies boycotting Israel

An international movement to boycott Israeli companies is prompting Illinois state lawmakers to react. Legislators are advancing a measure, which has the support of Gov. Bruce Rauner, that would prevent state pension funds from supporting those who are boycotting Israel.

“We, as a state, are making an affirmative statement that if you’re going to boycott Israel, an ally of the United States, a democracy in the Middle East, then we are going to divest from you,” said State Rep. Sara Feigenholtz (D-Chicago), who’s a sponsor of the bill.

Feigenholtz advanced the proposal out of the House Executive Committee Wednesday with unanimous support from both Democrats and Republicans. It still needs approval from the full House of Representatives. Last month, the proposal passed the Senate on a vote of 49-0, with three senators voting Present.

The bill calls for the creation, and monitoring, of a list of companies that boycott Israel so the state pension funds would know not to invest in those companies. Divesting is seen as an economic strategy to put economic pressures on those entities that aren’t in line with U.S. -- or Illinois -- policies.

State pension funds already divest in companies that have ties to Iran and Sudan. Feigenholtz explained to lawmakers this week that adding companies that boycott Israel to Illinois’ divestment strategy would further align the State of Illinois’ policies with the United States’ foreign policies. Two years ago, state lawmakers failed in their attempt to create another divestment strategy in which the Illinois would cut ties with gun manufacturers in hopes those companies would be motivated to get on board with gun control measures.

“We need to do our part to stand up to anti-Semitism, whenever and however it appears,” Rauner said in a written statement about the bill.

With unanimous support from lawmakers so far, criticism of the bill has come mostly from individuals or groups watching the politically-charged debate involving Israel. Reema Ahmad lives in Chicago’s Rogers Park neighborhood, and testified against the bill in a House of Representatives committee Wednesday.

“It politicizes our pension systems,” Ahmad said after the vote. “International politics, regardless of how you feel about issues in the Middle East, have no place in our state politics and much less within our pension system. We need to get our own house in order.”

Ahmad referred to a recent Supreme Court decision that rejected lawmakers’ attempts to restructure the retirement benefits of state employees. The now-defunct law was legislators years-long effort to save the state estimated billions toward its $100 billion pension debt.

Dave Urbanek, with the Teachers Retirement System, one of the pension funds potentially affected by this legislation, said they’d not yet done an analysis of how much of the fund, if any, is invested in companies that boycott Israel. He said if the bill is passed, and signed by the governor, a monitoring board would have to comb through about $45 billion in investment assets for the teachers fund alone. Another pension fund for state university workers has more than $17 billion in investments. And it’s not yet clear what mechanisms would be put in place for the pension funds to identify the companies that are in fact boycotting Israel.

But another critic of the measure warns that Illinois lawmakers are establishing policy based on recent high-profile efforts to boycott companies that do business in Israel. On its website, the Boycott, Divestment and Sanctions (BDS) movement defines itself as “a strategy that allows people of conscience to play an effective role in the Palestinian struggle for justice.” It encourages the use of “various forms of boycotts against Israel until it meets its obligations under international law,” which includes, “ending its occupation and colonization of all Arab lands occupied in June 1967 and dismantling the Wall.”

“While it doesn’t directly affect the rights of individuals in the U.S. to engage in boycotts themselves, it does create a chilling effect,” Dima Khalidi, the director of Palestine Solidarity Legal Support in Chicago, said of the bill in Springfield.

Khalidi defended the BDS movement as being motivated by human rights, and denies the protests against Israel are anti-Semitic in nature. She also criticized the scope of the proposal that’s awaiting a full House vote, saying the bill includes language to not only divest in companies boycotting Israel, but also those that take economic action against companies “in territories controlled by the State of Israel,” according to language in Senate Bill 1761.

“It applies to companies that not only boycott Israeli companies, but companies that operate within the occupied territory,” she said. “It does have important implications for what is considered Israel.”

Illinois lawmakers have acknowledged the proposal before them is a response to companies that take part in the BDS movement.

Alexandra Salomon, a producer for WBEZ’s Worldview, contributed reporting for this story.

Tony Arnold is WBEZ’s Illinois state politics reporter. Follow him @tonyjarnold.