Oiled Up and Ready To Go
In October, 73.7 percent of voting Columbia College students supported a ballot initiative to divest from fossil fuels. "Divestment" refers to a process of withdrawing funds from a company or sector, usually to make a political statement. In 1985, under overwhelming pressure from students, Columbia’s trustees agreed to divest from corporations operating in South Africa in protest of the country’s apartheid regime. Today, there are almost 500 fossil fuel divestment campaigns at colleges and universities across the country, and the movement continues to grow. Barnard Columbia Divest, the group that proposed the recent ballot initiative and of which I am a member, is petitioning Columbia to immediately freeze any new investments in the top 200 publicly-traded fossil fuel companies (identified by the Carbon Tracker Initiative as having the largest proven fossil fuel reserves), and to divest within five years from any direct holdings or commingled funds in those corporations. Recently, Barnard Columbia Divest met with Columbia’s Advisory Committee on Socially Responsible Investing to request that the committee disclose information on the University’s fossil fuel holdings, publish their meeting minutes, and participate in a public forum on divestment. With 73.7 percent of voting Columbia College students in favor of fossil fuel divestment alongside a coalition of alumni and students at other schools within the university, Columbia has received a mandate to divest from fossil fuels. It is imperative that collective action be taken to address climate change, and divestment is the most effective tool available to college students seeking to make an impact.
In order to understand the magnitude of climate change, the time we have to address it, and why divestment is the best way that college students can do something about the problem now, it is necessary to first consider two questions: how much warming can the planet reasonably tolerate, and how much carbon can be burned before that limit is reached? At the 2009 UN Climate Change Conference in Copenhagen, the international community concluded that Earth could not afford to warm more than 2°C (or 3.6°F) above preindustrial levels. Since 1880, we have already seen 0.8°C (1.4°F) of warming, which is linked to an overall trend of more severe weather events (like Hurricane Sandy and the recent Typhoon Haiyan, which that devastated the Philippines) more acidic oceans, and rapidly vanishing Arctic ice. The Intergovernmental Panel on Climate Change (IPCC) report, published in September, answers the second question: As of 2011 we can burn 469 billion more tons of carbon to have an 80 percent chance of remaining under 2°C of warming.
Herein lies the crux of the problem: The fossil fuel industry is planning to burn about three trillion tons of carbon, which is more than six times the carbon budget. According to Columbia professor and former NASA scientist James Hansen, if we burn all of the world’s proven fossil fuel reserves, the planet will undergo a minimum of 16°C (29°F) of warming, making Earth uninhabitable for humans and other species. At the rate we are currently consuming fossil fuels, we could burn through our carbon budget in 30 years or less. Currently, fossil fuel prices and stocks are based on burning the full three trillion tons of carbon (and the fossil fuel industry is exploring for more), meaning that share prices are significantly overvalued. This has created a massive "carbon bubble" that will bring about catastrophe for the global economy, the planet, or both when it bursts. John Fullerton, a former JP Morgan executive, estimated that the carbon bubble represents $20 trillion, which is ten times the size of the $2 trillion subprime mortgage bubble that devastated the world economy in 2008. If Columbia is concerned about the long-term stability of the endowment, the University should take a cue from the growing number of companies, such as Norway’s $74 billion asset manager, Storebrand, that are starting to recognize the carbon bubble and ditch their fossil fuel investments.
The international community has recognized the need for climate solutions since the 1990s, but more than two decades later, virtually nothing has been done. This inaction has been largely propagated by the fossil fuel industry, which spends billions of dollars lobbying against climate change legislation and funding public misinformation campaigns denying global warming. Just as the tobacco industry funded so-called scientific research to negate the evidence of the harmful effects of smoking, fossil fuel companies including Exxon, Shell, and others have funded conservative think tanks such as the Competative Enterprise Institute, the George C. Marshall Institute, and the Scientific Alliance, which have produced studies denying climate change. In 2013, the oil and gas industry was also among the top three largest lobbies in the US, along with the pharmaceutical and insurance industries. Furthermore, many fossil fuel companies receive subsidies from the US government, and the ever-present revolving door facilitates a cozy relationship between regulators and the fossil fuel executives.
Recognizing that our governments have failed to take meaningful action on climate change, fossil fuel divestment is strategically leveraging academic and research institutions as the next rung of institutional political power in order to pressure our elected representatives into seriously addressing climate change. Contrary to popular opinion, the main goal of divestment is not to hurt fossil fuel companies’ financial bottom lines; the goal is to delegitimize their reckless actions and revoke their social license to continue burning through the acceptable limit of fossil fuels. Columbia’s material investments in the fossil fuel industry may be drops in the bucket, the University’s reputation and name hold great weight, and a moral obligation to set an example.
Some have argued that the endowment might not perform as well without fossil fuels, and the endowment is an important resource to fund climate change research. Unfortunately, the complete lack of transparency surrounding Columbia’s investments makes it difficult to estimate the effect of divestment on the $8.2 billion endowment. For comparison, 5.5 percent of the University of California’s $7.1 billion endowment is invested in fossil fuels, while Barnard’s Chief Operating Officer Greg Brown said that less than four percent of Barnard’s $215.5 million endowment (separate from Columbia’s) is invested in fossil fuels. Many studies suggest that, in general, divestment would have little or no impact on returns. Fossil fuel investments may be lucrative, but they are also volatile: One study conducted by the research firm Standard and Poor’s Capital IQ found that a $1 billion endowment would have actually performed better over the past 10 years, by a margin of $119 million, if it had divested from fossil fuels. In order to gain a clearer picture of the potential effects of divestment on the endowment, students must call on Columbia’s administration to commission an independent feasibility study in addition to demanding greater transparency. As for the argument that we need the returns from our fossil fuel investments to fund climate change research, the two sides of this equation are logically and morally incompatible. Conducting researching on the negative effects of an industry, while continuing to support it, is a self-defeating and hypocritical exercise.
Some, including Harvard President Drew Faust, have argued that it is inconsistent to protest the fossil fuel industry when, as individuals, we rely on fossil fuels in our daily lives. In reality, it is precisely because of the fossil fuel industry that few large-scale, viable alternatives exist. Certainly, we need energy for transportation, manufacturing, and other activities; divestment proponents are not suggesting that we stop driving cars tomorrow. However, through its lobbying efforts, the fossil fuel industry has effectively prevented the large-scale development of alternative energy sources. Individuals can recycle and ride their bikes, but broad systemic change is needed to address climate change, and this burden rests on our governments. Brown University President Christina Paxson argued, in regard to Brown’s coal divestment campaign, that "a cessation of the production and use of coal would itself create significant economic and social harm to countless communities across the globe." Transitioning away from fossil fuels will not be painless, but it is imperative to wean ourselves off of fossil fuels in the near future if we hope to keep our environment intact. If we do not limit our carbon consumption, we can expect unprecedented natural disasters, drought, massive crop failures, famine, disease, political instability, and conflict when global temperatures rise. Climate change will exacerbate existing inequalities and issues such as poverty, disease, gender discrimination, racism, and violence. If society hopes to make progress on any of these fronts, we must first confront climate change.
Many have also argued that university endowments should not be used as political tools, but as resources for the sole purposes of education and research. However, universities are already political actors: They drive policy decisions and hold a great amount of influence in the most powerful circles of society. Furthermore, as many have already recognized, universities give their tacit approval of industries by investing in them, which is precisely why many institutions withdrew their financial support from companies linked to tobacco companies and the South African apartheid. A sentiment commonly expressed by those in opposition to divestment is that students do not have the authority to make decisions about how the endowment should be managed. This argument fundamentally misunderstands Columbia’s mission as an educational institution. We, the students, are the people Columbia exists to serve. We have a right to demand from and enact the change at our university we want in a world we inhabit and will inherit. During the campus protests of 1968, Columbia students did not stand by while our university supported the Vietnam War and attempted to build a de facto segregated gym. Columbia prides itself of our reputation as a liberal, and activist university. If we want to continue this legacy as a leading institution of progressive social change, we must lead on climate change.
If we accept the premise that students should have a voice in how their universities operate, another concern emerges, which President Bollinger himself raised: If Columbia divested from every industry that students protested as immoral, there would be little in which to invest. However, the slippery slope argument cannot justify inaction or condone the fossil fuel industry’s reckless business practices. The 73.7 percent of voting Columbia College students who voted in favor of fossil fuel divestment is a decisive endorsement that cannot be ignored. President Bollinger indicated that he would only support divestment in extreme cases where the university’s investments are supporting "highly immoral and unethical activities." As Barnard Columbia Divest member Michael Greenberg wrote, "if an industry that could harm all of humanity for all time is not extreme, I’m not sure what is."
When mobilizing this level of overwhelming student support, the realities of life as a college student can be a double-edged sword, but both edges can cut in favor of divestment. We are opportunely positioned to leverage the influence of the most powerful universities in the country. We can use Columbia as a platform to raise the profile of climate change. However, despite this potential, we are limited in our roles as students: We do not have the capacity or the time to appeal to our elected officials through traditional advocacy channels or to maintain a strong presence in Washington. Even if this were possible, the fossil fuel industry’s dominating influence in our political system would neutralize student efforts. Climate change may seem like a David versus Goliath problem—what can one college student do to have any impact? By empowering the student body, we can amplify our message and make a collective difference. Divestment is only one strategy out of many, and it is going to take a multi-pronged approach to address a problem as complex and enormous as climate change, but for now, it is the best tool we have to pressure our world leaders into action.
Whether we see the full force of global warming in 30 or 100 years, there will be consequences for pumping the atmosphere full of greenhouse gases. We can continue to be complacent and hope climate change will not be as bad as scientists are projecting, but that is not a risk society can afford to take. Past a certain point, which could very well be the 2°C mark, anything we do to address climate change will be useless because the damage will already be done. We are running out of time before we reach this climatic tipping point, and we must start by reining in the fossil fuel industry if we hope to avoid climate catastrophe in the not so distant future. Columbia needs to be on the right side of history on this issue, or human history may cease to exist. Personally, I need to believe that we can galvanize enough people to reach a critical mass in this momentous struggle, because the alternative is unthinkable.
Artwork by Gemma Gene