In spearheading a movement calling for the widespread divestment of fossil fuels, author and environmental activist Bill McKibben has sparked a discussion that gained speed and media prominence much more quickly than even he imagined. Still, his argument that the best way to fight climate change is by pressuring institutions like colleges and universities to divest their coal, oil and gas stocks has been met with plenty of detractors.
Since McKibben and 350.org, the environmental advocacy group that he leads, launched their 21-city “Do the Math” tour in early November to spread the word about divestment to campuses across the U.S., their message has grown legs and taken off at a full sprint. Now, not quite three months later, McKibben and students at 210 American colleges and universities are lobbying their endowment boards to divest from fossil fuels.
Unity College, a small institution in Maine, announced in November that it would adopt a new policy to minimize investments in coal, oil and gas stocks. Vermont’s Middlebury College vowed to begin the process of divestment. The administration at Hampshire College in Massachusetts approved a new policy that would clear fossil fuel stocks from the portfolio. At Harvard, where 72 percent of students voted in favor of divestment (in an election that drew half the student body), the administration announced in mid-December the formation of a new “social choice fund,” to be managed separately from the endowment.
In late December, Seattle Mayor Mike McGinn formally requested that the city’s pension funds start winding down all investment in fossil fuels.
Several critics have voiced doubts that the movement will lead to anything close to its intended effect, citing issues like the question of whether broad divestment will even be felt by the country’s fossil fuel giants; the argument around whether engagement is preferable over immediate divestment; and the point that creating an enemy out of the fossil fuel industry could well be counterproductive.
When I spoke with Bill McKibben recently, he told me about the common misconceptions surrounding his movement, creative alternatives to fossil fuel investments, and why endowment boards should be thanking 350.org’s campaigners, rather than ignoring them.Of all the ways one could organize a movement to protest fossil fuels, why is a call for divestment from these companies the way to go?
That’s a very good question. It’s not the first and most obvious thing one would do. The most obvious thing one would do is go to Washington and explain that the worst thing in the world that’s ever happened is happening, and that it is time to take action. In fact, that’s precisely what scientists and economists have been doing since the late 1980s. So far, it’s gotten absolutely nowhere. We’ve had an unblemished, 25-year bipartisan record of accomplishing nothing. The reason is, I think, that the power of the fossil fuel industry is so great that they have been able to blunt every attempt to do anything. They’re the biggest lobbyists, they’re the biggest campaign contributors. These are giants. They don’t apply logic, they don’t apply reason; they just apply power.
And so, among many other things, divestment is an effort to weaken their power some. To go directly after them and explain to people that they’ve become the villains in this fight. It grew out of this article I wrote for Rolling Stone last summer—a piece that became their most widely shared story ever, I think. It explained the new math of climate change. The fossil fuel industry has five times as much carbon in its reserves as even the most conservative government on earth thinks would be safe to burn. But they’re going to burn it, and they’re looking for more all the time. They’re an outlaw industry, outlaws against the laws of physics. So this is a last-ditch effort to get people to realize what it is they’re doing and to get people to stand up to it before they completely tank the planet.
You started with college and university endowments and religious institutions—why?
The first reason is that colleges are where we first learned about climate change. It’s in their labs where the work was done that uncovered this problem. Second, colleges have made it clear that they’re very interested in sustainability. If you go to the webpage of any college in the country, there’s a whole section about how they’re greening the campus, building new buildings that are energy efficient, building bike paths, bringing in zip cars, whatever it is. That’s very good, and if you’re greening the campus, logically I’d think you’d want to green the portfolio too.
Do you plan to put pressure on a wider range of institutions as this gains steam?
Yes, cities and states, religious denominations—these are other places that have big pools of money.
The city of Seattle divested because they spend tens of millions of dollars trying to figure out how to keep the sea from rising so high that it overwhelms their city. So why on earth would they be invested in fossil fuels?
For religious institutions, the fossil fuel industry is running Genesis backward. They’re setting up the conditions that scientists say will lead to the extinction of half the things that the good lord put on this earth! So these are obvious places to bring on board in this fight.
Why isn’t engagement an option?
What is important to understand is this is very different from the usual investment scenario. Most of the time, if we have a problem with a corporation, it’s because there’s a flaw in their business plan. We put pressure on them, and write shareholder resolutions, and then they do the right thing eventually.
The problem here is that the business plan is the flaw with the fossil fuel industry. Their business plan is to alter the chemical composition of the atmosphere in ways that the scientific community for many years has understood to be fatal to our prospects as a civilization. So we need to not try to change them a little bit, we need to change them in very big ways.
The only way forward is that the fossil fuel industry decides to become the energy industry. If they go full-bore into sun and wind and things. But that won’t happen until we change the rules of the game and put a price on carbon and the damage it does to the atmosphere. And we can’t do that until we’ve reduced the power of the fossil fuel industry in Washington.
Describe to me what a positive chain of events would look like—more and more endowments divest, and energy companies take some sort of action? Or are you mainly counting on government to take action? In other words, how do you hope to see this play out?
Here’s what I think won’t happen: I don’t think we have it in our power to bankrupt Exxon. They’re the richest people on earth. They made more money last year than any company in the history of money! And they were followed closely by Chevron, BP, Shell and Conoco.But I do think we have the power—I hope—to do to them what people were able to do to R.J. Reynolds and Philip Morris. To make people understand that these guys are rogue companies. What the cigarette companies were doing one person at a time, they’re doing one planet at a time. If we can spread that message far and wide, if we can catalyze a kind of revulsion of their plans for our future at, say, college boards around the country, they we have made a dent in their power.
You know, two-thirds of the most important people in the country sit on the board of one college or another. We need to have this in their faces.
That seems to be a common misconception about this movement—that you’re looking for some sort of economic outcome. But you’re really looking for a political one, right?
Exactly right, in the same way that the divestment movement against the Apartheid government of South Africa eventually worked its success politically more than financially.
If we can put enough pressure on them, we can weaken their position somewhat in Washington and in other capitals around the world and they’ll be willing at least to negotiate, which they haven’t been to this point.
What does Washington need to do?
They need to put a price on carbon if we’re ever going to get out of this trap we’re in.
Harvard set up a “social choice fund” after its student body voted to divest from fossil fuels. Does that social choice fund feel like any sort of victory to you?
Not really. As a Harvard alum, let me say I think the essential problem is not assuaging the guilty consciences of Harvard donors. The essential problem is slowing the rise of temperatures on this planet. I don’t see it as a huge concession. We need them to take action that reflects the tremendous work that’s been done in Harvard’s science labs over the last 20 years, where we’ve learned much of the story of climate change.
What are your best responses to an institution that’s considering divesting but is afraid of giving up the returns that fossil fuel investments offer?
I think there are two responses: One, make sure you understand that the reason you get returns on that fossil fuel stock is in essence because they’re cheating. Unlike everyone else in the world, they don’t have to pay to put out their trash. They get to put carbon into the atmosphere for free.
Two, understand that these campaigners are giving you a leg up. They’re showing you where the next bubble is before it bursts. Look, sooner or later, in the wake of some horrible hurricane or drought, governments are going to take steps to demand that fossil fuel companies keep their carbon underground, and when they do, the price of those stocks is going to go way down.Do you have discussions with endowments and other institutions about alternative investments to fossil fuels?
To some degree. The most interesting work I’ve seen is from the Responsible Endowments Coalition. It demonstrates that there’s low-hanging fruit at most colleges, and if they take some of this fossil fuel money and instead invest it in changes to the energy systems of their campus, the return on investment would be enormous. I think the average return on investment was 28% for changing all the light bulbs, updating the heating systems, and so on. It doesn’t seem like the same thing as making money on the stock market, but of course it’s exactly the same thing.
How do you see the divestment movement developing into 2013 and beyond?
I don’t really know! It’s a tide that’s forming really fast, and I don’t know how to ride it. Two months ago, there were five or ten colleges that were working on this, now there are 210. It’s going to be hard just to keep up with the pace of it, but my guess is that students will come up with an endless number of interesting ways to make this case. And I’ll be very excited to watch that happen.