Divestment du Jour

Published October 14, 2013

National Review

Has President Obama declared war on America’s fossil-fuel industry? The administration has been at pains to deny claims by lawmakers of both parties that it is waging a “war on coal.” But what if the real war is wider? Largely unnoticed by critics, Obama has begun supporting a cause called the “fossil-fuel resistance” by its radical advocates. The movement’s leading edge is a drive to have college endowments, as well as church, municipal, and state pension funds, divest themselves of stock in any large fossil-fuel companies.

Fossil-fuel divestment is meant to turn America’s conventional energy producers into social pariahs. Its goal is the enactment of a steeply escalating carbon tax that would result in America’s oil companies’ having to leave 80 percent or more of their known reserves forever unused in the earth. A massive national shift to renewable energy sources could then be financed by a slow-motion, government-imposed shutdown of America’s fossil-fuel industry.

If only for political reasons, it might seem unlikely that a president could support a program this extreme. After all, Obama may yet approve that ultimate environmental bugaboo, the Keystone XL pipeline project, which is still broadly supported by the public. And for all of his assaults on coal, the president’s June address on climate change at Georgetown University contained an endorsement of job-creating natural-gas production, at least for the medium term. Yet that same speech included a barely noticed expression of support for the extremist fossil-fuel-divestment movement, which swept across America’s college campuses over the past academic year. After telling Georgetown’s students he wanted to enlist their generation’s help in the battle against climate change, Obama said: “Convince those in power to reduce our carbon pollution. Push your own communities to adopt smarter practices. Invest. Divest. Remind folks there’s no contradiction between a sound environment and strong economic growth. And remind everyone who represents you at every level of government that sheltering future generations against the ravages of climate change is a prerequisite for your vote.”

That quick call to divest, followed by a plea to make climate change an election issue, was overlooked by the general public, few of whom had even heard of the fossil-fuel-divestment movement. Yet for student activists listening in, Obama’s call hit like a thunderclap. “We all shouted, screamed, and/or fell out of our chairs,” wrote University of Michigan divestment campaigner Marissa Solomon, adding, “This was huge. The president of the United States of America knows that we have started a legitimate, world-changing movement, and he likes it.” Barnard-Columbia divestment campaigner Daniela Lapidous was quoted in the Huffington Post as saying, “I was watching the speech with fellow divestment activists and when the president said ‘divest’ our jaws dropped. We just looked at each other in shock and then excitement.”

Jamie Henn, communications director for 350.org, the group behind the divestment campaign, quoted in the same Huffington Post piece, called Obama’s statement “a huge endorsement” and added: “My Twitter feed absolutely lit up with students tweeting the news, people are pumped.” A Boston Globe magazine piece recently declared that fossil-fuel divestment “now has the support of the White House,” while the New York Times devoted a July article to Obama’s pro-divestment signal.

Given the radicalism of the divestment crusade, it may suit the president that few outside of liberal environmental circles realize he has endorsed it. Responding to Obama’s climate-change address, Chris Hayes, who hosts a show on MSNBC, tweeted, “‘invest, divest’ is the most crypto-radical line the president has ever uttered.” The author of the Huffington Post piece, senior community organizer and 2008 Obama campaign adviser Peter Dreier, said the president was “signaling his support to the current generation of campus radicals,” adding, “The word ‘divest’ was like a dog whistle to campus activists.”

Transposing the president’s elusive whistle into an audible register could reshape the politics of energy. To understand why, let’s have a closer look at the fossil-fuel-divestment movement.

Divestment’s biggest moment to date was a November 2012 referendum in which 72 percent of participating Harvard undergraduates called on their university’s endowment to sell off any stocks in large fossil-fuel companies. Prior to that, fossil-fuel divestment was an outlier idea, confined to radical environmental groups on a few scattered campuses.

That changed after America’s most influential environmentalist, Bill McKibben, published a July 2012 article in Rolling Stone titled “Global Warming’s Terrifying New Math.” Already a hero to America’s green-minded Millennial generation for penning the first major account of global warming a quarter-century ago, McKibben caused a sensation with this new article by predicting climate catastrophe should more than about 20 percent of the world’s known fossil-fuel reserves be burned. He followed up by launching a rock-star-style tour of concert venues across the country, calling on students to join the “fossil-fuel resistance” by supporting divestment.

On a first hearing, divestment strikes many as a futile gesture. Since most energy companies are moneymakers, any stocks sold off are sure to find buyers. The only financial losers under such circumstances are likely to be the university endowments and public pension funds that divest, not oil companies.

McKibben understands this. The real goal of his effort, modeled on the anti-apartheid divestment movement of the 1980s, is to impugn the moral legitimacy of America’s energy producers. The first step toward bankrupting oil companies financially, McKibben believes, is bankrupting them politically, by turning them into pariahs. With disarming honesty, McKibben insists that “movements require enemies.” By painting oil companies as planetary enemy No. 1, McKibben hopes to generate a public groundswell for steep carbon taxes and other policies designed to force America’s conventional energy producers out of the fossil-fuel business.

That Harvard divestment vote, which followed hard on McKibben’s Boston tour stop, made the New York Times’s front page. In the ensuing months, the movement spread to over 300 college campuses, sparking scores of pro-divestment student votes at schools across the land.

While McKibben is the leading figure behind fossil-fuel divestment, his key ally is Naomi Klein, long an inspiring presence for the anti-corporate-globalization movement and its successor, Occupy Wall Street. Klein argues that, as a practical matter, hard-Left causes can best be advanced in current political circumstances under the banner of environmentalism. Her partnership with McKibben’s divestment movement embodies a long-sought alliance of the environmentalist and anti-capitalist Left.

By any reasonable standard, McKibben’s social vision is radical. Breaking with liberals as well as conservatives, he firmly opposes growth as an economic goal. As he explained in his 2007 book Deep Economy, as well as 2010’s Eaarth, McKibben hopes to unwind capitalist modernity, putting something like a postmodern peasantry in its place. From McKibben’s perspective, modern society is not only ecologically disastrous, it’s also far less satisfying than village and small-town life in the days before the Industrial Revolution.

That’s why McKibben would like to see a return to farm-based living. Instead of industrial farming, with its products distributed by way of carbon-intensive long-haul transport, McKibben seeks a revival of local, labor-intensive organic farming. In his ideal future, we’d abandon our cars and grow food on our suburban lawns.

While this vision is laid out in McKibben’s books, he’s downplayed it since the divestment campaign began. “More farm labor” has limited appeal as a student rallying cry. Yet the goal of shutting down America’s fossil-fuel-based economy dovetails perfectly with McKibben’s agrarian communitarianism. Critics of the climate movement have long maintained that forcibly paring back the carbon economy will do more harm than good—killing economic growth, with devastating human consequences. A post-growth society is McKibben’s goal, and he’s willing to risk some social and economic disruption to get there.

Do McKibben’s young followers understand his deep-lying hostility to economic growth, not to mention his odd utopian vision for America? For the most part, they do not. These days, McKibben has plenty to say about all the industry he wants to shut down, but he tells us virtually nothing about the economic and social consequences of that loss.

Naomi Klein shares McKibben’s no-growth, communitarian, localist vision, and means to use state power to achieve it. Shifting American society from high-tech capitalism to postmodern peasanthood can be financed, Klein believes, by nationalizing America’s oil companies and making them pay for the transition to a post-fossil-fuel economy. Full-throttle anti-capitalism? Klein happily embraces the charge. Given the intellectual underpinnings of the movement President Obama has endorsed, it’s hardly surprising that he chose to quietly “whistle” his support rather than shout his approval from the rooftops.

The quality of debate over the divestment issue on college campuses has, in general, been atrocious. At Harvard, apocalyptic climate-disaster scenarios drawn from the most questionable studies went all but unchallenged. Divestment critics raised questions about the economic wisdom of the tactic, yet few dared dispute the underlying assumptions of the movement: the fantasy of a cost-free post-carbon economy, or catastrophic climate predictions based on data susceptible to perfectly reasonable alternative interpretations. During Harvard’s debate, the wildly controversial economic and social visions of McKibben and Klein never even came up.

No doubt any student with the temerity to raise such questions would have been stigmatized as a climate-change “denier” and an abetter of corporate evil. Like many other universities that now house an official “office of sustainability,” Harvard, with its many “green” programs, effectively sends a message to its students that climate activism is something close to official university policy. The principle of free debate at the heart of liberal education cannot help but suffer when a disputed policy becomes an officially protected sacred cow.

This past March, Vassar College provided an example of what happens to those who dare to cross the line guarding campus climate orthodoxy, when a student group invited Alex Epstein, president of the pro-fossil-fuel Center for Industrial Progress, to speak on campus. Posters advertising the talk were ripped down. Students, a number of them wearing Dick Cheney masks, interrupted Epstein’s lecture with a hostile statement accusing him of being a pawn of the oil industry, then walked out en masse. Before Epstein arrived, a couple of student leaders even tried to persuade his hosts to pay him a fee not to give a talk.

The climax of the last school year’s divestment movement came just before graduation at Swarthmore, where activists took over a Board of Managers meeting that had been called to discuss divestment, at the activists’ request. Conservative student opponents of divestment were blocked from speaking by a bizarre, Alinsky-style tactic in which the protesters rhythmically “clapped down” opinions they opposed, rendering them inaudible. Craven administrators present at the meeting did nothing to impose order. Caught on video, the spectacle rightly embarrassed many Swarthmore students, yet served to encourage the radicals.

The coming school year is bound to bring more disruptions. A takeover of the president’s office at the Rhode Island School of Design late last year may be repeated elsewhere. Divestment activists have been training and planning all summer.

On the plus side, organized opposition to the divestment movement has emerged at Vassar, where many students were outraged by last March’s assault on free speech. They are circulating a statement opposing divestment to students, faculty, and administrators across the country. That statement, developed by the Center for Industrial Progress, calls the divestment movement “an attempt to silence legitimate debate” and condemns its refusal to grapple with the social costs of an industry shutdown. Rather than asking schools to endorse a particular stance on energy or the environment, the statement calls on them to eschew politics and promote open debate. Signed by such luminaries as Steven Hayward, Alan Charles Kors, Harvey Mansfield, Matt Ridley, Roger Scruton, and Peter Wood, the statement represents the most serious pushback against the divestment movement to date. (A copy of “Don’t Divest, Educate—An Open Letter to American Universities” can be found at fossilfueldebate.com.)

Lopsided student support for fossil-fuel divestment depends on the atmosphere of intimidation that has surrounded the movement so far. Many students support divestment for want of having heard counterarguments, or because they live on campuses where just about any policy proposal claiming the mantle of environmentalism is considered right. Real opposition could burst this bubble.

The president clearly hopes otherwise. As the New York Times suggested in the wake of Obama’s Georgetown nod to the divestment movement, his speech can be taken as a plea for help. Obama knows, said the Times, “that if he is to get serious climate policies on the books before his term ends in 2017, he needs a mass political movement pushing for stronger action.” So Obama’s supportive signal may have been an attempt to kindle divestment activism that will serve to pressure Congress to pass aggressive carbon restrictions, the end that Obama and the fossil-fuel-divestment movement share.

Democrats worry that the president’s climate proposals will leave them vulnerable to charges of killing jobs and raising energy prices. Organizing for Action, President Obama’s national community-organizing group, will counter such attacks by painting Republicans as anti-science climate “deniers.” That’s silly, since it’s perfectly possible to accept the basic physics of carbon dioxide’s effect on temperature without buying into climate catastrophism, but the administration is paying attention to polls that say Republicans can be hurt by being portrayed as “deniers.” This is what’s behind Obama’s more open and aggressive stance on the issue.

What if, instead of fighting a defensive battle against bogus efforts to paint them as troglodytes, Republicans were to highlight President Obama’s endorsement of the fossil-fuel-divestment movement? Again, the real goal of that movement is to use divestment activism to pressure Congress to pass a draconian carbon tax. Would the public be onboard with a government-imposed shutdown of America’s conventional-energy industry, leaving 80 percent of America’s fuel reserves in the ground, well before wind or solar becomes an economically viable substitute? What would that do to jobs and energy prices, not to mention our dependence on Middle Eastern oil (in the short term)? And what if the public were to get an inkling of the radical social vision of the divestment movement’s leaders?

The White House has so far declined to elaborate on what the president meant at Georgetown when he called on students to divest. No wonder. Should critics force the issue, the president will find that he has trapped himself. Either he will have to justify his support for a radical movement whose outlandish goal the public is sure to reject, or he will have to back off, sorely disappointing his Millennial base. Congressional Republicans and potential GOP presidential candidates should help the president choose—by calling on him to clarify his stand on fossil-fuel divestment.

Stanley Kurtz is a senior fellow at the Ethics and Public Policy Center.

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