Opinion

Divestment is Immoral

Wikimedia Commons/Chad Teer: Oil, along with over fossil fuels, contributed to over 87 percent of America's energy usage over the past decade.

It may only be a month into the year, but I’m already waiting for the divestment movement to pick up where it left off last semester.

For those of you who don’t know what the divestment movement is, allow me to summarize: The movement wants Loyola to dis-invest (“divest”) its holdings from fossil fuel companies. Why? Proponents contend that it’s wrong to profit from “wrecking” the planet and that fossil fuels cause health problems that no one deserves. Its goal is to freeze investments then divest from holdings in the fossil fuel industry. In effect, it wants the fossil fuel energy sector to be dismantled and become nonexistent. This movement is immoral. Yes, immoral, as in it cannot be squared with any conception of justice (even “social justice”) or notion of Truth, Good or Right. It is flat out immoral. Allow me to explain.

Wikimedia Commons/Chad Teer: Oil, along with over fossil fuels, contributed to over 87 percent of America's energy usage over the past decade.
Wikimedia Commons/Chad Teer: Oil, along with over fossil fuels, contributed to over 87 percent of America’s energy usage over the past decade.

Fossil fuels quite literally fuel our world. Over the past decade fossil fuels, such as petroleum, natural gas and coal, have contributed 87 percent of the United States’ energy, according to the U.S. Energy Information Administration. By contrast, wind and solar energy contributed less than 2 percent of our energy in 2011 (and even less so over the last decade). The other 10 percent of our energy came from sources such as nuclear, hydroelectric, other renewable sources and even wood.

With context provided, the immorality of the movement can now be seen. When one sector, in this case the fossil fuel sector, fuels just about everything we rely on it is wrong — completely wrong — to try to prematurely dismantle it. To be frank, our way of life right now depends on fossil fuels to function. Try to imagine everything that works or is built because of fossil fuels: cellphones, computers, televisions, refrigerators, cars, elevators, electricity, plastic products and even indoor plumbing (the pipes have to be made somewhere and the water has to be treated somehow). Air travel, train travel, sea travel, our armed forces — they all depend on fossil fuels and the fossil fuel industry to do what they do. Hospitals that offer life-saving treatment need to get their electricity and power from somewhere. In most cases that “somewhere” is a fossil fuel.

Our economy, too, depends on the energy (fossil fuel) sector to remain strong. Exxon Mobil is one of the largest companies in the world for a reason. To dismantle it, and the other energy companies that aren’t “green” enough, would be to wreck the economy. In the age of the American world order, in which the United States is the only superpower, a damaged domestic economy would mean a damaged global economy. Surely no one wants that.

Perhaps it would be good for divestment proponents to try to live a week without using anything that is produced by fossil fuels. That would mean no cars or public transportation (obviously) but also no bikes — after all, their metal has to be extracted, shaped and put together with something. It would mean no food that isn’t grown in a garden that you can walk to because cafeteria, restaurant and supermarket food is transported using fossil fuels (this would go for your clothes too — they’re made and transported by using fossil fuels). It would mean no cellphones, computers or other electronics. Cooking would pretty much be thrown out the window, unless you can set up a fire somewhere, because natural gas is a fossil fuel too. Even using paper — which itself is made from a renewable resource — is produced using machines that run on fossil fuels. Money, whether paper bills or coins, would be forbidden because those are produced using fossil fuels. So what could one do for a week without fossil fuels? Beats me. But if someone wants to try it I wish them the best of luck.

What this comes down to is that divestment is poor policy, both morally and practically. The university and the student government (especially the student government) would be wise to steer clear of it.

 Dominic Lynch is a contributing columnist. You can contact him at dlynch1@luc.edu

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16 thoughts on “Divestment is Immoral”

  1. Hi, Dominic. Good to be hearing from you and the Phoenix again.

    The divestment movement takes a lot of different forms. Not all groups interested in divestment are actively trying to take down the fossil fuel industry overnight (although some are). Here at Loyola, we are encouraging that our holdings be divested from fossil fuel companies as we also work toward ethical investing and shareholder advocacy–we’re not trying to specifically take down the fossil fuel industry, we’re trying to create an ethical investment portfolio as a whole. Given the effects that fossil fuel use and production has on the health of communities and our environment, it also doesn’t fit in with Jesuit values to continue supporting companies with those practices. Along with divestment efforts, we’re also looking at how we purchase our energy here and how that could be changed to include more renewable sources. We do, after all, have a pretty great sustainability record and a green reputation to uphold.

    We realize that our world runs on fossil fuels. We realize that an overnight abandonment of fossil fuels would wreak havoc on the economy and the services provided to communities around the country. We realize that everything we do directly involves fossil fuels. But just because that’s how it is now doesn’t mean it has to stay that way. When it comes down to it, we’re pushing for change. The vast majority of our energy is generated by fossil fuels, but there’s no reason why we can’t start transitioning into renewable energy sources. There are fossil fuel companies such as BP who are already researching how they could use renewable energies, because they realize that the future won’t run on oil. We want that transition. We are not eco-terrorists trying to shut down the US power supply. We are simply advocating for a better world.

    I’d love to sit down and discuss more of your thoughts on divestment. Feel free to email me at shart2@luc.edu to continue this discussion, and thank you, as always, for encouraging meaningful dialogue on this campus.

    Suzanne Hart
    Student Environmental Alliance
    Co-President
    shart2@luc.edu

    1. Suzanne,

      Full disclosure, Dom and I are friends and have talked about this before. I consider myself an environmentalist, but I see environmentalism on a personal level. I try to walk places when I can. I try to recycle and reuse water bottles when I can. I don’t litter.. But at the same time we have to look at why a university has an investment portfolio. The university takes its revenues (from donations let’s say) and tries to invest it in a safe but also growth oriented mix of stocks, bonds, mutual funds, etc.. Loyola uses this money to build new buildings, to fund scholarships and to keep a safety fund should tuition not cover the whole cost of running the school. So there goal is to invest the money in the most profitable and safe portfolio possible. If “green” companies out pace oil and gas companies in terms of value, then yes Loyola should invest in those companies. Ultimately Loyola has a responsibility to get the most money out of their investments. I have more thoughts on this as well so if you would like to shoot me an email mlamb4@luc.edu I’d be happy to meet with you, because unlike Dom, I am in the country.

      -Matt Lamb

      1. Matt,

        We realize that as well, and we’ve been in contact with the University’s Chief Investment Officer to talk about how to go about divestment in a financially responsible way.

        I’ll send you an email so we can discuss details. Thanks for your input!

        Suzanne

    2. Hi Suzanne,

      Thanks for this post. You make a lot of good points and I think you’ll be surprised to hear me say that we agree on a lot here. I do agree in change, in that I do support a move away from fossil fuels to more renewable energy resources. That said, I don’t believe in an artificial move created from divestment policies. It’s not the ends that we disagree on, no, it’s the means.

      You state that the goal of Loyola’s divestment movement is to “create an ethical investment portfolio as a whole.” That may be true (I’m in no position to dispute that), but the goals of a campaign do not eliminate the consequences of the campaign. Working towards a goal such as yours does not eliminate the fact that, should the divestment movement as a whole succeed, it would create poor (and may I add, immoral) economic consequences. I believe this fact must be recognized along with the fact that we must shift away from fossil fuels as an energy source as I recognize above. Such poor consequences are inescapable and they don’t fit with our Jesuit heritage either.

      The fact of the matter is that Loyola’s divestment movement is not an isolated movement, wherein our campus is the only one that will change. Like I stated above, it is a coordinated movement with branches at universities all around the country. Imagine what would happen if every single American university divested itself of it’s fossil fuel stocks. Surely nothing good. Investors would be scared off, fossil fuel stocks would turn toxic, and the economy would tank; an immoral outcome to the Nth degree.

      Perhaps if Loyola’s divestment campaign was isolated I could get behind it. But the facts at hand tell a different story to my ears and so I oppose it.

      On another note, as Matt alluded to, I am currently out of the country. I’m studying abroad until May so I won’t be able to meet you until then. However, you are more than welcome to email me at dlynch1@luc.edu to talk until then.

  2. Dominic, your run-through of a typical students’ daily mingling with our fossil fuel-driven energy system is well done, and highlights the small steps conscientious students can take towards less dependence on an energy system that will eventually, gradually, phase out.

    When one discovers that the goods and services he/she is investing in, from food to transportation to something as small as a light bulb, are part of a system in decline, one “divests”. I believe Loyola’s student body is becoming more aware each day of how unsustainable fossil fuel consumption is (by definition) as a business model, and so it makes sense for our student body (and our reps in USGA) to urge for investment in energy production that can provide more dividends in the future, like the geothermal and biodiesel expansion that is already underway at our new IES building, instead of in energy production that in many areas has already peaked in resource availability. Certainly no one expects nor desires the chaos that would ensue with an abrupt “dismantling” of the current energy system, but Loyola can invest in the gradual change taking place towards a more reliable and low-impact energy future.

    …and of course that’s only the practical side of the equation. I believe the moral ground for divestment transcends the practical for a University with such a Christian, social justice-oriented mission. Is it the right and just thing to support the part of the energy industry that is dismantling the current face of the earth? That is expelling the sorts of pollutants that increase local citizens’ risk of lung cancer and the sorts of gases that change our climate and send coastal dwellers to seek refuge inland? We will always need energy, and jobs will transition as the current energy paradigm shifts. So lets take the small steps necessary towards a better, more aware business model and learn and invest in cool, ingenious renewable energies!

    1. Good post Anthony. I would like to address your last paragraph which seems to encapsulate your argument well. Allow me to quote:

      “Is it the right and just thing to support the part of the energy industry that is dismantling the current face of the earth?

      But I ask, rightly so I believe: is it just to put people out of work and endanger their food supply? For that truly is the end game of energy divestment policies. As divestment proponents have recognized, Loyola singularly divesting from fossil fuels would merely be a symbolic move. How could this not be so? One school dumping their holdings of a massive corporation like Exxon wouldn’t even dent the company. Dumping those holding would give people peace of mind, but it wouldn’t actually produce results. But the divestment movement is moving one school at a time, like a chain of dominoes. One domino on it’s own can’t do anything, but combined they can achieve a common end. So it is with multiple universities divesting from fossil fuel companies. One school on it’s own won’t matter; multiple schools will. Should the movement succeed as planned, and fossil fuel companies are financially ruined, the economic calamity I described above would come to fruition. Thus I ask: is that a just outcome?

      Your contention about immoral fossil fuels is as true as my contention about immoral economic consequences and ramifications. One does not trump the other. They are both justice issues and should be treated as such.

      Feel free to email me at dlynch1@luc.edu if you want to discuss this further.

      1. Dominic,

        This is why we use the term “transition” to clean energy. As the clean energy industry grows, jobs will shift from fossil fuels to renewables. Companies are already preparing for the inevitable fact that the oil and the coal will run out, and looking into renewable energy options.

        The point of the divestment movement is to knock over that chain of dominoes, in time. When enough large institutions start withdrawing their holdings, fossil fuel companies will see their stocks sink and realize that to appeal to stockholders, they should transition to renewable options. We are putting our money where our mouths are.

        As we’ve said previously on these comments, we are not trying to take down coal and oil in one day. We know that this will be a process, that will take enough time for the economy and the job markets to make adjustments, adjustments they will have to make inevitably unless they believe that the stores of oil and coal will start magically replenishing themselves.

        Let us know if you would like to discuss further outside of this medium.

        Suzanne

  3. Thank you for bringing this conversation to the table. Without
    wanting to reiterate what Anthony and Suzanne said so well, I would like to touch
    on some points. The great presence of fossil fuels and related products
    throughout our lives it does not make it acceptable or right. The divestment
    movement has taken on many forms and approaches, some without compromise;
    however it does not make it an immoral movement. To put divestment into perspective,
    I want to look at one of the most successful divestment campaigns; Divest from
    Apartheid South Africa. Collective national and international action led to
    mass divestment from South African to combat oppressive principles. These
    principles, like those of fossil fuel damage, are globally recognized to be
    immoral and unjust. This action eventually
    contributed to the fall of a radically racist regime that scared many
    generations. With that said, I would like to point out a key factor; divestment
    contributed to this change that liberated the Rainbow Nation, not caused it. A
    call for divestment from fossil fuels at Loyola University would not be aimed
    at toppling our investment portfolios or undermining the lives we currently
    lead, rather it would be a conscientious decision on the part of many people to
    make a change to a cleaner and more sustainable life, one that Loyola hopes to
    embody and inspire.

    I hope to connect soon and discuss this concept further.

    Jessica Immelman
    Student Environmental alliance e
    Co-President
    Jimmelman@me.com

    1. Hi Jessica,

      Thank you as well for posting. You raise an important point that I didn’t have room to address in my column above.

      I do not believe that the national divestment movement is on par with the divestment movement against South Africa from yesteryear. Allow me to explain myself. Whereas the South African divestment movement aimed to break the grip of apartheid, the fossil fuel divestment movement aims to break fossil fuels prematurely. As I have stated, I believe that a move away from fossil fuels should be made, but I do not believe in an artificial move like divestment.

      Back to the matter at hand, the anti-apartheid divestment movement fought for equality under the law- the epitome of a moral goal. The national fossil fuel divestment movement, on the other hand, wants to sink the industry. That is the goal of the national movement, even if it’s not the goal of Loyola’s movement. No less, even if Loyola’s goals are different the consequences and ramifications will remain the same, namely the creation of poor and immoral economic conditions. That end game is not equivalent to the anti-apartheid movement.

      Note, as I did in my column above, that 87% of our energy comes from fossil fuels and 2% came from renewables. A premature death of the fossil fuel industry would cause unparalleled economic destruction and immoral conditions for no other reason than because the renewable energy sector is not ready to pick up the slack. I do not see how this would not be so if the campaign succeed on a national level, as it wants to do.

      There seems to me to be two prongs in this issue: one is the goal of Loyola’s movement itself and the other are the consequences of the success of said movement. The goal of Loyola’s own divestment movement may be laudable enough, but the consequences it would have were it to go through are unavoidable (see: law of unintended consequences). Frankly put, goals do not change consequences.

      I believe that all of these factors must be taken into account before Loyola decides whether or not to fall in step with the several other universities that have either decided to divest or whose student body has voted to.

      Thanks again for your post. If you want to talk further you are more than welcome to email me at dlynch1@luc.edu

      1. A minor point, but important nonetheless.

        The South African divestment movement sought to end apartheid and create equality in their country. Their goal was a moral one. But didn’t it still have economic consequences? Wouldn’t people still lose their jobs? As you stated, goals do not change consequences. If the consequences of divestment are the same, then surely the South African movement was immoral as well.

        Furthermore, the goal of the national movement is just to sink the industry for the sake of sinking it. It is to create a pressure for these companies to change their techniques or focuses as to be more environmentally friendly and conscious. Isn’t this goal moral, just as the goal to end apartheid was?

        1. I think the error here lies where you say that the goal is to create pressure for companies to change their ways. If that were actually the case then perhaps I could back this movement. But the goal, as stated by organizers of the national movement, is “to immediately freeze any new investment in fossil fuel companies, and divest from direct ownership and any commingled funds that include fossil fuel public equities and corporate bonds within 5 years.” http://gofossilfree.org/about/

          The goal is not merely to create pressure. It is to produce real, tangible change in energy companies, change that I believe is premature and harmful.

          Lastly, imagine again if every university did that. I think the scenario I described would suddenly be very, very realistic.

        2. I must also add that the goals of the two movement are in fact very different. The anti-apartheid movement aimed to end apartheid through economic sanctions. The divestment movement aims to end fossil fuels through economic sanctions (and prematurely at that- and that’s where the numbers come in. Where will we get our energy if 87% of it is eliminated?) I do not believe the two movements are on the same moral standing.

  4. As someone who is knows little about the issue, your argument has done little to convince me.

    Your article begins by giving information about which forms of energy contribute the most to energy production in the US; as expected, fossil fuels contribute by far the most. You fail to mention, however, how much money is invested into each of these markets. Fossil fuel companies are huge (as you state later on), and even the largest of renewable energy companies are dwarfed by the giants of fossil fuels. Considering this, it makes sense that fossil fuels contribute more to energy output of the US. The disparity is not due to some fundamental flaw in renewable forms of energy, but is rather a matter of economics. So far though, I agree with what you have said (you’ve only stated facts!)

    You then make your claim that attempting to dismantle this industry is immoral, and continue to list many services that are a part of day to day life that rely on fossil fuels. You continue by stating that it would certainly hurt the economy if these companies were to be dismantled. However, none of this backs your claim that it is immoral to do so. It is certainly easier (and probably more profitable) to continue investing, but this would mean financially supported companies that contribute to damaging the environment. By supporting these companies, Loyola is implicitly okay with practices that damage the environment. The moral choice is not always the easy one, and this is one of the instances where we must make the hard choice.

    Fossil fuels are currently integral to modern society, and no one is claiming that they are not. There is really no incentive right now for fossil fuel companies to change their practices, but by divesting, Loyola could send a message. A single institution divesting would hardly be noticeable on the global scale, but this certainly does not mean that the moral option is to do nothing. Morality is not dependent on the economy. Even if enough institutions divested as to make these companies notice, they would hardly fail and cease to exist. This is important to note- divestment will not completely destroy the energy sector. As it is in any capitalist system, they would respond to the market pressures created by divesting, or (if they refuse), some other company would take their place. There is a demand for fuel which needs to be filled, and it will be filled – the issue is the type of company that fills it.

    If we are basing this argument off of morals, it should not be “Should Loyola divest?”, but “How should Loyola divest?” If a way of doing so can be found that provides the same financial security as investment in fossil fuels, that route must be taken.

    1. Hi Martin,

      I don’t know how I missed your comment. It must have gotten buried and I just skipped over it. Sorry about that.

      You raise a lot of good points. Instead of responding in this comment, I’ll refer you to the other comments I wrote to Suzanne and Jessica where I expand on my column above. Read those and if you have further questions comment back here or email me at dlynch1@luc.edu.

      Dominic

  5. A guiding premise for the divestment movement is that:
    A) global climate change is a devastating phenomenon which is primarily caused by fossil fuel consumption.
    B) depending on what scientist you consult, the point of no return for global climate change is anywhere from several decades to “it’s already too late.”
    Your analysis doesn’t address these concerns at all, which proponents of divestment obviously see as immoral to stand by and watch happen.

    This article’s claims that divestment does not fit into “any conception of justice … or Right” doesn’t reference any belief system other than economics. Whereas here is an article which describes leaders of almost every major religion (typically who decide wrong and right) demanding immediate climate change action (though not specifically divestment).
    http://www.jpost.com/Health-and-Sci-Tech/Science-And-Environment/Catholics-Muslims-Hindus-Sikhs-fight-global-warming

    Sorry for my brusqueness. Response appreciated.

    1. My article didn’t address scientific concerns because that wasn’t the point. Another article would be more suited for that.

      Pulling religious leaders into the climate change debate is a recipe for disaster. Religious leaders are not politicians- they are religious leaders. To use their words for political agendas is misuse.

      Furthermore, as you say, they are “demanding immediate climate change action,” which I take to mean any number of actions and not necessarily divestment. Wouldn’t you agree? Until and unless the Pope makes an ex cathedra statement that divestment policies must be followed, I am certainly free to believe in alternative “climate change actions” that exclude divestment.

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