At the 2012 Republican National Convention, Clint Eastwood famously spoke to an invisible Barack Obama sitting in a chair about the failures of the president’s administration.
At least Fossil Free Yale had cardboard mannequins.
Two weeks ago, Yale’s environmentalists spent an afternoon addressing the absent members of the Yale Corporation. The folks at the Corp had neglected to meet with the divestment activists — and for good reason. Divestment would hurt Yale’s finances, and the moral arguments against fossil fuels don’t pass muster.
The fiscal argument against divestment is simple. So long as it is profitable to invest in fossil fuel companies, Yale loses an opportunity to make money if it divests. Its portfolio also gets less diverse, which, as I seem to recall from my schooling in the dismal science, would be a bad thing. Now, the prices of oil and gas and coal go up and down like the prices of everything else. I sure didn’t predict the shale boom. I imagine lots of geniuses at Goldman Sachs didn’t either, and that’s no charge against them. As a great philosopher once said, “It’s tough to make predictions, especially about the future.” The endowment exists to pay professors, provide financial aid and furnish capital for big projects. It’s a tomfool dereliction not to invest in something on principle.
Yale divesting from Exxon and BP would have also have about zero effect on the value of fossil fuel companies. There are many investors less scrupulous, rich and comfy than Yale, and they would not decline to buy the stocks from which Yale refuses to profit. As long as fossil fuel companies will make a good living, they’ll be a good buy.
And that’s another thing: If you’re investing at all, you’re investing in fossil fuels. There’s pretty much no supply chain that doesn’t include equipment or factories powered by them. Unless you’re wearing linen shirts handmade by natives of Orkney, your getup drips in oil. Do the FFY folks hate fossil fuels so much they’d have Yale divest from every company in the world, and go naked in protest besides?
FFY might reply, “We don’t care about Yale’s (enormous) endowment. We care about Yale profiting from the great oily evil.” There’s no question that fossil fuels help cause anthropogenic climate change. But fossil fuels also do enormous good, particularly for the poor.
In 2013, about 87 percent of world energy consumption came from fossil fuels, which are much cheaper than renewables like solar and wind. And still, over 1 billion people had no access to electricity. Asia, where most people live, got over half its energy — and 68 percent of its electricity — from coal alone in that year.
The enormous rise in fossil fuel use in the 20th century has coincided with a huge reduction in global poverty. In 1981, 44 percent of the world earned under $1.90 in 2011 dollars. In 2015, the number was just 10 percent. This miracle was the product, primarily, of markets powered by fossil fuels, rather than renewables like solar and wind. Would FFY have forgone such progress?
It looks like the world’s poor will continue to benefit from fossil fuels. The U.S. Energy Information Administration reported in 2012 that 65 percent of energy consumed in 2040 will be consumed by non-OECD countries, up from 54 percent today. That is to say, those who can least afford pricey renewables will need more energy in the future. Would FFY stunt the prosperity of the most vulnerable nations?
And let’s not kid ourselves: The thousands of New Haven locals employed by Yale probably haven’t got the money for a Tesla. Today’s low oil prices are helping them get by. Would FFY deprive them of their savings?
There’s a final problem with the FFY crusade. Imagine the United States stopped emitting carbon dioxide. Like, completely. According to estimates and models used by the Intergovernmental Panel on Climate Change, the temperature by 2050 would be 0.08 degrees Celsius lower than if nothing changed. Are the livelihoods of poor coal miners to be taken for this small reduction?
FFY imagines that the moral case against fossil fuels is clear and unimpeachable. It’s not so simple. Getting rid of all fossil fuels right now would devastate the poor. It might also ameliorate climate change — reasonable people can differ about the correct balance. FFY should be worried about the excessive use of fossil fuels, not any use at all. The solution is to search for cheap and clean ways of powering our lives that can put dirtier sources on a course toward ultimate extinction. Yale’s endowment managers should concentrate on those efforts, rather than divesting from companies who have given billions of desperately poor people lights by which to read at night.
Cole Aronson is a sophomore in Calhoun College. His column usually runs on Mondays. Contact him at firstname.lastname@example.org .