{"id":7697,"date":"2015-10-23T13:59:43","date_gmt":"2015-10-23T13:59:43","guid":{"rendered":"http:\/\/gofossilfree.org\/usa\/?p=7697"},"modified":"2015-10-23T13:59:43","modified_gmt":"2015-10-23T13:59:43","slug":"why-bill-gates-exxon-endorsed-position-on-divestment-is-wrong","status":"publish","type":"post","link":"https:\/\/gofossilfree.org\/usa\/why-bill-gates-exxon-endorsed-position-on-divestment-is-wrong\/","title":{"rendered":"Why Bill Gates’ (Exxon Endorsed) Position on Divestment Is Wrong"},"content":{"rendered":"

This piece was written by\u00a0Alex Lenferna<\/a>,\u00a0a leader and researcher for Divest University of Washington, the Gates Foundation Fossil Fuel Divestment campaign, and 350Seattle. This is a direct response to Bill Gates’ statements on\u00a0fossil fuel divestment in an\u00a0interview with The<\/strong>\u00a0<\/a>Atlantic<\/a>.\u00a0<\/strong><\/em><\/em><\/p>\n

 <\/p>\n

Beginning in March 2015, <\/span>The Guardian<\/span><\/i><\/a>, <\/span><\/i>one of the world\u2019s most respected and influential news organizations<\/span>,<\/span><\/i> launched <\/span>an unprecedented media advocacy campaign<\/span><\/a> – it was asking <\/span>the richest and largest foundation on Earth<\/span><\/a>, the Bill & Melinda Gates Foundation, to remove their investments in the fossil fuel industry. With the help of divestment activists, the Guardian collected the voices of a quarter of a million people across the globe who called on the Gates Foundation to join 100\u2019s of other foundations, institutions, pensions, churches and communities <\/span>representing trillions of dollars of investments<\/span><\/a> who had taken their investments out of the fossil fuel industry since <\/span>the fossil fuel divestment<\/span><\/a> movement began just over 3 years ago. <\/span><\/p>\n

Gates responded by giving a rather dismissive response to divestment, so former Seattle Mayor Mike McGinn, 350 Seattle, Divest University of Washington and numerous other partners, including leaders of the Black Lives Matter movement, <\/span>launched a local Seattle-based divestment campaign<\/span><\/a> in the hometown of the Gates Foundation. After volunteers delivered a 40-page rebuttal of Gates\u2019 rejection of divestment and then persistently campaigned outside the Gates Foundation every day for over a month, Bill Gates addressed divestment again in <\/span>an interview with the Atlantic.<\/span><\/a><\/p>\n

Gates\u2019 response was once again disappointing \u2013 creating <\/span>straw men<\/span><\/a> out of the divestment movement in order to knock them down, and downplaying <\/span>the remarkable prospects for a clean energy revolution<\/span><\/a>. As a result, instead of aligning his investments with a clean energy future, Gates is continuing to support the very industries who are lobbying against progress on clean energy and whose business models are deeply out of line with averting the climate crisis. Perhaps not surprisingly, <\/span>Exxon endorsed Bill Gates\u2019 view<\/span><\/a> as part of their attempt to cover up their role in spreading misinformation and holding back climate progress for which <\/span>they may be held legally liable<\/span><\/a> under the <\/span>Racketeer Influenced and Corrupt Organizations Act<\/span><\/a>. It seems Gates is in good company\u2026 <\/span><\/p>\n

 <\/p>\n

Divest-Invest: Two Sides of the Same Coin<\/b><\/h4>\n

To Gates\u2019 credit he got the equation partly right, when <\/span>he said<\/span><\/a> that \u201cthe solution is investment\u201d \u2013 a statement he backed up by committing to double his investments in clean energy to $2 billion. However, clean energy investments are only part of the equation: we also need to wind down investments in the fossil fuel industry while breaking the fossil fuel industry\u2019s corrupting stranglehold on politics so that we can unlock the sorts of policies, societal changes and investments needed to tackle the climate crisis. \u00a0Divestment is a powerful tool in unlocking the latter half of that equation. <\/span><\/p>\n

Of course, Gates rightfully points out that divestment alone will not solve climate change, but he creates a straw man by suggesting that anyone is advocating for divestment alone as a solution. Such all-or-nothing dichotomization is rhetorically misleading as divestment campaigners are well aware that divestment is just one tool among many needed to help push the envelope on climate action. (For instance, here in Seattle myself and other divestment advocates are building on the social and political will created by the divestment movement to <\/span>bring a carbon tax to Washington<\/span><\/a> \u2013 one of Bill\u2019s favoured climate solutions, perhaps he\u2019d care to join us?) <\/span><\/p>\n

It is one thing to say that divestment is not <\/span>the<\/span><\/i> solution to climate change, but it\u2019s another to make Gates\u2019 claim that divestment is a \u201cfalse solution\u201d that \u201c<\/span>won\u2019t <\/span><\/i>emit less carbon\u201d and that there is no \u201cdirect path between divesting and solving climate change\u201d. Contrary to Gates there is a chorus of influential and credible voices who have illustrated how divestment is an important part of aligning the financial sector with a clean energy future, and who have illustrated that the societal power it builds is an important and powerful tool in unlocking the clean energy revolution and legislation needed to help solve climate change. <\/span><\/p>\n

We can start by asking the fossil fuel industry itself, who, despite their feeble attempts to <\/span>discredit the fossil fuel divestment movement<\/span><\/a>, <\/span>fund bogus divestment reports<\/span><\/a>, and <\/span>claim divestment is an ineffective strategy<\/span><\/a>, have reluctantly admitted to the power of divestment. For instance, in contradiction to <\/span>their PR poker face<\/span><\/a>, Peabody, the largest private-sector coal company in the world, submitted a filing to the Securities and Exchange Commission, where they admitted that by shifting perceptions around fossil fuels, spurring on restrictive legislation and driving unfavorable lending policies, <\/span>divestment efforts \u201ccould significantly affect demand for [their] products and securities\u201d<\/span><\/a>.<\/span><\/p>\n

For more divestment advice, we could also ask the researchers at Oxford University\u2019s Stranded Assets Programme whose influential <\/span>report on divestment<\/span><\/a> points out that \u201cin almost every divestment campaign [they] reviewed from adult services to Darfur, from tobacco to South Africa, divestment campaigns were successful in lobbying for restrictive legislation\u201d. Their report illustrated that the political and social power that divestment builds through stigmatizing the fossil fuel industry could also \u201cindirectly influence all investors\u2026 to go underweight on fossil fuel stocks and debt in their portfolios\u201d.<\/span><\/p>\n

Alternatively we could ask those \u2018radical\u2019 environmentalists over at HSBC bank who recently issued a <\/span>research report<\/span><\/a> warning investors that the fossil <\/span>fuel<\/span><\/i> industry is at serious and growing risk of <\/span>stranded assets<\/span><\/a> from climate policies and unfavourable economics, including reduced demand for fossil fuels and the rapid development of renewable energy and efficiency measures. Contrary to Gates\u2019 claim that divestment \u201c<\/span>won\u2019t <\/span><\/i>emit less carbon\u201d<\/span> HSBC encouraged their investors to divest from fossil fuels and argued that divestment could lead to less fossil fuel production and less emissions. According to HSBC divestment could help \u201cextend the carbon budget\u201d and would create \u201cless demand for shares and bonds [which] ultimately increases the cost of capital to companies and limits the ability to finance expensive projects, which is particularly damaging in a sector where projects are inherently long term\u201d. <\/span><\/p>\n

Perhaps another good place to ask for divestment advice is the financial analysts over at the <\/span>2\u00b0 Investing Initiative<\/span><\/a>, who<\/span> pointed out<\/span><\/a> that \u201cdivesting from fossil fuels is an integral piece to aligning the financial sector with a 2\u00b0C climate scenario\u201d. A claim substantiated by the International Energy Agency (IEA) which estimates that reductions in fossil fuel investments of $4.9 trillion and additional divestment away from fossil-fueled power-transmission and distribution of $1.2 trillion will be needed by 2035 if we are to achieve the internationally agreed upon 2\u00b0C target \u2013 beyond which (<\/span>and even before which<\/span><\/a>) climate change becomes truly devastating. <\/span><\/p>\n

If after all of this evidence, we still wanted even further affirmation that divestment was important, we could also ask the head of the UN, <\/span>Ban Ki-Moon<\/span><\/a>, the head of the World Bank, <\/span>Jim Yong Kim<\/span><\/a>, or the head of the United Nations Framework Convention on Climate Change, <\/span>Christiana Figueres<\/span><\/a>, or the former head of Shell, <\/span>Mark Moody-Stuart<\/span><\/a>, or <\/span>Archbishop Desmond Tutu<\/span><\/a>, <\/span>Prince Charles<\/span><\/a>, <\/span>Cornel West<\/span><\/a>, <\/span>Noam Chomsky<\/span><\/a>, <\/span>the Rockefeller Brothers<\/span><\/a>, <\/span>Stanford University<\/span><\/a>, <\/span>the University of Washington<\/span><\/a>, <\/span>the World Council of Churches<\/span><\/a>, <\/span>the British Medical Association<\/span><\/a>, <\/span>the Norwegian Sovereign Wealth Fund<\/span><\/a>, <\/span>the Guardian Media Group<\/span><\/a>, and the <\/span>plethora of other influential and credible institutions and individuals who support divestment<\/span><\/a>. <\/span><\/p>\n

Finally, we can ask the philosophically-minded climate blogger David Roberts, who has <\/span>adeptly highlighted<\/span><\/a> that by bringing the deeply moral nature of the climate crisis to the fore, divestment activists are dramatically shifting the climate narrative. Not only are they showing that a better, cleaner, more high-tech, prosperous, and just future is possible. More than that, they are making it a moral imperative to achieve that future, and illustrating quite clearly that the fossil fuel industry is on the wrong side of that moral imperative. <\/span><\/p>\n

 <\/p>\n

Whose Side Are You On? <\/b><\/h4>\n

By drawing on the sophisticated work of organizations like the Carbon Tracker Initiative and Kepler Chevereux, divestment activists having been exposing <\/span>the carbon bubble<\/span><\/a> to the light of day \u2013 and typically bubbles don\u2019t do well when exposed to the sun. As the Carbon Tracker Initiative calculated, 60 – 80% of coal, oil and gas reserves of listed fossil fuel firms are already unburnable if we are to stand a reasonable chance of staying below the internationally agreed upon 2\u00b0C target – a realization which has led the British Energy Secretary Ed Davey and many others to call fossil fuels \u201c<\/span>the sub-prime assets of the future<\/span><\/a>\u201d. \u00a0Looking forward, if we are to stand a reasonable chance of hitting the 2\u00b0C target, Kepler-Chevereux has showed that <\/span>the fossil fuel industry stands to lose up to $28 trillion in revenues<\/span><\/a> over just the next twenty years, and Citibank has estimated over $100 trillion dollars by 2050, <\/span><\/p>\n

The fossil fuel industry thus seems to be deep down a hole of potentially stranded assets, and <\/span>as Bill McKibben is fond of pointing out<\/span><\/a>, the number one rule of holes is that when you\u2019re in one, stop digging. The fossil fuel industry, however, seems to have misplaced their rulebook, because despite having more reserves than we can afford to burn, they are trying to dig us deeper into the hole of climate chaos, <\/span>spending approximately 1% of global GDP<\/span><\/a> just on developing even more <\/span>new<\/span><\/i> unburnable reserves. In a tragic turn of irony that\u2019s about the same amount of money that the <\/span>IEA concluded<\/span><\/a> is required to invest in the clean economy in order to stay below the 2\u00b0C target. That\u2019s right, if we just shifted the money that\u2019s currently being wasted on exploring and developing unnecessary new fossil fuel reserves and instead spent it on clean energy, we could avert the worst of the climate crisis. <\/span><\/p>\n

<\/h4>\n

The \u2018Miracle\u2019 of Clean Energy<\/b><\/h4>\n

As part of Gates\u2019 rejection of divestment, he provided a misleading (<\/span>Exxon endorsed<\/span><\/a>) assessment of the economics of the clean energy transition (seemingly <\/span>out of the pages<\/span><\/a> of a fossil fuel industry misinformation handbook or his favored climate contrarian adviser Bjorn Lomborg). Gates claimed that the only way current technology could reduce global emissions is at \u201cbeyond astronomical cost\u201d, such that a \u201cmiracle\u201d on the level of the invention of the automobile was necessary to avoid a climate catastrophe.<\/span><\/p>\n

While innovation and invention is certainly <\/span>part<\/span><\/a> of the future ahead, numerous studies from the likes of Stanford University, the Chinese National Energy Research Institute, the IPCC, and many others, show that we have many of the technologies needed to transition to a clean energy future. Indeed, as the IEA points out, what we need is not a miracle, but <\/span>to speed up the energy revolution that is already underway<\/span><\/a> – already the market outlook for wind and solar has been \u201c<\/span>transformed<\/span><\/a>\u201d, such that \u201cthey are now the lowest-cost source of power in a number of regions\u201d. Looking forward, solar is set to be one of the cheapest energy sources across 80% of the world by 2017<\/span> according to Deutsche Bank<\/span><\/a>. \u00a0With clean energy making such great headway, the IEA has<\/span> estimated<\/span><\/a> that transitioning to clean energy in line with the 2\u00b0C target is not only possible, but that it would result in net savings on fuel and energy costs of $71 trillion by 2050.<\/span><\/p>\n

Not only would transitioning in line with the 2\u00b0C target save us from high fuel costs, <\/span>it would also<\/span><\/a> create millions of jobs, grow the economy, prevent major negative impacts on global health and development, protect clean air and water, and avert the truly astronomical costs of climate change –<\/span> estimated<\/span><\/a> to be as high as $3290 trillion by 2200. While those numbers point overwhelmingly in favour of climate action, they still cannot do real justice to the devastating nature of climate change. As the <\/span>UN Human Development Report<\/span><\/a> estimates, climate change and other environmental disasters could push more than 3 billion people into extreme poverty by 2050 if we do not act to stem the climate crisis. That hardly seems like an outcome consistent with the Gates Foundation\u2019s goal of helping \u201cevery person get the chance to live a healthy, productive life\u201d. <\/span><\/p>\n

Despite citing sources from the likes of the International Energy Agency, Deutsche Bank, HSBC and Stanford University, Gates makes it seem as if the case for divestment is based on the \u201cself-defeating claims of some clean energy enthusiasts\u201d. However, even if contrary to all these sources, Bill Gates is right and we need a \u201cmiracle\u201d in innovation to get to the 2 degree target, that’s somewhat irrelevant to the point of divestment. After all Gates also claims to believe we can get to the 2 degree target, he just believes we need a lot more innovation to get there. The question that the divestment movement is asking is this: If you believe we can hit the two degree target, why would you be investing in companies like Shell, Peabody or (their seeming allies) Exxon whose business models entail four or five degrees of warming and who are preventing us from getting to the 2 degree target?<\/p>\n

The Gates Foundation still has the opportunity to align their investments with<\/span> the noble goals that they were founded upon<\/span><\/a>: \u201cto help every person get the chance to live a healthy, productive life\u201d. However, as things stand they are currently investing and supporting companies whose business models could erase the prospects of a healthy, productive life for billions of people across the globe, especially for future generations, the poor and vulnerable the world over.<\/span><\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

This piece was written by\u00a0Alex Lenferna,\u00a0a leader and researcher for Divest University of Washington, the Gates Foundation Fossil Fuel Divestment…<\/span><\/p>\n","protected":false},"author":124,"featured_media":7701,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-7697","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"_links":{"self":[{"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/posts\/7697","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/users\/124"}],"replies":[{"embeddable":true,"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/comments?post=7697"}],"version-history":[{"count":0,"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/posts\/7697\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/media\/7701"}],"wp:attachment":[{"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/media?parent=7697"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/categories?post=7697"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gofossilfree.org\/usa\/wp-json\/wp\/v2\/tags?post=7697"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}