Let’s Talk Divestment

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You may or may not know what divestment is, but I’m going to tell you about it either way. Universities, including Penn State, have an endowment and they invest it in stocks to make it grow. Most of these universities have some or a majority of this endowment invested in fossil fuel companies. Investing in these companies is both socially irresponsible and bad financially for the universities. Divestment movements are popping up on universities all over the country to try stop them from investing their money in these companies. 

Let’s first talk about social irresponsibility, if you didn’t read my blog last week it briefly went over some of the many dangers of fossil fuels and the harm they do to the environment and human health and quality of life. Investing in these companies is giving them the ability to continue this and to say this is okay. If all universities currently investing in fossil fuels stopped the companies would have a financial incentive to invest in alternative energy (which if anyone says they “already do this” don’t listen because they only use like 1% of their yearly profits on alternative energy). Also by investing in these companies we are telling them that their actions are okay and that even if they destroy our planet and mess with international politics we’ll still invest in them. Universities are supposed to be progressive places and they should start acting like it.

There are a lot of financial reasons colleges use to avoid divesting. Most colleges use investment firms and claim they don’t know where their money is going. Although they do use investment firms we all know they can ask where their money is going and some even use firms that solely invest in fossil fuels (Penn State, for example, uses firms like this). This information can be hard to find but it is definitely out their for discovery. They also say they can’t just stop investing in these things right away, but no one is asking them to. Most divestment movements are just asking for a promise to work towards divestment and a stop to future investments in fossil fuels, not for colleges to sell all of their fossil fuel stocks immediately. The most effective movements have actually written out a new stock portfolio for the college that will be just as lucrative  and that does not involve fossil fuel companies. There are also more financial reasons for colleges to divest than to avoid divestment. The stock prices of all fossil fuel companies are highly inflated based on the assumption that they are going to sell all of the fuels they have. However, the IPCC, congresses committee on climate change, has said that if the earth warms more than 2 degrees Celsius it will have catastrophic effects. The fossil fuel companies have enough fuel in their  reserves to emit 2,795 gigatons of carbon dioxide which could raise the temperature 10 degrees if it is all burned. The IPCC has declared burning that much fuel illegal and so the fuel companies know that they will never burn all of it. The average investor, however, does not take this into account and invests as though this companies can and will burn all of their reserves.

Fossil fuel divestment is something all college campuses need to work towards and stop investing in companies that know they are destroying our planet and endangering the lives of everyone. Penn State actually has an up and coming divestment movement right now (this is where the shameless plug comes in), it’s called fossil free PSU and you can like their Facebook page at https://www.facebook.com/fossilfreepsu?ref=br_tf and sign the petition for Penn State to divest. They are also having an event April 9th at 6:30 in 112 Kern called Onward on Climate Change (https://www.facebook.com/events/1397120750559736/1402436780028133/?notif_t=plan_mall_activity). I seriously feel like everyone should check it out, they are going to have multiple speakers including Nobel Prize winning climatologist Dr. Michael Mann and Environmentalist Bill McKibben! They are not a fully functioning club yet but if you have any questions you can totally ask me in class. 🙂 Also you can check out the entire divestment movements website gofossilfree.org.

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