The argument for leaving fossil fuels in the ground is overwhelming

Alan Rusbridger in London, for the launch of the Guardian’s climate change campaign. Photograph: David Levene

I know I have been a bit slow but, I have now signed the Guardian’s new climate change petition. Indeed, I was – and am – very pleased to see editor-in-chief Alan Rusbridger leading their campaign to phase-out institutional investment in the fossil fuel industry over the next five years, which includes an online petition, at: The argument for divesting from fossil fuels is becoming overwhelming (Guardian website, 16 March 2015) Alan begins by pointing out that:

The world has much more coal, oil and gas in the ground than it can safely burn. That much is physics… Anyone studying the question with an open mind will almost certainly come to a similar conclusion: if we and our children are to have a reasonable chance of living stable and secure lives 30 or so years from now, according to one recent study 80% of the known coal reserves will have to stay underground, along with half the gas and a third of the oil reserves…

He then goes on to explain why divestment campaigns are working based on two arguments; one moral and the other financial. The basis of the moral argument for divestment is summarised as follows:

The moral crusaders… see divestment from fossil fuels in much the same light as earlier campaigners saw the push to pull money out of tobacco, arms, apartheid South Africa – or even slavery.  Most fossil fuel companies, they argue, have little concern for future generations.  Of course, the companies are run by sentient men and women with children and grandchildren of their own.  But the market pressures and [their duty to their shareholders] compel… [directors to pursue…] business as usual, no matter how incredible it may seem that they will be allowed to dig up all the climate-warming assets they own…

As such, there is a moral imperative to demand an end to the enormous subsidies that enable fossil fuel companies to pursue such an insanely short-sighted and ultimately self-destructive business strategy. The pragmatic basis of the financial argument for divestment is summarised as follows:

If… the companies cannot, for the sake of the human race, be allowed to extract a great many of the assets they own, then many of those assets will in time become valueless.  [Therefore, people…] managing endowments, pension funds and investment portfolios… will want to get their money out of these companies before the bubble bursts…

However, Alan makes it clear that:

The intention is not to bankrupt the companies, nor to promote overnight withdrawal from fossil fuels – that would not be possible or desirable… Divestment serves to delegitimise the business models of companies that are using investors’ money to search for yet more coal, oil and gas that can’t safely be burned. It is a small but crucial step in the economic transition away from a global economy run on fossil fuels.

Finally Alan explains why the Guardian‘s campaign is focussed on two organisations: The Wellcome Trust handles a portfolio of more than £18bn and invests around £700m a year in science, the humanities, social science education and medical research. The Bill and Melinda Gates Foundation has an endowment of $43.5bn. Last year it gave away $3.9bn in grants towards health and sustainable development…  Because both foundations are a) so progressive in their aims and actions and b) have human health and science at the heart of everything they do, we hope they, of all institutions, will see the force of the call for them to move their money out of a sector whose actions, if unchecked, could cause the most devastating harm to the health of billions [see footnote]…  We understand that fund managers do not like to make sudden changes to their portfolios. So we ask that the Gates Foundation and Wellcome Trust commit now to divesting from the top 200 fossil fuel companies within five years… [and] immediately freeze any new investment in the same companies. If you have not done so already, I would encourage all to read the full article and sign the petition at: The argument for divesting from fossil fuels is becoming overwhelming (Guardian website, 16 March 2015)Footnote: See a landmark report by the Lancet and University College London, which concluded in 2009: “Climate change is the biggest global health threat of the 21st century.”

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About Rick Altman

Possibly just another 'Climate Cassandra' crying 'Wolf' in cyberspace. However, the moral of the old children's story is that the Wolf eventually turned up!
This entry was posted in Climate Science, Economics, Environment, Fossil Fuels, Politics, Sustainable development and tagged , , , , , . Bookmark the permalink.

4 Responses to The argument for leaving fossil fuels in the ground is overwhelming

  1. catweazle666 says:

    Such a pity Rusbridger and his hypocrite colleagues at the Guardian don’t practice what they preach, isn’t it? [Actually, they do (see second reply by jsam at 17:14) – ML]

    Like

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