You DO realize that there are already hundreds of thousands, if not MILLIONS people being displaced by climate change, right? This is not some abstract idea. It’s happening TODAY, as we speak. It’s having a real world impact on real people.
This isn’t about some rich person’s bottom line. It’s about humanity refusing to make the necessary changes to stave off the worst case scenario, so that a few people can get even richer before the planet is fucking inhabitable. If Harvard, which has a huge endowment to invest, is willing to do something to help disinvest from fossil fuels, that’s great. It’s a shame that as @anon94804983 noted, it took them a year to do the right thing.
Makes sense. Now, I’m seeing a lot of reasons I don’t want that to happen. But you haven’t advanced any reasons the guys hiring the guard labor should be particularly concerned–and, indeed, noted that a big batch of starving people is an opportunity, if you happen to be in the market for unskilled labor.
The BBS is giving me the five-times-replied warning, so maybe I should summarize what I think I’m really trying to get across: I’m afraid the guys continuing to invest in fossil fuels are doing so for rational, albeit extremely selfish, reasons. That still leaves appealing to their better nature–as you noted, the young don’t always repeat the sins of their fathers–but I don’t think we have a way forward based on an appeal to their self-interest.
Because it’s what’s known as an opportunity cost. The wealthier one is, the more one tends to resent them.
Selfish, yes. Rational, only in the most short-sighted sense of the term.
A divestiture like Harvard’s, prompted as it was by the efforts of young people destined for a life of privilege, indicates that enough of them may see their self-interest to mitigate things. If other academic institutions do the same it sends a message that “free”-market business as usual is not going to solve the problem.
Oil companies have also retained one considerable asset that’s not technically a fossil fuel, they own several members of congress and governors. Not technically fossil fuels, but they are oily.
It certainly has an impact. These companies are seeing the availability of capital diminish. The coal industry is a terrible future for the oil and gas companies, which is why the majors are all talking - to varying degrees - about the energy transition.
When you have big investors, such as universities but also banks and funds talking about accepting Paris commitments to a 1.5 degree C warming it clearly has a knock on impact in what they can do.
There is a potential problem in tackling the sources of supply without demand, though. Returns on oil investments are around 20%, on wind, they’ll be under 10%. It will be a tough task to curtail demand without seeing some major price spikes, and where the oil industry starts looking more attractive will investors be able to stay strong and abstain?
We shouldn’t mistake any single thing for solving the crisis. It’s divestment, plus carbon capture, plus wind and solar, plus a halt to drilling, plus plus plus plus. It’s a huge combined effort, and every single little thing that contributes should be celebrated.
From a pure financial point of view, divesting from fossil fuels makes a lot of sense for a long term institution.
Oil companies have trillion $ in assets which actual value will become zero or even negative when global economy will decarbonise. And they know it very well, the huge efforts oil companies put in delaying the inevitable is just to buy time.
And by end of the century the economy will be very low carbon, one way or another.
So for a single person investing in oil could make some sense, for an institution that plans in decades or more, not so much.
Realistically I don’t think we’re likely to see big price spikes, though. Possibly the opposite. At this point vehicle electrification is a matter of when, not if, and there are already places in the world where solar electricity is cheaper than coal or gas (and approaching parity even with overnight storage). That could easily mean fossil fuel prices drop, since companies would retire their most capital intensive assets first. Costs of production vary from <$5/barrel to >$100/barrel - Saudi Arabia can pump profitably at much lower spot prices than Canada can, for example. I think ultimately decarbonization will be demand driven as customers and policy demand adoption of cleaner alternatives that are no longer so expensive as to be impractical.
