Page 2 of 2 DISPATCHES FROM AMERICA By the way, your home is on fire
By Rebecca Solnit
According to many scenarios, divesting energy company stocks will have no impact, or even a positive impact, on a portfolio. The biggest question, however, is what constitutes a good portfolio on a planet spiraling into chaos. The best way - maybe the only way - to manage a portfolio is to manage the planet, or at least to participate in trying. How will your stocks do as the oceans die? Or - leaving out all humanitarian concerns - as massive crop failures decimate markets and maybe populations? Is the fate of the Earth your responsibility or someone else's?
For the people who will be 86 in the year 2100
In that pretty room, a few dozen activists and one San Francisco supervisor, John Avalos, a great leader on climate issues, faced off against the San Francisco Employees Retirement System
board and its staff who talked interminably about how wild and reckless it would be to divest. And it was then that it struck me: inaction and caution may seem so much more rational than action, unless you're in a burning building or on a sinking ship. And that's what made me think of the World Trade Center towers on the day they were hit by those hijacked airliners.
It was as though the people in that room were having different conversations in different languages in different worlds. And versions of that schizophrenic conversation are being had all over this continent and in Europe. Students at the University of California, Berkeley, and across the California system of higher education are launching this conversation with the university regents and I already dread the same foot-dragging performances I've been watching here for almost a year.
There's already a long list of institutions that have committed to divestment, from the United Church of Christ and the San Francisco State University Foundation to the Sierra Club Foundation and 17 philanthropic foundations. Staff leadership at the Wallace Global Fund, one of the 17 divesting, said, "Who in our community could proudly defend, today, a decision not to have divested from South Africa 30 years ago? In hindsight, the moral case seems too clear. How then might we envision defending, 20 years from now, keeping our millions invested in business-as-usual fossil energy, at precisely the moment scientists are telling us there is no time left to lose?"
In fact, many climate activists point to the divestment movement that focused on apartheid-era South Africa as a model. That was a highly successful campaign, but also a relatively easy one for many of the companies being pressured to withdraw from their investments, subsidiaries, and other involvements in that country. After all, many of them weren't all that involved, financially speaking, to begin with. What worked then won't work now, because the situations are so profoundly different.
The San Francisco Retirement Board finally voted to engage in shareholder activism, their first and most timorous step. This is the procedure whereby shareholders chastise a corporation and ask it to change its sorry ways. Such activism, which was meaningful when it came to South Africa, is meaningless when it comes to carbon. Politely asking ExxonMobil or Chevron to divest from fossil fuel is like asking McDonald's to divest from burgers and fries or Ford to divest from cars. It's sort of like a mouse asking a lion to become vegetarian. The corporations are not going to quit their principal activity and raison d'etre; it's we who need to quit investing in them - the step the board was balking at.
Climate activists speak the language of people who know that we're in an emergency. The retirement board is speaking the language of people who don't. The board members don't deny the science of climate change, but as far as I can tell, they don't realize what that means for everyone's future, including that of members of their pension fund and their children and grandchildren. The words "fiduciary duty" kept coming up, which means the board's and staff's primary responsibility and commitment are to the wellbeing of the fund. It was implied that selling 3.3% of the portfolio for reasons of principle was a wild and irrational thing to support, no less do.
But it isn't just principle. The pensioners receiving money from the board will be living on Earth, not some other planet. Exactly what that means in 10, 20, or 50 years depends on what we do now. That we, by the way, includes money managers, investors, and pension-holders, as well as politicians and activists, and you who are reading this. What, after all, does "fiduciary duty" mean in an emergency? Can you make sound investments on a planet that's going haywire without addressing the causes of that crisis? In such circumstances, shouldn't fiduciary duty include addressing the broader consequences of your investments?
What does the future look like for a person paying into the pension fund who will be 60 in 2050? One of my brothers is a city employee paying into that fund. What will the future look like for his younger son, who will be 87 in 2100? A retirement board fund manager spoke of emulating Warren Buffett, who recently bought Exxon shares. Buffett is 83. He won't be around for the most serious consequences of his actions or Exxon's. My sweet-natured, almost-walking, brown-eyed nephew Martin, who turned one on Sunday, will. I likely will, too, because it's getting wilder on this destabilized planet, and even two decades hence is looking pretty grim.
Here's what I wrote the board before the meeting:
"Not only prosperity but human health and food supplies depend on a stable climate, but it's getting less stable all the time. How much we will lose, how much we will salvage depends on whether we act now. I get it that the board's first responsibility is to the financial wellbeing of the fund. Even more so it's to the pensioners, from those now receiving benefits to the youngest person paying in. But nothing exists in isolation: the stock market depends, whether or not Wall Street remembers, on weather, crops, strong markets for products, and the rest of what a stable world provides. And even a nice pension would not assuage the need of pensioners afflicted by tropical diseases moving northward, extreme heat that disproportionately affects the elderly, rising sea levels that take away billions of dollars of coastal California real estate - including SFO runways and the city's landfill areas. Crop failure and rising food prices, water shortages, dying oceans, climate refugees."
Or as a leaked UN report recently put it, "The planet's crop production will decline by up to 2% every decade as rainfall patterns shift and droughts batter farmland, even as demand for food rises a projected 14%."
I have great faith in the human ability to improvise, but there are limits to what can be done about a shrinking food supply and a growing population. The word not used in this cautious, conservative report is mass famine, which is very bad for your stocks. And infinitely worse for the people who are starving.
Another new report says, "Europe's financial losses related to flooding, which now total about 4.9 billion euros a year, could increase almost 380% to 23.5 billion euros by 2050." There are other versions of these dire projections about Asia, the Americas, and Africa. Studies about the future impact of climate change are one thing that's not in short supply. You can focus on the oceans and fisheries, on polar ice, on species, on food supplies, floods, fires, hurricanes, and typhoons - and in the language of the market, indicators are that catastrophe is going way, way up. How much depends on us.
Your house is on fire
A few weeks earlier, I went to a demonstration at the State Department's San Francisco office with a NASA scientist friend who's an expert on what makes planets habitable. She told me that we on Earth have been blessed by the remarkable stability of temperatures over the long haul and that for any planet the window of temperature in which life will thrive is pretty small. We're already at the upper end of the viable temperature for an inhabitable planet, she told me. I've heard the news delivered a thousand ways about what we're facing, but her version made me feel sick - as if she'd told me my house was burning down. Which she had.
I was in Japan for the first anniversary of what they call the great Tohoku earthquake and tsunami that Americans often call Fukushima (a reference - speaking of the unforeseen and of the failures of authorities - to the six nuclear power plants trashed by the tsunami that began to fall apart in various highly radioactive ways). The country's earthquake building codes worked well: hardly anyone was killed by the giant quake. Its tsunami alert system worked superbly, too: almost everyone was given plenty of time to evacuate.
But a lot of people didn't move fast enough, or they trusted the sea walls and sea gates to protect them, or they evacuated to the right level for tsunamis in living memory. In many places, the waves were higher than any tsunami since 1896, and about 20,000 people died in the disaster. The most horrible story I heard as I toured the wreckage and talked to officials, survivors, and relief workers was about an elementary school. Its teachers argued about what to do: one of them took several students to safety; the rest of the school, teachers and small children alike, stayed put and drowned. Unnecessarily. Reacting strongly to a catastrophe is often seen as an overreaction, but the real danger is under-reaction.
During 9/11, survival meant evacuating the south tower of the World Trade Center. In 2011, survival on the northeast coast of Japan meant going uphill or far inland. Our climate crisis requires us to evacuate our normal ways of doing things. That will not always be cheap or easy, but divestment can be done now with no loss, even possibly with an upside, say many financial analysts. In any case, it's the only honorable and sane thing to do - for the young who will be alive in 2064, for the beauty and complexity of the world we have been given, including all the other living things on it, for the sake of the people who are already suffering and will suffer more because of the disruption of the elegant system that is the Earth we inherited.