Saturday, May 23, 2015

California Democratic Party convention becomes first to call for climate divestment

I was at the party convention when it happened last weekend, but worked on campaign finance disclosure rather than divestment (disclosure got supported too). It's good news:

The California Democratic Party approved a sweeping resolution on Sunday to drop fossil fuel stocks from the state's two major public pension funds, valued at about $500 billion.  
The party also wants the state's 33 public universities to purge such investments from their $12 billion in total endowments. The resolution will not likely result in new legislative action soon.  
However, it could generate enough support among the Democratic majority to pass a less aggressive divestment bill, Senate Bill 185, working its way through the state legislature. Beyond California, this resolution adds to the fast-growing momentum of the fossil fuel divestment movement, which kicked off on college campuses in 2011 and has spread to cities and major corporations worldwide.  
Before the final vote, RL Miller, chair of the California Democratic Party's environmental caucus and author of the resolution, delivered a one-minute speech. In an interview with InsideClimate News she recounted her message: "The world is watching...We need to send a moral message that California will not invest in those businesses that burn our planet in the name of profit and this resolution is that message. Divestment from South Africa helped bring down the system of apartheid and [divestment] will likewise bring down our dependence on fossil fuels. And further, [the] passage of this resolution will help pass Senate Bill 185."

AFAICT and from asking around, it's the first party convention to do this. I was surprised at the lack of coverage originally, but a little more has leaked out over the last few days.

This helps mainstream the divestment movement and show the party leadership where its activist base is coming from. We'll see what happens in coming months.

I've heard from South Africa divestment veterans that climate divestment is happening at a more rapid pace - I guess it depends on whether the starting point for South Africa was 1977 or 1984. Regardless, climate divestment is at least comparable.

UPDATE:  wiki says the South Africa divestment movement got 53 educational institutions to fully or partly divest in 1984, 127 in 1987, and 155 in 1988, so there are some markers to measure against. The link at the top says about two dozen universities have done some form of climate divestment so far.


Barton Paul Levenson said...

Glad to hear about this.

jrkrideau said...

A bit slow?

It looks like the insurance companies are already bailing out.

Steve Bloom said...

As a close observer of both, I can say the current campaign is clearly making vastly faster and greater progress. OTOH it's a larger, tougher target.

The tricky part will be getting campus activists to pivot to other activities afterward.

Unfortunately the resolution didn't cover corporate paper, which is actually a softer target. This seems to have been an oversight, probably due to the activists involved not being very familiar with public agency finance. But the resolution is probably enough as is to use to pressure the state treasurer etc.

Brian said...

Steve, AFAICT it covers corporate paper. It "calls upon the University of California and California State University endowments, the University of California Retirement Plan, and the California Public Employees’ Retirement System (CALPERS) and the California State Teachers’ Retirement System (CALSTRS) institutional pension funds, to immediately stop new investments in fossil fuel companies, to take steps, without risking any financial loss to its members, to divest all holdings from the top 200 fossil fuel companies as determined by the Carbon Underground list within five years, and to release periodic updates to the public, detailing progress made toward full divestment...."

Corporate paper seems covered by "all holdings". Paper is all my old water district had, anyway (no equity investment allowed by law).

Steve Bloom said...

Brian, I'm referring to the funds outside the named entities, e.g. the state treasury. Some big bucks there. I don't think "endowments" covers UC/CSU operating funds, for the matter.

Steve Bloom said...

Oh, sorry, I see my initial comment wasn't clear on the distinction.

Fernando Leanme said...

I take it you intend to make Calpers sell all their investment funds? That's going to create a lot of bargains, as you divest others will buy.

Gingerbaker said...

You know, once our country actually builds the green energy farms and related infrastructure we all agree we need, and prices the resulting electricity dirt cheap as it should be, we can pretty much ignore the fossil fuel industry, as they have just become irrelevant.

Closing in on two decades of talk, talk, talk about carbon credits, carbon prices, carbon regulations, carbon limits, energy usage penalties, gasoline taxes, natural gas taxes, pollution penalties, pollution limits, pollution regulation, fossil fuel divestitures, fleet mieage requirements, etc.

Anonymous said...

Eli and Bernard J: Thanks--the further one looks, the worse Daly's argument gets, as is usually the case with these Galileos. It's sad when you consider how devoted he was to his art. When you consider the devotion of his followers, backwards ran sentences until reeled the mind. Returning to Wegman and Said's lawsuit and other filings by Schnare, we see a combination of incompetence and determination shared by a small group of GMU faculty and law alums who are closely aligned with the Kochs and other dark money interests. It reminded me to go back and review John Quiggin's and John Mashey's taxonomies of the denial ecosphere.

I'm expecting soon to read Judy's protestation against Schnare's excessive use of intimidation tactics to shut down debate (not) .

Russell: spot-on.

Taylor B

Anonymous said...

Oops, the foregoing got posted in the wrong place. I'm reposting it over at the other thread.

Taylor B

Fernando Leanme said...

Ginger baker, what's a "green energy farm" which sells cheap electricity? I've never seen anything like it.

Anonymous said...

Here you go, Fernando:

Yes, I know you'll complain that it's not "cheap" electricity because fossil fuels are so much cheaper, but that's because the true costs of fossil fuels aren't included in the price of the electricity they generate. But you'll argue incessantly that coal is the world's savior, so to be more efficient I'm saving you the effort.

Taylor B

Mal Adapted said...

Fernando: "I take it you intend to make Calpers sell all their investment funds? That's going to create a lot of bargains, as you divest others will buy."

C'mon, Fernando, you reveal your agenda when you make foolish arguments like this.

Institutional investment funds often contain fossil-fuel assets, but only as a small fraction of a broad mix of securities. It won't be difficult for CA's public institution endowment managers to assemble funds without FF stocks. And anyone who hopes to profit from a sell-off of FFs will need to consider what will happen to their value going forward.


Before committing to divestment , true blue green fiduciaries should light a single candlefish and give Moody's Register of Carbon Free Commodities & Manufactures a good read .