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Africa/Global: Fossil-Fuel Divestment

AfricaFocus Bulletin
Mar 10, 2013 (130310)
(Reposted from sources cited below)

Editor's Note

The fossil-fuel divestment movement now gaining momentum on college campuses to fight climate change frequently evokes the precedent of the anti-apartheid divestment campaigns of the 1970s and 1980s. But there are other Africa connections that are also beginning to be made. Africa is the continent most vulnerable to climate change and extreme weather events. American and other multinational companies have a long history of environmental destruction in areas such as the Niger Delta. And while many African countries look to fossilfuel exploitation to fund their development, the experience of the "resource curse" shows that the profits may fuel gross inequality and capital flight rather than development.

The range of issues involved is far too wide to be explored briefly. But it is essential to begin systematically making such connections. There is no doubt that both here and in Africa, our economies will depend on fossil fuels for some time to come. But delaying the transition away from such dependence not only endangers future generations. Its damaging effects, not entering into the profit-and-loss balances of corporations, are already costing lives through multiple causal chains in many places.

This AfricaFocus Bulletin contains excerpts from "The Case for Fossil-Fuel Divestment," by Bill McKibben in Rolling Stone, February 22, 2013 and a blog post by Marissa Moorman from the Africa is a Country blog on March 4 entitled "Oil in the Angolan President's Family."

Swarthmore Mountain Justice
http://swatmountainjustice.wordpress.com/

Power Up! Divest Fossil Fuels Student Convergence, Feb. 22-24, 2013
http://studentsdivest.org/

"To Stop Climate Change, Students Aim at College Portfolios," New York Times, December 4, 2012
http://tinyurl.com/cfvlta7

Todd Zimmer, "Divestistas: From Opposition to Resistance," Rainforest Action Network, March 7, 2013
http://understory.ran.org / Direct URL: http://tinyurl.com/bb66dqu

"The natural resources question, Tanzania Citizen, Feb. 24, 2013
http://tinyurl.com/b4447oh

For previous AfricaFocus Bulletins on climate justice and the environment, visit http://www.africafocus.org/envexp.php

For previous AfricaFocus Bulletins on Nigeria, including oil and the Niger Delta, visit http://www.africafocus.org/country/nigeria.php

++++++++++++++++++++++end editor's note+++++++++++++++++

The Case for Fossil-Fuel Divestment

On the road with the new generation of college activists fighting for the environment

by: Bill McKibben

February 22, 2013

[Excerpts: for full text visit http://tinyurl.com/b38f8lp]

It's obvious how this should end. You've got the richest industry on earth, fossil fuel, up against some college kids, some professors, a few environmentalists, a few brave scientists.

And it's worse than that. The college students want their universities to divest from fossil fuel ' to sell off their stock in Exxon and Shell and the rest in an effort to combat global warming. But those universities, and their boards, have deep ties to the one percent: combined, their endowments are worth $400 billion, and at Harvard, say, the five folks who run the portfolio make as much money as the entire faculty combined.

Oh, and remember ' this is supposed to be an apathetic college generation. The veteran leader Ralph Nader, in a speech in Boston last year, said kids today were more passive than any he'd seen in 45 years. "Nothing changes if you don't have fire in your belly," he said. "You are a generation without even embers in your belly."

Is Congress Finally Moving on Climate Change?

But here's my bet: the kids are going to win, and when they do, it's going to matter. In fact, with Washington blocked, campuses are suddenly a front line in the climate fight ' a place to stand up to a status quo that is wrecking the planet. The campaign to demand divestment from fossil fuel stock emerged from nowhere in late fall to suddenly become the largest student movement in decades. Already it's drawing widespread media attention; already churches and city governments are joining students in the fight. It's where the action all of a sudden is.

...

We even had some early victories. Three colleges ' Unity in Maine, Hampshire in Massachusetts and Sterling College in Vermont ' purged their portfolios of fossil fuel stocks. Three days before Christmas, Seattle mayor Mike McGinn announced city funds would no longer be invested in fossil fuel companies, and asked the heads of the city's pension fund to follow his lead. Citing the rising sea levels that threatened city's neighborhoods, he said, "I believe that Seattle ought to discourage these companies from extracting that fossil fuel, and divesting the pension fund from these companies is one way we can do that."

The logic of divestment couldn't be simpler: if it's wrong to wreck the climate, it's wrong to profit from that wreckage. The fossil fuel industry, as I showed in Rolling Stone last summer, has five times as much carbon in its reserves as even the most conservative governments on earth say is safe to burn ' but on the current course, it will be burned, tanking the planet. The hope is that divestment is one way to weaken those companies ' financially, but even more politically. If institutions like colleges and churches turn them into pariahs, their two-decade old chokehold on politics in DC and other capitals will start to slip. Think about, for instance, the waning influence of the tobacco lobby ' or the fact that the firm making Bushmaster rifles shut down within days of the Newtown massacre, after the California Teachers Pension Fund demanded the change. "Many of America's leading institutions are dozing on the issue of climate," says Robert Massie, head of the New Economics Institute. "The fossil fuel divestment campaign must become the early morning trumpet call that summons us all to our feet."

It won't be an easy fight in most places, of course. At Harvard, say, 72 percent of the student body voted to demand divestment, only to have the university respond in the most patronizing possible fashion two days later: "We always appreciate hearing from students about their viewpoints, but Harvard is not considering divesting from companies related to fossil fuels." But one of the Harvard student organizers responded with just the right mix of pepper and politeness: "The president is going to have to change her mind, because we're not changing ours," sophomore Alli Welton said. "Climate change is a matter of life or death for millions and millions of people."

And it's that simple truth that, over the next few semesters, will help students overwhelm boards of trustees and reluctant presidents. This movement didn't come out of nowhere, after all ' despite Nader's pessimism, if you knew where to look, you could see the pot boiling for several years. On hundreds of campuses, students had persuaded their administrations to build green buildings and bike paths; tens of thousands of students had traveled to Washington for giant Powershift conventions to learn how to lobby on global warming. And since there's no longer anything theoretical about climate change, this movement's not going to dissipate ' with each new storm and drought, it will gain tragic power.

In fact, if you sit down and game out the future, you start to realize that students, faculty, and engaged alumni have a surprisingly good hand. Trustees and presidents may resist at first ' they are, almost by definition, pillars of the status quo. But universities, in the end, are one of the few places in our civilization where reason still stands a good chance of prevailing over power (especially since students are establishing some power of their own as they organize). And here's where reason inevitably leads:

1) Universities need to lead because they are where we first found out about climate change. It was in physics labs and on university supercomputers that the realization we were in trouble first dawned a generation ago. By this point the proverbial man in the street can see their predictions coming sadly true: It wasn't just Sandy, though there's no doubt that the image of the cold Atlantic pouring into the New York subways had imprinted the new fragility of western civilization on many minds. (If that radical rag Business Week used the headline "It's Global Warming, Stupid," then you knew the message was getting through.) ...

All this means that climate is no longer a fringe concern. Seventy-four percent of Americans said global warming was affecting the weather. On campus, opinion is near-unanimous. "For one of my classes I just did a poll," says Stanford freshman Sophie Harrison, a leader in the divestment fight. "Out of 200 people I only found three who didn't believe in climate change."

Meanwhile, the scientists keep pushing their research forward. Twenty-five years ago, they were predicting the trouble we're seeing now; when they look forward another quarter century, things get truly scary ' and academics get much less academic. In the past, just a lonely few, like NASA's James Hansen, were willing to go to jail, but in November, the premier scientific journal, Nature, published a commentary urging all climate scientists to "be arrested if necessary" because "this is not only the crisis of your lives ' it is also the crisis of our species' existence." ...

So when, for instance, Harvard president Drew Gilpin Faust says "our most effective impact on climate change" will come from "what we do with our teaching, our research. . . the students who may be the heads of the EPA or all kinds of organizations," it's partly true ' that scholarship is important. But it's also clearly not doing the job alone, since the temperature keeps going up.

...

if you're committed to greening your campus, why wouldn't you be committed to greening your portfolio, too? Why is the heating system for the new arts center a proper target for environmental concern, but not the $50 million sitting in Peabody Coal, where it helps support climatedenying think tanks and reality-denying Congressmen?

Hence divestment. ... The fossil fuel industry, though ' its existence is fundamentally against our existence. We can't change them by investing in them, because they're not going to write off reserves. There's no way they can be made sustainable, in the same way tobacco can't be made healthy."

2) Universities understand math, and in this case the math about who's to blame is Q.E.D. clear. It points straight at the fossil fuel companies.

...

It's not as if all of us who use fossil fuel aren't implicated ' flying to Florida for spring break fills the sky with carbon. But it's only the fossil fuel industry that lobbies round the clock to make sure nothing ever changes. "We've figured out the root of the problem by this point," says Maura Cowley, who as head of the Energy Action Coalition has been coordinating student environmental efforts for years. Individual action matters, but systemic change ' things like a serious price on carbon that the industry has blocked for years ' is all that can really turn the tide in the short window the science of climate still leaves open. "Going after them directly feels seriously good," says Cowley.

3) Faced with this kind of irrefutable evidence, colleges have led in the past, conceding that their endowments, in extreme cases, can't seek merely to maximize returns.

In the 1980s, 156 colleges divested from companies that did business in apartheid South Africa, a stand that Nelson Mandela credited with providing a great boost to the liberation struggle. "I remember those days well," says James Powell, who served as president of Oberlin, Franklin and Marshall, and Reed College. "Trustees at first said our only job was to maximize returns, that we don't do anything else. They had to be persuaded there were some practices colleges simply shouldn't be associated with, things that involved the oppression of people."

Since then, colleges have taken stances with their endowments on issues from Sudan to sweatshops. When Harvard divested from tobacco stocks in 1990, thenpresident Derek Bok said the university did not want "to be associated with companies whose products create a substantial and unjustifiable risk of harm to other human beings." Given that the most recent data indicates fossil fuel pollution could kill 100 million by 2030, the coal, oil and gas industry would seem to pass that test pretty easily; it's also on the edge of setting off the 6th great extinction crisis, so everyone over in the biology lab studying non-human beings has a stake too. Here's how Desmond Tutu, Mandela's partner in the liberation of South Africa, put it in a video he made for the DotheMath tour: "The corporations understood the logic of money even when they weren't swayed by the dictates of morality," the Nobel Peace Prize-winner explained. "Climate change is a deeply moral issue, too, of course. Here in Africa, we see the dreadful suffering of people from worsening drought, from rising food prices, from floods, even though they've done nothing to cause the situation. Once again, we can join together as a world and put pressure where it counts." Or, you know, not.

4) And it's not just people at a distance who are in trouble here, though so far they've borne the brunt ' young people, the kind of people you mostly find on campuses, are the next chief victims of climate change.

...

5) And in this case, they can do the right thing without great cost.

College trustees, of course, are thinking about their endowments. They worry that they'll lose money if they do divest ' that if they can't park their money in Exxon et al., their yields may dwindle.

The fear is almost certainly overstated ' energy stocks have outperformed the market index the last few years, but lag if you take the last 30 as a whole. ...

At some schools, some of the money can be re-invested in the college itself ' in making the kind of green improvements that save substantial sums. Mark Orlowski, head of the Sustainable Endowments Institute, just published a report showing that the average annual return on investment for a thousand efficiency projects at campuses across the country was just under 30 percent, which makes the stock market look anemic. "College trustees often think of a new lighting system as an 'expense,' not an investment, but it's not," he says. "If you invest a million and can expect to clear $2.8 million over the next decade, that's the definition of fiduciary soundness." At colleges ' and elsewhere ' the potential for significant reinvestment is large: the San Francisco Board of Supervisors, for instance, is considering urging its pension fund to divest a billion dollars. That could do some serious re-greening.

...

So let's imagine for a moment that students and their allies are able to convince many colleges and universities to do the right thing. Especially for those who sign on fairly quickly, and with a minimum of rancor, there could be real advantages. "After we divested," said Mulkey of Unity College, "we started receiving donations online. We're seen an uptick in our inquiries from students. I think that will transform into an improvement in enrollment. That's not why we did it, but it's a fact." Powell, recalling the moment when Oberlin divested its apartheid stock, says, "I definitely feel it rallies people behind their alma mater. ..."

That influence could be decisive, too. Less in financial terms, though the $400 billion in American college endowments is no small sum, than in political and cultural ones. ... Fossil fuel companies care a lot about image, after all ' it's what makes it easy for them to exert their political control. It's why they run those back-to-back-to-back TV ads about "clean coal," those endless commercials with the polar bears and the drilling rigs. Colleges could strip them of their social license, and if they lead, others will follow. ...

Already, at least two major Christian denominations have announced they'll consider resolutions to withdraw their money. One could imagine the fossil fuel industry as the new tobacco, humbled enough that it actually has to come to the bargaining table in D.C. and a dozen other crucial capitals.

...
It's not perhaps a militant generation ' maybe that was what struck Nader, more used to the uprisings of the 1960s with their broad themes of cultural liberation. But in the wake of Occupy, many young people are drawing connections. "We want to make sure we don't just get divestment, but that we build real political power across wide coalitions," says Jones. And if you're a college administrator, you should probably fear folks who know how to use YouTube, Twitter and Facebook better than you do; "militant" sounds good, but "persistent," "organized" and "committed" are probably a deeper threat to the status quo. And you can prove it by watching the same students running divestment campaigns quickly joining the larger environmental movement: all of a sudden, they're helping run the opposition to the Keystone Pipeline, or working hard with their Appalachian allies in the fight against mountaintop removal coal mining.

The fossil fuel industry may be dominant in the larger world, but on campus, it's coming up against some of its first effective opposition. Global warming has become a key topic in every discipline from theology to psychology to accounting, from engineering and anthropology to political science. It's the greatest intellectual and moral problem in human history ' which, if you think about it, is precisely the reason we have colleges and universities.


Oil in the Angolan President's Family: Keeping it Global

By Marissa Moorman

March 4, 2013

Africa is a Country

[Text only, without embedded links. For the links see original blog post at http://tinyurl.com/cnyb2rr]

A few months late to this story, the Wall Street Journal published a piece last Wednesday entitled âAngola Wealth Fund is Family Affair." This was widely reported in the international press back in the fall when the Fundo Soberano de Angola was officially announced. The Fund, started with $5 billion, now puts Angola in line with other OPEC nations, which also have funds to protect against oil price volatility, to secure the future when oil runs out, to build infrastructure, and/or to diversify the economy. Angola could use all these. According to one prominent member of the board, the emphasis will be on diversification and wealth creation.

The FSDEA has a three person board, which includes José Filomeno de Sousa Santos, one of Angolan President José Eduardo dos Santos's sons, known by his nickname Zenú. Zenú is 34 years old and was raised primarily in Switzerland and England. He has a Master's degree in information management and finance from Westminster University in London and worked at the AAA insurance company in Luanda (currently in financial crisis), part of Sonangol's network of companies.

FSDEA values include: transparency, accountability, commitment, and integrity. The Wall Street Journal quotes the World Bank economist Marcelo Giugale who says that âA sovereign-wealth fund is a huge signal of discipline." Many Angolans and Angola observers have their doubts.

The local and international press have voiced some of those concerns. Mihaela Webba, a constitutional law specialist and advisor to opposition party UNITA president Isaias Samakuva, told Voice of America that the National Assembly is the only legitimate body to run such a fund and that the Fund's creation was a violation of Angola's Constitutional Law. Open Society director Elias Isaac launched a similar criticism to Deutsche Welle questioning whether such a fund could be created by presidential decree. And CASA-CE president Abel Chivukuvuku said he was skeptical that Zenú was the only person in the country qualified for the position. Makaangola did investigative work on the Swiss investment firm that will manage the Fund: Quantum Global and its Swiss-Angolan associate, and friend of Zenú, Jean-Claude Bastos Morais. Together Dos Santos and Morais started the investment bank Banco Kwanza Invest.

In the wake of Zenú's appointment to the FSDEA board, rumors have begun to circulate that the President intends to tap him as a successor. Manuel Vicente, the current Vice President, was the head of Sonangol and his new political prominence already caused much grumbling in the MPLA party headquarters for the same reason. But succession is for monarchs and the concerns around the Sovereign Fund again recall the ways in which President dos Santos acts more like a sovereign than a popularly elected official. For example, he has centralized power in the executive branch with the 2010 Constitution that removed the Prime Minister, gave the President the power to appoint a Vice President, and made presidential election indirect via the party ticket. One jurist described the constitution's Presidential powers as like those of Louis XIV. According to Freedom House, 90% of all legislation is initiated in the executive branch. And the President appoints and removes provincial governors at will. Much has already been said here and by others about the nepotistic mechanisms by which his children and especially his first-born daughter, Isabel dos Santos, have developed such robust and lucrative business portfolios.

We think there is something else to think about too. All of this sounds strangely familiar. All of this adds up to the pat equation: FSDEA + Zenú x Transparency International coefficient ÷ 100,000 barrels = oil curse.

But what about those of us who consume oil and petroleum products? And those of us who prop up governments that produce that oil? Anyone remember the story of the Cuban troops protecting U.S. oil installations from U.S. backed UNITA soldiers in Angola in the 1980s during the height of their civil war and the Cold War, for example?

Scholarly work by University of Houston historian Kairn Klieman on Nigeria (âU.S. Oil Companies, the Nigerian Civil War, and the Origins of Opacity in the Nigerian Oil Industry," Journal of American History, June 2012) and Columbia University political theorist Timothy Mitchell's recent book Carbon Democracy: Political Power in the Age of Oil (Verso 2011), suggests that the oil curse story is too one-sided. U.S. and other Western companies and governments that help produce and consume and often build infrastructure are also responsible for, and live the political consequences of, dependency on oil. Opacity in the Nigerian oil industry, Klieman argues, is a joint USNigerian co-production dating to the 1960s. Meanwhile, Mitchell asserts that in the late 19th century carbon provided the very basis for mass democratic movements while oil sets its limits in the 20th and 21st centuries. We are all implicated, in other words.

We ought to ask questions about Angola's Sovereign Wealth Fund. But we ought also to ask questions about the history of Chevron, Exxon, and Conoco in Angola when the oil industry was being established in the 1960s and the U.S. airbase on the Azores kept us quiet about Portugal's war in Angola. And we ought to wonder about current policy too.


AfricaFocus Bulletin is an independent electronic publication providing reposted commentary and analysis on African issues, with a particular focus on U.S. and international policies. AfricaFocus Bulletin is edited by William Minter.

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