Christian Williams

John always tells me to write short, sweet, and clear. Knowing that his advice is supreme on these matters, I’ll try to write mini-posts in between the bigger ones. But… not this time – the topic is too good.

(Dispossess of property/authority. Say it, sound smart.)


Work smarter, not (just) harder.

Today I got an email from Bill McKibben, founder of 350.org. (350 parts per million, the concentration of CO2 considered a “safe upper limit” for Earth, by NASA scientists James Hansen. We’re soaring past 415ppm.) In preparation for the global climate strike, Bill wants to share an important idea: divesting from fossil fuels may be our greatest lever.

Money is the Oxygen on which the Fire of Global Warming Burns

I’ll pluck paragraphs to quote, but please read the whole article; this is an extremely important and practical idea for addressing the crisis. And it’s well written… the first sentence sounds fairly Baezian.

I’m skilled at eluding the fetal crouch of despair—because I’ve been working on climate change for thirty years, I’ve learned to parcel out my angst, to keep my distress under control. But, in the past few months, I’ve more often found myself awake at night with true fear-for-your-kids anguish. This spring, we set another high mark for carbon dioxide in the atmosphere: four hundred and fifteen parts per million, higher than it has been in many millions of years. The summer began with the hottest June ever recorded, and then July became the hottest month ever recorded. The United Kingdom, France, and Germany, which have some of the world’s oldest weather records, all hit new high temperatures, and then the heat moved north, until most of Greenland was melting and immense Siberian wildfires were sending great clouds of carbon skyward. At the beginning of September, Hurricane Dorian stalled above the Bahamas, where it unleashed what one meteorologist called “the longest siege of violent, destructive weather ever observed” on our planet.

Bill emphasizes that change has moved far too slowly, of course. But he’s spent the past week with Greta Thunberg and many other activists, and one can tell that he really is heartened.

It seems that there are finally enough people to make an impact… what if there were an additional lever to pull, one that could work both quickly and globally?

The answer: money.

Today it is large corporations which have the greatest power over daily life, and they are far more susceptible to pressure and change then the insulated bureaucracies of governments.

Thankfully Bill and many others knew this years ago, and started a divestment campaign of breathtaking magnitude:

Seven years ago, 350.org helped launch a global movement to persuade the managers of college endowments, pension funds, and other large pots of money to sell their stock in fossil-fuel companies. It has become the largest such campaign in history: funds worth more than eleven trillion dollars have divested some or all of their fossil-fuel holdings.


And it has been effective: when Peabody Energy, the largest American coal company, filed for bankruptcy, in 2016, it cited divestment as one of the pressures weighing on its business, and, this year, Shell called divestment a “material adverse effect” on its performance.

The movement is only growing, accelerating, and setting its sights on the big gorillas. The main sectors: banking, asset management, and insurance.

Consider a bank like, say, JPMorgan Chase, which is America’s largest bank and the world’s most valuable by market capitalization. In the three years since the end of the Paris climate talks, Chase has reportedly committed 196 billion dollars in financing for the fossil-fuel industry, much of it to fund extreme new ventures: ultra-deep-sea drilling, Arctic oil extraction, and so on. In each of those years, ExxonMobil, by contrast, spent less than 3 billion dollars on exploration, research, and development. $196B is larger than the market value of BP; it dwarfs that of the coal companies or the frackers. By this measure, Jamie Dimon, the C.E.O. of JPMorgan Chase, is an oil, coal, and gas baron almost without peer.

But here’s the thing: fossil-fuel financing accounts for only about 7% of Chase’s lending and underwriting. The bank lends to everyone else, too—to people who build bowling alleys and beach houses and breweries. And, if the world were to switch decisively to solar and wind power, Chase would lend to renewable-energy companies, too. Indeed, it already does, though on a much smaller scale… It’s possible to imagine these industries, given that the world is now in existential danger, quickly jettisoning their fossil-fuel business. It’s not easy to imagine—capitalism is not noted for surrendering sources of revenue. But, then, the Arctic ice sheet is not noted for melting.

Bill elucidates the fact that it is critical to effect the divestment of giants like Chase, Blackrock, and Chubb. Even if these targets are quite hard, this method of action applies to every aspect of the economy, and empowers every single individual (more below). If the total divestment is spread over a decade, it can be done without serious economic instability. And if done well, it will spur tremendous growth in the renewable energy sector and ecological economy in general, as public consciousness opens up to these ideas on a large scale.

I want to keep giving quotes, but you can read it. (If anyone is out of free articles for New Yorker, I can send a text file.) I’ll contribute a few of my own thoughts, expanding on stuff implicit in the article; and then this topic can be continued with another post.


Divesting is a truly powerful lever, for several reasons.

First, money talks. Many people who have been misled by modern society have the following equation in their heads:

money = value

These people, being overwhelmed with social complexity, have lifted the “burden” of large-scale ethics off of their shoulders and into a blind faith in the economic system – thinking “well, if enough people have the right idea, then capitalism will surely head in the right direction.”

Of course, after not too long, we find that this is not the case. But their thinking has not changed, and we need a way to communicate with them. While it may feel strange and wrong to reformulate the message from “ethical imperative” to “financial risk”, this is the way to get through to many people in powerful places. When you read about success stories, it is effective, especially considering all the time spent mired in anthropogenic-warming skepticism.

Second, social pressure is now a real force in the world. We can bend competition to our will: incentivize companies to better practices, and when one capitulates, the others in that sphere follow. It has happened many times, and the current is only getting stronger.

Though if we want to fry bigger fish than no-straws, we need to sharpen our collective tactics. It will of course be more systematic and penetrating than shaming companies on Twitter. The article includes great examples of this; it would be awesome to discuss more ideas in the comments.

Third, everyone can help this way, directly and significantly. Everyone has a bank account. It is not difficult, nor seriously detrimental, to switch to a credit union. The divestment campaign can be significantly accelerated by a movement of concerned citizens making this transition.

(My family uses Chase. When I was spending quality time back home, I asked my parents how the value of a bank is anything more than secure money storage. The main thing they mentioned was loans – but they admitted that the biggest and best loan they ever took was through a credit union. The reasons simply did not add up. I plan to show them this article, and I’ll try to have an earnest conversation with them. I really hope they understand, because I know they are rational and good people.)

It’s all but impossible for most of us to stop using fossil fuels immediately, especially since, in many places, the fossil-fuel and utility industries have made it difficult and expensive to install solar panels on your roof. But it’s both simple and powerful to switch your bank account: local credit unions and small-town banks are unlikely to be invested in fossil fuels, and Beneficial State Bank and Amalgamated Bank bring fossil-free services to the West and East Coasts, respectively, while Aspiration Bank offers them online. (And they’re all connected to A.T.M.s.)

This all could, in fact, become one of the final great campaigns of the climate movement—a way to focus the concerted power of any person, city, and institution with a bank account, a retirement fund, or an insurance policy on the handful of institutions that could actually change the game. We are indeed in a climate moment—people’s fear is turning into anger, and that anger could turn fast and hard on the financiers. If it did, it wouldn’t end the climate crisis: we still have to pass the laws that would actually cut the emissions, and build out the wind farms and solar panels. Financial institutions can help with that work, but their main usefulness lies in helping to break the power of the fossil-fuel companies.


The economy is far more responsive to changes in the collective ethos than the government. This is how people can directly express their values every day, with every bit of earning they have. We are recognizing that the public mindset is changing, and we can now take heart and leverage society in the right direction.

Conjecture The critical science of our time has the form:

\Uparrow \;\;\;\;\; \Downarrow

This is why John Baez brought together so many capable people for the Azimuth Project. I hope that we can connect with the new momentum and coordinate on something great. Even in just the last post there were some really good ideas. I really look forward to hearing more. Thanks.

18 Responses to Divesting

  1. John Baez says:

    As Christian himself pointed out today, the University of California will divest from fossil fuels:

    • Jagdeep Bacher and Richard Sherman, Opinion: UC investments are going fossil free. But not exactly for the reasons you may think, Los Angeles Times, 17 September 2019.

    A quote with some links:

    We believe hanging on to fossil fuel assets is a financial risk. That’s why we will have made our $13.4-billion endowment “fossil free” as of the end of this month, and why our $70-billion pension will soon be that way as well.

    This risk-averse reasoning might not jibe with what you will read in a newspaper headline or scroll through in a news feed on your phone. Some might see our action as born of political pressure, or as green movement idealism or perhaps political correctness run amok. So be it; we are part of a university system where diversity of opinion thrives.

    But none of these perspectives paints a full picture of what UC Investments has done or why it matters. The bigger, more significant story of how we manage UC’s money began five years ago and reflects a long view of investing for the benefit of the university.

    In 2014, when both of us were brand new to our roles, UC Investments had no structural approach to sustainable investing. Today, we are on track to beat our own five-year goal of investing at least $1 billion in climate change solutions and, by incorporating environmental, social and governance factors — ESG factors — into our investment decision-making, we’ve become better stewards of university funds.

    That year we were the first public university in the United States to sign onto the U.N.’s Principles for Responsible Investing. In 2015, UC Investments published its own Framework for Sustainable Investing, which identifies the eight ESG factors most salient to our work. In 2018, the UC Board of Regents publicly changed the university’s investment policy to explicitly include ESG in investment decision-making. And this year, in response to these and other initiatives, the Responsible Asset Allocator Initiative at New America recognized UC Investments as one of the world’s 25 most responsible institutional investors.

  2. rovingbroker says:

    ” … this year, Shell called divestment a “material adverse effect” on its performance.”

    I searched Shell’s 2018 Annual Report (which is the latest so qualifies as “this year”) for “divestment” in the section Risk Factors and found four instances …

    “We seek to execute divestments in the pursuit of our strategy.”

    “Additionally, in some cases, we have retained certain liabilities following a divestment.”

    “Estimates could also be altered by acquisitions and divestments, new discoveries, and extensions of existing fields and mines, as well as the application of improved recovery techniques.”

    “Potential impacts include: forced divestment of assets; expropriation of property; cancellation or forced renegotiation of contract rights; additional taxes including windfall taxes, restrictions on deductions and retroactive tax claims; antitrust claims; changes to trade compliance regulations; price controls; local content requirements; foreign exchange controls; changes to environmental regulations; changes to regulatory interpretations and enforcement; and changes to disclosure requirements.”


    I don’t think that these divestments are the type Bill McKibben is writing about. These are divestments by Shell not by holders of Shell stock or debt.

    I will be happy to be corrected.

    • christianbwilliams says:

      It’s possible that it was implicit, using a word other than “divest”. Let me see… aha.

      “Additionally, some groups are pressuring certain investors to divest their investments in fossil fuel companies. If this were to continue, it could have a material adverse effect on the price of our securities and our ability to access equity capital markets. The World Bank has also announced plans to stop financing upstream oil and gas projects in 2019. Similarly, according to press reports, other financial institutions also appear to be considering limiting their exposure to certain fossil fuel projects. Accordingly, our ability to use financing for future projects may be adversely impacted. This could also adversely impact our potential partners’ ability to finance their portion of costs, either through equity or debt.”

      • rovingbroker says:

        It’s interesting that they put this into a “disclaimer” rather than the body of the annual report. Nevertheless, further down they write,

        “Although, we have no immediate plans to move to a net-zero emissions portfolio, in November of 2017, we announced our ambition to reduce the Net Carbon Footprint of our energy products in accordance with society’s implementation of the Paris Agreement’s goal of holding global average temperature to well below 2°C above pre‑industrial levels. Accordingly, assuming society aligns itself with the Paris Agreement’s goals, we aim to reduce the Net Carbon Footprint of our energy products, which includes not only our direct and indirect carbon emissions, associated with producing the energy products which we sell, but also our customers’ emissions from their use of the energy products that we sell, by around 20% in 2035 and by around 50% in 2050.”

        Sort of “If people stop buying our products, we’ll stop selling them.” Which introduces the true situation that Shell, BP and others are in. Automobile manufacturers are universally investing billions of dollars converting their products from carbon burning to electricity consuming which suggests that oil companies’ customers will disappear soon — for some value of “soon”. Why are we worried about putting Shell out of business when the dynamics of technology and the market will do it anyway? Did anyone force the coal companies to stop delivering coal to peoples houses?

  3. nad says:

    you may eventually want to read about efforts to reduce methane emissions in fuel production by the Oil and Gas Methane Partnership (OGMP): Third-Year Report. For example (page 9):

    By establishing best-practices in both emissions
    quantification and management, the OGMP equips
    partner companies with the tools to systematically survey
    their operations to identify equipment and processes
    with high potential to emit methane, and to utilize proven
    methods to minimize these emissions.
    The OGMP has established detailed implementation
    surveying participating assets; Technical Guidance
    Documents that provide emission quantification
    guidance and specific best-practice recommendations
    for minimizing emissions from the nine core sources;
    and reporting systems to present the results of partner
    company efforts.

    The 9 core emission sources of methane are:

    1. Natural gas driven pneumatic controllers and
    2. Fugitive component and equipment leaks
    3. Centrifugal compressors with wet (oil) seals
    4. Reciprocating compressor rod seal/packing
    5. Glycol dehydrators
    6. Unstabilised hydrocarbon liquid storage tanks
    7. Well venting for liquids unloading
    8. Well venting/flaring during well completion for
    hydraulically fractured gas wells
    9. Casinghead gas venting

    As a matter of fact (p.8):

    According to the IEA, globally, the oil and gas industry can cost-
    effectively reduce up to 75% of its methane emissions,
    and 40-50% of global methane reductions can be realized
    at zero net cost. This level of reduction would deliver the
    same long-term climate benefit as immediately closing all
    the existing coal-fired power plants in China.
  4. Grant Roy says:

    I think it’s very important to make this point, especially as another Bill (from Microsoft), has come out saying that divestment has no impact on CO2 emissions. I think he misses the point of soft power. With Norway’s SWF capitalized at 1 trillion and built by fossil fuels, this seems like a good target to apply maximum social pressure. After all, Norway’s population is less than NYC. The question would be whether it is possible to convince Norwegians to fully bite the hand that feeds.

    Further, this book (the title misleads, the book is extremely academic) makes the case that there is more going on internationally with respect to oil than many may fully realize.

    Great post!

    • christianbwilliams says:

      Yes, that was a very strange article to see. Especially because… what do you do when you divest? Much of it you will reinvest, of course. In what kinds of things? Greener things. He is emphasizing that it should be carbon-reducing technology, which is of course the main place to be.

      You’re definitely right, that he’s not accounting for soft power. Just how social and psychological all of this change is in general. If he’s “too numeric” to be in tune with that, then I think he’s missing a crucial aspect of the whole picture. As the article (https://www.ft.com/content/21009e1c-d8c9-11e9-8f9b-77216ebe1f17) mentions.

      Good point about Norway. These places with small populations and a lot of wealth may be more easily capable of change. They have $60B in oil/gas, and they’re pulling out $13B… but leaving in the ones for the big companies. And putting in $20B toward renewable. It certainly sounds like a situation that may totally divest in the next five years or so.

      How do people apply pressure across countries? That’s something I’ve been wondering a lot – how do eco movements support each other internationally (besides demonstrations like Fridays for Future, which is simple to help) ?

      • Grant Roy says:

        I hope you don’t mind public brainstorming, I can throw a few ideas out I suppose.

        I think the key is that you need a means of focusing/coherence, something akin to creating laser light but for these types of movements.

        1) Maybe something like an ‘EcoGuild’, where members can invest some money, and then have a voting say on how that money is appropriated towards the goals (or simply just vote on which issues to take action on, like divestments, protests etc without any capital outlay). Of course, people would need to be OK with starting small first–but these types of things can scale rapidly if they catch fire. I think there will need to be some sort of formal democratic mechanism, to organize worldwide in a meaningful way.

        2) Convince celebrities, like Leo, to all coordinate a trip to Oslo, and do like a ‘Billy on the Street’ trying to convince Norwegians to fully divest now (I agree they are moving in a good direction). Musicians can do some type of free concert, whatever–make it a big deal–but try to coordinate and focus it all. I think the idea of targeting Norway is a powerful symbol because their SWF is seen as a leading example of a successful public policy.

    • John Baez says:

      Christian wrote:

      Good point about Norway. These places with small populations and a lot of wealth may be more easily capable of change.

      But of course Norway gets a lot of its wealth from oil: 1/3 of its exports are of oil. As a nation they seem to be trying to have it both ways. According to the New York Times:

      In fact, Norway hopes that only electric cars will be sold in the country by 2025 — a surprising goal, given that it means kicking the nation’s powerful oil industry in the shins.

      But Norway’s big electric push on cars does not mean the nation is abandoning fossil fuels, revealing what critics call a notable contradiction in its climate policy.

      While Norway wants to wean its own citizens off fossil fuels, it remains one of the world’s biggest oil producers and is revving up production, almost all of it for export. So even as the country tries to cut emissions and clean up its own carbon ledger at home, it is effectively doing the opposite abroad.

      Spurred by attractive state subsidies, the Norwegian oil company Statoil is chasing after new oil and gas fields in the Arctic. Nearly all of the supply is destined for export — and to show up in the carbon emissions of countries that burn Norwegian oil and gas.

      There’s a lot of it, too. Peter Erickson, a senior scientist with the Stockholm Environment Institute, a research organization, found that emissions from Norway’s oil exports this year will be 10 times as much as Norway’s domestic carbon emissions.

      Perhaps this is why Norway is near the very bottom of countries when it comes to how many citizens feel human activity is mainly responsible for climate change. Look who is second to the bottom:

      • arch1 says:

        Yikes. It is sobering to see that the U.S. proportion of AGW skeptics (last 2 cols in the chart) is not only highest of those listed, but exceeds by a factor of 3 that of two-thirds of the countries listed.

      • ishicrew says:

        That is a very interesting or puzzling graph. I do note the last 2 columns—humans aren’t responsible for climate change, or it’s not even happening—are both relatively small %s. (Some physicists and philosophers argue that time doesn’t exist, so I wonder if that implies climate doesn’t change.)

        The countries don’t neatly line up—in EU, Italy and Spain are up near the top (possibly because they experience the brunt of both some of the extreme heat and theoretically partly climate induced human migrations—even Syrian war has been described as partly due to climate change effect on agriculture) . UK and France in the middle, Nordic countries and USA at bottom. Mideast countries are both in the middle and bottom.

        There is a lot of media I come across (mostly USA (Heartland institute), UK, and Australia ) which cherry picks scientific findings to argue use of fossil fuels have no role ( ‘Copenhagen consensus’ , and even Nordhaus seemed to discount it a bit).

  5. James Smith says:

    Yeah, Norway’s hypocrisy is shocking. I think I read somewhere recently that they power their oil rigs with renewable energy wired out from the mainland.

  6. rovingbroker says:

    Selling shares (equity) of Shell and other carbon-based energy suppliers out of portfolios as has been suggested (under the name “divestment”) above will have little financial effect on the companies involved unless they have reason to bring new shares to market. Refusing to buy bonds (ie. lend to Shell et al) would have an effect when Shell tries to sell bonds to finance new operations.

    This is more interesting …

    How to Cut Emissions Without Wrecking the Economy
    A proposal for carbon dividends, backed by the broadest climate coalition in American history.


    “In a major shift, the Business Roundtable recently embraced the idea that the purpose of a corporation should go beyond serving shareholders and include responsibility to the environment and the broader community.

    “The outcome of this two-year dialogue is a breakthrough plan to cut U.S. carbon emissions in half by 2035—while benefiting American businesses, workers and consumers.

    “Our carbon-dividends plan demonstrates that economic dynamism, environmental stewardship and social well-being are mutually compatible and need not be traded off against one another. It should serve as the basis for a much-needed bipartisan climate breakthrough.

    Sounds a lot like a carbon tax.

    What Would Milton Friedman Do About Climate Change? Tax Carbon

    “The media always reports that there’s near consensus among scientists about the effect of human activity on the climate. What gets less attention is that I think there’s even greater consensus, starting from Milton Friedman and going to the most left-wing economist you can find, that the obvious practical solution is to put a price on carbon. It’s not controversial.”


    Not controversial unless you’re selling carbon. But in our world carbon sellers are in the minority .. or so I’ve read.

  7. ishicrew says:

    The 2 things I wonder about are

    1) if you do divest from fossil fuel/ carbon based industries (ie sell stocks you own), what is to prevent others from buying these stocks? I guess the idea is to basically create a new social norm—just get it generally accepted that its no longer socially acceptable to do certain things (even if in the short run you may lose some money and suffer some pain from changing lifestyle—no more slavery, gun and drug trade, etc ). Some people are choosing to buy electric venicles, or not own a car (bike or take uber) .

    (i think i do not own any stocks including ones in fossil fuels tho i still have enough cash in my bank account to possibly pay rent for a year and then i have to revert to ‘cliff dwelling’. my bank account is actually with a major bank which has been implicated as a major pro-fossil fuel supporter (and i have protested them). Only reason i have that account is because someone i know who works there opened an account for me, since i didn’t have a bank account.

    I did have a bank account at the old local Community Credit Union—which folded, so i lost the few 100s$ i had in there which was my ‘nest egg’ or emergency fund. So that was sort of like losing your house in a fire—have to find somewhere else, even if the house was 2nd rate.

    2) If you do create a carbon tax, it seems it should be done in a ‘complex way’—witness the yellow vest movement in France, which apparently was a reaction by the rural low income people to gas tax increases.

    In my area you basically have to be wealthy or upper income to have convenient public transit. (my local bus lines during rush hour are often standing room only; but you go to ‘nicer neighborhoods’ and the buses are often half empty. Few people want to stand for an hour in a moving bus so as quick as they can, people buy cars.)

    The ‘sky trust’ discussed by Peter Barnes in an old article in YES magazine is a more nuanced approach to carbon taxes–=you help all boats rise by giving rebates to those in need, while they also transition to new lifestyles not based on alot of commuting. In my area many bus commuters (until they get a car) work building new roads. (Now some have jobs installing solar panels.)

    • John Baez says:

      Ishi wrote:

      if you do divest from fossil fuel/ carbon based industries (ie sell stocks you own), what is to prevent others from buying these stocks?

      Indeed, if nobody bought the stocks from organizations who divested, these organizations would be very sad! They would lose a lot of money.

      The idea of divestment is that it slowly makes it socially unacceptable to invest in certain things, and thus slowly drives down the price of these stocks… which in turn makes people even less eager to invest in them.

      You can imagine people selling and reselling an egg that’s slowly going rotten and becoming more stinky.

  8. rovingbroker says:

    Since this post opened with a letter from Bill McKibben, followers might be interested in what Michael Shellenberger has written in Forbes about Mr. McKibben and nuclear power …

    Green New Deal Excludes Nuclear And Would Thus Increase Emissions — Just Like It Did In Vermont

    One influential local voice loudly opposing continued operation of the nuclear plant belonged to the climate activist Bill McKibben. “I’ve been opposed to Vermont Yankee for a long time,” McKibben wrote in 2012. “I believe Vt. is completely capable of replacing (and far more) its power output with renewables, which is why my roof is covered with solar panels.”

    Pro-nuclear environmentalists disagreed. In a highly-detailed 2010 analysis they warned that the closure of Vermont Yankee would increase emissions.

    McKibben was unmoved. In a 2013 debate at Vermont’s Middlebury College with pro-nuclear filmmaker Robert Stone, McKibben told the crowd, “We don’t need nuclear power.”

    Vermont’s rising emissions prove that it did. Had Vermont’s utilities supplied its customers with power from Vermont Yankee instead of from out-of-state fossil electricity, nearly half of the state’s increase in emissions since 1990 could have been avoided.

    I reached out to McKibben to ask if he regretted his anti-nuclear advocacy. He responded that Vermont Yankee’s closure “didn’t, I think, lead to big increases in emissions from Vermont electricity.”
    He pointed to a New York Times data tool, which he said showed “the state replaced the [nuclear] power by buying lots and lots more hydro from Quebec.”

    But that’s not what the data actually show. In reality, Vermont’s utilities couldn’t replace with in-state generation the lost electricity from Vermont Yankee, instead turning to electricity imports from the New England power pool, primarily from natural gas.


    Much more at the link.

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