Greg Dennis: Bold leadership on Vermont divestment
What a difference a year makes.
In 2014, Gov. Peter Shumlin made national headlines with a bold State of the State address that highlighted opiate addiction.
Last year, by contrast, the governor had to find a back way out of the Statehouse after his annual address. His normal exit was blocked by dozens of angry protesters, who objected to his abandoning the dream of single-payer healthcare.
Fast forward to this year’s address — and once again Shumlin plays the role of bold leader.
In his 2016 State of the State, the governor surprised everyone by calling for Vermont to rid itself of investments in coal companies and the rogue giant that is ExxonMobil.
Shumlin has set the table for a lively debate in this year’s legislative session — and virtually isolated state Treasurer Beth Pearce, who continues to stubbornly oppose any form of divestment.
While divesting out of coal is a half-measure, it’s a logical step. Doing so would make our state the second in the union to do so, after California. Vermont would join dozens of other entities around the world — governments, churches and universities (though not yet Middlebury College) — that have pledged a significant form of divestment.
The total holdings of those entities? More than $3.4 trillion. Nothing to sneeze at.
Divestment would strengthen the stability of Vermont’s $4 billion in pension funds for about 40,000 state, municipal and public school employees and retirees.
There’s ample precedent for Vermont to withdraw financial support from fossil fuel companies.
The state divested out of companies that did business in apartheid South Africa. And when he was state treasurer, Middlebury resident Jim Douglas ordered state investment advisers in 1998 to reallocate $20 million that was invested in tobacco companies.
“The most tropical Christmas in memory reminds us that climate change threatens the Vermont we love, from our ski season to our lakes,” Shumlin said last week.
So why target coal?
“Let’s remember Vermont is downwind of the coal-fired plants to our west; we’re the tailpipe to their dirty energy choices,” Shumlin said. “Their pollution sickens our children, creates acid rain, dumps mercury on our forests and in our lakes and increases greenhouse gas emissions.”
A perennial objection to divestment has been that it would always be financially unwise. But a growing number of financial analysts reject that claim. Recent events have shown they’re right.
A detailed analysis by Corporate Knights, a nationally recognized research firm, showed that Vermont pension funds would be much better off if they had divested three years ago.
As fossil fuel stocks dropped and Vermont continued to hold them, the state left $77 million on the table — money that would have strengthened its holdings and directly benefitted workers.
Now that the governor is pushing for coal divestment, it’s got a real chance of passing in 2016. The idea has dozens of supporters in the Legislature, including Addison County House Reps. Willem Jewett and Amy Sheldon plus Sen. Chris Bray.
Despite the mounting evidence, however, Treasurer Pearce has been quick to criticize the governor’s position.
Pearce claims to be an environmentalist, but she’s on the wrong side of the biggest environmental issue ever. She’s stubbornly promoting a losing strategy of “engaging” with fossil fuel companies, in shareholder votes that Vermont has been losing for years now.
Meanwhile, fossil fuel companies are struggling. The Wall Street Journal recently reported that over a quarter of U.S. coal production is now in bankruptcy, and that by next year, “as many as a third of American oil-and-gas producers could tip toward bankruptcy.”
Are these the kinds of companies that make wise investments?
Pearce won’t find many allies among party leaders. Coal divestment has the support of all four leading Democratic candidates for top offices — lieutenant governor hopefuls David Zuckerman and Kesha Ram, and gubernatorial candidates Matt Dunne and, more recently, Sue Minter.
It will be interesting to see if a pro-divestment Democrat emerges to run against Pearce. She is, after all, an elected official and could be replaced by the voters.
Another surprise of the governor’s attack on fossil fuel companies was the vigor with which he attacked ExxonMobil. He specifically targeted the world’s biggest oil company because it knew about the dangers of climate change — and spent decades lying about it.
“Vermont should not wait to rid ourselves of ExxonMobil stock,” he said. “It has been clearly documented that since the 1980s, ExxonMobil’s own scientists have long known about the dangers of global warming, and chose to conceal that from the public. At the same time that they were building their oil rigs taller to account for rising sea levels, they were funding front groups of scientists to deny climate change is real. This is a page right out of Big Tobacco, which for decades denied the health risks of their product as they were killing people.”
With that, the governor gave a gracious shout-out to Ripton resident Bill McKibben, co-founder of 350.org and one of the world’s leading climate activists.
What a state we live in.
Late last year, McKibben was arrested for reminding the world “Exxonknew,” when he staged a solo protest against the oil giant by blocking pumps at a Burlington gas station.
Last week after the State of the State, the governor was publicly praising and proudly posing for photos with McKibben.
And thanks to years of groundwork by 350.org and its 350 Vermont affiliate, we could make history this year by washing our hands of dirty and costly coal investments.
Gregory Dennis’s column appears here every other Thursday and is archived on his blog at www.gregdennis.blogspot.com. Email: [email protected]. Twitter: @greeengregdennis.
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