Money is the second-best reason for colleges and universities not to shed oil and gas investments.
On many campuses in the US and elsewhere, faculty and student activists demand that administrators divest holdings in companies whose products emit carbon dioxide when burned.
So far, bursars in only a few ivory towers have complied.
Doing so, according to a new study commissioned by the Independent Petroleum Association of America, is costly.
Conducted by Bradford Cornell, visiting professor of financial economics at Caltech and senior consultant at Compass Lexecon, the study estimates that divesting equities related to fossil fuel could cost five top US schools together more than $195 million/year.
Within that group, Harvard would lose most—perhaps $107 million/year. New York University would lose the least—$4.16 million/year. Divestment losses from other studied universities—Yale, Massachusetts Institute of Technology, and Columbia—would range between those extremes.
University decision-makers haven’t yielded in great numbers to the squawky inhabitants of their hallowed halls. Most know costly futility when they see it.
Colleges and universities have an even better reason than portfolio damage not to divest fossil-energy holdings, though.
Too many reports from too many schools make academia seem gripped by ideological intolerance.
Stories abound of campus speaking invitations made to dignitaries and later withdrawn when political beliefs of the speaker come to be deemed unacceptable.
This judgmental dogmatism is intellectual spawning ground for gestures like divestment of holdings in fossil-energy companies.
Unconstructive in any realm, it’s altogether appalling on university campuses, which are supposed to be havens for the competition of ideas.
Central to divestment demands is the assertion that catastrophic global warming represents the near-certain consequence of an atmospheric build-up of CO2 resulting largely from combustion of fossil energy.
That’s a selective reading of climate science, which is in fact complex and uncertain. And failure to accommodate important contexts, such as economics, makes it uselessly narrow.
Climate politics takes the rigid approach, of course. People devoted to brain power should know better.
(From the subscription area of www.ogj.com, posted Sept. 11, 2015; author’s e-mail: [email protected])