41–50 of 253 posts
Right now tough regulations will directly hurt pensioners with pensions invested in fossil fuel companies. After divestment will not hurt those people in the same direct way.
So:
Step 1) - Divest
Step 2) - Regulate to fully compensate for externalities caused by fossil fuel companies without worry of collateral damage
Fossil fuel divestment is basically subsidy for those who don't care. Divestment causes stock price drop and it increases ROI for those who invest into the company.
The board answers to the shareholders, and shareholders generally want to be able to sell their shares at a profit. If shareholders start to believe that the market for the shares is going to continuously decline because of some activity the company engages in, that creates an incentive to pressure the company to change behavior.
Earlier quoted context omitted.
Because investors will be able to own a piece of that company for less. The company hasn't changed, its ability to offer dividends hasn't changed, its longer term prospects haven't changed (due to divestment.) Really, the only impact this might have is a slight reduction in the ability to those companies to raise capital by selling stock (and I don't think that is incredibly common in the oil industry).
If the lack of investment from certain segments of the population was sustained then the stock will be of lower demand in the long term hurting it's price for investment, if this is really well sustained and consistently done then IPOs for such industries will raise less capital because there is less demand available when initial investors want to cash out. However, that's really conditional, I think in actuality we'…
Would this really have an impact on fossil fuel usage? The companies that drive fossil fuel consumption are established players and it seems like limiting seed funding in their industry would only help these players.
I'm pretty sure that you would have a bigger impact teleconferencing rather than flying around for meetings and investing the money saved on airfare in oil companies.
The solution is not divestment, but investment. Taking your money out of oil companies seems far less effective that putting your money into green companies.
1. https://qz.com/1072581/sanctions-dont-work-until-they-do-the...
[0] https://www.theguardian.com/sustainable-business/2017/jul/10...
Investors divesting from fossil fuels sounds a lot like sanctions in that they “don’t work until they work.”[1] It would take an overwhelming number of investors to make divestment really hurt, which is unlikely. And I definitely agree that focusing on supporting climate change impact is better than starving the polluters. But it seems intellectually dishonest to say that divestors are “wasting their time.” And there…
To reduce demand you should either create cheaper ways to store alternative energy or make carbon based fuels more expensive with a carbon tax.
For a while I've wondered if the math might work out such that the most cost effective way to fight greenhouse gas emissions is simply to buy up and horde oil on the open market. The oil has carbon already trapped in an efficiently storable form, it's absurdly dense, it's quite inexpensive... and buying it up would have a secondary effect of driving up the price, which would incentivize efficiencies and alternatives.…
It would incentivize the extraction of oil, which at present requires infrastructure that damages the surrounding environment. A lot of the oil is in the ground now because it doesn't make financial sense to extract it; the cost of extraction is less than the revenue generated from its sale on the market.
There's plenty of oil hoarded in the ground now in private wells. People sitting on land rights waiting for the right time to sell that oil on the open market. A massive government program that artificially props the price of oil up is the perfect setup for a massive wealth transfer to people that do nothing but hold title. That extracted oil would need to be transported or piped away from the extraction site and stored in perpetuity, all of which the land was already doing for free!
Techniques for extraction like fracking destroy the quality of adjacent groundwater and externalizes that cost onto the surrounding community. We don't want a government program that incentivizes poisoning groundwater on a hotter planet with diminishing glacial melt surface water.
Planet Money did an excellent series on the crude economy: https://www.npr.org/sections/money/2016/08/26/491342091/plan...
Earlier quoted context omitted.
I think Ha Joon Chang suggested that managers will likely receive reduced bonus, or in extreme cases fear losing their jobs, if their actions lead to drop in share price?
But the managers' actions aren't leading to a drop in share price, it's divestors' actions that are leading to the drop in share price, and this would be obvious with any divestment effort large enough to create an effect.
Earlier quoted context omitted.
If the lack of investment from certain segments of the population was sustained then the stock will be of lower demand in the long term hurting it's price for investment, if this is really well sustained and consistently done then IPOs for such industries will raise less capital because there is less demand available when initial investors want to cash out. However, that's really conditional, I think in actuality we'…
> if this is really well sustained and consistently done then IPOs for such industries will raise less capital because there is less demand available when initial investors want to cash out. Would this really have an impact on fossil fuel usage? The companies that drive fossil fuel consumption are established players and it seems like limiting seed funding in their industry would only help these players. I'm pretty s…
Also, the amount of coaching and conditions in the post above were an effort to express how utterly futile it is for you to actually effect change through this approach - there are far more effective things to do as an individual or group... And if you've got enough clout to lobby then the best tactic is probably getting the US government to stop subsidizing oil because, honestly, what... why is that something that deserves subsidies.
Investors divesting from fossil fuels sounds a lot like sanctions in that they “don’t work until they work.”[1] It would take an overwhelming number of investors to make divestment really hurt, which is unlikely. And I definitely agree that focusing on supporting climate change impact is better than starving the polluters. But it seems intellectually dishonest to say that divestors are “wasting their time.” And there…
Wouldn’t it be better to reduce demand? Even just now where supply was literally taken out with missles (or were they drones?) that doesn’t affect how much fossil fuel is used. Why would divestment work any better? To reduce demand you should either create cheaper ways to store alternative energy or make carbon based fuels more expensive with a carbon tax.
And taking out supply to drive up cost of fossil fuel will absolutely have an impact. At least a few people will opt for the fuel economy version of their new car in the next few days after seeing the new sticker price of a gallon of gas.