The divestment of fossil fuels from the global economy is an essential cog in helping humanity avoid global warming reaching 2°C above pre-industrial levels. Global initiatives preaching divestment are a dime-a-dozen nowadays, and have spawned a global student-led movement to pressure universities and other educational institutions to divest themselves of fossil fuel investments. For many campaigners it is all or nothing — divest now or kill the planet. It is an unsurprisingly binary way to look at the world; it’s catchy, it plays upon growing fears, and it is easy to see who are the good guys and who are the bad.
However, I have made the case repeatedly over the past year in covering the global divestment movement that total and immediate divestment of all fossil fuel investments by every financial institution, body, and conglomeration is not necessarily a healthy tool, by virtue of it being completely beyond the realm of reality.
It certainly sends a message, but it also creates a false binary situation which inevitably leads to binary sides:
On one side are the fossil fuel divestment protesters, environmentalists, climate scientists, etc., easily ignored for not understanding the deeper economic issues at play. On the other side are those who have suddenly become the face of environmental evil — fossil fuel companies, politicians, and the very rich — and they are not going to just roll over, admit their mistakes, and cease all operations. Rather, those entrenched in the fossil fuel industry fight back, mother bear-style, simply because everyone is attacking them.
As such, we end up getting nowhere, and the rift between the two sides only grows wider with each arrow shot across the gap between the two camps.
Though it might not have occurred to you, something very similar was at play in the Soviet Union during the last decades of its existence — and you don’t have to be a student of Russian history to see the similarities.
There were those in power who had beholden themselves to the teaching of Lenin, and more importantly to those of Stalin, and refused any backward steps — in this way we have what is now called the Prague Spring of 1968, a time of intense political revolution in Czechoslovakia, which was finally put down by the Soviets on August 21, when tanks rolled into the country. No political freedoms could be allowed for fear that they would initiate a fully-fledged refusal of all things Communist — the encroaching lessening of restrictions on the media, speech, and travel were quickly halted, and policies were normalized, back to the way the leaders in Moscow wanted them to be.
There were those in Moscow who would have had things go differently, however — moderates, not yet in the full grip of the power which would soon become theirs, who were not as threatened by the liberal policies spreading throughout Czechoslovakia. In fact, they would initiate similar lessening of restrictions when it became their time to rule. It was their superiors who reacted harshly, fearful that any potential political liberalization would eventually sweep through the whole Union, and eventually corrupt and eat away at Communism.
Given the uneasy state of the Soviet Union, especially throughout the satellite states, they were probably right — during the 1980s, the lessening of restrictions that came from Perestroika (restructuring) and Glasnost (openness) would eventually bring ruin to the Soviet Union.
But it is interesting that in the aftermath of the Prague Spring two things happened — the intelligentsia took one of two paths; either they left the Communist Party and made a public stand — which inevitably led to exile or forced-psychiatric institutionalization — or they remained within the Party in an attempt to moderate the whiplash reactions of their older brethren, and to influence and change things from within. In his book The Invention of Russia, Russian-born British journalist Arkady Ostrovsky explains:
“The crushing of the Prague Spring had divided the intelligentsia into two groups — those who joined a dissident movement trying to apply pressure on the system from the outside and those who condemned the invasion but stayed inside the system, hoping to push its boundaries from within. The two circles overlapped and complemented each other.”
However, while “the two circles overlapped and complemented each other,” it was those who remained within the system that eventually brought it to its knees (whether wittingly or unwittingly, we may never know for sure). Ostrovsky explains that on August 25, 1968, the first Sunday after the invasion, seven dissidents protested the invasion in Red Square. “They lasted a few minutes before the KGB pounced on the demonstration, beat up the dissidents, banged them into a car and drove them off. (Two of the demonstrators were put in a punitive psychiatric clinic. The rest were exiled or sent to a labor camp.)”
Though the challenges and personal consequences may not be as dire, Russia during the 1960s to 1980s bears a remarkable lesson for the current fossil fuel divestment campaign.
In April of 2015, the Global Research division of Britain’s multinational banking and financial services company, HSBC, released a report detailing the increasing risk of stranded assets in the fossil fuel industry — fossil fuel resources and projects surplus to requirements, and therefore running at a loss to investors and owners. Specifically, the report answered the simple question, “How investors can manage increasing fossil fuel risks?” The report provided a simple, two-pronged conclusion: Divestment of fossil fuel stocks, either partial or 100% divestment, or holding onto fossil fuel investments so as to retain the ability to communicate with the companies you are invested in.
“Divesting fossil fuel stocks removes assets but dividend yields may suffer and portfolios become more concentrated. Holding onto stocks allows investors to engage with companies and encourage best practice, although there are reputational as well as economic risks to staying invested.”
The current political climate is shifting, not least of all with the soon-to-be President of the United States, Donald Trump, likely to provide the country’s fossil fuel industries with a second (or is it fifth?) lease on life. Now, more than ever, we may need both circles to overlap — a growing number of citizens aware of the potential danger of fossil fuel, clamoring for change from beyond the Wall Street buildings, and those in the boardrooms, retaining their investments pressuring fossil fuel companies from within.
Without both sides of this equation, the Soviet Union of Fossil Fuel Empires may never crumble.
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