Oh goodie. In this campaign season full of ill-considered, no-hoper, “who asked for this” candidacies, comes yet another: a 30-year-old financial analyst with no political experience who’s only lived in Vermont for four years has decided to challenge State Treasurer Beth Pearce for the Democratic nomination.
You go to any campaign or party event, Beth Pearce gets louder cheers and more applause than anybody else. She is incredibly popular. She is not losing the primary, no way, nohow.
The financial analyst in question, Richard Dunne, is running because he favors divestment of state funds from fossil fuel stocks. He’s on the same page as Governor Shumlin among many others. And Pearce’s steadfast opposition to divestment has been a thorn in Shumlin’s side since he started tub-thumping the issue earlier this year.
But there’s no way he’s backing a challenger. There’s no way Dunne can ride this one issue to victory in the primary. And Pearce’s stand on divestment should not put her in danger of losing her post.
Pearce is, at heart, a technocrat. She is very experienced and very good at her job. It is an absolute blessing to have such an expert in an important position that’s left to the will of the voters. Too often, we end up with ideologues and party hacks in such posts. We’re lucky to have Pearce as Treasurer — just as we’re lucky to have a proponent of open, efficient governance as Auditor and an advocate of transparency as Secretary of State. (That’s Doug Hoffer and Jim Condos, for those just tuning in.)
It is her green-eyeshade dedication to the job that informs her stand on divestiture. She wants investment decisions to be made on fidiuciary grounds; she doesn’t want them hamstrung by political considerations.
Now, you can take a political stance in favor of divestment. But I can understand why the State Treasurer takes a strictly financial approach. I’d rather our Treasurer not be playing politics, thank you very much.
Okay, I can hear the chorus from the likes of 350.org and Rising Tide: fossil fuel stocks are actually money-losers, and fossil fuel companies are doomed in the long run. Why invest in the 21st Century equivalent of the buggy-whip industry?
The truth of the former assertion is questionable. It’s based on a study by Trillium Asset Management, a firm that offers fossil fuel-free investment vehicles. It found that, over a three-year period, Harvard’s endowment fund lost money on fossil fuel stocks.
The problem there is the time period. The last three years have seen dramatically depressed oil prices, and many operators have had to cut back or even close down. That history is not, as they say, indicative of future performance. In fact, in the longer run, fossil fuel stocks have been a safe and profitable investment. Bad for the planet, yes. Bad for pension and endowment funds, no.
As for the latter assertion, that fossil fuel corporations are fated for the dustbin of history, not so fast. These big corporations are unlikely to sit still as they crash into a brick wall. If they see fossil fuels as a declining industry, they will shift their focus toward renewable energy and other sectors — and they have the expertise and the resources to be highly successful at it. The long-term future of Big Oil is not fixed in stone.
That’s why someone like Beth Pearce is fully justified in opposing divestment. Now, if you ask me, do I want Vermont to divest? I say yes. But that’s a political discussion, not a financial one.
I say it’s worthwhile risking a loss — or having to invest more creatively and nimbly in order to maintain revenues — to take a stand against Big Oil and Big Coal. Being the first state to divest would send an important signal to others. That’s worth doing.
Just don’t expect your State Treasurer to be happy about it. And don’t expect me to vote against her because of this single issue.