Op-Ed Submitted by Zoe Wray’16, Preston Cooper’15, Tyler Becker’14, Paige Willey’16, Cole Turner’15, Riley Collins’16, Savannah Saunders’16, and Nicholas Zahorodny’16.
On behalf of the Swarthmore Conservative Society, we would like to express our opposition to the campus movement that calls upon the College to divest from fossil fuels. Quite plainly, we write in defense of our endowment. We respect the passion of Mountain Justice members, the History Department, and other pro-divestment groups on campus, but passion cannot replace facts.
This is a political issue, and our endowment should not be subjected to students’ political whims. The Board of Managers is called upon to “manage the endowment to yield the best long-term financial results, rather than to pursue social objectives.” If the Board engages the demands of Mountain Justice, it invites a slippery slope: Why stop at divesting from fossil fuel companies? Why not any company that engages in highway transportation? What if other students or faculty have moral objections to other companies in our portfolio? Where do we draw the line?
Unlike many of our peer institutions, much of Swarthmore’s endowment goes directly back into sponsoring students. Even full-pay students receive a “scholarship” of $28,652. According to the College’s 2011-12 Financial Report, philanthropy provided 45 percent of educational costs, while student tuition accounted for 42 percent.
Due to the current economic stagnation in America and the enormous cost of attending Swarthmore, 57 percent of students now receive need-based financial aid. In fact, aid is one of the fastest growing line items in the College budget. Mountain Justice members dismiss this as a reason to keep our endowment partially financed by fossil fuel companies, insisting that divestment will not impact financial aid availability. But there is no such thing as a free lunch, and certainly no such thing as a free Swarthmore education. It strikes us as naive and elitist to overlook the importance of a robust endowment for funding Swarthmore’s accessibility. The Admissions Office’s need-blind policy can only continue if the endowment remains strong. Divestment threatens the socioeconomic diversity of our campus.
For better or worse, fossil fuel companies have access to tremendous capital and are some of the largest investors in the search for alternative energy solutions. For instance, Chevron is currently developing one of the largest solar photovoltaic projects in California. Critics maintain that our investment in fossil fuel industries is “unsustainable” in the long run, overlooking the extent to which free enterprise companies adapt and change with the times to stay viable and profitable.
We’re not in the business of defending Big Oil, but we are in the business of common sense. In a private equity market, divesting from a stock does not necessarily harm the targeted company. So long as the firm is profitable, someone else will almost immediately purchase that stock. All Swarthmore would shed by divesting would be the opportunity to exert shareholder pressure.
Our classmates claim that Swarthmore’s divesting would set a national example, but most Americans aren’t taking their economic cues from Swarthmore. The fact that tuition is now approaching $60,000 demonstrates our alarming inability to contain costs. In the unlikely event that Swarthmore were to set off a “domino effect” and prompt the national bankruptcy of major oil companies, the U.S. economy would risk recession, preventing the kind of alternative energy research investments America needs.
We would love a world in which renewable energy companies were at the top of the Fortune 500 list. But right now, the best economic solution is to continue to encourage a competitive market environment that forces alternative energy startups to become affordable. As of late, that hasn’t happened. The buses that President Chopp’s Office sent to the Keystone Pipeline Protest were, alas, fueled by diesel.
We as students do not have the “right” to control the College’s financial portfolio. Those decisions are rightly left up to an independent board. Mountain Justice members claim that members of the Administration and Board have met with them an astounding total of 25 times over the past 2 years. After all those discussions, the Board must remain firm: divestment is economically unreasonable.