The question we need to be asking is, Can social activism do the right thing?
Riffing off American filmmaker Adam MnKay, in a recent interview with Rolling Stone Magazine, social activism today “cannot seem to get out of this cultural framework that we’re trapped in, that won’t allow us to take in the enormity of” the changes taking place in our changing times in the 21st Century.
That framework is constraining social activism to seeing only private choice and public protest in Markets and against Government as theories of social change.
Civil Society gets marginalized. Finance gets trivialized.
Bill McKibben tells us “They have money. We have bodies. That’s the fight.”
Here's an Inconvenient Truth for Bill: money buys bodies
So the fight Bill wants us to fight is really : they have money to buy bodies; we don’t.
That’s a fight we cannot win.
What a terrifying place to be, for people who care about climate and habitat and equity and a good future.
There is another way. We can get the money on side. It doesn’t have to be a fight. It can be an evolution.
An evolution that begins with innovation in social activism. The innovation of fiduciary activism.
This is public engagement in conversation within Civil Society, about Money.
Not Capital Markets Money.
Fiduciary Money.
The tens of trillions, collectively, worldwide, in society’s shared savings aggregated into social trusts for the social purposes of socially provisioning the social safety nets of Workplace Pensions and Civil Society Endowments as forever promises of hope for a dignified future quality of life for some, directly, that will also be, of necessity, hope for a dignified future quality of life for us all, consequently.
This is money with the size, the purpose and the time to use the technologies of spreadsheet math, desktop publishing and digital communication to supply money to enterprise for its use, for a purpose, for a time, at.a cost and on terms, through negotiated agreement on equity payback to an actuarial/fiduciary cost of money, plus opportunistic upside, from enterprise cash flows prioritized by contract for suitability, longevity and fairness to a dignified future for all.
Plenary powers of discretionary authority over the deployment of this Fiduciary Money are vested in fiduciaries who are required by law to exercise care (prudence) and be caring (loyalty) in their exercise of that discretion. They are accountable to us, as reasonable people who care enough to acquire knowledge and experience relevant to the choices that can and should be made, for being properly careful (prudent) and caring (loyal).
Fiduciary activism needs to engage in conversation with the fiduciaries who are entrusted by law with plenary powers of discretionary authority over the deployment of this money about which enterprises they can and should be negotiating with, and what terms they can and should be negotiating for.
This can and should include responding to COP28's call for "transitioning away from fossil fuels in a just, orderly. and equitable manner".
Social Activism is not taking up this call from COP28. Probably because Social Activism cannot figure out how private choice and protest politics can be deployed to drive that transition in that manner.
Fiduciary Activism can and should take up that call, by mobilizing, through popular conversation, Fiduciary Money to form consortia to buy hydrocarbon companies out of public markets ownership and place them into prudent stewardship, where they can be directed to become, and supported in being, positive contributor to a new global initiative to rapidly redesign and reconstruct our global energy supply ecosystems - core technologies and supporting infrastructure - to be purpose-built, by design, for energy sufficiency complete with habit longevity and social equity in the 21st Century and beyond....
This rededeign will be an enterprise of integrated, coordinated and synchronized Urban, Rural, Curated and Left-Alone landscape design on a planetary scale, the enormity of which Fiduciary Activism will allow us all to take in.
The fiduciary duty of pension funds is to do their best to make sure the fund earns enough income from its investments to cover the payouts to pensioners. That means being a conservative investor, despite the fact that pensions typically invest quite a lot in stock markets, which, by the way, are going to crash soon as the impact of global warming hits our ability to grow food and gives investors the wakeup call they so badly need. Relying on neoclassical economists to predict how GW will impact global economies is foolish when those impacts are, for example only 8.5% of global GDP at a 6C temperature rise (Nordhaus in 2017). Pension funds have very little capital, if any, that they are allowed to invest in private markets, which is where nearly all the innovation is coming from needed for a carbon-free world. Pension funds are typically restricted to buying only blue-chip stocks: companies that are now part of the problem. Pensions, in this suggestion, will need to change the rules of their investment contract, which will require the consent of the members (pensioners) as well as that of the government who are beholden to the blue-chip companies. Imagine how the government will react to large pensions saying they want to dump 10-20% of their blue-chips in order to invest in startups and small companies? What will the reaction be from the corporate elites who put the government in office? I like the idea, but I don't know how feasible it is.
Pensions (as opposed to retirement savings plans) are constituted by the law of trusts with plenary powers of discretionary authority to deploy the money entrusted to their control, subject only to fiduciary duties of care (prudence) and caring (loyalty) according to the common sense of reasonable people knowledge and experience relevant o the choices to be made. This is sometimes called in the law the Prudent Person.
Since the early 1970s, a new lore of fiduciary duty has evolved that replaced the Prudent Person with the Prudent Investor through a trick of linguistic ledgerdemain that started out with a generic definition of "investor" as a person who supplies money to enterprise for its use, for a purpose, for a time, at a cost and on terms, without specifying the logic to be followed in selecting enterprises to supply with money or the cost and terms on which that money will be supplied.
Used in this generic, non-specific way, the word "investor" is not understood in common parlance as really any different from the world "person".
So, the swap passed unnoticed.
Then "investor" came to be specially encoded with the specific meaning of a person who supplies money to enterprise through the mechanisms of the capital markets, buying incrementally liquid ownership shares in large-scale, long-dated financing agreements in the markets for maintaining market sealing prices on such shares, at one market clearing price in anticipation of selling those shares at some unknown future point in time to some unknown future buyer at some unknown, but hoped-for better, market clearing price.
Gradually, over time, it came to be widely (mis)understood that the fiduciary duty of pension fiduciaries with regard to their deployment of fiduciary money entrusted to their plenary powers of discretionary authority is to be a prudent buyer and seller of shares at market-clearing prices in the public (Exchanges) or private alternative (Funds) markets for maintaining market clearing prices on such shares.
One of the glaring ignorances that drives me nuts is that we ignore the etiology of the cycle itself.
There are reforestation and rehabilitation of habitats performed by animals on this planet that we take for granted. This is why biological collapse of diversity is such a harm to the eco community.
It’s clear that the flux of carbon being pulled into the web of life is dependent on the stewards within those systems. From pollination to seed dispersal, all of these integrations are dismissed in the use of “carbon cycle” by economics.
My point being, the carbon cycle is not static. We actually have more wiggle room today than we will next year and every year after that.
Carbon capture by any means other than habitat restoration is an ignorant approach to the problem. We need habitat repair and expansion to increase those hidden beings keeping the planetary systems going.
The scariest things to me are die offs of base producers like diatoms in the ocean. Another hidden service by the living community that is struggling with these temperatures.
For those of you who are interested in the economics of carbon and climate change mitigation, I recommend that you read the "carbon reward" working paper Abstract and Introduction:
The paper and the presentations on the GCR website are more informative in terms of the policy approach and its relevance to the many and varied problems inherent to the climate crisis.
Does anyone now where I can find the UN report they talk about? that says that mining would increase 60% with decarbonizaton. Or someone knows it's name?
Like most discussions of how to confront warming, the solutions are out of sync with the timeframe to social and ecosystem collapse. Any time someone says "By 2100..." we need to remind them that by then, at this rate, humanity will be in tatters. Delton mentions the long timeframes necessary for industry to develop and bring new products to market, and specifically talks about how CDR (not industrial CCUS which has been shown to be nonfunctional but rather things like direct air capture - DAC - or bioenergy with carbon capture and storage), despite being smaller than a drop in the bucket at this point, is still worth investing in now even if it is being used, like David Keith's Carbon Engineering DAC firm he sold to oil giant Oxy and made himself a millionaire with, to take the carbon and use it for enhanced oil recovery (just to pump out more oil) as Oxy's CEO openly admitted. Delton thinks it is worth accepting the cheaters and the slow progress that is typically part of any new technology, because "some day" that tech will finally be a powerhouse. But again, some day soon, we will run out of time. Far too few working even in climate science are willing to admit that our very long term plans are totally unrealistic given warming's rate, which as James Hansen and team recently pointed out, is speeding up.
So back to the question of Can the market do the right thing? It is not designed to do right things, only profitable things. Freedom, here, has resulted in the Jeff Bezos's and Elon Musk's of the world. With no limitations on the pursuit of private wealth, everyone seems to want a piece of the action and nobody wants to behave. Trying to fix this from inside the Problem is so unlikely. When our scientists are on the inside, no wonder they don't speak out. I don't see much hope outside of a popular revolution. If we all learned how to protest like the French, we might get somewhere.
I think this is an idea worth pursuing. Change the incentive to change the game, but why stop with Carbon? Could this methodology not be used to move the dial on other planetary and social boundaries? As Rachel points out, there would doubtless be those who would attempt to play the system, but whatever social and political methods are suggested will have this problem and require appropriate governance.
I wonder whether changing the incentive at a board and citizen level with something like GCP, would go some way to re-wiring the super organism. A “third-attractor” towards a more regenerative future?
Unfortunately this guy doesn't live in the real world. Anyone can come up with a fantasy economic system. This isn't even a tiny bit realistic. The fundamental issue with this scheme is that it is based on a bunch of independent actors trusting the carboncryptocoin printer but our basis for trust is our current financial system. There is no reason for anyone to trust the backing of the coins price, because the backing of it would have to be based on power derived from our current model.
Well, that was a long one :)
Delton's thinking and ideas are interesting and could have merit.
My biggest concern is that the system proposed would rely too heavily on people 'playing nice'.
Oh, and thanks for the link to your Mongabay article!
“Can the market do the right thing?”
Wrong question.
The question we need to be asking is, Can social activism do the right thing?
Riffing off American filmmaker Adam MnKay, in a recent interview with Rolling Stone Magazine, social activism today “cannot seem to get out of this cultural framework that we’re trapped in, that won’t allow us to take in the enormity of” the changes taking place in our changing times in the 21st Century.
That framework is constraining social activism to seeing only private choice and public protest in Markets and against Government as theories of social change.
Civil Society gets marginalized. Finance gets trivialized.
Bill McKibben tells us “They have money. We have bodies. That’s the fight.”
Here's an Inconvenient Truth for Bill: money buys bodies
So the fight Bill wants us to fight is really : they have money to buy bodies; we don’t.
That’s a fight we cannot win.
What a terrifying place to be, for people who care about climate and habitat and equity and a good future.
There is another way. We can get the money on side. It doesn’t have to be a fight. It can be an evolution.
An evolution that begins with innovation in social activism. The innovation of fiduciary activism.
This is public engagement in conversation within Civil Society, about Money.
Not Capital Markets Money.
Fiduciary Money.
The tens of trillions, collectively, worldwide, in society’s shared savings aggregated into social trusts for the social purposes of socially provisioning the social safety nets of Workplace Pensions and Civil Society Endowments as forever promises of hope for a dignified future quality of life for some, directly, that will also be, of necessity, hope for a dignified future quality of life for us all, consequently.
This is money with the size, the purpose and the time to use the technologies of spreadsheet math, desktop publishing and digital communication to supply money to enterprise for its use, for a purpose, for a time, at.a cost and on terms, through negotiated agreement on equity payback to an actuarial/fiduciary cost of money, plus opportunistic upside, from enterprise cash flows prioritized by contract for suitability, longevity and fairness to a dignified future for all.
Plenary powers of discretionary authority over the deployment of this Fiduciary Money are vested in fiduciaries who are required by law to exercise care (prudence) and be caring (loyalty) in their exercise of that discretion. They are accountable to us, as reasonable people who care enough to acquire knowledge and experience relevant to the choices that can and should be made, for being properly careful (prudent) and caring (loyal).
Fiduciary activism needs to engage in conversation with the fiduciaries who are entrusted by law with plenary powers of discretionary authority over the deployment of this money about which enterprises they can and should be negotiating with, and what terms they can and should be negotiating for.
This can and should include responding to COP28's call for "transitioning away from fossil fuels in a just, orderly. and equitable manner".
Social Activism is not taking up this call from COP28. Probably because Social Activism cannot figure out how private choice and protest politics can be deployed to drive that transition in that manner.
Fiduciary Activism can and should take up that call, by mobilizing, through popular conversation, Fiduciary Money to form consortia to buy hydrocarbon companies out of public markets ownership and place them into prudent stewardship, where they can be directed to become, and supported in being, positive contributor to a new global initiative to rapidly redesign and reconstruct our global energy supply ecosystems - core technologies and supporting infrastructure - to be purpose-built, by design, for energy sufficiency complete with habit longevity and social equity in the 21st Century and beyond....
This rededeign will be an enterprise of integrated, coordinated and synchronized Urban, Rural, Curated and Left-Alone landscape design on a planetary scale, the enormity of which Fiduciary Activism will allow us all to take in.
The fiduciary duty of pension funds is to do their best to make sure the fund earns enough income from its investments to cover the payouts to pensioners. That means being a conservative investor, despite the fact that pensions typically invest quite a lot in stock markets, which, by the way, are going to crash soon as the impact of global warming hits our ability to grow food and gives investors the wakeup call they so badly need. Relying on neoclassical economists to predict how GW will impact global economies is foolish when those impacts are, for example only 8.5% of global GDP at a 6C temperature rise (Nordhaus in 2017). Pension funds have very little capital, if any, that they are allowed to invest in private markets, which is where nearly all the innovation is coming from needed for a carbon-free world. Pension funds are typically restricted to buying only blue-chip stocks: companies that are now part of the problem. Pensions, in this suggestion, will need to change the rules of their investment contract, which will require the consent of the members (pensioners) as well as that of the government who are beholden to the blue-chip companies. Imagine how the government will react to large pensions saying they want to dump 10-20% of their blue-chips in order to invest in startups and small companies? What will the reaction be from the corporate elites who put the government in office? I like the idea, but I don't know how feasible it is.
Pensions (as opposed to retirement savings plans) are constituted by the law of trusts with plenary powers of discretionary authority to deploy the money entrusted to their control, subject only to fiduciary duties of care (prudence) and caring (loyalty) according to the common sense of reasonable people knowledge and experience relevant o the choices to be made. This is sometimes called in the law the Prudent Person.
Since the early 1970s, a new lore of fiduciary duty has evolved that replaced the Prudent Person with the Prudent Investor through a trick of linguistic ledgerdemain that started out with a generic definition of "investor" as a person who supplies money to enterprise for its use, for a purpose, for a time, at a cost and on terms, without specifying the logic to be followed in selecting enterprises to supply with money or the cost and terms on which that money will be supplied.
Used in this generic, non-specific way, the word "investor" is not understood in common parlance as really any different from the world "person".
So, the swap passed unnoticed.
Then "investor" came to be specially encoded with the specific meaning of a person who supplies money to enterprise through the mechanisms of the capital markets, buying incrementally liquid ownership shares in large-scale, long-dated financing agreements in the markets for maintaining market sealing prices on such shares, at one market clearing price in anticipation of selling those shares at some unknown future point in time to some unknown future buyer at some unknown, but hoped-for better, market clearing price.
Gradually, over time, it came to be widely (mis)understood that the fiduciary duty of pension fiduciaries with regard to their deployment of fiduciary money entrusted to their plenary powers of discretionary authority is to be a prudent buyer and seller of shares at market-clearing prices in the public (Exchanges) or private alternative (Funds) markets for maintaining market clearing prices on such shares.
This is not the law.
One of the glaring ignorances that drives me nuts is that we ignore the etiology of the cycle itself.
There are reforestation and rehabilitation of habitats performed by animals on this planet that we take for granted. This is why biological collapse of diversity is such a harm to the eco community.
It’s clear that the flux of carbon being pulled into the web of life is dependent on the stewards within those systems. From pollination to seed dispersal, all of these integrations are dismissed in the use of “carbon cycle” by economics.
My point being, the carbon cycle is not static. We actually have more wiggle room today than we will next year and every year after that.
Carbon capture by any means other than habitat restoration is an ignorant approach to the problem. We need habitat repair and expansion to increase those hidden beings keeping the planetary systems going.
The scariest things to me are die offs of base producers like diatoms in the ocean. Another hidden service by the living community that is struggling with these temperatures.
Dear all,
For those of you who are interested in the economics of carbon and climate change mitigation, I recommend that you read the "carbon reward" working paper Abstract and Introduction:
https://globalcarbonreward.org/2024-climate-shift/
The paper and the presentations on the GCR website are more informative in terms of the policy approach and its relevance to the many and varied problems inherent to the climate crisis.
Best,
Delton
Does anyone now where I can find the UN report they talk about? that says that mining would increase 60% with decarbonizaton. Or someone knows it's name?
Like most discussions of how to confront warming, the solutions are out of sync with the timeframe to social and ecosystem collapse. Any time someone says "By 2100..." we need to remind them that by then, at this rate, humanity will be in tatters. Delton mentions the long timeframes necessary for industry to develop and bring new products to market, and specifically talks about how CDR (not industrial CCUS which has been shown to be nonfunctional but rather things like direct air capture - DAC - or bioenergy with carbon capture and storage), despite being smaller than a drop in the bucket at this point, is still worth investing in now even if it is being used, like David Keith's Carbon Engineering DAC firm he sold to oil giant Oxy and made himself a millionaire with, to take the carbon and use it for enhanced oil recovery (just to pump out more oil) as Oxy's CEO openly admitted. Delton thinks it is worth accepting the cheaters and the slow progress that is typically part of any new technology, because "some day" that tech will finally be a powerhouse. But again, some day soon, we will run out of time. Far too few working even in climate science are willing to admit that our very long term plans are totally unrealistic given warming's rate, which as James Hansen and team recently pointed out, is speeding up.
So back to the question of Can the market do the right thing? It is not designed to do right things, only profitable things. Freedom, here, has resulted in the Jeff Bezos's and Elon Musk's of the world. With no limitations on the pursuit of private wealth, everyone seems to want a piece of the action and nobody wants to behave. Trying to fix this from inside the Problem is so unlikely. When our scientists are on the inside, no wonder they don't speak out. I don't see much hope outside of a popular revolution. If we all learned how to protest like the French, we might get somewhere.
I think this is an idea worth pursuing. Change the incentive to change the game, but why stop with Carbon? Could this methodology not be used to move the dial on other planetary and social boundaries? As Rachel points out, there would doubtless be those who would attempt to play the system, but whatever social and political methods are suggested will have this problem and require appropriate governance.
I wonder whether changing the incentive at a board and citizen level with something like GCP, would go some way to re-wiring the super organism. A “third-attractor” towards a more regenerative future?
Unfortunately this guy doesn't live in the real world. Anyone can come up with a fantasy economic system. This isn't even a tiny bit realistic. The fundamental issue with this scheme is that it is based on a bunch of independent actors trusting the carboncryptocoin printer but our basis for trust is our current financial system. There is no reason for anyone to trust the backing of the coins price, because the backing of it would have to be based on power derived from our current model.