Sunday, February 10, 2008

Misinformation Threatens Divestment Legislation

Four of the seven members of the House State Affairs Committee heard testimony on HB 287 on Saturday Feb 9th. The committee decided to hold the vote on the bill for a later date. It is, however, in big danger of being killed, based on the committee members' comments during the deliberation. A big factor in this is the testimonies presented by the Permanent Fund Board and the Alaska Retirement Board. The misinformation presented during these two testimonies threatens to kill the legislation. Because these two testimonies were the last two of the day and there were no opportunities provided to pro-legislation people to correct the misinformation during the hearing, these next few blogs are dedicated to doing just that.

Truth 1: Targeted divestment is NOT blanket divestment.
In his testimony, Mike Burns, representing the Permanent Fund Board, cited an article that stated that divestment did not impact the outcome of the anti-apartheid movement in South Africa, and therefore, the Sudan divestment effort is likely to be just as ineffective. Mr. Burns was comparing, perhaps unknowingly, apples to oranges. The South Africa divestment movement encouraged what is called blanket divestment. Blanket divestment targets all companies equally. Divesting from South Africa meant divesting from companies that financed arms deals and from companies that provided medical supplies. All companies doing business in South Africa were impacted, and therefore, the South African people were as impacted at least as much as the government, and often to a greater degree.

Our state divestment bill (HB 287/SB 227) proposes targeted, not blanket, divestment. Targeted divestment calls for divestment from about 24 companies that either contract directly with the Government of Sudan or work on projects run and financed by the Government of Sudan. These companies are either directly or indirectly enabling the Darfur genocide and providing minimal services, goods, or support to the regular people of Sudan.

Yes, blanket and targeted are both divestment approaches, just as apples and oranges are both fruit. But they are very different - - just ask anyone who's ever had a warm piece of orange pie.

Truth 2: Targeted divestment works.
Mr.Burns also stated that divestment would not effect the companies targeted and would not have any real impact on the genocide. Mr. Burns is not a foreign policy expert, or an expert on genocide, so he may have been speaking a bit beyond his area of expertise. He may also not have been aware of the following facts:

Companies operating in Sudan have proven highly responsive to the current Sudan divestment movement. Canadian oil company, Talisman, withdrew from Sudan in 2002. "Shareholders have told me they were tired of continually having to monitor and analyze events relating to Sudan," Talisman CEO Jim Buckee said in a press release. He conceded that the criticism directed at the company's activities had had an effect, stating: "Talisman's shares have continued to be discounted based on perceived political risk in-country and in North America to a degree that was unacceptable for 12 per cent of our production." Other oil companies followed Talisman's lead and, soon thereafter, the Khartoum regime entered into negotiations that finally ended the country's 21-year civil war.

In 2007, the Canadian firm CHC Helicopter Corporation, the world's largest provider of helicopter services to the global offshore oil and gas industry and previously a Highest Offender on the Sudan Divestment Task Force list of companies, ceased all business operations in Sudan for the indefinite future after substantial levels of inquiry from a range of concerned investors. CHC Helicopter had been executing a contract with Greater Nile Petroleum Company, the largest oil consortium in Sudan.

Also in 2007, the British firm Rolls Royce PLC, previously a Highest Offender due to the sale of oil equipment to a problematic consortium abutting Darfur, announced it will begin withdrawing from current contracts in Sudan and cease pursuing new contracts. Schlumberger Ltd.,which provides oil-field services to the major oil consortiums in Sudan, committed to reinforcing its existing outreach programs by implementing substantial humanitarian programs to reach marginalized populations in the country. This includes several humanitarian projects carried out in coordination with non-profit entities in one of the country's many Internally Displaced Persons (IDP) camps. "Substantial" humanitarian action is rigorously defined in the Sudan Divestment Task Force's "targeted divestment" model, and Schlumberger has committed to this high standard in a detailed written letter to the Task Force.

As for the government of Sudan? The Sudan Divestment Task Force sums it up well: "Perceiving the divestment movement as a clear threat, the Khartoum government has taken considerable steps to publicly oppose divestment, placing a $1 million advertisement in The New York Times extolling the virtues of investing in Sudan, and issuing both a press release and an op-ed condemning the divestment movement. In direct correspondence with the Task Force members, the Sudanese Ambassador to the United States reiterated his country's strong opposition to divestment. As Sudan researcher Eric Reeves notes, 'The fact that the regime is responding so distinctly to the movement means they certainly understand the implications.'"