By Mark Niedergang, Peter St. Clair and Patricia Wild

(The opinions and views expressed in the commentaries of The Somerville Times belong solely to the authors of those commentaries and do not reflect the views or opinions of The Somerville Times, its staff or publishers)

We urge the Somerville Retirement Board to divest from all companies in the fossil fuel business. All three of us are vested members of the Somerville City Retirement System. We support divestment for two reasons: (1) We believe that our children’s and the City’s future is in peril if humankind does not drastically reduce our use of fossil fuels; and (2) we want to protect our retirement and our pensions. We believe that fossil fuel companies are poor investments that will not only generate less return than other, comparable stocks and bonds, but are becoming increasingly volatile and risky investments, likely in the future to lose money for the Somerville Retirement System.

While everyone cares about the Earth’s future, we all also have to worry about our own families. Many City workers and retirees have voiced opinions about fossil fuel divestment – some for, some against – and many base their opinion on one key question: will divestment result in lower rates of return for the City’s pension fund? We are lucky in Somerville that our Retirement Board has done a terrific job in recent years of investing our pension funds, with returns outpacing what the State Retirement Board has achieved. But while self-interest is important, we need to balance it with our concern for the future and the planet. Predicting future returns is notoriously difficult; however, we believe the evidence is clear: the financial risks associated with divestment are slight or nil, while the risks associated with catastrophic climate change are severe for all of us. Divestment is a moderate step with minimal financial risk to help mitigate the disruptions and threats posed to our children’s lives and the Somerville community by climate change.

Divestment from the top 200 fossil fuel companies will not significantly affect the Somerville Retirement Fund portfolio’s rate of return. The Somerville pension fund has a very small amount invested in these companies, just 1.9% of our total portfolio.   We are not saying sell all fossil fuel investments immediately. (Given the severe decline in the price of oil, that would be unwise, as those stocks have dropped tremendously in value in the past six months.) Rather, we urge a gradual, moderate approach to divestment. Over a five-year period, the Board should sell their holdings in these companies, replacing those fossil fuel investments with investments offering similar or better returns. It is quite possible that divestment will result in higher returns. An MSCI report found that portfolios without fossil fuel companies would have outperformed those with in a five-year period from 2007-2013. Over the next 5-10 years, fossil fuel use will almost certainly be limited by world governments, further eroding this industry’s profitability and further hammering its stock values.

The record on climate change is clear: rising flood waters will threaten our Assembly Square and East Somerville neighborhoods; severe storms already threaten our homes, businesses and public infrastructure, especially in low-lying areas like Union Square and Duck Village; crop failures both locally and internationally will threaten our ability to feed our families. Some changes to our climate are now inevitable, but the worst effects – the almost unthinkable catastrophes – are not. The fate of our City and our society as we know it largely depends on whether the world can rapidly reduce carbon emissions. Reducing carbon emissions means quickly and severely reducing the use of fossil fuels. And reducing the use of fossil fuels means massive profit losses to the fossil fuel companies.

If the fossil fuel companies were willing to reduce their production of coal, oil, and natural gas in line with what our community and the world desperately needs, if they were willing to invest in renewable energy, then we wouldn’t call for divestment. Unfortunately, they are not. Instead, they are focused on increasing short-term profit, which means digging, drilling, and fracking for more coal, oil, and natural gas; lobbying Congress for tax breaks; drilling on Federal lands such as National Forests, and advocating for pipelines we don’t need (like Keystone XL). And they use their enormous political clout to block the legislation we do need to develop clean, new energy sources.

Their business plan pretty much ignores climate change. The rationale that permits the fossil fuel companies, filled presumably with good people who love their families and care about their communities, to make these decisions is short-term profit above all else. It is a mentality that has gotten the planet Earth into a dangerous situation, and it is a mentality that the Somerville Retirement Board must not adopt.

None of us would knowingly support a company whose business plan threatens our community and our children’s future. The evidence is clear: fossil fuel companies are actively doing permanent harm to our planet and intend to continue to do so. For the sake of our community, we urge the Somerville Retirement Board to do the right thing and begin divesting from the top 200 fossil fuel companies.

Mark Niedergang is the Ward 5 Alderman; Peter St. Clair is a retired Somerville firefighter (Deputy Chief), and Patricia Wild is a writer and a retired teacher from SCALE, the Somerville adult learning center.