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  • Lara Crigger

Inside Columbia Protestors' Nonsense Proposal to "Divest From Genocide"


Amid the anti-Israel protests roiling college campuses right now, divestment has become a common rallying cry.


Literally, in some cases: In between chants of “From the river to the sea” and “Infitada Revolution,” the protestors can also often be heard saying, “divest from genocide” or “divest from the Israeli occupation.


Catchy slogans, perhaps. But if you actually read the Columbia University divestment proposal, you'll see it’s mostly nonsense, based on crummy data, poor financial literacy, and incomprehensible word salad. Even if the Columbia University endowment wanted to action on it, they couldn’t, because the demands just don’t make any sense.


Today I thought I’d step through what divestment is and why it matters, as well as some of the curious and concerning specifics of the Columbia University divestment proposal.


What Is Divestment?

What does it mean to “divest”?


“Divestment” means selling some or all of an investor’s holdings in a given company, industry, or sector. In this case, the investor is the university’s endowment, a special financial structure designed to provide support for the school’s activities.


In essence, the anti-Israel protestors are demanding that the managers of Columbia University’s endowment sell a set of objectionable stocks from the portfolio, stocks which the protestors claim support Israel and genocide.


Conceptually, divestment is a very reasonable way to utilize capitalism for social good. After all, money talks! If enough large investors pull enough money from an objectionable company, the stock price tanks, thus sending a message to the companies in question that objectionable behavior won’t be tolerated.


Or, if that doesn’t work, then at least the investors have a clean conscience about the investments inside their portfolio.


Does Divestment Work?

Over the past decade or so, activist investors have used divestment to varying success to effect change, convincing large investors to divest from fossil fuel companies, weapons manufacturers, private prisons, and more.


However, divestment has limits to its effectiveness, chief among them being that a public company’s leadership doesn’t have to care what non-shareholders think about their activities. Typically, the most impactful change often comes through engagement, not divestment.  


Still, divestment is just another tool in the toolbox, one that can be valid and powerful if implemented wisely.


I learned this firsthand a few years back, when I offered guidance to a student group looking to convince their high school to divest from weapons manufacturers and fossil fuel stocks. I helped them understand what data their endowment committee used to make investment decisions and what divestment could and could not achieve. I’m proud to say those teenagers did their homework and presented a proposal that was ultimately adopted, because they decided to keep level heads and lead with facts, not feelings. (Sometimes I wonder what those kids, now in their late 20s and 30s, must think of these college kids now.)


The Columbia University Apartheid Divest’s Proposal

In December 2023, Columbia University Apartheid Divest, an organization professing to be a coalition of 89 student groups, submitted a proposal to the university’s Advisory Committee on Socially Responsible Investing.



In it, the group demanded that Columbia University “withdraw financial support from Israel” via divestment from a number of specific investments. Divestment, argued the students, “is more viable, timely, and ethical than ongoing communication and engagement with company management” given the context of the ongoing Israel-Hamas war.


In the proposal, CUAD outlined specific divestment demands, including:


  • Divestment from and refrain from adding positions in individual U.S. stocks, including Microsoft, Amazon, Airbnb, and Alphabet

  • Sale of holdings from BlackRock iShares ETFs, specifically the iShares Core MSCI Emerging Markets ETF (IEMG) and the iShares Intermediate-Term Corporate Bond ETF (IGIB), because the two funds “expose Columbia to Hyundai, Caterpillar Inc., Lockheed Martin Corp., Boeing Co., and Barclays Bank plc”

  • Refusal to directly or indirectly invest in Elbit Systems, Volvo, JC Bamford Excavators, CAF, HikVision, and TKH Security


Why No Israeli Stocks?

Let’s first talk about the objectionable stocks themselves. Logically, if one was looking to “withdraw financial support from Israel,” the obvious low-hanging fruit would be to target Israel-domiciled companies. If they are headquartered in Israel and conduct operations in Israel, then those companies could be meaningfully and directly tied to the fortunes of Israel and Israelis. 


However, Amazon, Alphabet, Microsoft, and Airbnb are U.S. companies, not Israeli. They are not headquartered in Israel. Israeli consumers do not constitute a meaningful portion of their revenue streams, nor do products and services that are developed in or made for the Israeli market.


Same for Elbit Systems, Volvo, JC Bamford, CAF, HikVision, and TKH Security, all of which are foreign securities domiciled in various countries like Spain, Germany, and elsewhere.


Meaning, the protestors are demanding the university divest from non-Israeli companies as a way to make the greatest impact on the Israel economy.


O…kay?


But It’s The Partnership That’s The Problem!

But it’s these companies’ partnership with Israel that’s the problem, say CUAD. That their products and services are used at all by Israeli hands is what makes these companies objectionable.


For example:


Israel and Israeli settlers have used equipment from these companies [Hyundai, Caterpillar, CAF, and others] to demolish Palestinian homes; destroy water, sanitation, and hygiene infrastructure; destroy and uproot olive trees; and construct settlement infrastructure like (Jewish Israeli-only) roads and light rail between the illegal settlements.


In other words, because bad actors may or may not have used Caterpillar equipment in the construction of settlements on the West Bank (which, I would point out, is an entirely different geographical region than Gaza, which ostensibly is what the protestors are concerned with at present, given all the chants of “Free Gaza”), Columbia University should divest from Caterpillar.


This confuses an end user’s use of the equipment with the company’s endorsement. For example, if I purchase a Porsche, then—I don't know—use it to run over a protected, endangered tortoise, should the government hold Porsche liable for my actions?


I think most of us would agree that it isn’t Porsche’s fault I ran over the tortoise. The fault lies with me and me alone. Yet this is precisely the argument CUAD is making—that because some Israelis use Caterpillar excavators, Caterpillar is inherently endorsing how the Israelis use the excavators.


Who Profits From “Who Profits”?

I could step through, bit by bit, on how many inaccuracies and falsehoods the CUAD proposal includes (no, there is no such thing as a “Hyundai ETF”). I could point out that the data they use cites forms that are incomplete and out-of-date, and how they confuse ETFs and stocks as well as stocks and bonds. But frankly this article is long enough as is.


The one thing that jumped at me, however, is this: To justify its selection of these particular stocks and not others as targets for divestment, CUAD cites research from the Who Profits Research Center.


This site, which operates a database of companies engaged in the “Israeli Occupation Industry,” purports to be an non-profit dedicated to “exposing the commercial involvement of Israeli and international corporations in the ongoing Israeli occupation of Palestinian and Syrian land and population.” 


You can view a sample page of their database for yourself: Hyundai. Note the strangely bad grammar, the lack of sources, the lack of more recent updates on the page (nevermind that the entries were cited in the proposal without any mention of how out-of-date they were). If you navigate to the home page, you'll find more of the same: bad grammar, no sources, even Arabic in places (despite the organization supposedly being based in Israel).


Something here is very fishy.


Who Profits claims to be a non-profit, with an “.org” designation. However, nowhere on the site is a Tax ID available; nor is the Tax ID number is not searchable in IRS.gov, Candid’s GuideStar, or other online databases.


Nor is there any reference to a webmaster, a site owner, a masthead, or any indication of who runs the site at all.


What’s more, the address cited on the “Support” page appears to be cloned across several potentially phishing or spam sites that purport to be the Israeli Ministry of National Infrastructure, Energy and Water.


Yeah, something definitely stinks here.


Divest From Ignorance

I don’t fault anybody for not knowing how the stock market or investing works. I’ve been covering it for nearly 20 years, and I still can’t profess to understand everything about it.


What I do fault these protestors for, however, is waging a campaign of targeted harassment, bullying, vandalism, trespass, and violence against their peers while making demands in bad faith, based on illogical assumptions and reasoning, as well as on questionable data taken from what could be malicious websites.


What this shows to me, quite clearly, that the “noble goal” of divestment was never the point. All it was is a cover story, provided in the hopes that easily manipulated students drawn to the cause and their partners in the media wouldn’t interrogate it further.


NOTE: I am not a financial advisor, just a recovering financial journalist. For actual investment advice, please consult your preferred financial professional.

 

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