Speakout: It's imperative that Colorado divest from Iran
Sens. Joan Fitz-Gerald, Ken Gordon, Andy Mcelhany And Josh Penry
Published September 16, 2007 at midnight
There is clear bipartisan support in Colorado and around the country for legislation that would require public pensions to divest from direct holdings in companies doing business with Iran. That is why we were disappointed with the recent Rocky Mountain News editorial against such divestment.
Divestment from Iran is the right thing to do, and other states are proving that it can be done in a way that has no impact on the investment returns of pension funds like PERA's.
Not only is Iran the world's largest state sponsor of terrorism, and not only is Iran manufacturing and supplying the IEDs and other devices killing American soldiers in Iraq and Afghanistan, but Iran is engaged in an illegal effort to obtain nuclear weapons. Meanwhile, Iran's leader has made clear his desire to "wipe Israel from the face of the map" and more broadly has called for a world "without America."
Both the United Nations and Congress recognize the threat that Iran poses. The U.N. Security Council unanimously voted twice to impose sanctions on Iran because of its nuclear program, and Congress has enacted a long list of laws that have placed sanctions on Iran and companies doing business there. Unfortunately, the threat of sanctions has not yet stopped a small number of foreign companies from investing in Iran, nor has it stopped American public pension funds, including PERA, from pumping money into Iran via their foreign corporate investments.
Divestment is a strategy calculated to put effective nonmilitary pressure on Iran.
The Iranian regime is highly vulnerable to economic pressure, especially in the petroleum sector where production has fallen 30 percent over the last 30 years. Iran subsidizes the price of gasoline for its population, which it must import due to a lack of internal refining capacity. It uses energy investment revenues to provide this subsidy. Similarly, the cash needed by Iran to fund its nuclear weapons pursuit is provided by companies invested in Iran's energy sector, which accounts for 80 percent of the country's hard currency. Divestment will provide a strong additional disincentive to companies considering an investment in the rebuilding of that capacity that, in turn, will help choke off the cash currency that is the lifeblood of this regime.
Divestment is also a prudent economic step. When PERA invests in Iranian companies, it takes on a higher level of risk. As Iran progresses dangerously close to succeeding in its nuclear efforts, increased sanctions against foreign companies doing business with Iran may not be far behind. As a matter of fiduciary responsibility to its members, PERA should not invest in companies subject to this substantial risk of sanctions.
Of equal weight, if these and other nonmilitary sanctions against Iran work, they could forestall military conflict, which we all hope to avoid.
Our proposal will be a narrowly crafted bill, targeting only direct holdings in foreign companies investing more than $20 million in Iran's energy sector (the same companies subject to sanction under U.S. law). Numerous sources, from the Department of Energy to the Congressional Research Service, already have identified this list of 19 companies. Many comparable investment opportunities exist in the energy sector in companies that do not invest in Iran.
The members of PERA, and all citizens of Colorado, should be deeply concerned about investing in companies that support one of the most dangerous countries in the world. Colorado should join Congress and its fellow states in sending a strong signal to the Iranian regime that we will not help Iran advance its nuclear weapons pursuit, support terror and kill and maim innocent people, including U.S. troops.
Joan Fitz-Gerald, D-Coal Creek Canyon, is Senate president. Ken Gordon, D-Denver, is Senate majority leader. Andy McElhany, R-Colorado Springs, is Senate minority leader. Josh Penry is a Republican state senator from Fruita.
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November 22, 2007
9:44 a.m.
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Jimminy writes:
Although I'm a little chagrined to see that it all too often takes a law to get individuals and businesses to do the right thing,waging economic war on mad dog regimes is always the right thing to do.