How’s Environmentalist Superhero Tom Steyer Doing 2 Years In?
Having invested heavily in traditional disaster-based climate rhetoric, Steyer could benefit from diversifying his portfolio with a positive vision of a climate-safe future.
You may have heard of Tom Steyer, he’s the billionaire founder of Farrallon Capital, a San Francisco based hedge-fund, that has pledged his private fortune to mitigating climate change. He’s basically playing the opposite side of the table from the Koch Brothers, forming a superPAC and spending millions on political ads to win key political races. He earned his stripes in 2012 helping to pass California’s Prop 32, which closed a business tax loophole to raise millions for energy efficiency upgrades in schools. So how’s he doing now?
Recently, his 501(c)3 research arm NextGeneration released a study called Risky Business.
It’s evident that Steyer is putting his experience from the financial markets to work in this report. As he says himself, “what the Risky Business Study has really done is marry climate scientists with economists and risk measurement.” The fact that he has not one, but two former Secretaries of the Treasury, Henry Paulson and Robert Rubin, as co-chairs on the study testifies to its standing in the financial community. Reading Risky Business you can almost believe that Steyer will lead a charge of rationally self-interested business people to defend us from the catastrophic risk of climate degradation.
But Steyer’s own past reveals the truth. As a partner in Farrallon Capital he made tens of millions by investing in Indonesian and Australian coal mines. This highlights the fact that men of finance still see huge profits in fossil fuels. Those stacks of dollar bills have and continue to outweigh the risk calculations on the other side of the equation, the kind evaluated by Risky Business.
Steyer has since explained his change of heart on his blog. He points out that he has completely divested his own fortune from fossil fuels. But this is not a question of character, it’s a question of money. No one doubts Steyer’s best intentions in fighting climate change, the fact is that there are just lots of people still out there thinking like he did. A trim report on the real risks associated with climate change aren’t going to change that. Steyer may in fact be just one business person, turning back to face insurmountable odds alone.
As for Steyer’s current position – he’s currently elbows deep with NextGen, his 501(c)4 superPAC in the 2014 mid-term gubernatorial elections. The PAC’s campaign page recently updated to shift gears away from the Keystone battle (a fight that’s on the backburner for now while a South Dakota court considers renewal of permits), and squarely towards governor and senate races in states like Florida, Iowa, Colorado and Pennsylvania.
The question is, can Steyer really win the battle for the climate with good old fashioned attack ads? I’d give him a 5% chance of altering public opinion somewhat and a 30% chance of altering it not at all. While some may look with glee upon “calling a spade a spade” and pointing out the horrible climate-destroying deeds some of these candidates have supported, those aren’t the minds these ads need to change.
To actually win the battle, Steyer will need to get moderate people out to vote that might otherwise have stayed at home. Given the whole demographic shift and voter participation phenomenon of the last presidential elections, there’s a decent (lets call it 50%) chance of that happening. (That’s slightly better than the 40% chance that famous political statistician Nate Silver’s gives the Democrats keeping the Senate this year. Remember that young and minority voters are less likely to turnout for midterm elections).
So let’s say the pro-climate team wins the mid-terms what then? We may very well be looking at the same indetermination that we have with Obama on the Keystone pipeline, where a president elected with a clear environmental mandate wavers and draws out the process for the sake of his political career. How many more senators and house representatives will meander down this line before we get a strong, decisive set of not one (i.e. Obamas action through the EPA) but hundreds of laws to help chart a climate-saving course? What other alternatives does Steyer have?
The answer lies in the fact that Steyer’s real allies are in Silicon Valley, not Washington or Wall Street. And if he’s going to #WinOnClimate he should diversify his political messaging with a technology driven vision for a positive future. Afterall, it’s the candidates that define the future that win elections, not the ones that wallow in the present.
In the long game, some parts of the Country may deny climate-change until they’re underwater. (Fossil-fuel funded advertising dollars and news stations will certainly help them maintain that world view). Steyer is going to have to convince these people by appealing to a different side of their nature, by altering their reality with exciting new technology like solar roads and marine aquaculture. These may sound like space age technology to you, but they’re here now. Solar roads just raised $2.2M on Indiegogo and aquaculture is a $60 billion year industry worldwide expected to double in size by 2019.
These technologies can save us, but they need a political advocate. Marine aquaculture isn’t legal in the United States and the innovative state of California is talking about dumping billions into outdated train technology, not installing the first solar roads. NextGen could play a huge role in setting the legislative table to encourage green innovation on a state by state basis. If California, Oregon or Massachusetts pioneered legislation on say, self-driving cars, other states might soon find themselves trying to keep up with the Joneses.
What’s more, if Steyer works on the political side of green tech – he will also have the coalition of business people he needs to succeed. Google, Apple, Sunpower, Tesla, these companies are all going to profit handsomely from a sustainable, technology enabled future. Coincidentally, they’re also starting to flex their political muscle, so they might help fund that superPAC should Steyer’s own funds wear thin.
Spending his 501(c)3 and 501(c)4’s money on state based climate-innovation policies could help Steyer create the offensive he really needs to #WinOnClimate instead of relying on the same old defensive scare tactics Al Gore lead off with. As a man of finance, Steyer should at least be able to appreciate that such strategies will diversify his political portfolio and increase the chance of success. Now that’s a plan that may be worth investing in.
The opinions expressed in this article are those of the author and are in no way shared by Civinomics Inc.