[Themaintainers] {Ideas for Varun} Themaintainers Digest, Vol 74, Issue 9

[Varun Adibhatla]

Tim,

Thanks for the detailed explainer along with the LOTR lean-in (loved the
Theoden analogy).
I'm realizing that these emails reflect a certain intergenerational
discourse that ought to happen more often.
It's come up in discussions on maintaining 50+year old IT systems within
the federal government
<https://www.nextgov.com/cxo-briefing/2016/05/10-oldest-it-systems-federal-government/128599/>
where knowledge transfer on systems like COBOL that run critical
(financial) infrastructure could be happening more but is not because the
market doesn't value these skills.
Yet the markets would likely not operate without these systems.

I get goosebumps thinking how LOTR is a kind of intergenerational lore that
binds us in interesting ways.
I think I'm getting the story here.
Pensions & Endowments are giant + sleepy pools of capital. Sleepiness is a
necessary condition to protect long-term, broad-based fiduciary interests
Wow this reminds me of ENTS. The ents of LOTR lore ARE steward-like
curmudgeons who are deeply committed to their cause but incredibly hard to
rally to macro threats but when rallied destroy the extractive forces of
saruman and isengard
Some major goosebumps as I type this!

Tim, at the risk of sounding incredibly naive, a question:
Could a "woke" Pension or Endowment fund  acquire a municipal utility that
owns/operates gas and electric infrastructure with the specific "endgame"
of decommissioning its reliance on fossil fuels?
I revert back to my original provocation on why a city like Palo Alto, CA
continues to maintain its natural gas distribution infrastructure to the
tune of a quarter *B*illion (2020-2026)
Can the ents of CALPERs & Stanford University be rallied to get Palo Alto,
the supposed bastion of liberal America
<https://www.paloaltoonline.com/news/2021/11/13/around-town-palo-alto-comes-under-fire-in-new-york-times-op-ed>
to snap out of this inaction?

[image: image.png]

Varun

On Sat, Apr 30, 2022 at 3:06 PM Tim MacDonald <timmacdonald1 at me.com> wrote:

> Hi Varun
>
> Yes. You are right.
>
> Let’s start with stewardship.   Like all institutions of human social
> decision making, stewardship must be accountable to purpose. Otherwise,
> things can go horribly wrong, as your example of Denethor from JRR
> Tolkien’s imaginary history, The Lord of the Rings, shows. Think also about
> the much-ballyhooed “moral hazard” that is supposed to keep speculation
> markets on the right side of history, but always fails in boom times, with
> catastrophic consequences for the economy and society when the boom goes
> bust, as it always does. Remember 2008.  A boom is just a bust that has not
> happened yet!
>
> In the case of Pensions & Endowments, accountability is effected through
> the law of fiduciary duty. This law requires fiduciaries to exercise
> prudence in the use of their powers of ownership in undivided loyalty to
> the purpose for which that ownership was created and is continued by
> society.  In the case of pensions, their purpose is to write retirement
> checks to qualifying retirees, every month, forever.  Endowments for
> universities, philanthropies and other civil society institutions are less
> formulaic in their qualifications and entitlements, but the principle is
> the same: every month, forever.
>
> The law of fiduciary duty also holds that the standard for prudence and
> loyalty is us: that is, it is the common sense of reasonable people.
>
> So, I advocate that we all have a right and a responsibility to learn
> somewhat about the powers and purposes of pensions and endowments,
> sufficient so that we can participate in public discourse about prudent
> loyalty of institutional fiduciary power to intergenerational fiduciary
> purpose.   If Pensions & Endowments have the power to negotiate, as I argue
> that they do, WHO can and should they be negotiating WITH? And WHAT can and
> should they be negotiating FOR?  We all have a right and a responsibility
> to engage in discourse that explores the answers to those questions.
>
> I am taking the liberty of attaching a drawing I have made that tries to
> show people what these important public discussions can and should be about.
>
> Online discussion groups like this one can be important digital places
> where reasonable people can contribute to this important public discourse
> that as of this moment is not yet really ongoing.
>
> Here I am going to lean into your use of LOTR to illustrate the situation
> we are in today.  This time, however, I ask you to call to mind the story
> of the character Theoden, King of Rohan, who falls into dotage under the
> whisperings of Grima Wormtongue. This Grima speaks in ways solicitous to
> the King, lulling him into inaction, while actually advancing his own
> interests, in league with Saruman, who has his own plans for conquering and
> ruling Middle Earth, indefiance of the Dark Lord, Sauron.  The wizard
> Gandalf wakes Theoden from his dotage by calling for Theoden’s sword to be
> retrieved from the keeping place where Grima had secreted it, and placing.
> It once more in the hand of the King. Thus awakened from his somnambulance,
> Theoden rediscovers his strength, and the strength of the Rhohirrim who
> ride in glory to the succor of Gondor, the defeat of Saruman, and
> eventually also the throwing down of the Dark Lord, Sauron, and the
> triumphal Return of the King.
>
> Without taking the analogy too literally, we can say that Pensions &
> Endowments today are in a kind of dotage similar to that of Theoden, lulled
> into thinking they have no power by the experts in financialization who
> want to appropriate the great power of these vast aggregations of fiduciary
> money for their own use and benefit.
>
> It will be good for Pensions & Endowments to shake off the theories of
> financialization that currently hold them in a kind of thrall, and take up
> again their own “sword” of fiduciary power to negotiate, to feel
> authentically their own strength to shape enterprise, the economy, society
> and our future through negotiation with enterprising visionaries, directly.
>
> The first place to begin, I argue, is with changing the shape of the
> global energy economy, for climate security and real endgame
> sustainability.  These are the steps I argue can and should be taken:
>
>
>    1. Acquire existing energy-extraction-from-hydrocarbons enterprises
>    out of public markets ownership, and place them into superfiduciary
>    stewardship, where they can be decommissioned in synchronized coordination
>    with the commissioning of new energy technologies. Before it is too late.
>    2. Once placed into stewardship, and set on a path to replacement and
>    decommissioning, STOP funding Dark Money obstruction of climate action, and
>    instead spend that money on campaigns of climate awareness and the design
>    of the right new energy economy for the 21st Century.
>
>
> I have long thought that the good people who organize and contribute to
> this discussion group have much to contribute to the design of such a
> reshaped energy economy.
>
> Tim
>
>
>
> On Apr 30, 2022, at 12:14 PM, Varun Adibhatla <varun.adibhatla at gmail.com>
> wrote:
>
> Tim,
>
> Thank you.
> As a millennial immigrant who's graduate school tuition was paid for by
> the US government, my experience with either pensions or endowments is
> close to 0.
> I'm naive about the possibilities here but very curious.
> You appear to suggest that the combined capital forces of pension &
> university endowments ought to be more aggressively deployed into
> decarbonized focussed strategies while also guaranteeing a steady return?
>
> Some signals that you may already be aware of:
>
>    - Climate Safe Pension Network
>    <https://climatesafepensions.org/about-us/>
>    - Divest101 <https://www.divest101.com/> gets your college to divest
>    from fossil fuels
>    - This article discusses reinvestment
>    <https://grist.org/sponsored/divestment-campaigns-and-reinvestment-efforts-gain-strength-as-climate-change-intensifies/> of
>    endowments.
>
>
> *re:stewardship*
> yes, all for stewardship but In a way the weaponization of CEQA laws could
> be also be branded as "stewardship"
> I'm reminded of the Denethor, Steward of Gondor from LOTR who is a
> steward-curmudgeon and blocks and actively sabotages necessary action :|
>
>
> On Thu, Apr 28, 2022 at 8:20 AM Tim MacDonald <timmacdonald1 at me.com>
> wrote:
>
>> Varun
>>
>> Thank you for these good thoughts, and your important work.
>>
>> Can I invite you to consider with us if stewardship might prove to be a
>> better way than speculation for giving Nature a voice in human social
>> decision making?
>>
>> The stewardship we seek to activate is a potency latent in the structure
>> of Pensions & Endowments as the institutional fiduciary owners of ten of
>> trillions, collectively, worldwide, of intergenerational fiduciary money.
>> The intergenerational characteristics of fiduciary money makes it a proxy
>> for Nature, and our Future, in how we decide the shape of the right economy
>> for keeping a good society ongoing into a dignified future. A dignified
>> future, of course, includes one in which we work with Nature, and not
>> against Nature, on energy and other things, including water and oceans!
>>
>> The instrument of that stewardship is the equity payback investment
>> structures I referenced. These are innovations upon the proven reliable
>> practice common in Institutional Real Estate and also US-style tax credit
>> transfer partnerships.
>>
>> We, too, are looking at the law as a way to break the prevailing
>> neoliberal monopoly mindset of extraction and externalization through
>> securitized financialization for institutional speculation with fiduciary
>> money, by alleging that participation in such financialized extraction and
>> externalization is a violation of the fiduciary duty of institutional
>> fiduciary money that is causing harm to society, Nature and our future.
>> They must stop.  Some of the legal theories we are exploring, in addition
>> to fiduciary duty straight up, include pubic nuisance, public trust,
>> product liability/untaken safer alternative, breach of contract and fraud.
>>
>> The alternative is to require fiduciary money to invest in enterprise and
>> the economy, directly, and not derivatively, through negotiated agreements
>> on sharing in the cash that flows through the flourish and fade of the
>> social contract between enterprise and popular choice (think brand
>> loyalty), prioritized for fiduciary sufficiency and social and
>> environmental justice in the conduct of commerce.  This focuses the action
>> of investing fiduciary money on the search for the right answer to these
>> two questions. WHO can and should fiduciary money negotiate WITH? WHAT can
>> and should fiduciary money negotiate FOR?  Seeking the answers to these
>> questions empowers fiduciary money to speak with a voice for Nature, and
>> our future, as a proxy for Nature, in choosing our future.  It also opens
>> up space in that conversation for each of us and all of us to exercise our
>> own personal agency in considering the answers to these questions as
>> reasonable people whose common sense sets the evidentiary standards for
>> prudent loyalty of fiduciary power to fiduciary purpose.
>>
>> I imagine participation in these conversations will fall within the field
>> of interest of at least some in this discussion group, as responsible
>> maintaining must surely also include prudent decommissioning from time to
>> time, as times change, and humanity evolves prosperous adaptation to life’s
>> constant changes, making new learning, new technologies and new enterprises
>> more popular as better fit to changing times, while letting previously
>> popular learning, technologies and enterprises fade into history as a good
>> fit to an earlier time.
>>
>> The prevailing, mainstream neoliberal philosophy of securitized and
>> financialized extraction and externalization ignores that fade, insisting
>> that it does not, in fact exist, until we crash into it, recklessly and
>> irresponsibly booming and busting our way through creative destruction.
>>
>> Surely, prudent stewardship of the flourish and fade is a better, more
>> maintainable, way.
>>
>> Tim
>>
>> Bankofnature.eco
>> Fiduciary for the Future on LinkedIn
>>
>> On Apr 27, 2022, at 7:57 PM, Varun Adibhatla <varun.adibhatla at gmail.com>
>> wrote:
>>
>> Tim,
>> Thank you! This is a very abundantly imagined thesis!
>>
>> As someone named after a vedic god of water & oceans, I'm compelled by
>> tradition and ancestry to confer god-like agency onto nature. A deeply
>> spiritual proposition.
>> To confer actual financial agency on nature, we need to take a hard look
>> at the neoliberal bias *against* nature.
>> That neoliberal calculus has led to desecrations such as
>> speculative financialization and the weaponization of well-intentioned
>> environmental laws
>> <https://www.theatlantic.com/ideas/archive/2021/03/signature-environmental-law-hurts-housing/618264/>
>> .
>>
>> Here's where I look to indigenous calculus. Some signals, maybe more out
>> there?
>>
>>
>>
>> * - Jason Flores-Williams sued the state of Colorado and Gov. John
>> Hickenlooper   on behalf of the Colorado River and its ecosystem for
>> violating the river’s “right to exist, flourish, regenerate..."- "In
>> Ecuador, the constitution now declares
>> <https://dotearth.blogs.nytimes.com/2008/09/29/ecuador-constitution-grants-nature-rights/?mcubz=3> that
>> nature “has the right to exist, persist, maintain and regenerate its vital
>> cycles.”- In New Zealand, officials declared  that a river
>> <https://www.theguardian.com/world/2017/mar/16/new-zealand-river-granted-same-legal-rights-as-human-being> used
>> by the Maori tribe of Whanganui in the North Island to be a legal person
>> that can sue if it is harmed.- A court in the northern Indian state of
>> Uttarakhand has called the Ganges
>> <https://www.theguardian.com/world/2017/mar/21/ganges-and-yamuna-rivers-granted-same-legal-rights-as-human-beings> and
>> its main tributary, the Yamuna, to be living human entities." (via NYT
>> <https://www.nytimes.com/2017/09/26/us/does-the-colorado-river-have-rights-a-lawsuit-seeks-to-declare-it-a-person.html>)*
>>
>>
>> *re: equity payback investment structures that align enterprise cash
>> flows with fiduciary minimums and fiduciary values, of a dignified future
>> in a prosperous present.*
>> Any examples that you could offer?
>> Outside of the Green Liberty Bonds by the CT green bank
>> <https://www.ctgreenbankbonds.com/connecticut-green-bank-ct/i6126> (debt
>> instruments), are there any equity instruments out there linked to a
>> dignified / prosperous future?
>>
>> I've been thinking of ways to securitize early adoption of decarbonized
>> consumption.
>> The concept is simple / Carbon avoided today is more valuable than carbon
>> avoided later. and sets up incentive and payback mechanisms.
>> A household that purchases an EV today ought to be granted shares whose
>> value is linked to the Global Carbon Budget
>> <https://www.globalcarbonproject.org/carbonbudget/21/infographics.htm> that
>> estimates that *CO2 cuts of 1.4 Gigatons are needed every year to reach
>> net zero by 2050*
>>
>> Lastly, Atmos Financial is a banking services platform where 100% of your
>> account balance is used to fund climate-positive infrastructure to
>> decarbonize the economy.
>>
>> On Wed, Apr 27, 2022 at 9:06 AM Tim MacDonald <timmacdonald1 at me.com>
>> wrote:
>>
>>> Varun writes in a recent post:
>>>
>>> On Apr 26, 2022, at 6:03 PM, Varun Adibhatla <varun.adibhatla at gmail.com>
>>> wrote:
>>>
>>>
>>>    - To decarbonize, we need to deploy capital in a way that likely has
>>>    not been witnessed before.
>>>
>>>
>>>
>>> Two things to explore more closely in this statement.
>>>
>>> One, we do not need to decarbonize. We need to completely redesign and
>>> restructure our entire global energy economy, to replace energy extraction
>>> from hydrocarbons, which is pushing earth’s habitats out of human-friendly
>>> zones, with new energy choices that will not change earth’s habitats.
>>>
>>> Two, YES we will “need to deploy capital in a way that likely has not
>>> been witnessed before”.  That way must be a fiduciary way, putting an end
>>> to financialization for institutional speculation and instead directing the
>>> tens of trillions of institutional intergenerational fiduciary money
>>> aggregated into Pensions & Endowments, collectively, worldwide, into
>>> enterprise and the economy directly, through evergreen equity payback
>>> investment structures that align enterprise cash flows with fiduciary
>>> minimums and fiduciary values, of a dignified future in a prosperous
>>> present.
>>>
>>> The first place we need to deploy Fiduciary Money through equity
>>> paybacks is in financing the restructuring of our global energy economy to
>>> resolve the climate crisis.
>>>
>>> Tim MacDonald
>>>
>>> Bankofnature.eco
>>>
>>
>>
>> --
>> Thanks,
>> Varun
>>
>>
>>
>
> --
> Thanks,
> Varun
>
>
>

-- 
Thanks,
Varun
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