By Bob Feferman
Over the past months, we have witnessed the Syrian regime murder more than 1,500 civilians who want nothing more than freedom and democracy. For the past several years, we have watched similar scenes in Iran. Therefore, it may come as a shock to know that through our investments, millions of Americans are unwittingly investing billions of dollars in companies that enrich regimes that sponsor terrorism and abuse the human rights of their own citizens. As we approach the tenth anniversary of the attacks on 9/11, now would be a most fitting time to put an end to this situation. It is time to recognize that there is an inextricable link between state sponsorship of terrorism and the abuse of human rights. Brutal regimes like Iran and Syria that torture and murder their own children do not hesitate to supply thousands of rockets and missiles to Hamas and Hezbollah to fire at children in Israel. Accordingly, the U.S. government has imposed tough economic sanctions on these regimes.U.S. law prohibits most American companies from doing business with countries designated by our State Department as state sponsors of terror. The list currently includes Iran, Syria, and Sudan. (However, Sudan may soon be removed from the list due to the recent peace deal.) Whereas some companies do receive special licenses from the U.S. Treasury to do business in these countries based on humanitarian grounds, no American oil companies are allowed to work in the energy sectors of Iran, Syria, or Sudan. There is a good reason for this strategy.Iran gets most of its government revenues from the production and sale of oil and natural gas. Yet, absent the help of foreign companies, Iran is incapable of exploiting its own natural resources. Although Syria does not have nearly the large oil reserves that Iran does, oil is Syria's largest export and it is also dependent on foreign companies to run its oil fields. Therefore, if we want to pressure Iran and Syria to end their abuse of human rights and sponsorship of terrorism, we must put pressure on foreign companies to get out of the energy sectors of Iran and Syria. What can we do as investors? According to a 2010 report by the Government Accountability Office (GAO), there were 41 non-U.S. companies working in Iran's energy sector. A similar report by the Foundation for Defense of Democracies identified several more companies. If we look at the holdings of our portfolios, the very least that we can do is to divest our holdings of these foreign companies that work in Iran's energy sector. It is no coincidence that several of the same companies that work in Iran also do business in Syria. We should also be aware that international stock mutual funds are very problematic to say the least. Far too many of these funds have significant holdings in foreign companies engaged in the energy sectors of Iran and Syria. Since American oil companies are not allowed to work in these countries, our domestic stock mutual funds do not have this problem. We must recognize that our investment decisions do have moral consequences. Investing in companies doing business as usual with Iran and Syria legitimizes the flagrant abuse of human rights and undermines the sanctions of our own government. Furthermore, as Americans, we should not be indirectly helping Iran to develop the oil wealth it uses to supply weapons to the Taliban in Afghanistan, and the insurgents in Iraq, who kill and wound American soldiers. Christopher Holton, director of the Divest Terror Initiative of the Center for Security Policy wrote on his website, "In a unified front, we should all be saying this is my money and it will not go to support terror."Since the terror attacks on 9/11, some 20 states -- including my home state of Indiana -- have adopted Divest Terror laws requiring their state pension funds to divest from holdings in companies doing business with state sponsors of terror. As investors, we can follow the courageous example of these 20 states and join the war on terror and struggle for human rights. The great German human rights activist Dietrich Bonhoffer, who resisted Nazi oppression, said, "Silence in the face of evil is itself evil." Through divestment, we can end our silence. We can give our investment advisers a simple message: "I do not want my hard-earned money invested in foreign companies -- or international mutual funds -- that help Iran and Syria to develop the wealth they use to sponsor terrorism and abuse the human rights of their own citizens."
Over the past months, we have witnessed the Syrian regime murder more than 1,500 civilians who want nothing more than freedom and democracy. For the past several years, we have watched similar scenes in Iran. Therefore, it may come as a shock to know that through our investments, millions of Americans are unwittingly investing billions of dollars in companies that enrich regimes that sponsor terrorism and abuse the human rights of their own citizens. As we approach the tenth anniversary of the attacks on 9/11, now would be a most fitting time to put an end to this situation.
It is time to recognize that there is an inextricable link between state sponsorship of terrorism and the abuse of human rights. Brutal regimes like Iran and Syria that torture and murder their own children do not hesitate to supply thousands of rockets and missiles to Hamas and Hezbollah to fire at children in Israel. Accordingly, the U.S. government has imposed tough economic sanctions on these regimes.
U.S. law prohibits most American companies from doing business with countries designated by our State Department as state sponsors of terror. The list currently includes Iran, Syria, and Sudan. (However, Sudan may soon be removed from the list due to the recent peace deal.) Whereas some companies do receive special licenses from the U.S. Treasury to do business in these countries based on humanitarian grounds, no American oil companies are allowed to work in the energy sectors of Iran, Syria, or Sudan. There is a good reason for this strategy.
Iran gets most of its government revenues from the production and sale of oil and natural gas. Yet, absent the help of foreign companies, Iran is incapable of exploiting its own natural resources. Although Syria does not have nearly the large oil reserves that Iran does, oil is Syria's largest export and it is also dependent on foreign companies to run its oil fields. Therefore, if we want to pressure Iran and Syria to end their abuse of human rights and sponsorship of terrorism, we must put pressure on foreign companies to get out of the energy sectors of Iran and Syria.
What can we do as investors? According to a 2010 report by the Government Accountability Office (GAO), there were 41 non-U.S. companies working in Iran's energy sector. A similar report by the Foundation for Defense of Democracies identified several more companies. If we look at the holdings of our portfolios, the very least that we can do is to divest our holdings of these foreign companies that work in Iran's energy sector. It is no coincidence that several of the same companies that work in Iran also do business in Syria.
We should also be aware that international stock mutual funds are very problematic to say the least. Far too many of these funds have significant holdings in foreign companies engaged in the energy sectors of Iran and Syria. Since American oil companies are not allowed to work in these countries, our domestic stock mutual funds do not have this problem.
We must recognize that our investment decisions do have moral consequences. Investing in companies doing business as usual with Iran and Syria legitimizes the flagrant abuse of human rights and undermines the sanctions of our own government. Furthermore, as Americans, we should not be indirectly helping Iran to develop the oil wealth it uses to supply weapons to the Taliban in Afghanistan, and the insurgents in Iraq, who kill and wound American soldiers. Christopher Holton, director of the Divest Terror Initiative of the Center for Security Policy wrote on his website, "In a unified front, we should all be saying this is my money and it will not go to support terror."
Since the terror attacks on 9/11, some 20 states -- including my home state of Indiana -- have adopted Divest Terror laws requiring their state pension funds to divest from holdings in companies doing business with state sponsors of terror. As investors, we can follow the courageous example of these 20 states and join the war on terror and struggle for human rights.
The great German human rights activist Dietrich Bonhoffer, who resisted Nazi oppression, said, "Silence in the face of evil is itself evil." Through divestment, we can end our silence. We can give our investment advisers a simple message: "I do not want my hard-earned money invested in foreign companies -- or international mutual funds -- that help Iran and Syria to develop the wealth they use to sponsor terrorism and abuse the human rights of their own citizens."
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