A group of Harvard and MIT professors, spearheaded of course by MIT’s Noam Chomsky, is calling for the Harvard endowment to sell its investments in a variety of companies which “benefit from or support the Israeli military.” (If the Harvard-MIT Divestment Campaign has its own website, I cannot find it; but this story in The Harvard Crimson cites IBM, General Electric and McDonald’s as examples of such firms targeted by the Campaign.)
What exactly does the Campaign hope to accomplish? Even if they got their way, this action would not cause the slightest bit of economic harm to Israel. This would be the case even if we were talking about an institution with vastly greater holdings than the Harvard Endowment trust. The only way for Harvard to sell its shares of IBM or McDonald’s is for some other investor to purchase them (duh!) Perhaps they spend too much time listening to the empty suits on MSNBC and other “instant analysts” on the tube, who attribute every dip in the stock market to a “sell-off,” never considering that every share traded on the floor of the NYSE is both purchased and sold at the same time.
Maybe you can chalk this up to delusions of grandeur, or the mistaken notion that Harvard holds as much sway in the financial world as it does in the intellectual realm. One of the most important (and under-reported) trends in the economics in the last 20 years has been the rise of “institutional capitalism” — financial institutions such as pension funds and mutual funds now own an outright majority of all corporate equities, rendering bit players such as the Harvard endowment largely irrelevant. In any case, this represents an awfully strange way to try to pressure the Israeli government.
So why are they doing it? I can think of two reasons … essentially they must believe that the Campaign serves some political or propagandistic purpose, because it is difficult for me to believe that they think their actions will directly punish Israel in any way.
Symbolism — elevating the cause to the level of the anti-apartheid movement. In the 1980s, there were a variety of disinvestment campaigns leveled against South Africa, and the Campaign wants their own cause elevated to the level of the global struggle against apartheid. I don’t think that I need to explain why such a comparison is preposterous, but they are trying to create that linkage in people’s minds. (This makes even more sense in light of the protestor I met in Washington a few weeks ago, who told me that the Palestinians were ‘the N
