Columbia protestors seem confused about how investing works | David Moon

If any of the protesters occupying the campus at New York’s Columbia University are students in the school’s renowned investing program, they should be expelled – if for no other reason because they lack the most basic understanding of investing and business. (As homage to fellow protestor Arlo Guthrie and "Alice’s Restaurant," they should also be required to pick up the garbage.)

In addition to the pro-Palestinian protestors' more extreme demands, the campus protestors want Columbia’s endowment to divest of companies that do business in Israel. These offending companies include Google, Microsoft and other big tech firms that have contracts with the Israeli government. The protestors also take issue with companies like Airbnb, citing concerns that “a portion of the company’s revenue comes from illegal settlement on occupied Palestinian land.”

Pro-Palestinian protesters gather on the campus of Columbia University in New York City on April 23. Tensions flared between pro-Palestinian student protesters and school administrators at several universities across the U.S. on April 22, as in-person classes were canceled and demonstrators arrested.
Pro-Palestinian protesters gather on the campus of Columbia University in New York City on April 23. Tensions flared between pro-Palestinian student protesters and school administrators at several universities across the U.S. on April 22, as in-person classes were canceled and demonstrators arrested.

Aside: Columbia University is on land once occupied by the Lenni-Lenape people, the indigenous residents of Manhattan’s upper west side.

The protestors at Columbia University have singled out investments as small as $30,000 from the school’s $14 billion endowment because they hold positions in supposed genocide-supporting companies such as Caterpillar and Hyundai. By this definition, likely every American with a retirement account is, in the words of the proposal to the Columbia Advisory Committee, lending “legitimacy to … the perpetuation of Israeli apartheid and war crimes.”

These demands concerning the school’s endowment either stem from a fundamental misunderstanding of everything about how investing works, or this is a protest just to protest. Or both.

These ridiculous demands almost certainly reflect a lack of understanding about how investing works. If you buy shares of Berkshire Hathaway stock, your money doesn’t go directly to Warren Buffett. It’s like buying a house. The guy who built the house 20 years ago doesn’t get your money. You give your money to someone who doesn’t want to own the house (or stock) any longer.

And if your objection to owning a particular stock is that you don’t want to profit from some objectionable or immoral activity the company’s products or services could be used to support, there is practically no investment you could own, including CDs in your local credit union.

The selective nature of the protestors’ ire is interesting.

One of the protestors arrested at Columbia was Isra Hirsi, the daughter of U.S. Rep. Ilhan Omar, a Democrat from Minnesota. In her most recent financial disclosure, Omar reports owning a global equity mutual fund that includes Google and Microsoft among its largest holdings. Thus far, no pro-Palestinian protestors have occupied Omar’s U.S. taxpayer-funded office and demanded that she cease her financial support of Israeli war crimes.

David Moon, president of Moon Capital Management, may be reached at [email protected].

This article originally appeared on Knoxville News Sentinel: David Moon: Protestors seem confused about how investing works

Advertisement