Recent demands by college protestors ask college administrations to "divest from death" by ending contracts with companies supplying the Israel Defense Force's (IDF) war in Palestine.
AUSTIN (KXAN) — Recent demands by college protestors ask college administrations to "divest from death" by ending contracts with companies supplying the Israel Defense Force's (IDF) war in Gaza.
Divestment is the opposite of investment; to divest means to sell off shares in a company. For example, the U.S. Congress passed a law that requires TikTok's parent company to divest from the app.
The student group Palestinian Solidarity Committee (PSC), which organized recent protests at the University of Texas in Austin, asked the University of Texas (UT) system to sell off its stock in U.S. weapons manufacturers that sell arms to the IDF. KXAN asked PSC for additional information on how it would want the UT system to proceed with divestment.
As of May 3, the United Nations Office for the Coordination of Humanitarian Affairs estimates that the conflict has killed 34,622 Palestinians and at least 1,200 Israelis.
The UT system's investments are handled by the nonprofit University of Texas/Texas A&M Investment Management Company (UTIMCO). In the UTIMCO's 2023 report of its "Permanent University Fund," it lists hundreds of investments held by the university system.
Those include companies that have supplied arms to the IDF, according to Quaker organization the American Friends Service Committee (AFSC):
The PSC also shared an infographic produced by UT Austin student group Collaboration for Undoing Racism in Environmental Sciences (CURE) that called out the UTIMCO's $3,448,008 investments in the top five weapons manufacturers.
The UTIMCO also has investments in other companies listed by AFSC:
In total, the UTIMCO has $8,125,888 in investments linked to the IDF and the ongoing Israel-Hamas conflict.
A 2017 Texas law prevents the state's public agencies from investing in companies that boycott Israel. It is also illegal for agencies to invest in "financial companies who boycott certain energy companies" under a 2021 law, and the same applies for investing in companies that "discriminate" against firearms companies.
Those laws do not prevent a public agency from selling its stock in weapons manufacturers. In the unlikely event that one of those companies stopped selling its aircraft, armored vehicles and missiles to the IDF, Texas public agencies may be required by law to divest.
However, if this logic follows through to UTIMCO it would slam the breaks on divestment -- if the UTIMCO were to selectively divest from stocks due to connections with the IDF, then the UT system could be required to end its contracts with UTIMCO, potentially dissolving the non-profit.
Ultimately, the policy-setting power for UTIMCO resides with the UT Board of Regents. That board is comprised of nine individuals appointed by Texas Governor Greg Abbott and confirmed by the Texas Senate.
In the aftermath of the October 7, 2023 attack by Hamas, Abbott voiced his support for Israel:
“We stand ready to offer our complete support to the Israeli and Jewish communities,” said Abbott in an Oct. 9, 2023 statement. “I firmly denounce the act of war against Israeli citizens and Americans in Israel and support Israel’s right to defend itself from these barbaric attacks...In response to these cowardly attacks, we stand united with our Jewish neighbors and we repudiate terrorism and anti-Semitism.”
The State of Texas has its own investments, which include nearly $100 million in Israeli bonds. Abbott also introduced a rule requiring state agencies boycott goods from the Gaza Strip or any organization with ties to Hamas.
