Saturday, October 3, 2015

Coal Industy Ugliness Exposed

Of course, climate change deniers are famous for making claims that defy logic. Among these are efforts to defend the coal industry. A common refrain I have heard repeatedly lately is that modern human civilization was made possible by coal. Of course, that is a false claim. Our modern society depends on energy, not specifically coal. It doesn't matter where that energy comes from.

Now, we have even more proof of how nasty the coal industry is, as if any reasonable person needed more. Patriot Coal Company filed for bankruptcy and in their reorganization papers they proposed taking $18 million from a $22 million fund for retired coal workers and spending it on legal fees. This money was supposed to be dedicated for the health benefits of the workers. Now, Patriot Coal has decided the health of these workers isn't important enough and is reneging on its promises to them.

To see just how nasty this is we need to take a look at the reported health problems of the workers. It is reported some suffer from black lung disease, while others are suffering from cancers they believe are linked to industrial waste dumps at Squaw Creek. No mention is made in the article of the health effects down stream of non-miners who may have been affected by that dumping.

But, even that isn't the end of it. The evidence strongly suggests this was a plot to unload pension liabilities and even have them disposed of in bankruptcy. It began when Alcoa and Peabody energy had a joint venture called Squaw Creek Coal Co.  In 2007, Peabody assigned the Squaw Creek health care liabilities for 208 workers to an offshoot called Heritage Coal, which was a subsidiary of Patriot Coal. Peabody also assigned 40% of its health care obligations, covering about 8400 former workers, to Patriot Coal.  Then, in 2008, Patriot purchased Magnum Coal and assumed the health care liabilities for another 2,300 retirees.

Lo and behold, this health care liability dumping was more than the mining could support and Patriot filed for Chapter 11 protection in 2011. Patriot emerged from bankruptcy that same year and part of the deal was to turn over the health care liabilities to the union, along with $310 million to help support the health care for about 11,000 retirees. 

Then, Patriot filed for bankruptcy again this year.

Since the Squaw Creek liabilities were supposed to be paid for by Alcoa under the original contract, it was a big surprise when the union and the retirees learned Alcoa had traded a $40 million obligation for a $22 million payment to Patriot. Then, as stated earlier, Patriot has decided only $4 million of that money is to go towards supporting the health care liabilities of the people who are suffering due to their work in the industry. In case you haven't been keeping count, that is 10 cents on the dollar of the original health care obligation. The rest of the money is being used to pay legal fees. The tragedy is that the Squaw Creek workers who are being abused by this procedure never worked for Patriot.

Hopefully, these workers will be covered by a government program assisting retired coal industry workers. Oh, by the way, that program is costing taxpayers nearly $500 million per year.

Remember this the next time some denier talks about how cheap and morally correct the coal industry is.

If that isn't enough, read about this hero of the coal industry, one we can all hope will be going to prison very soon.

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