March 26, 2013
by Jeremy Brecher and Brendan Smith
This is a call for environmentalists and other critics of coal to come to the aid of America’s miners.
Whenever government protection of workers health and safety or the environment rears its ugly head, America’s coal companies are quick to portray themselves as the coal miners’ best friends. They are ever ready to come to the aid of what they portray as workers threatened by environmentalists and government regulators dedicated to destroying miners’ jobs at any cost.
Today, the jobs of two thousand miners and the healthcare benefits of twenty thousand retirees and their families are threatened – not by callous environmentalists or government regulators, but by their own employer, Patriot Coal.
Patriot Coal was created in 2007 by Peabody Energy to acquire all of its operations east of the Mississippi River. Under the deal, Peabody shed many of its long-term health care obligations to its retirees. As Peabody’s CEO explained to investors, by creating Patriot “”we’re reducing our legacy liabilities by roughly $1 billion.” Soon after, another coal company, Arch Coal, also shifted its health care obligations onto Patriot, and as a result, Patriot now has $100 million in liabilities related to retiree benefits and three times as many retirees as employees — 90% of whom never worked for the 5-year-old company.
Since these deals were cut, the parent companies Peabody Energy and Arch Coal have made millions. But in 2012 – surprise, surprise – their offspring Patriot Coal filed for bankruptcy. Patriot cited, among other things, “substantial and unsustainable legacy costs,”which include the health care benefits owed to retirees and widows, and “many provisions that restrict the ability of signatory employers to deploy labor and operate their mines in a flexible and cost-effective manner.”
And it turns out that those “legacy costs” include much more than just healthcare benefits. Court papers estimate Patriot Coal has about $100 million in liabilities related to retiree benefits but almost $200 million in liabilities due to legislation that requires payments for retirees suffering from “black lung.” And it has substantial environmental liabilities stemming from a 2010 federal court order requiring Patriot to deal with groundwater pollution caused by the discharge of selenium at mountaintop-removal mines.
The UMWA has initiated a Fight for Fairness at Patriot campaign which it describes as a “multi-faceted worldwide strategic campaign to expose not only the moral issues underlying this struggle, but also the enormous consequences coalfield communities and other working communities will feel if the flow of hundreds of millions of dollars in benefit payments into their local economies is suddenly shut off.” It is “mobilizing workers throughout the national and international labor movement, reaching out to religious, civil rights and other community groups, and preparing a number of tactical remedies in order to send Patriot an unmistakable message of solidarity.”
Over the last few months, the UMWA has been holding protests outside company headquarters. On January 29, ten Mineworkers union members, including President Cecil Roberts, were arrested in front of Peabody Energy’s corporate headquarters in St. Louis, as more than 750 members and retirees sang Amazing Grace.
A Just Transition
While coal companies purport to represent the interest of miners and their communities by protecting their jobs, the Patriot story – and the Peabody and Arch stories – reveal these companies in a very different light. The real threat to miners’ jobs and communities comes not from environmentalists or government regulators, but from companies that are ready to ditch their most elementary – and legally binding – obligations to those who have risked their lives to make them rich.
Patriot coal is part of a much larger picture. Like it or not, the US energy industry is in a process of transition. Some of that is due to efforts to reduce the environmental and climate impacts of coal. At the moment much more of it is due to technological and economic changes like the development of cheaper natural gas due to fracking. That is inevitably going to affect coal miners and others who produce, transport, and use coal, like workers in coal-fired power plants.
It is a basic principle of fairness that the burden of policies that are necessary for society–like protecting public health and the environment or implementing new technologies –shouldn’t be borne by a small minority who happen to be victimized by their side effects. Protecting workers and communities from the effects of socially and environmentally necessary economic change is often referred to as a just transition.
Such provisions are a matter of elementary justice–it is unfair that workers who through no fault of their own happen to work in jobs that need to be eliminated to achieve a social good should bear the burden of that change by losing their jobs.
As part of the looming transition beyond coal, we need a national policy to protect those whom that transition may harm. It could be modeled on the highly successful process that helped local communities adjust to the disruption and job shifting that resulted from the closing of military bases under the Base Realignment and Closing Commission (BRAC). Those communities were provided a wide range of federal assistance, including, planning and economic adjustment assistance, environmental cleanup, Community Development Block Grants and Community Service Grants.
Workers dislocated by base closings also received extensive support. The Department of Defense itself provided advance notification of a reduction in force; pre-separation counseling; a hiring preference system with federal agencies to re-employ qualified displaced DOD employees; financial incentives to encourage early retirement of those eligible. Workers affected by base closings were also eligible for help under National Emergency Grants, “Rapid Response” programs, comprehensive assessments and development of individual employment plans and job training.
Communities and individuals affected by energy transition in general and EPA regulations in particular could be similarly targeted for assistance from such existing programs as the Department of Labor’s Rapid Response Services and the National Emergency Grants of the DOL’s Employment and Training Administration, as well as funding for economic development and industrial efficiency and modernization from the Departments of Energy and Commerce.
Because the needed resources are scattered among many different government agencies, the first step might well be for President Barack Obama to establish an interagency task force composed of U.S. agency officials overseeing issues of employment, energy and the environment. Their first task could be to create a transition package for coal miners, utility workers and other affected workers that would provide robust financial and training support and preferential access to the new jobs created by environmental policies. That could be combined with vigorous support for economic planning and investment in the affected communities, focusing on the development of new clean energy industries. Think of it as a GI Bill for displaced workers and their communities.
Patriot Coal is a particularly egregious instance of unjust transition. It is making coal miners and their communities pay the price for change, while the coal companies pocket the benefits. But for that very reason, the struggle at Patriot coal has the potential to bring together a new coalition for justice not only for Patriot miners, but for all those who might be innocent victims of the transformation now under way in the energy industry.
While the coal companies have told us over and over that coal miners and environmentalists are unalterably enemies, the Patriot Coal campaign provides an opportunity to move beyond an opposition that has been a loser for both. It could change the terms of the discussion from conflict over trying to “save” jobs that are already doomed to providing a just transition for the human beings who the companies are prepared to throw on the scrapheap.
The campaign for Patriot Coal workers could form an important starting point for broader campaign for a just transition. It provides an opportunity for environmentalists in particular, and progressives more generally, to prove that they are the allies not the enemies of America’s threatened working people. And it give them an opportunity to argue more broadly for a transition that protects workers even as it protects the climate and the environment.
In Billy Ed Wheeler’s haunting hit song The Coal Tattoo, an unemployed coal miner traveling the roads looking for work asks, “Who is going to stand by me?” The Patriot Coal campaign gives us all an opportunity to answer that question.