Source: http://windpub.com/dirtymoney.htm

Dirty Money — The Economy of Coal

by Kristin Johannsen

    Drive around the mountains long enough, and you’re bound to run across a bumper sticker bearing this sentiment, or something similar. It might be decorating a mud-spattered pickup truck or a late-model Mercedes, but the message is clear.

    Or is it? Is the driver really in love with a dirty lump of prehistoric vegetable matter? Does his heart beat faster at the thought of combusting fossil fuel? Is he proclaiming his affection for an arrangement of carbon atoms?

    More likely, what the driver really loves is not coal, but what it does for him or her. Coal, we are often told, is essential to Kentucky’s economy. Interfere with the coal industry, and you eliminate jobs, destroy communities, and take food out of little kids’ mouths. If the future of coal mining is in mountaintop removal, then restrictions on this process will doom countless Eastern Kentuckians to unemployment and a dismal standard of living.

    That’s what the coal industry would very much like us to believe. But a firsthand look shows a very different picture.

    If you ever have a chance to fly over a mountaintop- removal operation, the first thing that will strike you is its staggering scale. You’ll see draglines and power shovels bigger than houses scrape away the coal and load it into massive dump trucks. But all of these machines are swallowed up in the enormity of the site, and as you pass over, you’ll spot only a few people at work on the field. A handful of human beings are enough to pulverize an entire mountain and shove it aside.

    Countless Kentuckians have family ties to coal, with grandfathers and uncles and cousins and parents who worked in mining. For many people’s forebears, a steady job in the mines meant a leg up in the world, advantages for their children and grandchildren that they themselves never had.

    But these personal ties are becoming ever weaker and more distant. Over the decades, increased efficiency in mining methods means that more and more coal is produced by fewer and fewer people. In 1979, there were 35,902 mining jobs in Eastern Kentucky. By 2003, there were only 13,036. For every three people who once worked the mines, two are now doing something else

    Despite this tremendous drop in coal employment, Kentucky is still turning out nearly as much coal as it ever did—production has gone down only twelve percent in the last two decades. Coal companies favor mountaintop removal because it is the most efficient way to get coal out of the ground—and it cuts their labor costs significantly. In 2003, the average Eastern Kentucky mine worker produced 3.77 short tons of coal per hour in a surface mine—compared with 3.04 tons per hour in an underground mine. Put in human terms, it takes 24 percent fewer workers to produce the same amount of coal by surface mining.

    Every form of coal mining, from underground mining to conventional surface mining to mountaintop removal, has seen tremendous increases in productivity in recent years—which means declines in the number of workers needed. Overall, in the Appalachian region, coal mining productivity went up an average of 4.9 percent every year between 1988 and 1997, and it remained 52 percent higher in 2003 compared to 1988.
    But all this is neither here nor there, if you live in Eastern Kentucky and you need a job. Nevertheless, if coal mining really is the economic keystone that the mining industry would like us to believe it is, then you would think that Eastern Kentucky communities with coal would be doing much better than communities that lack it.
    You would be dead wrong.
    In Eastern Kentucky, there are thirteen counties that produce large amounts of coal—over 500,000 tons per year. Call them the "coal counties"—Bell, Breathitt, Floyd, Harlan, Johnson, Knott, Knox, Lawrence, Leslie, Letcher, Martin, Perry, and Pike. Another twelve eastern counties produce little or no coal—Clay, Elliott, Estill, Jackson, Lee, Magoffin, McCreary, Menifee, Morgan, Owsley, Powell, and Wolfe. We’ll call them the "non-coal counties.

    So, how do they stack up, economically? Consider the numbers on median family income. (If you ranked all the families in the county from top to bottom by their income, exactly half would earn more than this amount, and half would earn less.) In the thirteen eastern coal counties, median family income is $24,985; in the twelve eastern non-coal counties, it’s $24,374. That’s not much of a difference, especially when you consider that the median family income for all Kentuckians is $40,939. Coal has little impact on the pattern of family incomes.
    Some people will say that this figure includes counties where coal mining isn’t that important, so let’s look at a place where Coal really is King. In Pike County, the state’s biggest coal producer, 51.8 percent of families must get by on less than $25,000 a year. In the whole of Kentucky, only 37.5 percent of families have such low incomes. In Powell County, which doesn’t produce a single lump of coal, the figure was 49.1 percent.
    On the whole, information on people’s situation in coal and non-coal counties in the 2000 U.S. Census shows very little difference between them. Some numbers are very slightly worse in the coal counties—for example, 38 percent of working-age people have disabilities there, compared with 36.8 percent in the non-coal counties. Other things are very slightly better. In the coal counties, 59.1 per cent of adults have a high school diploma, while 53.3.percent in the non-coal counties have one. But on the whole, the profiles are very similar. In coal counties, 77.9 percent of families are homeowners; in non-coal counties, it’s 77.8 percent.
    The real shocker is seeing who truly is doing better. Consider a third group of counties in Eastern Kentucky, the ones that are crossed by Interstate Highways 64 and 75. Call these the "interstate counties"—Bath, Boyd, Carter, Fleming, Laurel, Rockcastle, Rowan, and Whitley.
    By every economic and social yardstick, they are better off than the coal counties. Median family income in the interstate counties is $32,658—meaning that the "middle" family there earns $8,000 more than in the coal counties. Less than half of families must get by on less than $25,000. Far more people have high school diplomas, far fewer working-age people and children have disabilities, fewer families with kids live under the poverty line—and more people even have telephones.
    One important reason for the difference is that major highways help make possible a more balanced economy. Factories and retailers locate there because they can more easily reach a broader market. Workers have access to a wider variety of jobs. Tourists can easily come to explore places like Cumberland Falls, Renfro Valley, and Daniel Boone National Forest. And money flows into the area as capital and stays there, instead of being drained away as natural resources are used up.

    In contrast to the coal counties, where communities boom when the mines are hiring and die when they’re laying off, areas with more balanced economies are better able to survive economic downturns. When one industry isn’t doing well, another will be hiring. And in a balanced economy, more money is circulated through the community by locally-owned businesses, rather than being shipped out in the profits of a faraway coal company.

    For 130 years now, we’ve been told over and over again that coal is good for Kentucky, but the numbers tell a different story. More than 7.8 billion tons of coal have been mined here in that time. But despite the extraction of vast mineral wealth from our land, Kentucky continues its uphill struggle to provide a decent living, a good education, and a clean environment for its people. And the counties of the eastern coalfields, with the richest natural resources of all, remain among the poorest in the entire state.

    Today, too many people are still asking, "What would we do if we didn’t have coal?" Our question, instead, should be: "What could we do if we didn’t have coal?"

    This article is taken from Missing Mountains. The book is available from your local bookstore, on-line vendors such as Amazon or Barnes & Noble, or you may order directly from the publisher.




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