If coal is so good, then why is W.Va. so poor?

July 22, 2011 by Ken Ward Jr.

A coal truck drives out of downtown Welch, W.Va., Wednesday, Feb. 9, 2011. (AP Photo/Jon C. Hancock)

As we wrap up another week of news from the coalfields of West Virginia, it’s worth looking back to see exactly who is asking the tough questions that need to be asked about this industry and its impacts on our state.

First, it takes a couple of members of Congress from California of all places to press Kevin Crutchfield, CEO of Alpha Natural Resources, about exactly how opposing unions fits into his company’s notion of “Running Right.”

West Virginia’s elected officials don’t seem to be interested in finding out what Crutchfield is doing to reform the Massey Energy safety practices that brought us the Upper Big Branch Mine Disaster. Contrast the grilling of Crutchfield by Reps. George Miller and Lynn Woolsey to the attitude of Rep. Nick Rahall, who this week touted “the new ownership in Southern West Virginia” as the answer to any coal-related problems. Of course, my good friend Congressman Rahall, despite spending more than 30 years in Washington, hasn’t been able to figure out what agency should look into the recent scientific study that found his constituents who live near mountaintop removal mines face a greater risk of birth defects.

Then, we had a Boston native, billionaire business information mogul (and mayor New York City) coughing up $50 million of his personal wealth to help the Sierra Club fight construction of new coal-fired power plants, encourage the closure of polluting older plants and halt new mountaintop removal mining permits.

That move by Michael Bloomberg really touched a nerve with the powers that be in West Virginia’s coal industry and among some of its political allies.

The United Mine Workers issued a statement blasting Bloomberg. So did the National Mining Association. I couldn’t imagine that Sen. Joe Manchin was going to let it slide, and he didn’t disappoint, issuing a press release saying:

Coal not only built this country, but it built the skyscrapers of New York City, and without coal, the lights of that city would be dark and its economy would be devastated.

My buddy Matt Ballard at the Charleston Area Alliance (a local business booster group) must have gotten the memo on this, because I noticed him tweeting about it:

1/2 Really would have liked 2 have seen #Bloomberg donate $ to build CO2 technology to help make coal cleaner & advance the industry.

2/2 tech advances environmental science to help reduce #CO2. But instead he chose to not think about our domestic security. #Bloomberg

That was a general theme from the UMWA, the NMA and Sen. Manchin … that Mayor Bloomberg should have used his money to support development of  “clean coal” technology such as carbon capture and storage, or CCS.

OK, now let’s be clear again on something: American Electric Power dropped its work on one of the largest CCS test projects in history over in Mason County at its Mountaineer Plant. Why? Because federal and state officials have failed to make such technology necessary, by not passing any sort of binding limits on greenhouse gas emissions from power plants.

So if the Charleston Area Alliance, the UMWA and Sen. Manchin are so big on CCS and “clean coal,” surely they supported the legislation that AEP said would have helped make the Mountaineer Plant project feasible, right?

Perhaps I’ve missed it. But I’m not aware of any steps that Matt Ballard or his organization have taken to encourage implementation of any sort of limits on greenhouse gas emissions. The last thing I saw out of Matt on these issues was an op-ed commentary blasting EPA’s efforts to try to reduce coal pollution.

The United Mine Workers? Well, they say the union says it supports CCS and legislation to deal with the climate crisis.  But while UMW officials said the Waxman-Markey bill provided “remarkable” funding to help CCS and assured that the future of coal would be “intact,” the union just couldn’t bring itself to actually endorse the bill — let alone encourage coalfield elected officials to vote for it.

And Sen. Manchin … well, gosh, my good friend Sen. Manchin got elected to the senate in part with a television ad where he shot a poor, defenseless piece of legislation.

Of course, Sen. Manchin’s very active press office churned out a release attacking the U.S. Environmental Protection Agency’s final guidance to reduce mountaintop removal pollution:

I am so frustrated to see that the Environmental Protection Agency is ignoring federal law and issuing its final guidance on water quality without giving the public a real chance to talk about how their burdensome approach is impacting our jobs and our economy. Since the EPA hasn’t listened to the people of my state on this issue, I know that West Virginians would tell them that this guidance puts our workers in the coal industry in a tough position, jeopardizing their jobs, our communities and our state’s economy. The EPA has been very callous in their approach to preserving the good jobs that we have and are trying to keep. I will do everything in my power as U.S. Senator to stop the EPA from regulating what has not been legislated.

Now, not for nothing, but I have yet to see one single member of West Virginia’s political leadership issue a press release to alert the media and the public to their concerns about the increased risk of birth defects among state residents who live near mountaintop removal mines.

But Sen. Manchin wants to talk about jobs, communities and the economy. So let’s talk about those things … I wonder if he or any of our other elected officials read the thoughtful report issued yesterday by the good people at the West Virginia Center for Budget and Policy.

Remember when Sen. Rockefeller said that “coal defines us“? Well, in their report, “Boom and Busts,” Sean O’Leary and Ted Boettner explain:

Although mining remains an important part of the economy, it has been steadily shrinking as a share of the state’s economy. Earnings from mining, as a percent of personal income, have been declining since the late 1970s.

Despite a slight uptick in the 2000s, mining provides a much smaller percent of the state’s total earnings than it did 30 years ago.

West Virginia’s share of the national mining sector has also been declining. Its share fell from nearly 10 percent in 1972 to 5.5 percent in 2009. The shrinking importance of West Virginia’s mining economy, both relative to the state and nationally, helps to explain the poor long-term performance of West Virginia’s mining counties.

When nearly 1/5th of personal income in West Virginia came from mining earnings, it was easy for the booming mining sector to be the driver of economic growth. However, as mining’s share of the economy fell, so too did the economic performance of the mining counties. Without economic diversity, mining counties saw their fortunes rise and fall with the energy booms and busts.

If mining counties continue to have little economic diversity, then they likely will continue to underperform and be poorly positioned to compete economically with other counties and other states. The absence of an educated workforce hurts future competiveness, creating a lack of entrepreneurship and productivity, and the high levels of income inequality create an unstable foundation for economic growth.

This important report outlines some of the root problems — lack of economic diversity, lower education levels, high income inequality — and questions whether the natural boom-and-bust cycle of an energy economy is really the answer:

In the past, West Virginia counties with a concentration in mining saw their economic performance dramatically decline after an energy development boom. Today, their economies are weaker than the rest of the state, and they are ill-positioned to compete and grow. It is uncertain whether today’s energy boom, led by natural gas extraction, will bring the prosperity to West Virginia that it promises. While the potential revenues from this boom seem to be an attractive source of economic growth for communities, history shows that natural resource booms inevitably lead to busts.

The conclusions are such a stark contrast to what West Virginia’s elected officials are telling their constituents: That there’s another huge boom — probably a long and very prosperous one — just around the corner, if only we can get these trouble-making outside agitators like the EPA, the Sierra Club and Michael Bloomberg off our backs.

Michael Hendryx at West Virginia University, a brave researcher at a coal-loving institution, published another important paper on this very issue recently. It’s called, “Poverty and Mortality Disparities in Central Appalachia: Mountaintop Mining and Environmental Justice,” and it appears in the current issue of the peer-reviewed Journal of Health Disparities Research and Practice.

In this paper, Dr. Hendryx examined mortality rates, poverty rates, Appalachian designation and mining activity in Kentucky, Tennessee, Virginia and West Virginia. He was trying to determine if people exposed to this type of mining experience greater poverty and higher death rates compared to other types of mining or other areas of Appalachia.

The paper found:

Mountaintop mining areas had significantly higher mortality rates, total poverty rates and child poverty rates every year compared to other referent counties of these states. Both poverty and mountaintop mining were independently associated with age-adjusted mortality rates in nested models.

And the paper concludes:

Persons living in MTM areas experience persistently elevated poverty and mortality rates. Higher mortality is independently associated with both poverty and MTM, the latter effect suggestive of a possible environmental contribution from mining activities. Efforts to reduce longstanding health disparities in Appalachia must focus on those areas where disparities are concentrated: the Appalachian coalfields.

This paper notes that our country, through the National Institutes of Health, has targeted Appalachia as part of the national effort to reduce and eliminate disparities based on race, socioeconomic status, rural or urban setting, region and other variables. Dr. Hendryx writes:

To achieve the national goal of eliminating Appalachian disparities, efforts must concentrate on reducing and eliminating disparities specifically in the central Appalachian MTM region.

For these efforts to succeed, we will need to address both socioeconomic and potential environmental risks faced by area residents. Persons exposed to environmental risks are more likely to experience adverse health consequences when they are already vulnerable due to other risks, such as those imposed by poverty. Even in the face of uncertainty regarding individual-level environmental exposures, prudent and reasonable efforts to reduce environmental risks can include stricter monitoring and enforcement of air and water quality standards, and restrictions on MTM practices to ensure that they occur only when adequate environmental quality standards can be met during mining and post-mining reclamation activities. Efforts to reduce poverty can include economic diversification and job creation programs; investments in K-12, vocational, college, and adult education; and modifications to tax structures to divert public dollars to geographic areas of greatest needs. These efforts become even more important when we consider that coal reserves in central Appalachia are expected to peak and production to enter permanent decline within the next few years, further reducing coal’s economic contributions to the region.

26 Responses to “If coal is so good, then why is W.Va. so poor?”

  1. Thomas Rodd says:

    Great collection and discussion, Ken.

    This post makes me think of another post or message that you made, I’m sure more than a year ago, in which you said something like: “I don’t mean to scold, but . . .”

    That remark made me laugh out loud, because (as this post clearly shows) you are a WORLD-CLASS scold!

    This post also prompts me to think: “And yet . . .”

    That is to say: “All this is true, and yet these difficult problems and challenges are being faced and handled by a citizenry who still look others in the face with an open look, and not the guarded aversion of many other Americans — a citizenry who lack equality and justice in many measures, but who still find meaning and value in things other than money and what it can buy.”

    In other words, still proud to be a West Virginian!

    And we are ALL in this together! Have a good weekend!

  2. Ralphieboy says:

    Darn fine reporting, Ken.

  3. Nanette says:

    Great article Ken. You touched on so many points that we have been trying to make for years and you summed it up beautifully in this article.

  4. Johnathan says:

    Entrenched poverty is one of the most difficult issues in America and doesn’t get enough study from either side, right or left (and believe you me, these are the camps that matter in American politics today… the middle is insignificant.)

    When you look at multi-generational poverty in Appalachia it’s hard to argue that mining plays a large role. I’ve lived and worked in some of the most impoverished counties in Appalachia all my life and rarely if ever have I known people who’ve lived in poverty for generations whose family have worked in the mines. Instead, most of the deep rooted poverty is cyclical and involves folks who have little formal work history and even less education.

    Whether entrenched poverty is in the Delta, on Native American reservations, or found in inner cities, we need to find new solutions to empower these individuals. But taking away good middle class coal jobs won’t solve things any more than creating good middle class coal jobs will solve them.

  5. Thomas Rodd says:

    Johnathan, it sounds like you are talking from real experience, which is great.

    Here’s my take on the issues you raise, based on a lifetime of making wild guesses (LOL): the terrain of the central coalfields is inhospitable to human population density, and had there not been such fine coal and timber there, settlement would have been sparse.

    But there was, and so lots of folks came, and became subject to the boom/bust cycles, mechanization issues. etc. This has all been well documented. The poverty became cyclical as you describe.

    The only substantial things that can be done to improve the situation — except the jobs issue, which the markets control — are to deliberately reduce infrastructure demands through incentivizing the centralization of population, and large investment in education to give people skills that will allow them to copmpete in the economy outside the region.

    The coal and timber industries shoud be heavily taxed to pay for this.

    But I could be wrong!

  6. Patty says:

    Thanks Ken for writing such a great article and including Dr. Hendryx’s research. He’s doing such an great job and we need everyone to understand that everyone has the right to clean air and water no matter where they chose to live.
    Please keep up the great work!

  7. Ted Boettner says:

    Johnathan,

    It is important to note that the report never concluded that mining concentrations ’caused’ poverty, while it is certainly true that communities dependent on resource extraction lag behind their counterparts in a number of ways – one of which is poverty. As Tom says, rural disadvantage is also a key factor explaining the relationship between community impoverishment and extractive industry. Other factors of how mining may influence economic conditions in these communities is overdependence, overadaptation, crowding out, lack of human capital investment, adversarial economic relationships, and global markets.

    Of all of these factors, the lack of human capital investment stands out the most to me since resource extraction industries require a relatively low-skilled and undereducated labor force, and because dominant local employers seek this type of workforce, residents see investments in education, training, or other forms of human skill having extremely limited or uncertain future rewards. The sacrifices involved with such investments are thus not justifiable in light of potential employment opportunities. Residents thus act rationally and place little stock in education as a means of securing future employment.

    One thing we do know is there is little reason to accept the commonly-held notion that the development of extractive industry will lead to regional economic improvement. However, this could change if we look at opportunities to expand supply-chain jobs, expand production of value-added gas products, and use low-cost natural gas to boost manufacturing in the region. In the long term, a key economic development issues is managing the pace of drilling activity to level out the potential boom and bust cycle associated with extractive industries. Forward looking governments in Wyoming, New Mexico, Alaska, and many nations have also created “permanent funds” to set aside a portion of the economic bounty from non-renewable energy production to be used to restore and reorient local economies once drilling ends.

    If you are interested in the academic literature on the topic of natural resource extraction and economic development, here is a short list of ones that informed our work.

    Billings, Dwight. 1974. “Culture and Poverty in Appalachia: A Theoretical Discussion and Empirical Analysis.” Social Forces 53(2): 315–323.

    Billings, Dwight and Kathleen M. Blee. 2000. The Road to Poverty: The Making of Wealth and Hardship in Appalachia. New York: Cambridge University Press.

    Brabant, Sarah and Robert Gramling. 1997. “Resource Extraction and Fluctuations in Poverty: A Case Study.” Society and Natural Resources 10:97–106.

    Bunker, Stephen G. 1984. “Modes of Extraction, Unequal Exchange, and the Progressive Underdevelopment of an Extreme Periphery: The Brazilian Amazon, 1600–1980.” The American Journal of Sociology 89(5):1017–1064.

    Duncan, C.M. 1996. “Understanding Persistent Poverty: Social Class Context in Rural
    Communities.” Rural Sociology 61(1):103–124

    Duncan, Cynthia M. 1999. Worlds Apart: Why Poverty Persists in Rural America. New Haven and London: Yale University Press.

    Duncan, C.M. and Nita Lamborghini. 1994. “Poverty and Social Context in Remote Rural Communities.” Rural Sociology 59(3):437–461.

    Freudenburg, William R. 1992. “Addictive Economies: Extractive Industries and Vulnerable Localities in a Changing World Economy.” Rural Sociology 57(3):305–332.

    Freudenburg, William R., and Robert Gramling. 1992. “Community Impacts of Technological Change: Toward a Longitudinal Perspective.” Social Forces 70(4):937–955.

    Freudenburg, William R., and Robert Gramling. 1994. “Natural Resources and Rural Poverty: A Closer Look.” Society and Natural Resources 7:5–22.

    Freudenburg, William R. and Robert Gramling. 1998. “Linked to What? Economic Linkages in an Extractive Economy.” Society and Natural Resources 11(6).

    Freudenburg, William R. and Lisa J. Wilson. 2002. “Mining the Data: Analyzing the Economic Implications of Mining for Nonmetropolitan Regions.” Sociological Inquiry 72(4):549–575.

    Gramling, Robert and William R. Freudenburg. 1990. “A Closer Look at ‘Local Control’: Communities, Commodities, and the Collapse of the Coast.” Society and Natural Resources. 55(4):541–558.

    Humphrey, C. R., G. Berardi, M. S. Carroll, S. Fairfax, L. Fortmann, C. Geisler, T. G. Johnson, J. Kusel, R. G. Lee, S. Macinko, N. L. Peluso, M. D. Schulman, and P. C. West. 1993. “Theories in the Study of Natural Resource-Dependent Communities and Persistent Rural Poverty in the United States.” In Persistent Poverty in Rural America, ed. Rural Sociological Society Task Force on Persistent Rural Poverty, 136-72. Boulder, Colorado: Westview Press.

    Jensen, Billie Barnes. 1974. “Woodrow Wilson’s Intervention in the Coal Strike of 1914.” Labor History 15(1):63-77.

    Joshi, Mahendra L., John C. Bliss, Conner Bailey, Lawrence J. Teeter, Keith J. Ward. 2000. “Investing in Industry, Underinvesting in Human Capital: Forest-Based Rural Development in Alabama.” Society and Natural Resources 13(4).

    Levernier, William. 2000. “The Causes of Regional Variations in U.S. Poverty: A Cross-Country Analysis.” Journal of Regional Science 40(3):473–497.

    McWhiney, Grady. 1954. “Louisiana Socialists in the Early Twentieth Century:
    A Study of Rustic Radicalism.” The Journal of Southern History 20(3):315–336.

    Peluso, Nancy Lee, Craig R. Humphrey, and Louise P. Fortmann. 1994. “The Rock, the Beach, and the Tidal Pool: People and Poverty in Natural Resource-Dependent Areas.” Society and Natural Resources 7:23–28.

    Savage, Lon. 1990. Thunder in the Mountains: The West Virginia Mine Wars, 1920–21. Pittsburgh: University of Pittsburgh Press.

    Tickamyer, Ann R. and Cynthia L. Duncan. 1984. AEconomic Activity and the Quality of Life in Eastern Kentucky.@ Growth and Change 15:43B51.

    Tickamyer, Ann R. and Cynthia M. Duncan. 1990. “Poverty and Opportunity Structure in Rural America.” Annual Review of Sociology 16:67–86.

    West, Patrick C. 1994. “Natural Resources and the Persistence of Rural Poverty in America: A Weberian Perspective on the Role of Power, Domination, and Natural Resource Bureaucracy.” Society and Natural Resources 7:415–427.

  8. Hi, It is sad to see behind the trees and thick, dense bushes, the way many people in the coalfields live (some by choice, others by the result of absentee coal operators who take but make no provisions for the future generation of people who need).

    http://www.dailyyonder.com/speak-your-piece-coals-legacy/2009/12/30/2509

    Betty Dotson-Lewis

  9. Thomas Rodd says:

    Thanks, Ted, for some theoretical economist-type explanation.

    Speaking as a layman, I could not agree more with the apparently obvious and great value of managing extraction over time to reduce the boom and bust cycle, and setting aside revenues for education, etc.

    In the case of the central app coalfields, what do you think of incentivizing centralization of populations to make infrastructure more affordable? My lay guess is that this could be a helpful effort.

  10. Observer says:

    “… resource extraction industries require a relatively low-skilled and undereducated labor force …”

    I don’t know if I should laugh of get mad.

    The work provided by my employer is 95+% related to the coal industry. We have one individual without a college education. He will probably be the last. As a matter of fact, the minimum eduacation in the future will probably be a bachelor’s degree.

    Having said that, I do agree that more needs to be done to diversify the economies of southern West Virginia.

    Here are some suggestions:
    Develop industrial parks. Even though MTR sites work wonderfully, it isn’t the responsibility of the coal companies to do.
    Develop the transportation system.
    Provide public water and sewer to all residents.
    Improve educational opportunities.
    Return all severance $$ to the county in which it was generated.
    Require all severance tax dollars be spent on economic development (roads, water, sewer, EDUCATION).

    Just think of the infrastructure that could be built with $400 million (FY2010 severance tax). A group such as this could be set up to administer it. http://www.vaceda.org/

  11. Ted Boettner says:

    Observer,

    I agree, that was a poor choice of words. Some of the smartest and most skilled workers I’ve known lacked formal education. However, I do think that a large majority of the 20,000 miners lack a college degree – although I do not have those statistics, do you? The indirect workers – the ones that you mention – could have a higher education attainment. Do you have these numbers? The CPS/ACS should be able to give us general idea of education by supersector. I will look at this on Monday. It would be nice to move beyond the anecdotal evidence. This 1981 BLS study (www.bls.gov/opub/mlr/1981/01/art1full.pdf) showed that less than 6% had above high school degree in 1970.

    This all being said, most well paying businesses require some form of higher education from their workers. As we showed in the report, there is a general trend and association with education level and earnings (http://www.bls.gov/emp/ep_chart_001.htm)

  12. Rudy Waltz says:

    Wonderfully said “observer”
    I’m glad I wasn’t the only one to get upset about the lack of education comments. Especially coming from the same sources that try to throw a fit over the recent inbreeding comments.

  13. Renate Pore says:

    One way to break the cycle of enduring poverty in the coal-producing counties is to invest in the health/safety of pregnant women and young children. We should take an interest in the health and well-being of every baby born in those counties. We should 1. Make sure that women have healthy pregnancies — that may require sending them to a spa during critical months in their pregnancy; 2. Babies have the best health care that medical science offers to address developmental delays; 3. Moms and dads have the support of the community to be good parents; young children grow in an environment that offers good nutrition, good nurture and learning to support their cognitive, social and emotional growth. Surely, such as investment would be worth every penny and give a return many times over the original investment.

  14. FactsFirst says:

    Looking at the article Table 1 I noticed that the adult and child poverty rates for the two comparisons 1.: “other mining” and “non-mining” and 2. “other Appalachian” and “Non-Appalachian” have increased signicantly more between 2000-2007 as compared to MTM in both comparisons (e.g., 11.4% for MTM vs. 18.6% for Non-Appalachian). To be sure, the rates are higher for so-called MTM counties, but what would be useful to know is whether these same MTM counties started from a higher baseline poverty rate before the increase in mountaintop mining (not defined in the article, but it seems to mean all forms of surface coal mining according to the Background section of the article). It would seem to me that lacking any real baseline or reference case pre-MTM era, one cannot draw any conclusions or even inferences as it relates to so-called MTM methods without discerning whether this has more to do as some commenters have identified as a broader resource extraction or rural phenomena.

    I have also noticed that in this article as well as others from the author, he cannot help himself in raising the fewer jobs related to coal mining than in earlier years. I am not sure what his point is on this since this is simply a product of productivity increases that are not unique to surface mining–the same has occurred in underground mining not to mention other industries whether they be steel, auto, manufacturing, agriculture and even services. I would suggest that any industry that has not vastly increased its productivity is no longer competitive and is out, or on its way out, of business in the US.

    Ted Boettner makes some interesting observations, but his assessment of the skill levels for extractive industries is antiquated. I would suggest that if QVC or some other firm built a call center in these areas, the skill set and wages would pale in comparison. Not that such ‘economic diversity” is bad, but the Appalachian region has a variety of impediments to such diversification whether we look at the southern tier of New York, Southern WV, East KY, SE Ohio etc.. But I agree with Ted’s observation that building out the supply and value add chain could make a big difference to leverage the resources found in the region including coal and gas. Coal to gas, Coal to chemicals, gas to chemicals and competitively priced electricity all hold that potential.

  15. Thomas Rodd says:

    What’s the percentage of coal miners, surface or deep, with college degrees? How about heavy equipment operators or mechanics? I think Ted’s probably got some decent data to back up that statement.

  16. coalfire says:

    What’s the percentage of coal miners, surface or deep, with college degrees? How about heavy equipment operators or mechanics? I think Ted’s probably got some decent data to back up that statement.

    I am finding it hard to understand where you all are going with this? College is not for everyone nor, should it be. These are very good paying jobs for the area.

  17. Barry says:

    That question posed in the title of the post is THE question for all West Virginians, especially those who would presume to call themselves leaders in the state, must acknowledge and answer clearly. It’s the massive elephant in the room for all of these politicians who fall all over themselves trying to show who’s more pro-coal and anti-EPA.

  18. bluecanary says:

    coalfire, I agree that college isn’t for everyone. But with the boom-and-bust cycle of coal, having some kind of higher education, whether it’s vocational school, an associate’s degree, or a 4-year college degree, will help folks find other work when we’re in the bust cycle, and when the coal industry packs up and heads off to Wyoming. Moreover, an educated workforce attracts different kinds of industry and business to diversify the economy, which we all can agree is needed in Appalachia.

  19. Johnathan says:

    I agree with you, Ted, when you talk about developing human capital.

    Thomas, I agree the extractive industries offer us a chance to pay for education, etc. Hadn’t thought much about the population density issues you raise but I will… at first blush, the challenge would be how wedded folks are to their lands. I grew up at a place where there’s still no city water and I dont’ foresee my neighbors ever leaving there. But I’m not sure that’s the source of the poverty, frankly.

    I think the real challenge is that you have a VERY LARGE segment of the population that’s never worked, who’ve lived on government assistance for generations, and who are trapped. There’s no easy answer for them. You can’t tell them (a huge percentage of them anyways) to get a job because they couldn’t hold the most basic of service jobs. It’s an entrenched problem.

    Resource extraction offers many in the middle class (and I use that term relative to the region) a chance at good paying jobs and a few at real wealth (the entrepreneurs). It’s a nice piece of the puzzle economically speaking, but not a silver bullet to be sure. But neither it is the albatross that many suggest and that the tenor of the title to this piece suggested (imho).

  20. Ken Ward Jr. says:

    All,

    I’m not sure this has been mentioned, but it certainly ties in with the theme of the boom-bust economy that the Center for Budget and Policy’s report addressed.

    One problem is that the “boom” part of an energy-focused economy creates a population in places like West Virginia that the long-term economy — especially the bust cycle — simply can’t support. One reason that indeed we have many families in West Virginia that are caught in a long-term cycle of poverty that lasts over several generations is that at one point West Virginia provided more than 100,000 jobs for coal miners …. but the coal economy today can’t support the children and grandchildren of those folks.

    it is indeed a difficult problem, but one that — as the center’s report shows — it is far from clear that more of a focus on energy economies will fix.

    Ken.

  21. Thomas Rodd says:

    Great discussion. And I think Ken’s last comment makes an important point.

    Coalfire, I completely agree that “college is not for everyone,” and you and Johnathan are certainly right about these decent-paying coal-mining-and-related jobs being important to the people and the economy in the coalfields.

    People who are solely working to end MTR mining sometimes say that any loss of jobs will be entirely replaced by deep mine jobs, but my personal view is that is a questionable assertion. More importantly, greater forces than simple opposition to MTR are at play — national and global forces are working to reduce coal mining of every sort.

    Despite ginseng economy fantasies and Pollyanish coal industry boosterism, there is no way to resolve these tensions other than for them to play out over time in the market, politics, and the courts — with lots of pain and uncertainty for ordinary people. And people on all sides tend to exaggerate and demonize.

    Meanwhile, how to best manage the changes? — which is sort of the subject of this post.

    Johnathan, I enjoy reading your thoughts, which seem pretty balanced. I entirely agree with what you say about people’s attachment to their homeplaces. Still, I wonder whether, if people were offered good and inexpensive housing, excellent schools, financial incentives, etc., they would relocate to more centralized places where infrastucture and good schooling could be better afforded, and maybe some jobs more easily created (This was kind of the idea about reducing flood damage by getting folks to move out of flood plains. I don’t think that has worked very well, but I don’t really know.)

    Also meanwhile, lots of people are still leaving the region. As my late pal Larry Harless used to say — Adam Smith’s “invisible hand” (of economic forces in a modern economy) may be invisible — but it sure isn’t intangible!

  22. Ted Boettner says:

    In case anyone was interested, we posted on the issue of educational attainment in the coal mining sector over at our blog: http://blog.wvpolicy.org/2011/07/29/educational-attain.aspx

    Hats off to my colleague Liz Paulhus who crunched the numbers while I was away at a conference.

  23. LdeG says:

    That’s great, Ted – now – can anyone post numbers that validate or invalidate this statement?

    “I think the real challenge is that you have a VERY LARGE segment of the population that’s never worked, who’ve lived on government assistance for generations, and who are trapped. There’s no easy answer for them. You can’t tell them (a huge percentage of them anyways) to get a job because they couldn’t hold the most basic of service jobs. It’s an entrenched problem.”

    West Virginia has a relatively high percentage of personal income from government transfer payments, but it is mostly because our population is older than average, and more likely to be on Social Security.

  24. LdeG says:

    Another answer to “why is West Virginia so poor?” might be that it isn’t. Income and poverty numbers are not adjusted for cost of living, because there is no comprehensive cost of living data for rural areas. However the Bureau of Economic Analysis has been working on developing measures that cover all areas, and if cost of living – Regional Price Parity – is taken into account, West Virginia falls in the middle, not at the bottom, of per capita personal income. This is mainly because housing costs are much lower here. A dollar goes much farther in West Virginia than anywhere else in the country. (And we get to live in a beautiful place, at least where the mountains haven’t been removed.)

    http://www.bea.gov/scb/pdf/2008/11 November/1108_spotlight_parities.pdf

    We do still need to ask, why are we unhealthy and relatively uneducated.

  25. Kevin says:

    Funny how folks were critcizing Bloomberg for not putting his money into coal research — his $50 million would have only been a drop in the bucket needed to advance the technologies. And before they criticize him, they should look at how their own state utility commissions refused to allow AEP to pass on the cost of their CCS development at Mountaineer — if they cared so much about the technology, they and the citizens should pay for it (though I agree that this should really be funded at fed level as it creates a public good for the entire nation, not just coal states).

  26. Mike Connell says:

    Wonderful analysis and reporting. Thank you.

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