Photo of the Month: April 2016

This month's photo shows the last remnant of the mining industry in one Colorado community bringing the economic effects of its downfall on the neighboring population to light.



This month's photo features the last coal mine operating in the Somerset, Colorado area. While this may be a win for environmentalists, we can't forget about the communities adversely affected by coal's decline. These miners continue to work in the West Elk Mine as owner Arch Coal Inc. filed for bankruptcy earlier this year, leaving many unemployed.

Colorado is not the only state suffering from the collapsing mining industry. Wyoming, the nation's largest coal producer, has had two of its three largest coal mines go through bankruptcy leading to major job losses in the region.

The decline of coal has been gradual, with companies first cutting jobs and healthcare benefits, affecting union and non-unionized workers alike:

A few years ago, Patriot Coal, a spinoff of Peabody Energy, tried to cut benefits for thousands of unionized workers. After many rounds of negotiations, Patriot’s estimated $1.3 billion dollars in accrued benefits were reduced to a pool of just $400 million dollars to fund ongoing healthcare costs. That future of that account is now in question because Patriot declared bankruptcy again in May.

A similar scenario is now playing out with Alpha Natural Resources. The company has asked a judge for permission to cut medical and life insurance for nearly 5,000 non-union retirees.

These cuts can continue until Chapter 11 bankruptcy is filed, which "allows a company to continue operating while it manages its debts and seeks to emerge as a viable corporation:"

[S]ociety as a whole pays a very high price as coal mining companies seek to pay off their creditors in bankruptcy. It could even be argued that a domino effect of coal mining bankruptcies has taken hold, as the urgency of already-bankrupt companies to pay off creditors has kept coal mine output from falling sufficiently. Though coal mining is down sharply, unusually large stockpiles of coal show that mining has not fallen fast enough to offset the effects of cheap natural gas and growing deployments of renewables.

The ones who have suffered the most from coal's decline are the workers and retirees who can least afford layoffs and benefit reductions. These people have spent all of their lives in the professions that dominate their community. As the world moves toward alternatives, the economic livelihood of workers in mining towns must be addressed.

To learn to more on the decline of the coal mining industry, listen to our podcast with Teresa Erikson of the Northern Plains Resource Council.


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