Greed

The Liberal Patriot

Greed, Lobbyists, Death and Coal - The Myth of Cheap Coal Energy - A Paradigm Of Greed

J.G. Schwam – January 9, 2006

The Sago mine disaster in Tallmansville, WV that took the lives of 12 men is not the result of a single tragic anomaly as the CEO of the Sago Mines International Coal Group Bennet Hatfield would like us to believe. It serves as an opportunity to expose a pattern of safety violations by one of many coal companies operating in West Virginia that view safety and life itself as secondary to profit. In fact despite Hatfield’s statements his companies actions in ICG’s, Kentucky mines in Breathitt and Knott counties were cited for 282 violations last year resulting in $21,343 in fines, according to U.S. Mine Safety and Health Administration records. Sago was not an anomaly. It was the nearly inevitable result of a company and industry that is with the help of the White House and its appointees gradually undermining decades of hard won safety improvements in a dangerous industry.

In Kentucky mining regulators issued 54 temporary closure orders to ICG mines in the state last year because of safety problems, said Holly McCoy, a spokeswoman for the state Office of Mine Safety and Licensing. McCoy said the company was cited for a variety of problems, and not one single issue stood out. At Sago, since October ICG was issued 50 violations when they officially took over operations from the bankrupt Anker Mining, Inc., some issued as recently as December 21, 2005. .

The Sago mine in West Virginia alone had 208 citations in 2005 and was fined $24,155. T his highlights the neglect of safety laws by ICG. They may make the claim that they have made substantial improvements in safety since they officially took over the bankrupt Sago mine in November of this year. ICG however, has operated Sago since August 2005, during which time the takeover was being finalized. But the facts do not bear out ICG's assertion. Since October, among the citations issued U.S. Mine Safety and Health Administration to ICG operations among the 50 issued the Sago mine, the violations included citations for accumulation of combustible materials such as coal dust and loose coal, an extremely serious safety issue. They had plenty of time make substantial safety improvements. Appearances indicate they chose not to.

MSHA claims to have stepped up their monitoring of the Sago mine since October because of the number of violations since August, 2005. The mine in fact has a history of dangerous roof falls. But in 2005, the Sago mine lost a total of 17.04 days of production as a result of nonfatal accidents. The national average for that type of mine is 6.54. In 2004 the mine lost 15.90 days, compared with a national average of 5.66.

Poorly informed apologists like Richard Price, managing director of Westminster Securities in St. Louis, said the citations were mostly for minor violations. "They were not so egregious that they had to shut down the mine. Historically, coal-mining was much more risky”. In fact MSHA officials reported that among the 208 citations issued to the Sago mine in 2005 97 of the violations were characterized as "significant and substantial." They included several for inadequate ventilation, inadequate roof support, and unsafe electrical equipment, all serious threats to the safety and lives of those that worked in these mines.

Price said he believed the explosion would have little effect on recruitment in an industry already known to be dangerous. "These are still the highest paying jobs around in places like West Virginia." But Jim Thompson, editor of the industry newsletter Coal & Energy Price Report, disagreed. "It can't be good for ICG or the coal industry in general in terms of labor, especially when the industry was already short. "This is a damaging blow to the company and a damaging blow to the industry," he said. "The industry is not as a dangerous as it once was, but that image still exists of a dark and dangerous place to work. This only contributed." But he agreed that despite a chronic shortage of skilled miners, especially in Central Appalachia, "there are still not many comparable jobs with pay and benefits." The fact is this only true because so many mining jobs have been lost with the advent of mountaintop removal mining that has displaced thousand of skilled mining jobs with millions of dollars of machines and explosives to blast away the mountains rather than dig into them to extract the coal. This has forced many skilled miners to leave the state and look elsewhere for jobs.

ICG stock fell more than 9 percent on the New York Stock Exchange. It was down 65 cent for the week ending Friday 1/6 or 9.2 percent, at $8.85 at Friday’s market close . Wall street is concerned about the risk law suits and the permanent shutdown of one of the new companies prime assets. The company has yet to post profits.

By Tuesday evening, monitors had showed carbon dioxide readings of more than 300 parts per million in some sections of the Sago mine, more than 10 times the amount considered safe, The New York Times reported, citing company officials. Again this exhibits an unconscionable lack of concern based on the history of violations the Sago mine incurred prior to and during ICG's stewardship of the facility. If the ventilation was adequate and the equipment was functioning within the legal requirement these levels would never have occurred, even after an explosion. If the fines were tough enough as they should be, to make paying them more egregious than ignoring them or correcting the failures they cite, perhaps 12 miners would be alive today.

If coal is indeed going to be taken seriously as a fuel source in the 21st century, it's up to federal and state regulators to make sure that even 20-inch dogholes, a working condition in shallow coal seems loathed by and commonly referred to by miners as “low coal” are safe industry regulators must take seriously the safety of the employees regulators must be both free to do their jobs and be able to enforece the regulations with adequate, not just cursory teeth. Coal mining with the proper technology, worker skills and governmental oversight can be safe. It is conditions like those that existed at Sago that created the uprisings that lead to the rise of legendary union leader John L. Lewis and the formation of the United Mine Workers union. Today Bush administration's new privacy rules have made it tougher for industry outsiders to obtain federal inspectors' reports. What purpose do such regulations serve except to hide the lack of and the undermining of mine safety rules and to hide the from public view the policies they have enacted to gut enforcement of mine safety rules? It is time to increase fines and other penalties regulators can impose upon operators who break the rules. In many cases the penalties for running a dangerous mine such as Sago are so low that there is no incentive to correct the violations. The moral incentive to do is clearly as absent today as it was in 1902 when John L. Lewis seized the moral high ground and demanded the changes in industry practices that created MSHA .

If you divide $21,000 by 208, the average fine per violation is approximately $100.00, about the equivalent of a New York City parking ticket. . The mine operators apparently view these fines as United Parcel Service does the parking tickets its trucks receive on a daily basis, a cost of doing business. Of the 2008 violations issued to Sago in 2005 89 of the citations and orders, or nearly 43 percent were assessed the lowest possible penalty of $60 each and none exceed $1,000. When lives are at stake it is unacceptable for the agency charged with the safety of men that work in the industry it regulates to only be able to or choose to impose fines that are so meager as to incentivize companies to pay or simply ignore them rather than correct the matter. It is in fact a disgrace.

Federal inspectors fined the Sago mine more than $24,000 for roughly 202 violations in 2005, the Times said, citing federal records. The total figure is likely to rise because the federal mine-safety agency has yet to put a dollar figure on some citations, according to the Times. A company official said the mine's "bad history" had occurred before ICG took it over last year, adding that dramatic improvements had been made since then, the Times reported. The danger to the miners was from the persistent high levels of carbon monoxide and volatile and dangerous coal dust inside the mine, not to mention others such as inadequate roof support.

The miners knew Sago was a dangerous mine. Mr. McCloy said his brother-in-law, who has a wife, two toddlers and a new mobile home, “ had been well aware of the peril. "He wanted to get out of it real soon because he knew it was dangerous," Mr. McCloy said. "As soon as he got financially set, he was going to quit", the New York Times reported. Randal McCloy is the sole survivor of the blast and remains hospitalized in critical but improving condition.

As bad as Sago was under the failing Anker Mining, according to the MSHA, the Sago mine received more citations in 2005 than previous years, up from 68 in 2004 to 208 in 2005. Sixteen of those were for violations that the mine operators knew about but did not repair before inspectors caught them, the agency said. The company said those numbers were not out of the ordinary. With senior appointed officials receiving highly questionable funds from lobbyists and the pressure they exert on inspectors not to close mines under threat of sanction or the simple dismissal of such violations and so many mines with so many, Sago would not have happened. Had it happened within an aggressive enforcement environment, it would have out of the ordinary, not the other way around, as industry apologists point out.

MSHA was created to provide a safe environment for miners and mitigate the historic risk. Under the Bush administration MSHA. once an organization of integrity led mine safety professionals has been reduced to a toothless, powerless bureaucracy, headed at its parent the Department of the Interior by former mining industry lobbyists.

The Secretary of Labor Elaine Chao is a former anti-labor lobbyist under who's oversight of MSHA falls. The former Assistant Secretary of Labor for Mine Safety & Health Dave Lauriski was most recently the President of Lauriski and Associates, LLC, a consulting firm in Price, Utah a lobbying firm for the mining industry. He served as General Manager of the virtually bankrupt and nearly de-listed from NASDAQ mining company, Energy West Mining Company from 1995 to 1999 and as the Director of Health, Safety, Environmental and Government Affairs for Interwest Mining Company from 1993 to 1995.

David Lauriski, is a long-time coal industry executive and lobbyist. Shortly after taking office, Lauriski bragged to a group of coal industry executives that his regulatory agenda "is quite a bit shorter than some past agendas." One Part of Lauriski's shortened agenda for MSHA was to reduce the number of times a mining company is required to sample coal dust levels inside the tunnels, a move that is virtually certain to increase incidence of black lung disease among miners. Lauriski also wanted to get rid of the chest X-ray program that tests miners for black lung disease. Lauriski slashed the number of mine inspectors by 25 percent. The announcement page of a conference sponsored by the Utah Mining Association Lauriski spoke at while he was MSHA head has a particularly disdainful mouse trail script on the page announcing the event. David Lauriski recent quit MSHA to lobby his former boss, Labor Secretary Elaine Chao. Herself a former mine industry lobbyist. To ensure the retraction of mine safety concerns safety is made secondary to corporate interests. The Bush administration continues to pack mine safety agencies with industry hacks, fired mining company executives.

Since Lauriski's resignation last year the acting MSHA secretary has been David G. Dye. Before coming to Washington, Dye served as a professional staffer to two committees of the Alaska Senate, as special assistant to Alaska's lieutenant governor and as a regional and urban planner with the Alaska Department of Community and Regional Affairs. He represents yet another Bush appointee with no experience in the field he is delegated to over see. Can you say “you’re doing a great job Brownie”. In December of 2001, under the leadership of Lauriski legislation requiring a second “escapeway” that would give miners a second way out in an explosion or collapse was withdrawn from the agenda due to Lauriskis' disdain "changing safety and health regulatory priorities." I n other words, increased regulation of the mining industry was seen as a roadblock to increased profits.

Most recently it nominated Stan Suboleski, an executive at Massey Energy. Suboleski served as Massey’s Executive Vice President and Interim Chief Operating Officer from 2001 to 2003.Massey has an ignominious record of safety which resulted in a substantial number of mine injuries and deaths. Suboleski was recently to serve on the Federal Mine Safety and Health Review Committee. Last year, David Lauriski, former general manager of the Utah-based Energy West Mining Co., was tapped to head the federal Mine Safety and Health Administration, where he has promoted policies favoring the mine operators.

Dye’s statement after the Sago disaster is detached and promises more of the same rhetoric and toothless cursory investigations. All one needs to do is to correct the 208 violations issue to the Sago mine, permanently.

Statement of David Dye, Acting Assistant Secretary, MSHA On the West Virginia Mine Incident

WASHINGTON - Acting Assistant Secretary David Dye issued the following statement on the Sago Mine incident in Buckhannon, W.Va.:

"Now that the rescue and recovery phases of this operation are nearing completion, the Mine Safety and Health Administration (MSHA) will begin an in-depth investigation of the accident. This starts with the appointment of a separate MSHA investigative team that will evaluate all aspects of the accident and response, including compliance with all federal health and safety standards, and how emergency information was relayed about the trapped miners' conditions. As always, the purpose of MSHA's investigation will be to improve mine health and safety and prevent such tragedies in the future."

Wilbur Ross, ICG's chairman, said there were no plans to close the mine permanently and that the tragedy would not alter company plans to develop coal production at several of the mines it acquired last year, including the Sago mine. Many different figures of the number of citations received by ICG and Sago have been quoted in the wake of the disaster. This seems to say something about the accuracy of records keeping at MSHA or their unwillingness, lack of import or even shame they privately attach to providing accurate information on mine safety under the Bush administration. "No amount of money can take the place of a loved one, but the families do have financial needs as well," ICG's chairman, Wilbur Ross, said in his statement. His official statement calls safety a prime concern. His past actions do not bear out his rhetoric. But as mentioned Sago is just one part of ICG and Ross’s growing portfolio and strategy of acquiring mines troubled mines. One can only hope that Sago is not a harbinger of things to come under Ross’ and ICG’s management.

Since October 2005, the U.S. Mine Safety and Health Administration issued 50 citations to the Sago mine including citations for accumulation of combustible materials such as coal dust and loose coal, a likely cause of the explosion. There have been numerous numbers of violations quoted in the wake of the disaster, the numbers range from 188 to 208.

The official formerly responsible for issuing permits for the expansion of mines, sludge ponds and processing facilities many of which are unsafe, laxly regulated and inspected. A a J. Steven Griles a long time mining industry lobbyist, Griles, the Secretary of the Bureau of from Bush’s first term until early in 2005 headed the Bureau of Surface Mining, an agency under the Department of the Interior headed by Gale Norton herself a long time lobbyist. Prior to her appointment to the cabinet level post of Secretary of the Interior. Both have been linked to uber-lobbyist now under federal indictment Jack Abramoff, Griles for blatant cronyism. A group with ties to and alleged to have been founded by Norton received who rcieved $50,000.00 from Abramoff and $10,000 from the DeLay foundation, headed by the disgraced former GOP House Majority leader Tom DeLay (R-Sugarland,TX) stepped down from the post while pending trial under a campaign finance and money laundering indictment in this home state.

In the summer of 2002, America watched the news of heroic of the rescue at the Quecreek Mine in Pennsylvania, America watched for three days as nine miners who had been buried alive, lives were ultimately saved. No one called Appalachia or America the Saudi Arabia of coal then, in a vain attempt to justify third world conditions or regulation in, the USA. There were no glib words about energy independence or the economic benefit of burning coal. The families who stood vigil, in prayer for their friends and loved ones in Tallmansville this week understand the real price of the myth of cheap coal power. Carol Ralston, a one time spokeswoman for the National Mining Association and former assistant to Griles at the BLM has links to Abramoff, Griles and Karl Rove. It was in fact Rove who got her, her job as Abramoff’s assistant, at the beginning of Bush’s first term in 2001. Evidence to how close the mining industry is to the white house can be found in the fact that Ralston is now Karl Roves personal assistant.

The underlying question yet to be addressed in the media is, is it legal for appointees like Norton, who do not need to campaign to take money while in office from lobbyists or elected officials that oversee and influence the budgets and laws that affect the organizations they head? If it is not it should be. Further is it even ethical for officials like Griles to advise lobbyists who represent clients with interests under the regulation of departments like the BSM? Logic dictates that doing so smacks of obvious cronyism and a lack of ethical backbone by those officials that do so without compunction.

West Virginia and Kentucky coal mines account for 309 fatalities since 1993 more than 65% of MSHA’s 471 recorded coal mining fatalities since 1993, two thirds of the total cost during that period, a figure that has increased since 2000.

Over the same past six years, coal companies have donated $9 million to federal political candidates and party organizations, and 90 percent has gone to Republicans, according to the Center for Responsive Politics Lobby Watch project.

Like much of what is wrong with politics today and until the American people see fit to take back their country from the clutches of the corrupting wealth of lobbyists, the vast wealth of the corporations that fund them and amoral greed mongers at their helm, there will sadly be more Sago’s. And more, hard working Americans will die for the myth they call, “clean cheap coal energy”. Cheap? Tell that to the families that lost their loved ones. Men like Wilbur Ross and other coal barons that sit in the boardrooms of ICG, Massey Energy, Peabody Coal, Arch Coal and others care less for the lives of the men that labor to create than the millions or billions of dollars they lust after, than money itself.

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