Obama’s War On Coal Results In More Casualties

In 2008, President (then presidential candidate) Barack Obama signaled his intent to bankrupt the coal industry.

Three years into his term, and less than four years after his election, critics of the President’s energy policies say his “War on Coal” is having exactly that effect.

Last month, the Patriot Coal Company filed for bankruptcy, a move prompted in part by the impact that regulations instituted by the Environmental Protection Agency (EPA) had on the company. According to the Institute for Energy Research (IER), rules targeting the coal industry helped to account for a dramatic drop in Patriot’s share price; those rules have also contributed to the slide in the share price of coal companies Alpha Natural Resources, Inc., Arch Coal, Inc., and Peabody Energy Corp, says the IER. Alpha Natural Resources, Inc., has indicated its intent to cease mining at various sites in Kentucky, and lay off about 150 workers.

In Pennsylvania last month, layoffs were also announced by two coal companies, which blamed Obama’s War on Coal for the job losses. According to Andrew Morriss, a University of Alabama law professor, the effects of these job losses might be more grave than the Obama administration has anticipated. Setting aside the inexpensiveness and ready availability of coal as an energy source, Morriss notes that according to National Mining Association data, a typical coal miner earns in excess of $70,000 per year. Moreover, about 60,000 people work in high-skilled, well-paying jobs in US coal-fired power plants. Those statistics hint at the economic impact that coal workers have as consumers within their own communities, as well as wage-earners in their own right.
A more immediate concern for Obama, however, may be their geographical location. Whereas coal-heavy states like West Virginia and Kentucky are not in play this presidential year, Ohio, Pennsylvania and Virginia are expected to be among the most hotly contested, meaning Obama's coal policies could end up having unintended effects, beyond the layoffs of well-paid, high-skilled workers.
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Deliberate government efforts to end an industry are not part of normal competitive market pressures and bad for the U.S. economy for three reasons.
First, virtually all our coal production goes directly to generate electricity.
Second, diversity in sources enhances our energy security by minimizing the chance that politics or wars in unstable and unfriendly countries will disrupt our energy supplies.
Third, the coal industry is a significant source of jobs.
Coal plays a key role in electricity generation. The power produced from coal-fired plants is embedded in everything from our prescription medications to the food we eat.

Tens of thousands of Americans earn good livings in coal-related industries. Domestically produced coal reduces our dependence on unstable and unfriendly suppliers.

Those facts make it obvious that market forces - not Washington bureaucrats - should determine the role coal plays in our economy.