Friday, January 22, 2016

The War on Coal Exists, but Miners Are the Targets

I suggest reading the whole article at the following link.

by Jeff Nesbit
Jan. 21, 2016

It turns out there is a war on coal. It's just not the one you've heard about.


Yes, it's true that every single one of the world's major coal companies are now either in bankruptcy or right there at the edge. But, as we've seen in other industries whose eras were drawing to a close, a very curious thing happens when a small handful of well-paid executives are pitted against thousands of low-wage workers in bankruptcy proceedings. The workers lose.

This is the real war on coal. And it is now playing out in byzantine bankruptcy court proceedings that virtually no one is covering – perhaps because it's easier to report on what coal executives are saying (and paying for in advertisements from corporate front groups in Washington) rather than the much harder work of discovering what they're actually doing.

As coal plants are shuttered in the face of efforts to clean up the air in major urban cities, and as market forces from natural gas companies exploit that shift, the truth has emerged. In every case, coal company executives are throwing thousands of coal workers under the bus to save their own salaries and bonuses.

The latest comes from a filing from the U.S. Trustee in the bankruptcy case for Alpha Natural Resources – a Virginia coal mining company that became one of the largest in the world after it acquired Massey Energy for $7.1 billion in 2011. Last year, after suffering four years of losses, Alpha laid off 4,000 workers and closed all but 50 mines. The company filed for bankruptcy protection in August more than $4 billion in debt.

The U.S. Trustee is a third party in the court proceedings whose job is to assess the impact of the bankruptcy on high-paid executives and low-wage workers alike. And, boy, did the Trustee weigh in on the Alpha case this week, the Casper Star-Tribune reported.

A secret list of 15 Alpha executives asked the bankruptcy court judge to allow them to give themselves nearly $12 million in salary bonuses for 2016 – while simultaneously denying about $3 million in benefits for more than a thousand retired, low-wage workers who need it for basic things like medical coverage and life insurance.

That didn't sit well with the U.S. Trustee.


According to Alpha, "these executives need these bonuses as an incentive to do the very jobs they were hired to do, that they are already highly compensated for with generous salaries, and which their fiduciary duties already compel them to do," it wrote.

What's more, Alpha's senior executives don't want their names to become public, even as medical and life insurance benefits for more than a thousand retired coal workers are denied.


Coal Executives Take Millions Before Bankruptcies

Dec. 16, 2015


Kevin S. Crutchfield, “Chairman and Chief Executive Officer” of Alpha, just picked up a $2,000,000.00 bonus this spring, as he led the company into bankruptcy. While Alpha’s stock has plunged over the last several years, he picked up over $6,000,000.00 in cash payouts in 2011 and 2012.

“President” Paul Vining walked away with almost $8,000,000.00 for just two years of work as these executives marched Alpha off a cliff. Vining then got away while the getting was good. As “Former President,” he still gets $4,500,000.00!

Peabody Energy, another company on the verge of bankruptcy, thought its corporate leadership so effective it awarded top suit Gregory Boyce well over $10,000,000.00 in 2014. The “President and Chief Operating Officer” got about $5,500,000.00.

Arch Coal was doing so well it rewarded the boss with a $7,300,000.00 payday in 2014. He got paid this stupendous sum while the company lost almost half a billion dollars — “Arch reported a loss of $558.4 million in 2014. In 2014, Arch common stock fell almost 62% and was recently trading at about $1.24 per share” — Imagine what he’d have got if it made money!


Don’t forget Consol, which hands over at least $8,300,000.00 annually to Rich DiIuliis. Remember that number as these guys go to the public talking about the “tough times” for coal.


Lesser-known Cloud Peak Coal pays a raft of executives million dollar salaries, but the top two rake in over $4,000,000.00 per year and for the big man at the head of the table, there is somehow $10,000,000.00 available to “invest” in his services. All of this while miners for CPC get laid off and left out of the financial bonanza reaped by the corporate big-wigs.

All of this occurred despite the key factors in coal’s decline being business factors and things people could see coming miles and miles away. If it doesn’t make sense for these savvy businessmen to have borrowed so much and spent so much in what everyone knew was a tough environment for coal, you’re not thinking about it right. The point was never to save the companies — it was to jack up their paychecks and make sure they cleared a bundle before the inevitable crash.


Oh, and even though the companies are “bankrupt,” they’ve got plenty of money left over to influence politics.

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