You are the owner of this article.

Statehouse Beat: No need for a war; coal is dying already

If you think there’s a “war on coal,” Murray Energy’s bankruptcy filing marks a major term of surrender.

The bankruptcy filing — making Murray the 11th coal company to declare bankruptcy since Donald Trump became president — spells out in stark and indisputable terms an industry in steep decline.

It notes that the market for thermal coal has “deteriorated significantly in the last several months,” with the closure of 93,000 megawatts of coal-fired power plant production, record production of inexpensive natural gas, and meteoric growth of renewable energy sources.

Bottom line: “There simply are no creative management solutions, operational improvements, or strategic or financial options remaining, even for Murray; the company has exhausted all options and liquidity.”

The Murray Energy bankruptcy is particularly notable given its outspoken former CEO Bob Murray, who has filed defamation suits against everyone from HBO’s John Oliver and “Last Week Tonight” to our own Ken Ward Jr.

Murray was buying up coal mines when others were getting out of the business, convinced that the downturn in coal markets was largely the result of Barack Obama’s purported “war on coal,” and that the industry would recover with the election of a Republican president.

After failing to help elect Mitt Romney in 2012, Murray got his wish with the election of Trump, who at a Huntington rally in 2017 boasted, “We’ve ended the war on beautiful, clean coal and we’re putting our coal miners back to work.”

Despite rolling back some Obama-era environmental regulations, Trump has, like many of his campaign promises, failed to deliver on his promise to bring back coal, and coal mining jobs.

More coal-fired power plants closed in Trump’s first two years in office than in Obama’s entire first term.

Global market forces, not policy, are driving the demise of coal. If natural gas, solar and wind power are cheaper and cleaner, what rationally managed energy company is going to continue to use coal?

•••

This statement hasn’t aged well, despite being just three months old: “West Virginia’s coal industry, which was on life support during Barack Obama and the Democrats’ War on Coal, is seeing a revival under Jim Justice’s leadership. The governor led the fight to reduce the coal severance tax, and just this week helped pass a bill to save the Pleasants Power Station. The results speak for themselves — under Jim Justice’s administration, West Virginia’s economy is booming.” — Gov. Justice’s re-election committee, July 2019.

Throughout the 30 years that I’ve covered the statehouse, the specter of the decline of the coal industry has loomed over state government. But instead of working to build a post-coal economy, governors and Legislatures — both Republican and Democratic — have devoted their efforts to propping up a dying industry.

As I noted in July, the successes cited by the Justice campaign were in the form of tax breaks to prop up coal: $60 million a year, ultimately, in severance tax cuts for steam coal, and $12.5 million a year in business and occupation tax waivers to keep an antiquated coal-fired power plant — owned by FirstEnergy Solutions and supplied coal from Murray Energy mines — operating.

While the legislation cutting severance taxes on steam coal passed the Senate on a mostly party-line vote, it passed the House by a bipartisan 82-17 margin. One wonders how legislators would have voted had they known during the session that a Murray Energy bankruptcy was in the offing.

During the session, coal industry lobbyists told legislators that the tax cuts would not only slow the downturn for West Virginia coal, but would create new jobs and economic growth. Chris Hamilton of the West Virginia Coal Association cited a study showing that the tax break would create 400 new jobs and generate more than $400 million in new economic activity.

Based on documents in the Murray bankruptcy filing, projecting massive and accelerating declines in coal production and revenue over the next decade, we now know Hamilton’s study was either vastly inaccurate or a fabrication.

It's becoming increasingly clear that $60 million a year of tax cuts won’t save coal mining jobs, or preserve miners’ pensions, but will allow out-of-state coal barons like Murray to line their pockets one last time.

The lost revenue will, however, make it tougher for future Legislatures to balance state budgets without cutting needed programs and services.

We’re seeing that already, when just three months after declaring that the economy is booming, the Justice administration is instructing state agency heads to prepare to cut their budgets by a collective $100 million this budget year.

We just learned that October severance tax collections were a weak $16.52 million, less than half of September collections, and down $8.2 million from October 2018. For 2019-20 year-to-date, the state has collected $75.9 million in severance taxes, $24.64 million below estimates, and $45.47 million below the same point in 2018, a drop of more than 37 percent.

Not exactly a booming economy.

•••

So far, going into the 2020 legislative session — at a time when we need truly innovative thinking to start building a post-coal economy — the only economic development proposal we’ve heard much about so far is yet another tax cut — since the previous $400 million a year in corporate tax cuts did such a remarkable job in attracting new business to West Virginia and reinvigorating the economy.

(Likewise, the 2017 federal GOP tax cuts that were supposed to pay for themselves with economic growth have had negligible impact on the national economy.)

Like the other tax cuts, the proposal to reduce or eliminate the state personal property tax on inventory will disproportionately benefit large out-of-state coal, natural gas and manufacturing companies — you know, the major contributors to legislative candidates and to the PACs that run ads for or against legislators.

Frankly, one of the drawbacks West Virginia has in attracting new residents or businesses is image. People see us as a backward, undereducated, regressive place where locals are suspicious of outsiders or of any new or different ideas or concepts.

Senate President Mitch Carmichael, R-Jackson, did little to dispel that image last week, by appointing Sen. Mark Maynard, R-Wayne, as chairman of Government Organization, the most major of the minor Senate committees.

Maynard is a good old boy who last session sponsored legislation that would bar the state from ever removing the statue of Confederate Gen. Stonewall Jackson from the Capitol grounds. Shortly after race riots in Charlottesville, Maynard mused on his Facebook page about whether he should drive his “Dukes of Hazzard” General Lee replica Dodge Charger to the Capitol for interim meetings.

No one from out-of-state is going to look at Maynard’s appointment, and say, wow, that West Virginia must really be an inclusive place that welcomes everyone from all walks of life.

Ditto the recent uproar when, in a spirit of inclusiveness, Charleston Mayor Amy Shuler Goodwin proposed changing the name of the city’s Christmas parade to a Winter parade. (While her intentions were noble, it’s doubtful that many people of other faiths, or no faith are particularly uncomfortable participating in an event for what has become a thoroughly secularized and commercialized holiday.)

Naturally, though, Republican operatives had a field day spreading havoc through the city about how another socialist Democrat was declaring war on Christmas.

It’s a typical GOP strategy: Knowing they won’t get many votes if they come out and admit that, bottom line, their party platform is to cut taxes for corporations and the wealthy, and to make up for those cuts by reducing or eliminating government services, programs, and benefits, they instead commit to agitate conservative voters with claims of gun grabbing, late term abortion on demand, hordes of immigrants at the border, men in girls’ restrooms, and yes, taking Christ out of Christmas.

Sometimes, I fear that as a result of the ongoing exodus of our state’s best and brightest, we are increasingly left with an electorate that may be less and less able to see through that ruse.

•••

Finally, speaking of Republican politics, based on recent campaign ads and interviews, it appears that advisors to Republican gubernatorial candidate Woody Thrasher have instructed him to take a turn hard right, including calling for restoration of the death penalty for drug dealers.

Thrasher also must have bought his voters’ list at a Cecil Underwood estate sale, considering that the campaign sent a fund-raising letter to Kanawha County Commission President Kent Carper, stating:

“You are one of West Virginia’s most loyal and generous Republicans, and I know you are as frustrated as I am with the situation in Charleston. We both know our problems are just too big for a part-time governor.” — followed by a pitch for a campaign donation.

Carper hasn’t been a registered Republican since 1999.

Reach Phil Kabler at

philk@wvgazettemail.com,

304-348-1220 or follow

@PhilKabler on Twitter.

Funerals for Wednesday, November 20, 2019

Abner, James - 1 p.m., Keller Funeral Home, Dunbar.

Black, Thomas - 11 a.m., Hafer Funeral Home, Elkview.

Bowcott, Doris - 1 p.m., Mt. Union Church, Pliny.

Dolin, Clayton - 2 p.m., Handley Funeral Home, Danville.

Harper, Brandon - 1 p.m., Cunningham-Parker-Johnson Funeral Home, Charleston.

Hively, Thomas - 1 p.m., Leonard Johnson Funeral Home, Marmet.

Kirk, William - 8 p.m., Hafer Funeral Home, Elkview.

McDonald, Jeremy - 11 a.m., Handley Funeral Home, Danville.

Rollins, Melvin - 1 p.m., Casto Funeral Home, Evans.

Short, Elizabeth - 1:30 p.m., Fidler & Frame Funeral Home, Belle.

Simpkins, Anthony - 1 p.m., McGhee-Handley Funeral Home, Danville.

Stone Jr., Darrell - 2 p.m., Smith Cemetery, Leon.

Thorne, Thomas - 1 p.m., Tyree Funeral Home, Mount Hope.