Ky. Voices: E. Ky. also suffered as it subsidized goal of 'cheap' electricity

December 1, 2013 

John Cheves' Nov. 17 article on the War on Poverty states that federal subsidies to Eastern Kentucky have reached over $23 billion in the past 50-year period. In Martin County alone, the target of much of Cheves' reporting, the county received over $2 billion in federal transfer payments since the mid-1960s.

Cheves posits that welfare and other transfer payments have created a culture of dependency in which many Eastern Kentuckians prefer a government check to work.

We have heard this story before. Hats off to Cheves for crafting a better documented, more convincing version than many of his predecessors.

However, by concentrating on government transfer payments to Eastern Kentucky, Cheves tells only half the story. To balance the equation, we need to also ask, "How does Eastern Kentucky subsidize the energy industry and subsequently, consumers of so-called 'cheap' electricity?"

Since Cheves focused on Martin County, we will do likewise: According to U.S Energy Information System data, in 2011, Martin County produced approximately 5.5 million metric tons of coal. Assuming a conservative gross value of $30 per ton, this means that $165 million dollars of value was extracted from the county in 2011.

During the 1990s, coal was extracted at double its current rate, ranging from 10 million to 11 million metric tons per year from Martin County alone. We conservatively estimate that Martin County produced $3 billion of coal value for the decade of 1990s.

Even after the October 2000 coal impoundment disaster, which released millions of gallons of coal slurry into the county's waterways, coal production remained steady at 11 million metric tons in 2000.

In this context, the $1 million fine that the state imposed on the responsible corporation, Martin County Coal (Massey Energy), was less than pocket change. But even this small corporate fine was ultimately claimed by the state's General Fund, rather than being returned to Martin County for environmental compensation.

Likewise, the tax on severed coal is mostly siphoned into the state's General Fund and what returns to the county is not adequate to meet the pressing needs of Eastern Kentucky or to fund its economic development future beyond coal.

Whereas, in some western states the coal severance rate ranges from 7 to 9 percent gross value per ton. In Kentucky, coal severance is roughly 4.5 percent or not less than 50 cents per ton.

Basing estimates on the latter, this yields about $50,000 of public money per million ton of coal extracted, with only half of those public monies returning to the county where the coal was extracted.

Those from the coal region also know that most severance funds that return to the county stay mostly within the county seat and very little is dispersed to the smaller coal towns to fund and underwrite their economic and infrastructure goals.

The point is that very little of the energy value extracted from Martin County returns home. That must change. Once the coal is gone, the county and the region are left with degraded landscapes, lost biodiversity, destroyed streams, tainted drinking water, increased flood risk due to strip mining and mountaintop removal, a host of health problems, and, thus, a shattered foundation from which to build their futures.

Thus far, the livelihood, safety and health of Martin County have been sacrificed for cheap energy for the rest of the nation. Even state government was unwilling to fund state-mandated emergency preparedness plans for coal waste impoundments in the event of another impoundment breakthrough. That was so despite the fact that Martin County citizens and others spent years lobbying the state legislature to impose such protections.

West Virginia has had state-mandated impoundment emergency evacuation planning in place since the 1972 Buffalo Creek disaster.

Kentucky is at least 40 years behind West Virginia on that score.

Energy corporations have externalized the costs of production onto coalfield residents and to the U.S. taxpayer who often wind up paying many of the costs of the ecological, public health and social damage done by the industry.

The oft-repeated story of Appalachia as a dependent region with a dependent people ignores the fact that the rest of the state and nation is overly dependent on this region to meet its cheap energy demands. Far more wealth has been pumped out of the region than has been transferred back via government transfer payments.

We need to work toward a better future for Eastern Kentucky, one that does not rely solely on coal. Some respect for the region that has subsidized the nation's industrial development and comfortable lifestyles would assist in this effort. So would a larger portion of the money that has been subsidizing the state and nation all these decades.

But, equally important, we must think and work outside the boxes in which we have been trapped for so long. We cannot keep trotting out tired stereotypes about dependency and indolence, for one thing. And we can't keep expecting the same "leaders" who have benefited from this system to change it.

Many of us will be going to Pikeville on Dec. 9 to attend the SOAR conference in the hope that some progress can be made in this endeavor.

Will this process result in serious investment in coalfield communities, local businesses, education, public health, sustainable economic practices and democratic governance to benefit the common good in Eastern Kentucky?

Or will the same players try to find new ways to extract wealth from a region and people that have already sacrificed too much?


About the authors: Stephanie McSpirit, left, and Shaunna Scott are faculty members in the sociology programs at Eastern Kentucky University and the University of Kentucky, respectively. Both have researched and written on the impacts of the 2000 coal waste spill on Martin County and both continue to research and work in the Appalachian region.

Stephanie McSpirit and Shaunna Scott are faculty members in the sociology programs at Eastern Kentucky University and the University of Kentucky, respectively.

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