Friday, August 9, 2013

Another Take on Obama's EPA Attacks on Coal and Power Plants

Obama's attacks on power plants and coal mining threaten to take us back to the bad old days, as described by many state historians.

Many historians, chief among them John Alexander Williams of Appalachian State bashed the early industrial development of the state.  Most who have ever taken West Virginia history have been taught that companies extracted wealth, shipped it out, and the state never got any benefit.

First off, that assertion is wrong.  Historians and others blame the lack of sufficient taxation.  But how much could the state have raised taxes before eliminating the competitive advantage enjoyed in attracting the companies in the first place?  Benefit comes through the attraction of supporting and satellite industries that expand the ripple effect of wealth extraction.

Coal, timber, and oil companies did bring added economic value to extraction.  They employed workers and professionals.  Some satellite industries, such as paper mills, grew up in the area.  Some railroads were built to support the transport of materials in and out. Could the state's community of capital and political leaders have done a better job in enticing other industries to come in? Certainly.  But to say there was no benefit is wrong.

There are at least three stages to development of wealth in extractive industries like coal.  First comes the work to get the coal from the ground.  Second comes the processing of the material into something useful.  A hundred years ago, coke, iron, and steel production used tremendous amounts of coal.  Now, much of the coal produces electric power for this part of the nation.

The third part comes in dissemination of the final products.

Unlike our forefathers, the state has succeeded in getting companies interested in taking West Virginia coal and turning it into a useful product within the borders of the state.  That would be crucial electric power.  Huge facilities such as at Mount Storm and John Amos employ hundreds of state residents in good paying jobs.  This is the best way to make sure that the wealth derived from coal stays in the state.  Make sure that as much of the production process as is possible remains in West Virginia.

Add to that the fact that cheaper power helps to produce advantages that state officials can use when trying to woo new companies to the state.

But Obama and his EPA have looked at every way possible to shut these plants down, which will have the result of removing wealth and productivity from the state.  Whatever coal gets mined will be shipped away with minimal added value to the state and the people.

Exactly what state historians bemoaned about the early industrial period.

Hopefully. West Virginia Democrats made it clear in their EPA meetings that they will not stand for Obama kicking the legs from underneath our chair, economically speaking.

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