And What Do You Get?

SCREWED

You load sixteen tons, what do you get
Another day older and deeper in debt
Saint Peter don't you call me 'cause I can't go
I owe my soul to the company store

Eddie Bullock spent 27 years in the mines of Peabody Energy, the largest private sector coal company in the world with almost 8 billion in revenue and 16 billion in assets.  He retired in 1998, today he's 72 and suffers from black lung disease.  No problem, he has a good pension and health coverage.

OR HAD

In 2007 Peabody created a new company, Patriot Coal.  It transferred 13% of its coal reserves and 40% of its health care liabilities (for 8,400 retired miners) to the new company.  In 2008 Arch Coal, the second largest supplier of coal in the US behind Peabody with 4 billion in revenue and 10 billion in assets transferred Magnum Coal and the liabilities for another 2,300 retired miners to Patriot Coal.

SURPRISE, SURPRISE, SURPRISE

Patriot Coal, now saddled with almost 11,000 retired miners and 1.37 Billion in liabilities has filed for bankruptcy.  Under Chapter 11 it is seeking to limit or discharge the pension and health care obligations to 22,000 miners.

Would Tar, Feathers, and a Rail be too Extreme?  

These shenanigans are so extreme even free market advocates are crying foul. Professor Bruce Rader, Temple University wrote:

...ultimately will shift the burden to the general public or in a word socialize the health care benefits since the miner’s ability to pay will not cover this obligation and then the health care burden will be shifted to the government. In essence we will all pay the costs. This is a perfect example of the use of the legal system to socialize the costs and therefore lead to a transfer of costs to the general public from the shareholders of a company.

Eddie Bullock never worked for Patriot Coal a day in his life, yet now suffers under the downfall of the company while his former employer skips happily along. 

WAIT!  It Gets Better

Patriot Coal has requested permission from the court to pay more than six million in bonuses to its corporate executives and salaried employees.  The UMW President called it a finger in the eye to thousands of miners and pensioners.  I'll be a little more succinct and simply call it giving them the finger. 

This one's for Eddie Bullock, a Big, Big Man.

New Republic

Wall Street Journal

West Virginia Gazette 

 

~Finntann~