The argument is straightforward.
1. Coal must go to save the climate. (Carbon sequestration in power plants is still only experimental, it’s very expensive, can only be fitted to new plants, if there are any, and doesn’t deal with the methane emitted during mining.Â A very long shot.)
Kingsnorth coal power station on the Thames estuary. Credit
2. The social costs of ending an entire industry will be high, as coal-mining communities are poor and isolated.
3. The new plan being floated in Washington for cap-and-trade limited to electric utilities just fixes a date for the death sentence on coal.
4. Under a scheme like this, the industry would have a moral and perhaps a legal case that it is the victim of discrimination and the object of an uncompensated “taking”. This would not arise under a comprehensive cap-and-trade rÃ©gime; but the whole argument for a selective scheme is that there are “low-hanging fruit” in electricity – meaning old coal power stations, that can be cheaply replaced with much more efficient gas (>50% against 33% thermal).
5. The case is easily distinguishable from the onerous regulations or taxes directed at say tobacco, alcohol, firearms and explosives, which create specific risks. Coal emits carbon dioxide, but then so do many other industries and activities. Cap-and-trade isn’t aimed at particulates.
6. The odious and reckless management style of Don Blankenship’s Massey Energy makes more sense if you see it as a response to the expected death of the industry. Without a secure future, take the money and run. Oil and gas are different: as they run out, prices and revenues will get higher. Coal won’t run out before it’s killed off or kills us. The mismanagement will get worse as the industry’s expiry nears.
7. So: nationalization with proper compensation would deal both with the discrimination argument for owners, and the incentives for managers to run mines even more dangerously during the rundown.
8. There are additional benefits. The American Coal Board should have a mandate to manage closures as sensitively and safely as possible and generate alternative employment. The UK National Coal Board (until abolished by Mrs Thatcher) and Charbonnages de France both tried hard on this. In addition, a nationalised agency would I assume not be treated superstitiously as a person for speech rights. It would lobby for its corner, like every public agency, but far less effectively and generously than a private industry.
We have a very specific problem for which the solution of nationalization looks a sensible solution. It won’t happen of course, at least in the USA.Â Nationalisation is genuinely socialist: a word that that has an emotive force in American political discourse roughly equivalent to paedophile serial killer. Besides, the ethos of Don Blankenship – and the miners unlucky enough to work for him – is off-the-charts macho and individualist. The sober suits of Big Pharma read the tea-leaves on health care and cut a pragmatic deal with Obama to protect their stockholders. Blankenship would rather die than protect his through socialism.
PS. “Taking” is not a peculiarly American doctrine. There’s some European human rights case-law on fair compensation: ECHR, Sporrong and LÃ¶nnroth v. Sweden (1982) and especially Lithgow and others v. UK (1986), see para 120.