Author: Mike Lillis

  • Dems’ Tax Credit Would Create 200,000 Jobs — Just 10.8 Million Shy of Target

    The Economic Policy Institute, a liberal policy shop, has some discouraging news for those hoping the Senate’s jobs bill will put a dent in the nation’s 9.7 percent unemployment rate: The business tax break at the heart of the bill will lead to the creation of only 200,000 new jobs this year, EPI notes, pointing to numbers crunched by Timothy J. Bartik, senior economist for the Michigan-based Upjohn Institute for Employment Research.* It’s a drop in the bucket relative to the roughly 11 million jobs needed to bring the jobless rate down to pre-recession levels.

    Bartik explains why the Democrats’ business tax exemption for new hires won’t go as far as some might hope:

    Limiting the credit to 6.2% for the rest of 2010 also limits the credit’s effectiveness at creating new jobs. For many employers, such a limited credit will be too small to change employer hiring behavior. For example, if an employer is not in a position to even consider expansion until the last quarter of 2010, it is difficult to believe that a 6.2% hiring credit for the final three months of the year will have much effect on their decision about how many hires to make.

    Additionally, Bartik warns, the Senate proposal would offer the tax break for all new hires, even when companies simultaneously lay off other workers. By contrast, the White House has proposed a plan to lend the credit only in cases of net job creation. Which, of course, is only the whole point.

    *Correction: An earlier version of this post incorrectly named Bartik an EPI economist. Thanks to Mr. Bartik for pointing out the error.

  • Corker: Forget the Consumer Financial Protection Agency

    Bad news for consumer advocates who experienced a flutter of hope this week when Sen. Chris Dodd (D-Conn.) swapped Sen. Richard Shelby (R-Ala.) — an opponent of creating a consumer financial protection agency — for Sen. Bob Corker (R-Tenn.) at the finance reform negotiation table: Corker today told Bloomberg News that he won’t support a CFPA — in any form.

    “What you don’t want to have in my opinion is a consumer protection agency that’s free standing,” Corker said. “Nor do you want one that is inside another entity but acts as if it’s freestanding.”

    What does that leave? Corker said he was looking at ways to carve out a consumer protection unit within the new bank regulator proposed by Dodd, Bloomberg reports.

    Add the CFPA to the long list of “things Democrats want that they won’t get.”

  • Poll: Everyone Hates Congress

    Some shocking numbers from a new CBS News/New York Times poll, revealing that just 8 percent of Americans think the sitting members of Congress deserve re-election.

    That figure is a bit misleading, if only because voters tend to have a much stronger affection for their own representatives than they do for the institution as a whole. Still, pollsters also found that 70 percent of respondents are either “dissatisfied” or “angry” with the way Congress conducts business (enforcing similar findings from a recent ABC News/Washington Post poll), and, perhaps most stunning of all, “80 percent said that members of Congress are more interested in pandering to special interest groups than in serving the needs of people who elected them. Only 13 percent believe that Congress represents the interests of the people.”

    Translation: It’s a tough year to be an incumbent.

  • Doubting the Powers of Tax Credits to Create Jobs

    While Sen. Harry Reid (D-Nev.) has stripped out most provisions of the $85 billion jobs bill proposed yesterday by Finance Committee leaders, the majority leader is reportedly interested in keeping the 2010 Social Security tax exemption for businesses that hire unemployed workers this year. That provision also includes an additional $1,000 business tax credit (in 2011) if companies keep those workers employed for a year.

    The White House says the credits will entice new hires. Some economists say: not so much.

    Roberton Williams, tax policy expert at the Urban Institute, points out the obvious, telling the Christian Science Monitor today that no struggling company is going to bring on a new worker — an obligation of tens of thousands of dollars — just for the 6.2 percent tax exemption on that salary.

    Generally, companies only hire more workers if they think demand for their products is going to increase, notes [Williams].

    A tax credit now might drive some hiring on the margins, says Williams. It might push companies that were thinking of taking on new worker to move more quickly than they might have otherwise.

    “But the real winners will be firms who were going to hire anyway,” he says.

    Huh. Where have we heard that before? (Surely not here, or here.)

  • Gibbs: Consumer Financial Protection Agency Still ‘Great Priority’ of White House

    Robert Gibbs, White House press secretary, was asked today whether the administration will insist on the creation of a separate consumer financial protection agency as part of the year’s plans for banking reform. His response should encourage the consumer advocates pushing for that agency.

    The president still believes it is a great priority to have the independent authority to ensure that consumers in this reform are protected from the type of loans that we’ve seen happen that have led to massive foreclosure, the types of tricks with credit cards that we had seen in the past. …  So the president continues to be a very strong supporter of that function of the reform bill that we sent to Congress.

    Pressed about whether it should be a standalone agency, Gibbs hedged a bit, saying it would have to have “independent authority.” The question remains: Will any Republicans — notably Sen. Bob Corker (R-Tenn.), who has taken the GOP lead on negotiations — get on board?

  • The Severe Middle-Class Squeeze

    This Washington Post story about the recession pulling more mothers out of the home and into the workforce recalls this recent column by L.A. Times columnist Tim Rutten, who reminds us that it’s no new trend.

    “[I]f you adjust for inflation,” Rutten writes, “the average income of American males has not grown in real terms since the 1970s.”

    Most families have compensated for that by sending mom to work outside the home. (The simultaneous push for equality by the women’s movement masked the fact that significant numbers of women now in the workforce were drafted by economic necessity.)

    Furthermore:

    The wholesale flight of American employers from the responsibility of maintaining traditional pension plans forced tens of millions of 401(k) participants into the equity markets to secure their retirements. The crash erased $5 trillion from their accounts.

    Add to this mix an unemployment/underemployment rate near 20 percent — not to mention the fact that the economy created precisely zero net jobs over the last decade — and the true extent of the troubles facing the nation’s middle class begins to emerge.

    Something to think about while some in Congress see a solution in more free trade agreements.

  • From the White House: a Bleak Picture for the Unemployed

    Digging a bit deeper into the annual White House economic report, released yesterday, there’s this statement about the enormity of the nation’s jobs crisis. “[E]ven a quick return to job growth will not immediately eliminate employment problems, as it will take time to create the millions of new jobs needed to return to normal employment levels.”

    That part we knew. Job creation has been the lagging indicator in recessions stretching back two decades, and, as the Labor Department reported recently, the economy has shed 8.4 million jobs since this recession began 25 months ago.

    “This is an enormous hole we’re in,” Chad Stone, senior economist at the Center on Budget and Policy Priorities, said recently.

    But the White House also offers this warning about the likely consequences of the long-term unemployment problem — an assessment rare in Washington for its brutal honesty.

    Many workers will have difficulty finding work for some time to come. Extended periods of high unemployment and low job creation rates mean that many displaced workers will exhaust their unemployment insurance benefits before jobs become available in large numbers. After months or even years of unemployment, most who exhaust their benefits will likely have used up whatever savings they had when they lost their jobs. Many will be forced to turn to public assistance—temporary Assistance for Needy Families, Supplemental Nutritional Assistance (formerly known as food stamps), or other similar programs—to make ends meet.

    The message is clear: For millions of Americans, this thing will get worse before it gets better. And there’s only so much that Washington can do.

  • Docs Send Warning to Dems: No More Temporary Doc-Fixes

    In December, when the American Medical Association, the nation’s largest doctors lobby, endorsed the Senate’s plan for reforming health care, the backing came with a warning: The final bill must include a long-term fix to the flawed formula — dubbed the Sustainable Growth Rate, or SGR — that currently dictates Medicare payments to doctors. Although AMA was willing to accept Congress’ 60-day patch (passed in December) preventing a 21-percent cut in doc payments scheduled for January, the group vowed to oppose any temporary pay patches in the future.

    “Congress must replace the SGR early next year,” AMA wrote to Senate Majority Leader Harry Reid (D-Nev.) in December.

    Unfortunately for Democrats, the future is now.

    Because that 60-day patch expires at the end of February, Senate leaders are scrambling for ways to stave off those cuts and satisfy the powerful doctors lobby. So far, they aren’t doing a very good job.

    Indeed, the $85 billion jobs package unveiled yesterday by Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) — which included a seven-month SGR patch — met the immediate opposition of the AMA.

    “It is deeply disappointing that the Senate is considering a short-term, band-aid approach through the pending jobs bill,” AMA said in a statement. “Kicking the can down the road with another short-term action increases the size of the cut and the cost of reform — and makes it very difficult for physicians to care for seniors and military families.”

    Reid has reportedly stripped the Medicare language out of the jobs bill, to the satisfaction of both AMA and economists who want that package to focus exclusively on job-creating measures. How he plans to address that 21-percent cut before March 1 is another dilemma altogether.

  • Why Not Write a Jobs Bill That Would Create Jobs?

    That’s the question being asked around the country today in response to the $85 billion proposal presented Thursday by Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa), the leaders of the Finance Committee. Although immediately rejected by Democratic leadership, the draft bill provides a sense of what conservatives are willing to accept if the package is to be bipartisan (which it must be in order to win the 60 votes that are the new norm for passing bills in the Senate.) Trouble is, as The New York Times points out today, “about half of the proposal had nothing to do with new jobs.”

    The single largest chunk, about $31 billion, went to renew expiring tax breaks that are generally useful but unrelated to jobs. Another $10 billion would renew an expiring Medicare payment formula so doctors wouldn’t face a pay cut.

    Politically, those things make sense. No one wants to take the blame for a tax hike in an election year, and they certainly don’t want to be seen sitting idle while doctors suffer a 21 percent cut in Medicare payments. But those things will get done anyway. The question remains: why stick them in a bill that’s supposed to create jobs? What effect could they have on the nation’s grave unemployment situation except to crowd out real job-creating measures?

    Robert Greenstein, executive director of the liberal Center on Budget and Policy Priorities, issued a statement yesterday warning what could happen if Congress doesn’t step in with more targeted, bang-for-your buck spending. He’s particularly worried that there’s not nearly enough money directed to help states survive their worst budget troubles in recent history. “If Congress does not act — and act quickly — to provide more fiscal relief, states will have to take steps to close their budget gaps that could cost the economy up to 900,000 jobs,” Greenstein said.

    They will likely cut education, leading to teacher lay-offs; cut Medicaid, throwing more working-class people into the ranks of the uninsured, and cut aid to local governments, leading to cutbacks in local services like police and fire protection.  All of these actions will mean less money for families and small businesses to spend in their communities, further depressing economic growth.

    The good news is that Senate lawmakers will have some time to rework the bill. The recent snowstorm that slammed Washington left Democratic leaders with no choice but to postpone any votes on the legislation this week. And next week lawmakers are out of town for President’s Day recess, meaning the first votes on the bill won’t take place anytime before Feb. 22.

  • Congress Warned Not to Forget Long-Term Unemployed

    Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) (WDCpix)

    Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) (WDCpix)

    There is unemployment, and then there is long-term unemployment. As Congress grapples this month with ways to tackle the nation’s jobless crisis, many economists are hoping lawmakers recognize the distinction.

    Not only is there often a stigma associated with being out of work for long stretches, but the long-term unemployed are also more likely to have lost a competitive step in their field, requiring focused retraining programs more nuanced than simply throwing federal dollars to existing industries. Many other workers will discover that the task they’ve spent a lifetime doing is no longer relevant on the other side of the recession.

    Image by: Matt Mahurin

    Image by: Matt Mahurin

    “The longer you remain unemployed, the tougher it is to get a job,” said Gus Faucher, director of macroeconomics at Moody’s Economy.com. “You’re skills atrophy. Employers — rightly or wrongly — take that as a signal that you’re damaged goods.”

    The combination of factors presents a dilemma, not only for jobless folks in search of work, but also for the Washington lawmakers trying to stoke the coals of hiring. That long-term unemployment is at the highest level since recording began in 1948 only adds to the urgency of getting the policy right.

    “It’s a hard question for policymakers,” said Chad Stone, chief economist at the liberal Center on Budget and Policy Priorities. “There aren’t a lot of things they can do quickly.”

    Not that they aren’t trying. The House in December passed a $154 billion jobs bill, including billions of dollars in highway infrastructure, public transit and emergency help for struggling states. Few observers, however, gave that proposal much chance of passing the Senate, where Republicans have been pushing for a smaller bill with a greater emphasis on tax cuts. Indeed, on Thursday Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa), the leaders of the powerful Finance Committee, introduced a jobs bill of their own. The $85 billion draft proposal is centered around a series of business tax breaks designed to spur hiring and individual tax relief designed to encourage spending.

    Senate Majority Leader Harry Reid (D-Nev.) was quick to dismiss the proposal, arguing that it was too heavy on Republican sweeteners and too light on actual job-creation provisions. “The message is so watered down,” he said. The final product, though, is certain to look more like the Baucus-Grassley draft than the bill passed by the House.

    Some economists are warning, however, that tax provisions like those in the Senate bill pretend that the jobless pool is a level playing field, ignoring the stigma and skills questions associated with the long-term unemployed — and therefore favoring those who lost jobs more recently. ”Someone who’s been unemployed only 6 or 8 weeks often looks like a much stronger job candidate than someone who hasn’t been employed for the last 66 or 68 weeks,” said economist Gary Burtless, formerly with the Labor Department and now at the Brookings Institution.

    Desmond Lachman, economist at the conservative American Enterprise Institute, agreed, arguing that policymakers should be drafting their legislative fix in recognition that the nation’s jobless crisis is historically long-term. ”There is a distinction to be made,” Lachman said. “Policy needs to concentrate on retraining the long-term unemployed. Those who are short-term unemployed can rejoin the labor force more easily. They would benefit from policies that got the economy moving again and that subsidized employment through tax credits [among other things].”

    The $787 billion economic stimulus, enacted last winter, included billions of dollars for new job training. Economists are largely in agreement, however, that the package wasn’t large enough to address the recession. Another pickle: deciding which jobs merit retraining is never easy. It leaves lawmakers with the task of trying to distinguish which occupations were shed as a result of the recession, and which were lost due to deeper structural shifts governing the ever-changing economy in the age of increasing globalization. In short, some experts warn, not all retraining is created equal. “There’s a mismatch between the skills these people have and the skills we need moving forward,” Faucher said. “Retraining won’t do any good if the demand isn’t there.”

    The comments are timely. Even as the nation’s jobless rate fell to 9.7 percent last month — down from 10 percent in December — that headline-grabbing figure disguised a deeper problem: Namely, the number of American workers who’ve been unemployed longer than 27 weeks hit another all-time high of 6.3 million in January — up 183,000 since December and 5 million since the start of the recession in December 2007.  And that doesn’t count the roughly 2.5 million folks who want to work but have stopped looking.

    The National Employment Law Project, an advocacy group, lent a bit of context to those numbers, pointing out recently that the average stretch of unemployment has topped 30 weeks — a full nine weeks longer than the most recent severe jobs crisis in 1983. Another dismal milestone: more than 41 percent of jobless Americans have been without a job for longer than six months, NELP noted, up from 26 percent in 1983. Since the start of the recession in December 2007, the economy has shed roughly 8.4 million jobs.

    It’s a trend that threatens the economy in a number of ways. Not only do the long-term unemployed consume less, but they’re also more likely to foreclose on their homes — a situation that only cripples recovery efforts by depressing the housing market even further.

    The White House seems to be well aware of the hurdles ahead. On Thursday, the administration issued its annual economic outlook, warning that long-term unemployment — and the skills lost as workers sit idle — can lead to a reduction in productivity and earning power, even long after the economy rebounds. The White House estimated that the economy will begin creating jobs this spring, though not in significant enough numbers to keep up with the labor pool, which grows by 100,000-150,000 workers each month. Indeed, Moody’s Economy.com is predicting the nation’s unemployment rate will jump back up near 11 percent later this year.

    For his part, Brookings’ Burtless suggested that the depth of the crisis demands a public jobs program on the level of the Franklin Roosevelt’s Works Progress Administration — which employed 3.3 million people in 1936 — or the Comprehensive Employment and Training Act under Jimmy Carter, which grew to 725,000 public jobs in 1978. The political reality, however, is that today’s Congress is much too conservative to endorse such large, government-backed programs, even despite the stagnant jobs picture the country faces.

  • Another Legislative Fix to Citizens United

    Democratic leaders in each chamber have teamed up today to introduce a legislative package designed to nullify the Supreme Court’s recent decision empowering corporations to spend uncapped sums to influence federal elections. Calling the High Court’s ruling a “radical decision” that could “drown out the voices of American citizens,” Rep. Chris Van Hollen (D-Md.) called on Congress to consider the bill quickly. Sen. Charles Schumer (D-N.Y.) is the upper-chamber sponsor.

    The highlights:

    • Ban on expenditures from foreign interests.
    • Ban on expenditures from Federal contractors.
    • Ban on expenditures from TARP recipients.
    • Disclosure to the public through enhanced reporting through the FEC and LDA.
    • Disclosure to shareholders directly and through the SEC.
    • Stand By Your Ad (CEO and donor disclosure).
    • Lowest Unit Rate (air time for candidates and party committees).
    • Coordination Rules (tightened between outside groups and candidates).

    Not that this has much chance to get anywhere anytime soon — especially considering the way Senate Minority Leader Mitch McConnell (R-Ky.) embraced the Citizens United decision. But it’s probably also more realistic for Congress to address the issue this way, rather than going the much tougher Constitutional-amendment route.

  • Bipartisan Senate Jobs Bill Reiterates 3-Month Jobless Benefits Extension

    The latest draft — but perhaps not the final version — of a Senate jobs bill was released this morning by Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa), the leaders of the Finance Committee, who are hoping to tackle the nation’s 9.7 percent unemployment rate.

    Wish them luck.

    Not only are business leaders already doubting the effectiveness of the business tax cuts at the center of the bill, but the proposal is also loaded up with unrelated goodies that have little or nothing to do with job creation. For example: a seven-month Band-aid preventing Medicare doctors from getting smacked with a 21-percent pay cut at the end of this month.

    By contrast, the extensions of both unemployment and COBRA benefits would run only three months (though May) under the Finance bill.

    There’s time for tweaks. With the recent snow in Washington — combined with next week’s President’s Day recess — the Senate isn’t expected to vote on anything until the week of Feb. 22.

  • On Finance Reform Talks, Dodd Trades Shelby for Corker

    What happens if you’re chairman of the Senate Banking Committee and your negotiations with the panel’s senior Republican over finance reform break down? If you’re Sen. Chris Dodd (D-Conn.), you recruit Sen. Bob Corker (Tenn.) to be the new lead Republican. Here’s Dodd’s statement explaining why:

    For over a year, the Senate Banking Committee has been grappling with how best to address the many problems that led to the financial crisis. In that time Senator Corker has proved to be a serious thinker and a valuable asset to this committee. For that reason, I called him Tuesday night and asked him to negotiate the financial reform bill with me.

    We met in my office on Wednesday and given the importance of these issues he agreed.

    Dodd warned that “many difficult questions remain” (i.e., whether to create a Consumer Finance Protection Agency), but added that he’s more optimistic than he’s been in weeks about the proposal’s chances.

    Corker, of course, is no stranger to taking the reins on issues that appear at an impasse. It was the Tennessee Republican, remember, who intervened in late 2008 to try to salvage some bipartisan deal on a Detroit bailout. It’s worth noting, however, that those talks, too, ended without the sides reaching an agreement.

  • A Slow Return to Job Creation

    At least that’s the warning coming from the White House, which today released its annual economic outlook report predicting that an average of 95,000 jobs will be created each month this year.

    That’s quite an improvement from the more than 700,000 jobs the economy was shedding when Obama took office, but it still falls well short of the 125,000 to 150,000 new jobs that must be created each month just to keep up with normal increases in the job pool — never mind those needed to pull the country out of the recent employment crater.

    The Economic Policy Institute summarizes the problem like this: “Each month we need to create 127,000 jobs just to keep unemployment from rising. Therefore, we actually need 10.9 million new jobs to get us back to 4.9 percent unemployment.”

    It’s something the White House report acknowledges.

    [E]ven a quick return to job growth will not immediately eliminate employment problems, as it will take time to create the millions of new jobs needed to return to normal employment levels. Many workers will have difficulty finding work for some time to come.

    Economists, of course, have been predicting all along that employment numbers — the so-called “lagging indicator” — would be the last thing to rebound from the downturn. The irony is that if the White House is right about that 95,000 figure, it will mean the unemployment rate will likely rise later this year, even as the economy is rebounding and jobs are being created. Look for Republicans to focus on that rate — not the creation of new jobs — as November’s elections get closer.

  • Angry Nation

    No shocker here: People are mad at Washington. From The Washington Post:

    Two-thirds of Americans are “dissatisfied” or downright “angry” about the way the federal government is working, according to a new Washington Post-ABC News poll. On average, the public estimates that 53 cents of every tax dollar they send to Washington is “wasted.”

    Disappointingly, the pollsters didn’t ask specifically which party respondents blame for the government’s perceived failures. Unless there’s been some strange break from recent public perception, though, odds are the discontent is being aimed at incumbents in general, not any one party in particular.

  • In Search of Bipartisanship the Meaning of Words

    spon-sor, n. 1. one who vouches or is responsible for a person or thing.

    Forget policy for a second. Democrats and Republicans can’t even agree on the meaning of English words. We’ve seen the evidence in recent weeks as the sides have jousted over the definition of bipartisanship (see here and here and here). And now we’re seeing some lawmakers grappling with an even much simpler concept: that of sponsorship.

    (To clarify: When bills are introduced on Capitol Hill, the authors are known as the sponsors, or chief sponsors, who usually try to recruit other lawmakers to sign on in support. These after-the-fact supporters are known as co-sponsors. Bills with a great number of co-sponsors are thought to have a better chance of getting floor time, and therefore have a better chance of becoming law.)

    With that in mind, recall a few weeks ago when six Republican co-sponsors of a deficit task-force bill experienced a last-minute change of heart, voting against their own bill after President Obama endorsed it. Funny way to show support for a thing, but they’re not alone. Fast forward to yesterday. Here’s Sen. Lamar Alexander (R-Tenn.) telling The Washington Post’s Ezra Klein that, despite his co-sponsorship of a sweeping health-care reform bill authored by Sens. Ron Wyden (D-Ore.) and Robert Bennett (R-Utah), he feels the legislation is too comprehensive to actually support.

    The Wyden-Bennett bill was simpler, with fewer surprises, and more straightforward. I liked it because it was bipartisan. I wouldn’t have voted for it. But over the past two years, I’ve looked at all these issues and come to the conclusion that the policy skeptics are right. We don’t do comprehensive well in the Senate. It’s not because we don’t do our job well. It’s because we’re such a complicated country.

    Which begs the only relevant follow-up question: huh?

    Then again, both the deficit task force and Wyden-Bennett bills were bipartisan. Maybe this trend isn’t so confusing after all.

  • Good News for Boeing

    It’s never bad news for local business when the home-town guy takes the reins of a powerful congressional committee. In the case of Seattle-based Boeing, that credo might come with an exclamation point, as Washington Rep. Norman Dicks (D) is poised to take over the throne of the powerful defense appropriations committee in the wake of the death this week of Rep. John Murtha (D-Pa.).

    The Hill’s Roxana Tiron lends context:

    Dicks would take the gavel of the Defense panel as the Pentagon decides whether Boeing would win a $35 billion contract for a new fleet of midair refueling tankers. Boeing has been going head to head with a team made up of Northrop Grumman and EADS North America. The Pentagon is scheduled to issue a final request for proposals Feb. 23….

    Defense insiders have called Dicks an unapologetic supporter of Boeing, particularly when it comes to the tanker program. Boeing would build the tanker aircraft in Washington state, where it has large commercial aircraft operations. Dicks has long opposed the tanker contract going to EADS, the parent company of Airbus — Boeing’s rival on the commercial market.

    Dicks’ office claims that the Washington Democrat, while interested in the contract, won’t enter the fray any more than he already has following Murtha’s death, Tiron reports. Still, the relationship between Dicks and Boeing is a close one. The aerospace giant is the top contributor to Dicks over the course of his congressional career, giving more than $142,000 since the 1998 election cycle, according to the Center for Responsive Politics. That trend remains true this cycle, with Dicks already raking in $10,500 from the Seattle company, which makes him the sixth highest recipient in Congress, CRP notes.

  • The Story of Coal’s Dirty, Deadly Legacy

    A mountaintop mine in West Virginia (Rick Eglinton/Toronto Star/ZUMA Press)

    A mountaintop mine in West Virginia (Rick Eglinton/Toronto Star/ZUMA Press)

    Most of us take it for granted that when we flip the switch, the lights will go on. Sure, we write the electric company a monthly check, but otherwise lend no thought to the source of the power — like urban kids clueless that chicken originates someplace other than the freezer aisle of chain groceries.

    But this month, an energetic author from the rugged, coal-laden hills of southern Illinois hopes to relay the message — utterly apropos in a country where coal generates nearly half the electricity — that a consequence of that national dependence is the outright decimation of the communities surrounding the mines.

    Image by: Matt Mahurin

    Image by: Matt Mahurin

    Jeff Biggers, a civil rights activist and cultural historian, watched helplessly a dozen years ago as the hollers of Eagle Creek, Illinois — a corner of the Shawnee National Forest and his family’s home for roughly 200 years — were blasted away, the forested hills bulldozed under by companies intent on harvesting the lucrative coal seams beneath — a scene from Avatar playing out in real time.

    “They’ve strip-mined your heritage,” Biggers’ uncle told him at the time.

    The tragic episode launched Biggers on a decade-long examination of the history of the coal industry’s impact on local communities — not only the environmental imprint, but the effects on culture, health and family history as well. The result is “Reckoning at Eagle Creek — The Secret Legacy of Coal in the Heartland,” released last week, in which Biggers describes the industry’s utter disregard for everything standing between it and the coal it wants out of the ground. It’s an apt study as the Obama administration advances its “clean coal” agenda.

    “The old pond, the four plum trees, the sorghum and cornfields, the garden, the barn, and the one-hundred-fifty-year-old log cabin were buried in a crater formed before the Paleozoic era,” Biggers writes of his family’s experience with strip mining. “But it wasn’t just our family history. It also included a thousand years of bones of the first natives in the region, the modern Shawnee encampments and farms, the pioneering squatters and homesteaders in our family, and the slave and coal miners in one of the first settlements in the nation’s heartland — all of which had been churned into dust in the race to strip-mine the area.”

    All told, the miners hauled an estimated 960,000 tons of coal from his family’s property and the adjacent plots — “enough electricity to supply American demands for approximately four and a half hours,” Biggers writes. “That was the choice we made.”

    The book isn’t all. Biggers has also adapted the story for the stage, taking the two-man show — “The Saudi Arabia of Coal” — on a 22-city tour that arrives this week at Busboys and Poets in Washington. The story — about a strip miner and his wife faced with losing their home to the very project providing their income — features Biggers and Stephanie Pistello, a community organizer with Appalachian Voices, a North Carolina-based environmental group. Both are products of Appalachia; both are grandchildren of coal miners. The driving force behind the play, Biggers said in a phone interview last week, was simple: “How do we bring strip mining to people who have never seen it?”

    It’s a timely story. For all the scientific warnings about the warming effects of coal combustion, the White House continues to view the fossil fuel as central to the nation’s energy future. Indeed, President Obama last week announced the creation of a new “carbon capture” task force charged with developing new “clean coal” technologies. The administration hopes to have between five and 10 new commercial facilities featuring these advancements up and running by 2016.

    “Even if you disagree on the threat posed by climate change,” Obama said, “investing in clean energy jobs and businesses is still the right thing to do for our economy.”

    Obama was referring to coal processing, not extraction. But in the eyes of a growing number of environmentalists and human rights advocates, the administration’s alacrity to embrace coal — combined with the mixed signals from the Environmental Protection Agency on mining permits — likely means that coal communities will remain vulnerable to the ravages of strip mining for many years to come.

    “We see this as a criminal activity,” Biggers said. “And if you recognize there’s criminal activity taking place, how can you minimize it [instead of banning it]? It’s their mentality that they can regulate this crime.”

    Human rights activists are hoping that Congress will step in to eliminate the most destructive forms of strip mining, a method featuring the removal of all materials (rock, soil, trees, etc.) resting on top of the coal. (That contrasts with underground mining, in which tunneling allows the overlying land to remain intact.) Of particular concern in Appalachia is one type of strip mining, known as mountaintop removal, in which the peaks of mountains are blasted away and the debris pushed into adjacent valleys, many of which contain tiny streams representing the headwaters of much larger rivers below. Bipartisan bills introduced in both the Senate and the House would end mountaintop removal by prohibiting such dumping into active streams. There appears, however, to be little congressional appetite to challenge the powerful mining industry in a tough election year when unemployment remains near double digits.

    “My miners and the folks who are working and those who are unemployed are very concerned about some of your policies,” West Virginia Rep. Shelley Moore Capito (R) told Obama last month, referring in part to the EPA’s denial of some mountaintop permits. “In our minds, these are job-killing policies.”

    At a much-watched debate on mountaintop mining in Charleston, W.Va., last month, Don Blankenship, president of Virginia-based Massey Energy, echoed Capito’s concerns. “The mission statement for coal is prosperity for this country,” Blankenship said. “This industry is what made this country great and if we forget that, we’re going to have to learn to speak Chinese.”

    The adverse health effects associated with coal mining have, of course, been known for decades. Biggers’ grandfather was among the tens of thousands of miners to die of coal workers’ pneumoconiosis, or black lung disease. Though the cases of black lung are down considerably relative to historic highs, more than 10,000 American miners died of the disease in the last decade alone.

    But health problems are only one part of coal’s dubious legacy, critics argue. Coal communities also suffer from poisoned streams, the noise pollution associated with blasting and the barrage of heavy machinery constantly lumbering along local streets. In short, they just aren’t great places to live.

    “Over 1,200 miles of waterways had been sullied and jammed with mining fill,” Biggers writes of mountaintop mining’s effect on Appalachia. “Blasting and coal dust had made life unbearable for anyone in the strip-mined areas. Wells had been busted and polluted with toxic waste. … The history was clear: Coal was not cheap, and coal was not clean.”

    Backing that argument, Forbes magazine last November deemed West Virginia — the second largest coal-producing state and a hot-bed of mountaintop removal sites — the worst state in the country to live, ranking it 50th in “well being,” “life evaluation,” and physical and emotional health. That’s no coincidence, says Biggers, contending that the tactics employed by the coal industry all but ensure that coal communities will be one-industry towns.

    “As long as they keep those communities poor, they can continue to plunder Appalachia,” he said.

    For all the wealth that Appalachia’s coal beds have brought to coal executives and corporate shareholders, the money isn’t exactly trickling down to local communities. Indeed, West Virginia ranks 49th in the country in per capita median income, according to the latest figures from the U.S. Census Bureau, with a median household income of $37,989 — well below the national median of $52,029. Only Mississippi families fare worse.

    Coal critics say that the message is beginning to sink in among residents of coal towns. Although recent protests have featured the arrests of such prominent figures as actress Daryl Hannah and climate scientist James Hansen, Biggers says the backlash against strip mining is being led by locals fed up with seeing their communities decimated. “We’re all children and grandchildren of coal miners,” he said. “The only people defending coal companies are on their payroll.”

    This charge could extend to Capitol Hill, where coal-country lawmakers — backed by considerable donations from the giants of the coal industry — have built careers defending those companies, usually in the name of creating jobs for their constituents.

    It’s an argument, critics maintain, designed simply to insulate the industry from stricter regulations on tactics like mountaintop removal, which actually rely more on dynamite and heavy machinery than they do manual labor. Indeed, while U.S. coal production is at an all-time high, the number of mining jobs has dropped off considerably in recent decades. Just 25 years ago, coal mining employed more than 169,000 workers, according to the Energy Information Administration. In 2006, the figure had fallen below 83,000.

    “If mountaintop removal disappeared tomorrow we would start creating jobs,” Biggers said, advocating for more sustainable projects. Community groups, for example, are hoping to thwart Massey’s plans to level West Virginia’s Coal River Mountain, pushing instead for a wind farm they say will sustain more jobs and bring in more tax revenue for the state — all without destroying one of the oldest mountains in the country.

    Yet Biggers is also aware that numbers and statistics, whatever secrets they might reveal, can never be as persuasive as real stories of human suffering in the face of privation. His play, he hopes, will bring that tale — his tale — to audiences sitting hundreds, even thousands of miles from coal country.

    “We all relate to the human story,” Biggers said. “We all relate to a sense of loss. Hopefully, this can change more minds than all the statistics I could rattle off.”

    At the very least, he’s provided something to think about the next time we flip on the lights.

    “The Saudi Arabia of Coal” will be at Busboys and Poets in Washington on Wednesday, Feb. 10, starting at 9 p.m. Afterward, the show will move to Pittsburgh (Feb. 11) and New York City (Feb. 27) before moving on to the West coast.

  • Draft Senate Bill Includes 3-Month Unemployment Benefits Extension

    It’s just an early version — or so the Democrats are saying — but Senate leaders appear to be that much closer to extending the filing deadline for unemployment insurance (which expires Feb. 28) through the end of May.

    The additional three months are half what the House passed in December, and an even further cry from the seven months included in the White House budget, not to mention the 10 months being advocated by a number of Senate Democrats. Still, this would prevent roughly 1.2 million Americans from exhausting their benefits in March.

  • McConnell’s Plan to Create Jobs: Drill, Baby, Drill

    Following this morning’s White House jobs meeting with congressional leaders from both parties, Senate Minority Leader Mitch McConnell (R-Ky.) issued a statement laying out his four-part plan to tackle the nation’s unemployment crisis.

    Let’s just say there’s a bit of a theme:

    •           Increase clean nuclear energy in America

    •           Expand exploration of offshore areas for oil and gas development

    •           Develop Clean Coal technologies

    •           Expand American exports through free trade agreements

    McConnell’s plan brings to mind the charges leveled yesterday by House GOP leaders against Obama’s plans for health care. Bipartisanship, the Republicans said, is not best accomplished by forcing one party’s ideas on the other. Seems that McConnell, at least as it pertains to his call to expand offshore drilling, didn’t get the memo.