Officials say it's too soon to pinpoint the exact cause of the tragic explosion at the Upper Big Branch mine in West Virginia that took the lives of 29 miners, but we certainly know enough to identify the root cause. It's the same cause that led to the 2007 Crandall Canyon mine disaster in Utah that killed six miners and three rescue workers. It's the same cause that led to the 2006 Sago mine disaster in West Virginia that killed 12 miners. And it's also the same cause that led to the Lehman Brothers disaster, the Citigroup disaster, the bursting of the housing bubble, and the implosion of our financial system: a badly broken regulatory system.
The loss of life at Upper Big Branch happened in one horrific instant. The economic collapse has not killed people, but it has gradually destroyed millions of lives. Both calamities occurred because elected officials who should have been creating a regulatory system that protects working families instead created a system that protects the corporations it was meant to watch over.
Just look at the ways in which the New York Times describes the regulatory agency that so atrociously failed the Upper Big Branch miners:
Sound familiar? Most of these conditions were the same ones that led to the housing bubble, credit default swaps, toxic derivatives -- and, by extension, the bank bailout, long-term unemployment with no end in sight, and the rapid acceleration of the decline of America's middle class.
The "fundamentally weak" state of America's watchdogs is the deliberate end product of massive amounts of corporate lobbying. In the case of the mining industry, the amount spent by mine owners on lobbyists intent on weakening regulations and widening loopholes has skyrocketed from under $2.5 million in 2003 to $14 million today, with predictable results: profits up; dead miners up.
The problem isn't a shortage of regulators. It's the way we've allowed the regulated to game the system. The federal government has an entire agency, the Mine Safety and Health Administration (MSHA), dedicated to overseeing the mining industry. Indeed, a federal inspector was at the Upper Big Branch mine hours before it blew up.
Similarly, there are myriad financial regulatory agencies. In fact, before the economic meltdown there were dozens of federal regulators dedicated to keeping an eye on the big banks -- in many cases, with offices inside the premises of the banks. Fannie Mae and Freddie Mac had the Office of Federal Housing Enterprise Oversight and the Federal Housing Finance Agency dedicated solely to them. And, after Bear Stearns crashed, Tim Geithner's New York Fed had a team of examiners at Lehman Brothers every day. And yet they still missed the economic collapse.
Regulations are "very difficult to comply with," and "so many of the laws" are "nonsensical." Those are the words of Don Blankenship, the CEO of Massey Energy, the company that owns the Upper Big Branch mine and has a grotesque history of safety violations.
In the case of the financial industry, the reason it can't be regulated adequately is because, as Alan Greenspan put it last week in testimony before the Financial Crisis Inquiry Commission, "the complexity is awesome," and regulators "are reaching far beyond [their] capacities."
That is, of course, exactly the way Wall Street designed it. To the financial world "awesome complexity" is a feature, not a bug.
Something else the mining and financial industries share: the revolving door between regulators and those they're supposed to be regulating.
Former Massey COO Stanley Suboleski was appointed to be a commissioner of the Federal Mine Safety and Health Review Commission in 2003 and four years later he was nominated to run the Office of Fossil Energy in the Energy Department. Today, he's back on Massey's board. And Massey exec Richard Stickler was made the head of MSHA by President Bush in 2006. Talk about hiring the foxes to guard the hen house.
Massey has also mastered the D.C. art of buying friends in high places. Back in 2000, Massey was responsible for a coal slurry spill in Kentucky that was three times larger than the Exxon Valdez spill. The company very successfully limited the damage -- not to the environment, but to its bottom line. Once Elaine Chao, Kentucky Senator Mitch McConnell's wife, became Secretary of Labor, which oversees the MSHA, she, according to Jack Spadaro, an MSHA engineer investigating the spill, put on the brakes. Two years later, Massey was assessed a slap-on-the-wrist $5,600 fine. The same year, Massey's PAC donated $100,000 to the National Republican Senatorial Committee, which was chaired by McConnell. And Massey's CEO Don Blankenship has personally donated millions to the campaigns of judges and politicians.
The essence of the story is remarkably similar to what happened in the financial industry over the last decade. A disaster occurs. Politicians are "outraged" and demand reform. Laws are passed. And then, when the next disaster occurs, that the new laws were supposed to protect against, we find out about the loopholes.
Massey offers a textbook example -- in this case deadly -- of how this works. After the Sago disaster in 2006, mining regulations were enacted that called for a company found to have a "pattern of violations" to be subject to a much greater level of scrutiny.
And if you're looking for the poster child for the phrase "pattern of violations," it's Massey Energy. In 2009, the Upper Big Branch mine was ordered to be temporarily closed over 60 times. That same year, the mine was cited for 515 violations. It has already received another 124 this year. And 48 of the '09 violations were considered serious, as were 10 of this year's. According to Ellen Smith, editor of Mine Safety and Health News, this is far more than any other mining company. What's more, in the ten years before the Upper Big Branch explosion, 20 people had been killed at mines run by Massey.
So how did Massey escape greater oversight for having a pattern of violations? It turns out that a loophole written into the law says that if a company contests a violation, while that violation is being contested it can't count toward the establishment of a pattern. Massey is currently contesting 352 violations at the Upper Big Branch mine alone.
Another loophole in the law says that a company can delay paying a fine if it contests the violation. The result? Only $8 million of $113 million worth of major penalties levied against mining companies since April of 2007 have been paid -- around 7 percent. To people like Don Blankenship, or any big bank CEO, that kind of money is seen as the cost of doing business -- it's factored into the bottom line, like bribes would be in the Third World.
I'm sure there will be new regulations written in response to this latest mining disaster. Just as we're about to get yet another grab-bag of financial regulations. But by the time these regulations make their way through the Congressional sausage grinder, the lobbyists will have added in the loopholes that ensure that the fix is in -- and that the American people get the short end of the stick. Again.
There is no sense of urgency in Washington about making sure these corporations play by the rules. In 2007, after the Utah mining disaster, we got angry, we held hearings, we supposedly fixed things, then we moved on. Three years later, 29 miners die. And the cycle starts again.
In the same way, in 2003, after the Enron and WorldCom disasters, we got angry, we held hearings, we supposedly fixed things, then we moved on. Five years later, we got AIG, Lehman Brothers, Citi, and an economic crisis that devastated -- and continues to devastate -- the lives of millions. Will we just sit back and let the cycle start again?
Disasters -- both mining and financial -- are going to keep happening until we reevaluate our priorities, and force our elected officials -- and the regulators they pick -- to put the public interest above the special interests and their lobbyists in Washington.
The lives of hardworking Americans have to take precedence over the bottom line at Massey Energy and on Wall Street.
This isn't a matter of right vs. left. It's a matter of right vs. wrong.
Follow Arianna Huffington on Twitter: www.twitter.com/ariannahuff
Lawrence H. Summers: Relief for Middle Class Families
It has been a trying time for Americans since the recession began nearly two and a half years ago, and we still have a long way to go. Relief for middle class families is indispensable to our efforts to lay a new foundation for our future prosperity.
By Mario Parker
Bloomberg BusinessWeek
April 23, 2010
"...Massey Energy Co. has three mines with more citations classified as “significant and substantial” than its Upper Big Branch operation, where 29 people were killed in an explosion this month.
Three Massey mines are among the top 20 in the U.S. ranked by the number of “significant and substantial” violations accrued since January 2009, according to the U.S. Labor Department’s Mine Safety and Health Administration. Consol Energy Corp., based in Pittsburgh, had three of the four mines with the most S&S violations and seven of the top 20..."
http://www.businessweek.com/news/2010-04-23/massey-has-mines-with-more-citations-than-blast-site-update1-.html
Growing up, at least 60% of the streams in mine and neighboring counties ran orange. The rocks were Orange. Old strip mines still had mine pits in them, high walls (we would play on them), slag heaps, and drainage ponds/ditches. The reason was that it was cheaper for the companies to pay the fine than to reclaim the land after it was mined.
These things are not true anymore, because the fines were increased to exceed the cost of reclamation.
People are people regardless of where they are located and some are just too greedy, disregarding what’s right and they are not afraid for someone else to die because of their greed. This is a stupid way to run a business but the money Massey should've used to make the mines safe initially will now be spent on lawyers, wrongful death suits and settlements and probably a hefty fine from the government if they can’t buy their way out of it.
I don’t know how these people sleep at night but ''Oh what a tangled web we weave when first we practice to deceive''.
T.J. Templeton
Progressively Speaking
Le Mars Daily Sentinel
Posted Monday, April 19, 2010
"... the end result of eight years of republican undermining of government regulation became major news: 29 miners killed in a mine in West Virginia. The mine was rife with safety violations from 8 years of no oversight.
Always there for GOP damage control, Rush Limbaugh was quick to comment on the event..."
http://www.lemarssentinel.com/blogs/1295/entry/34400/
http://www.orionmagazine.org/index.php/articles/article/166/
The fact that 50% of the fortune 500 has paid NO CORPORATE income tax in the last 10 years is non-sensical.....The fact that Warren Buffett owes one billion in taxes and pays no interest is non sensical....
ve been injured on the job and their FAMILIES ..I havent seen it yet,butr WE'RE awaiting her ARRIVAL lol...I recently lost a family member on Sat.03-17-10 and the PAIN IS DEEP,so yes I truly feel your Pain and hope DEPT OF LABOR doesnt 4get you all.
Not only do corporations, having become super-persons, have unrestrained influence, but ordinary people pay more taxes (than actual corporate people), have less access, and do not have the time, knowledge, or wherewithal to influence law making in the game-changing ways that corporate not-real-persons as well as real corporate people do.
Republicans may argue illogically, but they do so in a constant stream of advertising that changes opinion almost subliminally, as well as behind the scenes in every political entity in our country.
Corporations owned the "game" called the United States Constitution before they even became the protected, elite corporate persons they are now.
National corporations have swallowed small businesses across the country, making it almost impossible to own your own business and compete successfully; this has depressed wages in most communities.
For real access to elected government representatives, you need a personal, campaign-worthy story (gets access for a limited period of time) or you need to be part of the management of national, i.e. influential, corporations. Try getting your Congressperson or Senator on the phone; then imagine their response to anyone in the upper echelons of corporate management.
The notion that you go to school, work hard, and succeed is no longer valid. You must have the wherewithal to get into elite private elementary schools and expensive business schools, as well the ties to join the management "team" of the kind of corporation that has government influence. Being good looking (or having the money to make yourself good looking) is priceless in this structure and can get you a pass.
Increasingly, wealth is how we define success. Wealth is influence. Wealth is the great arbiter of our society.
Republicans, Bush, Cheney are for WALL STREET-CARE. Democrats, Obama, Pelosi, Reid are for MAIN STREET-CARE.
Republicans, Bush, Cheney are for ELITE-CARE. Democrats, Obama, Pelosi, Reid are for MIDDLE CLASS-CARE.
Republicans, Bush, Cheney are for CORPORATE EXECUTIVE GREED. Democrats, Obama, Pelosi, Reid are for FAIR TREATMENT OF EMPLOYEES.
Republicans, Bush, Cheney are for ANTI-HEALTHCARE INSURANCE REFORM. Democrats, Obama, Pelosi, Reid are for HEALTHCARE INSURANCE REFORM.
Republicans, Bush, Cheney are for FOREIGN OIL. Democrats, Obama, Pelosi, Reid are for HOMEGROWN ALTERNATIVE, RENEWABLE, GREEN ENERGY.
Pre-2009 -Republicans, Bush, Cheney said DEFICITS DO NOT MATTER.
Repubs, Bush, Cheney passed Deficit Spending for 2 wars.
Repubs, Bush, Cheney passed Deficit Spending for TAX-CUTS for the ELITE ONLY.
Repubs, Bush, Cheney passed Deficit Spending for MEDICARE DRUG PLAN.
Repubs, Bush, Cheney passed Deficit Spending for HALIBURTON.
After 2009, Republicans, Bush, Cheney say DEFICITS MATTER.
Repubs, Bush, Cheney DID NOT TAKE CARE OF VETERANS.
Repubs, Bush, Cheney DID NOT TAKE CARE OF KATRINA VICTIMS.
Repubs, Bush, Cheney incentify MOVINGS JOBS OVERSEAS.
Repubs, Bush, Cheney wants to DESTROY MEDICARE.
Repubs, Bush, Cheney wants to DESTROY SOCIAL SECURITY.
by Howard Berkes
NPR
April 17th, 2010
"...Massey Energy CEO Don Blankenship was paid $17.8 million last year even as some of the coal mines he supervised accumulated safety violations and injuries at rates that greatly exceed national rates.
That 2009 pay represents a $6.8 million raise over 2008 and almost double his compensation package in 2007.
Blankenship also has a deferred compensation package valued at $27.2 million at the end of last year..."
http://www.npr.org/templates/story/story.php?storyId=126072828&ps=cprs
By Steven Mufson
Washington Post Staff Writer
Saturday, April 17, 2010
"...The Labor Department will establish an independent team of safety experts to evaluate the Mine Safety and Health Administration's internal review of the April 5 explosion at a West Virginia coal mine that killed 29 workers, officials said Friday.
The establishment of the independent evaluation follows criticism of MSHA's own internal review team, which is being led by Norman Page, a veteran agency employee who oversaw inspections in a district where a similar explosion occurred in 2006. After that blast, an MSHA review sharply criticized the district's oversight efforts, saying they "permitted poor performance to continue uncorrected at all levels..."
http://www.washingtonpost.com/wp-dyn/content/article/2010/04/16/AR2010041604731.html
And yet we have tea-partiers calling for even more deregulation. Go figure.
[sort of similar to legalized slavery in many aspects] It was used heavily against women and children and is totally disgusting! Its always about union thugs when it is the opposite that is true! The special interests and PACs deal with much more money and engage in more dishonesty with the chamber of commerce than all the unions combined by a sizable margin! The media seldom exposes it or reports on it and all our workers, union and non union suffer for it!