Tag: don blankenship

Coal Executives Take Millions Before Bankruptcies

Amid the news of Alpha Coal’s bankruptcy, attention is rightly given to the communities and miners affected. The bankruptcy will be used to take away promised benefits from miners who earned them. But there are some people who won’t be harmed at all by what happened, and it’s important to know who they are.

Kevin S. Crutchfield, “Chairman and Chief Executive Officer” of Alpha, just picked up a $2,000,000.00 bonus this spring, as he led the company into bankruptcy. While Alpha’s stock has plunged over the last several years, he picked up over $6,000,000.00 in cash payouts in 2011 and 2012.

“President” Paul Vining walked away with almost $8,000,000.00 for just two years of work as these executives marched Alpha off a cliff. Vining then got away while the getting was good. As “Former President,” he still gets $4,500,000.00!

Peabody Energy, another company on the verge of bankruptcy, thought its corporate leadership so effective it awarded top suit Gregory Boyce well over $10,000,000.00 in 2014. The “President and Chief Operating Officer” got about $5,500,000.00.

Arch Coal was doing so well it rewarded the boss with a $7,300,000.00 payday inhttp://bloximages.newyork1.vip.townnews.com/stltoday.com/content/tncms/assets/v3/editorial/d/f7/df73955e-6183-11e1-8bc1-001a4bcf6878/4f4bebaed534f.preview-620.jpg 2014. He got paid this stupendous sum while the company lost almost half a billion dollars — “Arch reported a loss of $558.4 million in 2014. In 2014, Arch common stock fell almost 62% and was recently trading at about $1.24 per share” — Imagine what he’d have got if it made money!

Of course, that’s just chump change compared to the tens of millions executives paid themselves just a few years ago. Coal executives, including, yes, Don Blankenship, have extracted hundreds of millions to pad their wallets even as miners have lost their jobs and communities have been devastated.

Don’t forget Consol, which hands over at least $8,300,000.00 annually to Rich DiIuliis. Remember that number as these guys go to the public talking about the “tough times” for coal. Tough for some, pretty clean sailing for others. Follow those links and you’ll find out that Consol calls the eight million plus a “savings” because they paid the last guy over $15,000,000.00 per year. What for? So the company can go down, down, down . . .http://www.post-gazette.com/image/2013/11/27/The-Cultural-Trust-at-18.jpg

Lesser-known Cloud Peak Coal pays a raft of executives million dollar salaries, but the top two rake in over $4,000,000.00 per year and for the big man at the head of the table, there is somehow $10,000,000.00 available to “invest” in his services. All of this while miners for CPC get laid off and left out of the financial bonanza reaped by the corporate big-wigs.

All of this occurred despite the key factors in coal’s decline being business factors and things people could see coming miles and miles away. If it doesn’t make sense for these savvy businessmen to have borrowed so much and spent so much in what everyone knew was a tough environment for coal, you’re not thinking about it right. The point was never to save the companies — it was to jack up their paychecks and make sure they cleared a bundle before the inevitable crash.

Same story, different day: the risks of capitalism are only for the workers and their families and communities. It’s win-win for the corporate leadership that always gets paid in advance. Oh, and even though the companies are “bankrupt,” they’ve got plenty of money left over to influence politics.

America’s CEO Culture

UPDATE, from August 19th plea hearing:

West Virginians are going to remember WVCHS8’s iconic photo of Gary Southern swigging ice-cold bottled water as he walked away from reporters in Charleston, citing a “very long day” that he had after depriving hundreds of thousands of West Virginians of usable water. The “Freedom Industries” CEO is not all that different from British Petroleum CEO Tony Hayward, who famously “wanted his life back” after questions from reporters put him out, just because BP had dumped over a 100,000,000 gallons of crude oil into the Gulf of Mexico. These men don’t understand our lack of sympathy for their plights, when they are “unfortunately” caught red-handed doing the things they do every day.

Now Gary Southern has waltzed into court to get his luxury Bentley automobile and millions of dollars back to spend on himself, while people harmed by the Freedom Industry spill are told there is “no money left” to pay their claims. When is enough finally going to be enough?

These lamentations from the multi-millionaire or even billionaire class are becoming more and more common. West Virginia’s own Don Blankenship famously complained of the “indignity” he felt subjected to as his mines violated state and federal laws and safety standards, ultimately resulting in numerous unnecessary deaths of coal miners. Former Bloomberg CEO and billionaire mayor of New York City Michael Bloomberg recently took time out from his busy schedule to tell us that homeless people are homeless because “that’s how God works.”

Meanwhile, we recently learned that while coal corporations in West Virginia lay of workers and claim they are “bankrupt” to avoid paying benefits and wages miners earned, that coal CEOs have been looting the companies taking seven and eight figure salaries to run them into the ground. There is always enough money to pay the CEOs. There is always plenty of money to lobby politicians like Bill Cole and Patrick Morrisey to protect their wealth. It’s only the working people that there’s never enough money for in “bankruptcy.”

You could do a whole story just on our friends at AIG – current CEO Robert Benmosche recently complained that when his titanic bonuses of tens of millions of dollars are criticized, he feels like he’s being lynched in the Jim Crow south. His predecessor, Hank Greenberg, having received over 180,000,000,000 in public money, is now suing us, the taxpayers, for not being generous enough to him.

Each of these super-wealthy leaders displays the same fundamental attitude towards the rest of us – that of the narcissistic personality disorder. American corporate culture excels at producing these individuals who have outsized notions of their own importance, an inability to empathize with others, a penchant for exploiting others and “a very strong sense of entitlement.” And so, whether they are in the midst of polluting Charleston’s water supply, or the Gulf of Mexico, whether they are getting men killed underground in the mines, leaving the homeless on the street in New York City or simply destroying America’s economy for their own financial gain, these folks repeatedly see themselves as victims, even
martyrs.

These folks have come to believe, because of their wealth, that they are simply above the rest of the people in this country. A certain number of them have swallowed the notion that they are the “job-creators” and that the rest of us are just oh, so lucky to have them in our lives. They may be devotees of Ayn Rand and Atlas Shrugged – believing, truly believing – that without them, the world would simply fall apart.poison

The facts tell a different story. In this most recent disaster, Southern’s company not only failed to report the disaster immediately, they actually knew ahead of time the leaking tank was bad, but failed to act. When the EPA inspectors arrived “no measures” had been taken to contain the spill. These don’t appear to be the acts of elite talent managing a company “better than government.” Nonetheless, these same individuals believe that any regulation of their work is “job-killing” and “burdensome.” In fact, we come to find out that getting “government out of the way” of Freedom Industries is what paved the way for the spill in the first place as the company appears to have been covered by loopholes [immediately] that prevented inspections at the site to make sure the company was acting safely.

southernMr. Blankenship has tried to hold himself out as an advocate for mine safety, but his internal memoranda sing a different tune: “If any of you have been asked by your group presidents, your supervisors, engineers or anyone else to do anything other than run coal (i.e. build overcasts, do construction jobs, or whatever), you need to ignore them and run coal. This memo is necessary only because we seem not to understand that the coal pays the bills.” A lot of good West Virginians died underground to cash the checks written by one CEOs outsized ego. This collection of “great men,” earning unbelievable salaries and bonuses, paid by the taxpayers of this country, just can’t seem to get its own basic job done right.

We needn’t bother reciting how our best-paid CEOs in the financial industry brought down the economy in 2008. What we should wonder is why we paid them so well to do it, and why do we reward them with even more afterwards? We have underfunded agencies trying to keep up with unsafe workplaces, toxic releases and financial frauds. Dedicated public servants work for modest pay at OSHA, EPA and the SEC, for example. But all they get is heat from the anti-government crowd and the next thing you know, there’s no clean water to drink in Charleston for a month1403654b-3f2b-4c42-b015-2226289bb69e_l.

Meanwhile, it only gets tougher for ordinary people. With the largest unemployment figures since the great depression, unemployment benefits are not just cut, they’re terminated (they should be raised). Somehow, opinion makers seem to think that America’s deficit is due to the poor and nearly poor collecting too much in the way of benefits. Each time lawmakers meet in Washington DC, more punishment for the poor and the unemployed tops the list of topics. Maybe it’s time to start punishing the people who are actually responsible for what’s happening in this country. Maybe they need more rules, more regulations, and more oversight and maybe it’s time they started actually paying for the trouble they’ve caused out of their bursting bank accounts.

Here’s what it comes down to: While no one in Charleston had clean water to use this past week, you can bet Gary Southern did. While the BP oil spill crushed livelihoods in the Gulf, Tony Hayward was planning his next sailing adventure. When our miners died underground, Don Blankenship was safe and snug at home. Mike Bloomberg doesn’t sleep on the street because unemployment and poverty are God’s decision, as far as he’s concerned. And when millions of ordinary Americans lost their pensions and investments in 2008, the billionaire bankers only got richer on the taxpayer’s dime. It’s no wonder they think so well of themselves – we always give them what they want.

It’s ordinary Americans that pay the price for our CEO culture, over and over again. It’s ordinary Americans who take the blame for what a privileged few do wrong, over and over again. These CEOs eat the big dinners while we pick up the checks.

How about next time we stiff ’em?

Blankenship Case Exhibits the Need to Change the System

UPDATE 2/17/16: Regular as clockwork, another CEO, Gary Southern, has swung himself a 30 day jail sentence despite poisoning the water supply for Charleston West Virginia. There continues to be one system for the rich in this country and one for everybody else. That has got to change.

Don Blankenship will escape his criminal trial without receiving the long prison sentence he deserves. A possible one year in jail, and a fine, are punishments that do not fit his crimes. But rather than rail against the injustice, we need to understand it, and address it, by fixing the laws and the system that made it happen.

Don’t imagine the lawyers, or the judge, or the jury rigged it. All of those folks performed their roles properly and honestly in this case. Everyone involved did their lawful duty in the epic Charleston trial of the former coal baron. But the resulting sentence points to a larger and more important truth below the surface.

For a powerful few in this country, nothing is left to chance. Blankenship didn’t have to try to influence the judge or jury unduly, because people like him set the system up well in advance, and make sure that the law itself is looking after them. When the chips fall their way, there is no surprise because everything has been arranged ahead of time.

CEOs like Blankenship have rigged our system in a deep and systematic way. The reason the sentence will be such a letdown was perfectly expressed by Vann Newkirk’s observation that our “system cannot avenge those it was not designed to protect.” Exactly so.

Our justice system has been built up over hundreds of years — all of them dominated, to one extent or another, by the power of organized money. A person can receive a long prison term for possessing marijuana, but not for conspiring to violate mine safety regulations. The reason is that those who would conspire to violate mine safety regulations organize their money and demand special protections from the legal system — and they get them.

West Virginians overwhelmingly believe that Don Blankenship bears responsibility for the deaths at Upper Big Branch. A clearer case of “industrial homicide” has rarely been seen. Yet again, and again, Blankenship’s team expressed frank incredulity and indignity at the idea that he would even be tried, let alone convicted, of anything.

Booth Goodwin’s historic prosecution of Blankenship was a tour de force, all the more so given the limited tools we give our prosecutors to work with against CEOs. But the light sentence — destined to be heavier in money than jail time — clearly shows us where ordinary miners stand in our legal system compared to the big bosses. Blankenship faced thirty times as many years behind bars for crimes against banking than he did for crimes against human beings.

Mine safety regulations are a matter of life and death. But conspiracy to violate them carries a misdemeanor-grade sentence. The system we have cannot avenge those it was not designed to protect. So we must change the system, and bring it into balance with what truly matters — bringing workers home at the end of the day to be reunited with their families — instead of tilting it towards “profit at any cost.”

All aspects of the system have this problem. Pensions and health benefits for workers are no safer than the workers themselves. In bankruptcy court, there is always money, and more money, to pay executives their salaries, bankers their fees, and bonuses on top of that. But there is never money for the workers’ pensions. Modest, monthly checks earned over thirty-plus-years of service at hard labor are suddenly “bloated” or “excessive,” while multi-million-dollar bonanzas for single executives are “necessary expenditures” for “key employees.”

More often than not, the most-highly compensated personnel have the most responsibility for the financial disasters, just as they have the most responsibility for the the human catastrophes. But they have financed a system that makes sure the price for their mistakes is paid by others. And they are getting their way.

Year after year, just as families are broken and bereft of their loved ones who do not survive Blankenship’s vision of how to “run coal,” so are those who survive bereft of the money once thought to have been earned underground. Organized money operates a system much like the house in a casino; in the end, they get it all.

Financial criminals brought this nation to its knees in 2007, and few if any of them have been prosecuted and none received a significant jail sentence despite costing the nation hundreds of billions of dollars and millions of jobs. Meanwhile, thousands of Americans are jailed for failing to have money enough to pay fines for petty violations of the law and regulations. Privatization of our prisons and courts is another means for organized money to extract profit from ordinary working people, and it’s a growth industry in 2016.

We need to redesign our system. We need to give prosecutors the tools they need to reach the top — where the decisions really get made. Mine safety is as good a place as any to start. At the federal level, the Byrd Act remains ready to go — every member of West Virginia’s Congressional delegation should support it as a top priority. If West Virginia’s leaders won’t stand up for miners and their families, who will? At the state level, conspiracies like Blankenship’s to violate mine safety rules should be deemed a felony, and carry a stiff sentence.

Some say that West Virginia prosecutors wouldn’t have the moxie to take on CEOs like Blankenship. But our U.S. Attorney has set an example for others to follow by boldly placing the responsibility where it belongs: on the wealthy men making the decisions that sent honest, hardworking, decent people into needless peril and death. Others must follow his work. The least leaders can do is deliver to our prosecuting attorneys the legal tools they need to make their convictions count at sentencing time.

Working people don’t have the advantage of unlimited bank accounts. They have to educate, organize, and vote to beat the Blankenships at their own game. When organized people demand it, we will have a system that protects them from organized money. Let’s get started.

Day of Reckoning: Blankenship Goes on Trial

Whatever happens at his trial, the hard truth is we are living in Don Blankenship’s West Virginia. The billionaire coal baron may have landed himself in the dock, but along the way, he landed an avalanche of politicians in our Capitol. The policies, and the politicos, that Blankenship groomed for a decade finally broke through in 2014 and they are busily turning our state into one big Massey enterprise.Old Scratch

Don Blankenship has a knack for summing himself up better than anyone else. He has declared that he believes in a kind of social Darwinism — “survival of the fittest” — whatever produces more money and profit justifies itself by that alone. Miners killed or injured by his deliberate circumvention of safety rules were simply a cost of doing business and as long as his bank balance went up, he felt fine.

And, Lord, did it go up. In 2011, when Massey sold out to Alpha, Don Blankenship took an payout worth over $86,000,000.00, on top of all the money he’d made before that. He locked up a lifetime deal for company lawyers too and who knows what other perks. At the height of what people call the “war on coal,” money rained down on Don Blankenship. He won the war.

But as Don faces the long arm of the law, United States Attorney Booth Goodwin, and a possible prison sentence, his legacy surrounds every West Virginian in every county — not just the coalfields he used to haunt. His cronies, proteges, and pals are a veritable “who’s who” of the present-day West Virginia Republican Party. Senators, Delegates, GOP Party officials and flacks — odds are any given one of them graduated from the Don Blankenship school of social Darwinism (or at least took plenty of money from it). They call him the “kingmaker.”

Blankenship’s reign demanded unremitting hostility toward union miners in particular, and the idea of working people bargaining collectively for better wages in general. He despised safety regulations that could slow down his efforts to “run coal” and increase company profits. Most of all, he wanted Republicans to control the Legislature so they could implement his agenda and his favorite policies.Coal Tattoo

And they have. The Armstead/Cole regime in place since the 2014 election followed Blankenship’s playbook page by page. Repeal of coal mine safety regulations: check. Attack on union wages and organized labor: check. Tax cuts for wealthy and influential businesses: on the way. Blankenship didn’t want to run only his mines, he wanted to run the whole state, albeit by proxy. Now West Virginia faces the prospect that Don Blankenship will rule West Virginia from a prison cell.

The power of Blankenship reared its head in Wood County last month, where one of his proteges, Republican county chair Rob Cornelius, got himself removed from his post for outrageous and offensive behavior. His actions included crude sexual remarks at public hearings and brandishing a baseball bat at a retired police officer. The dean of the GOP House caucus, Delegate Frank Deem, called Cornelius “bad news.” Never mind. The State Party quickly reversed course and put Blankenship’s man back on the job. Asked to comment on the trial, the Republican Party darling said: “[Blankenship] was a very good man and friend to me over the years.”

It pays to be Don’s friend, and it pays well.UBB

Millions and millions of Blankenship’s dollars have been poured into the West Virginia Republican machine, and none of it appears to have been returned when he was indicted. Bereft of the man himself as he occupied himself preparing for trial, Bill Cole, Mitch Carmichael, and Patrick Morrisey have become pale echoes of Blankenship’s rhetoric. They lobby for tax cuts benefiting rich businesses like Cole’s own auto-dealerships. They lambaste the wages earned by construction workers. They decry any regulation aimed at protecting human lives and limbs, or even basic clean water, as an affront to the “interests of business.” They re-brand the Blankenship agenda as the “Chamber of Commerce” agenda.

Blankenship once made a great show of living in West Virginia. But after his companies polluted the water supplies in his neck of the woods, we found out he’d built his own private water line for his house, while the local people dealt with his pollution. Once again, he sums himself up better than anything you can say about him. The pure self-interest, the total disregard for the rights of other human beings in the pursuit of profit — Don Blankenship piped in his own special water, while the local folks drank the water he’d dirtied. Social Darwinism.

It’s a shame Blankenship’s friends won’t go on trial with him. He may be the ringleader, but he recruited dozens of accomplices to do his dirty work, and many of them have yet to be charged. Even if he goes to jail, the men his money put in power will continue on the path he paved for them. “The evil that men do lives after them; the good is oft interred with their bones.” So it may be with Blankenship, unless, in 2016, his legions of politicians receive a different verdict, from a different jury: West Virginia’s voters.

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