Bacon Bits: Black Diamonds, Tarnished Silver, Wilting Green

Free falling. As coal production declines, the economy of far Southwest Virginia is in free fall, with potentially dire fiscal consequences for local governments. “A sharp decline in coal production jeopardizes the fiscal health of local governments, degrading their capabilities to provide adequate public services and issue and serve debt,” finds a report by Columbia University’s Center on Global Energy Policy and the Brookings Institution. Between 2007 and 2017, Virginia coal production fell by 50% from 24.9 million short tons to 12.8 million. The study identifies Dickenson and Buchanan counties as the fifth and sixth most mining-dependent localities in the nation, with 17% and 16% respectively of the labor force engaged in the industry in 2015. The Virginia Mercury has the story here.

Tarnished silver. Phase One of the Washington Metro’s Silver Line to Tysons ran $220 million over budget and was completed six months later. Now Phase Two of the $5.8 billion project funded largely by commuters on the Dulles Toll Road, reports the Washington Post, is running late. The project, expected to be wrapped up next month, may not be completed until next spring or summer. The construction project has been plagued by cracks in concrete structures, defective rail ties, and faulty dimensions for a rail-yard platform. It is not clear yet if the problems will exceed the project’s $550 million contingency fund.

Why do today what you can put off until tomorrow? Bacon’s Rebellion has made much of Virginia’s $5.8 billion in unfunded pension liabilities. Now a new study, “The Sustainability of State and Local Government Pensions: A Public Finance Approach,” says there’s no reason for Virginia or any other state to panic. After “reverse engineering” future benefit cash flows of the pension plans, the authors find that pension benefit payments in the U.S., as a share of the economy, are currently at their peak level and will remain there for the next two decades. Thereafter, the reforms instituted by many plans will gradually cause benefit cash flows to decline significantly.” 

“Under low or moderate asset return assumptions and in the aggregate for the U.S. as a whole, pension debt can be stabilized as a share of the economy with relatively moderate fiscal adjustments,” the authors write. “Notably, there appear to be only modest returns to starting this stabilization process now versus a decade in the future.”

There are currently no comments highlighted.

7 responses to “Bacon Bits: Black Diamonds, Tarnished Silver, Wilting Green

  1. The coal mining business may be in a free fall in South West Virginia, but coal mining (along with gas production) is booming around the world, leaving a relative trickle of growth in renewable power in its wake. For the whole story, see https://wattsupwiththat.com/2019/07/23/developing-nations-latest-decade-of-energy-emissions-growth-torpedoes-alarmist-global-emissions-control-scam/

  2. A June 9, 2019 Forbes story helps explain the the great coal generation boom for energy in Asia, such as:

    “The claim that aggressive climate change mitigation programs helps the poor is egregiously misleading. Modern coal plants are a success story, as pollutants emitted have fallen dramatically with technological improvements over the past several decades … The second misleading claim is that intermittent sources of renewable energy can replace the need for grid-supplied power based on fossil fuels. An endless litany of “green” success stories permeate the mainstream media with the erroneous believe that that wind and solar power are “already competitive” with fossil fuels. Rigorous economic analyses of the hidden costs of unreliable, weather-dependent solar and wind power have countered such claims as an exercise in magical thinking. According to data reported by energy generators to regulatory authorities in the US, wind and solar power are two to three times more expensive than existing coal or gas-fueled power.

    See the entire Forbes story at: https://www.forbes.com/sites/tilakdoshi/2019/06/07/in-coal-we-trust-the-need-for-coal-power-in-asia/

    • More facts in the face of green power deception:

      “U.S. media conceal 4.5+ billion tons increase of CO2 by developing nations – push meaningless “sustainability” propaganda agenda
      Guest Blogger / 2 mins ago July 25, 2019

      Guest essay by Larry Hamlin

      In the politically contrived climate alarmist propaganda campaign by the U.S mainstream media there is no limit to the degree of distortion, deception and dishonesty employed in attempts to conceal from the public the reality of global energy use and resulting emissions that is underway in the world that clearly demonstrates their propaganda war of alarmism is already lost.

      Global energy and emissions data through year 2018 documents that the world’s developing nations have increased CO2 emissions by over 4.5 billion metric tons during the last decade and now account for 64% of the global emissions total.

      China and India accounted for over 67% of the developing nations CO2 emissions growth through the use of increased fossil fuel – predominately coal fuel where China and India accounted for about 88% of developing nations increased coal use during the decade.

      The U.S. decreased its CO2 emissions by about 530 million metric tons during this same period, more than any other nation in the world, largely through substituting lower cost, reliable and more efficient natural gas in place of coal.

      The developing nations increased CO2 emissions were over 8.5 times greater than the size of the significant U.S. reduction.

      China is continuing to increase coal use with plans to build hundreds of new coal plants in the coming decade.” End quote.

      For the balance of this fact filled article see:
      https://wattsupwiththat.com/2019/07/25/u-s-media-conceal-4-5-billion-tons-increase-of-co2-by-developing-nations-push-meaningless-sustainability-propaganda-agenda/

  3. Jim,
    “As coal production declines, the economy of far Southwest Virginia is in free fall, with potentially dire fiscal consequences for local governments.”

    Dickenson and Buchanan Counties have a total population of 30,000 — not than many. So it is a stretch to say that far southwest Virginia’s economy is in “free fall.” I checked and found that Roanoke has an unemployment rate of 3 percent.
    I also cringe at the lack of perspective about the decline of coal. Employment reached its highest point in the early 1990s and has been declining since. Despite mining coal for a century or more, these counties never benefitted much from the selfish coal operators. They have always been poor and the wealth was taken elsewhere.
    Reed, fracking comes in fits and starts. The rigs are expensive and they tend to shut down when oversupply of gas dips prices.

  4. Reed,
    You are correct that there’s plenty of enthusiasm for coal in China and India. This is very dated, but here’s a story I did on the topic iin 2012;

    https://www.nytimes.com/2012/11/13/business/energy-environment/china-leads-the-way-as-demand-for-coal-surges-worldwide.html

    The problem is that Forbes gets too cheer-leady when it says that the new coal plants are just dandy when it comes to pollution. I now there was a school of thought about 10 years ago among Chinese engineers that the government had the money and the means to build much cleaner coal plants. I don’t know how that has gone.

    • Point of clarification: When I refer to “far Southwest Virginia,” I mean the six or seven counties in the most southwestern extremity of the state, which is largely synonymous with the coalfields. To my mind, “Southwest Virginia” is a significantly broader region that stretches east to the Blue Ridge and as far north as Blacksburg. In a discussion akin to asking how many angels can dance on the head of a pin, we could argue whether the Roanoke Valley is better classified as part of “Southwest” Virginia or “Western” Virginia. For what it’s worth, the Tobacco Indemnification Commission excludes both the New River and the Roanoke Valley from its definition of Southwest Virginia.

  5. I would like to see Virginia equalize taxes instead of bifurcated approach we have. hitting NoVA. But if there are counties in economic hardship, then it makes sense to have a lower sales tax etc for economic development.

Leave a Reply