Friday Roundup: The Chicken Game

The price of lamb and the cost of chicken • WV mine operator agrees to phase out strip coal • Canada increases numbers of rural doctors • Post Service losses hit record

 

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St. Louis-based Patriot Coal has agreed to phase out its coal surface mines, saying the move was in the best interests of both the company and the communities where it operates its mines, Ken Ward Jr. reports in the Charleston Gazette. 

The announcement is part of an agreement between Patriot and West Virginia citizen groups. The company said it would never seek permits for large-scale coal strip mines, Ward reports.

“Patriot Coal recognizes that our mining operations impact the communities in which we operate in significant ways, and we are committed to maximizing the benefits of this agreement for our stakeholders, including our employees and neighbors,” Patriot CEO Ben Hatfield told U.S. District Judge Robert C. Chambers Thursday. “We believe the proposed settlement will result in a reduction of our environmental footprint.” 

The agreement involved Patriot, the Sierra Club, the West Virginia Highlands Conservancy and the Ohio Valley Environmental Coalition. Ward reports:

Appalachian Mountain Advocates lawyer Joe Lovett, who represents the citizen groups, said the settlement will “significantly change mining practices in Central Appalachia.”

Derek Teaney, another Appalachian Mountain Advocates lawyer, said the deal will eventually end all surface mining by Patriot as the company’s existing mineral rights run out. At some point as those leases expire … there will be no small-scale surface mining.” 

The settlement arises out of more than $400 million in liability Patriot faces for pollution caused by its mining operations.

Patriot is not expected to immediately close any mines or lay off workers. It must cut its surface mine production beginning in 2014 and reduce it to no more than 3 million tons a year by 2018, about half of its 2011 production, Ward writes.

Today, Ward has reactions from West Virginia and Kentucky politicians and others in and around the industry. 

• BBC Checks Out Bio-Lab — The BBC looks at the stalled bio-lab that was supposed to be built in the middle of Kansas, in Manhattan to be exact. 

The decision to move the lab (which would carry out research on highly contagious animal diseases) from an island off New York City to Kansas was made in 2008. But “little has happened in the intervening years.” One reason, perhaps, is the fear among Kansas ranchers that bad stuff from the lab could escape and work havoc on the national herd.

• About MuttonHigh Country News’ Emily Guerin reports on the disparity between what ranchers are being paid for their lamb (now about 90 cents a pound) and the $16 a pound that groceries are getting for their lamb chops. 

Last fall lamb was selling for $2.23 a pound and producers think the price drop is due to market manipulation. Senators in Montana, the Dakots and Wyoming have asked for an investigation. The Senators wrote:

“We respectfully request that the Grain, Inspection and Packers and Stockyards Administration (GIPSA) fully investigate this drastic change in price spread to ensure that no packers or meat processors are violating the Packers and Stockyards Act by manipulating on-the-shelf lamb and other sheep product supplies and prices in such a manner that would drive down live prices for sheep producers.”

Lots of reasons for price changes in mutton, reports Guerin.

• Subsidies Love Romney — Of the top ten counties in terms of ag subsidies, only one voted for President Obama, Business Week reports

Only majority-black Bolivar County, Mississippi, supported Obama.

• The Chicken Game — The Washington Monthly reviews the failure of the Obama administration to break up or limit the control the power of meat packers in a good, long review of the subject. 

Reporter Lina Khan reviews the history of the administration’s failures and concludes:

Administration officials who took part in the hearings say two factors thwarted their attempts to protect farmers from exploitation by processing companies. One was a deliberately obstructionist Republican-controlled House set on derailing countless reforms, not only in agriculture, and on protecting big industry from any tightening of regulation.

The other factor the administration blames is the weakened state of America’s antitrust laws. In the past, antitrust law was used to promote competition and to protect citizens from concentrated economic power. But today, enforcers say they are handicapped even when confronting markets that are no longer competitive. “However desirable, today’s antitrust laws do not permit courts or enforcers to engineer an optimal market structure,” the DOJ wrote in its recent report on the 2010 agriculture hearings. Far-reaching actions—like the Wilson administration’s challenge of the meatpacking industry ninety years ago—are, they say, simply unimaginable under today’s narrow antitrust framework.

But, she continues:

One wonders, though, whether the administration’s actions—taken as a whole—did not set the farmers back as much as would a loss in court. By documenting the big processing companies’ exploitation of independent farmers, then failing to stop that exploitation and retreating in almost complete silence before entirely predictable resistance from the industry, the administration, for all intents, ended up implicitly condoning these injustices. The message to the processing companies is, after all, absolutely clear: you are free to continue to act as you will.

• Postal Service Losses — The Postal Service lost $15.9 billion in the fiscal year ending September 30, a record. 

Most of that loss wasn’t from operations, however. The Wall Street Journal reports that $11.1 billion comes from Congress’ requirement that the Postal Service prepay on retiree health benefits.

Operating losses are actually decreasing.

Congress has yet to act on a Postal Service reform bill. 

• Doctors Increasing in Rural…Canada — The number of doctors in Canada has increased at a rate three times faster than that of the general population in the last five years. 

“The encouraging news is that the gap between the number of urban and rural family physicians is decreasing,” Geoff Ballinger, CIHI’s manager of health human resources, said Thursday in a statement.

 

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