By John P. David
March 13, 2018 - Among the many issues in the news, the one that is missing serious attention is passage of the American Miners Pension Act. This act pertains to securing promised benefits to nearly 87,000 coal miner retirees, widows and future retirees in the negotiated United Mine Workers of America 1974 Pension Plan. Passage of this Act has major repercussions on the West Virginia economy.
The situation is clear. In 1946, President Truman signed the historic Lewis-Krug Agreement negotiated by UMWA President John L. Lewis and U. S. Department of Labor Secretary Julius Krug. This industry-wide agreement obligated the federal government to life-time health and pension benefits for the nation’s miners through the initially called UMW Welfare and Retirement Fund. In the deal, workers sacrificed wage increases for the promise of life-time health-care and pension benefits. These promises were obligations and responsibilities agreed to by corporate America and top political leadership in the absence of national programs, such as those in Canada and Europe, that were legislatively obtained through the political process. The plan was set up with royalties paid per ton of coal backed by a federal guarantee.
In 1974, the Employment Retirement Income and Security Act caused the above-mentioned fund to split into two separate funds, with the 1974 Pension Plan providing pension benefits to eligible miners who worked on or after January 1, 1976. As a result of extremely depressed coal markets, coal company bankruptcies, layoffs, consolidation and other factors there has been a dramatic decrease in the level of employer contributions to the 1974 Plan. In the last two years alone contributions have dropped by more than $100 million, leaving less than $25 million per year still coming in to the Plan.
As noted, there are many factors that are contributing to the problem. One is the failure of the federal government to honor its commitment to coal miners who made America a great nation. Another is declining coal production. A third is the use of bankruptcies to take away worker’s lawful benefits. It is ironic that this country does not recognize that human resource obligations negotiated by companies and government are a legal debt equal to if in fact not superior to the debt owed to commercial vendors. Abraham Lincoln made the point clear when he said, “labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could not have existed had not labor first existed. Labor is superior to capital and deserves the much higher consideration.”
Indeed, there is an issue of moral values. Corporations that over the years gained wage concessions and promised health/pension benefits for life, now have unscrupulous leaders. Benefits that promised economic security were agreed to by all parties. Workers, accepting the promise in good faith, paid for the promise over and over again. But when the promises had to be honored, the promise-makers danced and laughed. They milked assets and ran. They hid behind bankruptcy laws and non-union shields. Furthermore, they preached in favor of moral values while they practiced deceit. They claimed to be in favor of family integrity while they practiced policies that disrupted and destroyed family stability. The decision to break commitments, promises and guarantees to workers and their families is morally despicable.
The described contradictions cause deep division and consternation. We cannot boast of being free politically when we permit workers to be economically enslaved, disregarded, disrespected and relegated to the human scrap heap. Bankruptcy laws must become humane and government commitments are treaties that must be honored. Judges must be made accountable. Economic terrorism must be stopped. And fairness, good working relations, and honesty must return as the top priority to the value system of those who lead America.
Coal miners are owed the American Miners Pension Act. It represents a promise for today and tomorrow made yesterday that must be kept.
John P. David, Ph.D., is Emeritus Professor of Economics at West Virginia University Institute of Technology and director of the Southern Appalachian Labor School.
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