Alan Krupnick:
Can there possibly be a worse idea than to have the federal government give every ton of eastern coal burned a $15 subsidy—as was proposed by West Virginia Governor Jim Justice. To put this in perspective, the current price of coal from West Virginia ranges from $45 to $52 per ton, so this subsidy is very large relative to the price. Or, using the US Bureau of Labor Statistics’ estimate of coal jobs in the East (here defined as Appalachia) of 38,000, $4.5 billion translates to about $120,000 per miner per year.
The ostensible reason for the subsidy is to improve national security. ... If anything, coal should be taxed for its environmental damages relative to other electricity fuels to internalize its many negative externalities into its price—from mountain top removal and acid mine drainage to carbon dioxide and sulfur dioxide emissions when burned. A better plan for the $4.5 billion a year would be to support new efforts to build an enduring, modern economy in eastern coal country along with bolstering health care and job assistance programs.
via www.rff.org
I deleted the argument against subsidizing eastern coal as a national security issue. I understand why those at RFF need to act like they are taking it seriously but I don't, do I?
