My first journal in awhile and I'm pretty much just posting this here because it's too long for twitter!

This journal is in response to Murray Energy laying off some 160+ workers in direct response to Obama being reelected. You can read more about this in the following article:

http://www.huffingtonpost.com/2012/.....p_ref=business

The only thing I want to really emphasize is what people should take out of this. In my opinion this is very much a PR stunt. A PR stunt that affects dozens of people's lives but a stunt nonetheless.

The thing is it's certainly working. People are talking about it. It's doing it's job of raising awareness of the plight of the coal industry.

But what is this plight? According to Robert Murray himself in a prayer to employees following the announcement of these layoffs, "My regret, Lord, is that our young people, including those in my own family, never will know what America was like or might have been. They will pay the price in their reduced standard of living and, most especially, reduced freedom."

This is a man who was an outspoken critic against global warming and whose company raised hundreds of thousands of dollars for the Republican party and the Mitt Romney campaign.

Do these things upset you? I can't answer that. I'm not particularly bothered by these things. But we should examine some of the facts and figure out for ourselves what we should take away from this.

We have a coal company that is claiming that under Obama we are ruining America and that they are going to be forced to make terrible decisions. If America had picked Romney, they are saying, things would have turned out differently. These layoffs are the prelude to what's to come and that's the message they are trying to send.

What's causing these layoffs? Policies and taxes on carbon emissions.

To be honest I don't know too much about the specific policies being referenced here but I do know about carbon taxes.

Carbon taxes are used to reduce carbon emissions. If you assume carbon emissions are bad (and Murray might argue, or at least has argued in the past, they are not as bad as scientists claim them to be) then it's what we call a Pigovian tax. You set this tax level at a point where you get a desired level of the negative product.

Think of it this way... if you're a company that, without tax, produced 100 units of carbon what will happen if you are now taxed $50 per unit that you emit? Producing 100 units will reduce your profits by $5000. Because of this, you will adjust your business plan so that you find the number of units that maximizes profits. Those companies that can't find a new equilibrium will be forced out of business.

So now we have coal companies going out of business... That's bad, right? Murray would definitely tell you that and that's the message he's trying to get across. He's warning of us of a future where we will no longer be able to live our lives with affordable coal energy.

But let's look at another effect of this carbon emission tax. Energy Company A finds that producing coal energy is no longer as profitable but the demand for energy is still there. So what do they do? They invest in the research and development of alternative methods of energy product that produce less carbon emissions. Coal miners lose their jobs, but engineers of wind energy, nuclear power plants, etc. gain jobs.

Obviously there are some ideologies involved there but that that's the gist of it. Is this good or bad? That's up to you to decide but it seems like America already made their choice.

My thing is I have a problem with how this was done. These employees were basically handed letters that said 'America hates you so we have to let you go.' Is this what a company should tell employees that have worked for them 5+ years just to send a political message? Whether you jump to the company's side or the workers', you could still end up on the side of tearing down these policies and carbon taxes and that's obviously what they want.