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Supporting Coal Exports Brings Jobs to America

Hal Quinn | 6/6/2013, 9:13 p.m.

If we sell more products to our trading partners than we buy from them, we will create jobs and add value to our economy.

But during World Trade Month, our negative balance of trade is a stark reminder of a soft spot we face on the road to economic recovery.

If the President succeeds, one industry that will help him close our trade deficit may surprise those who think only of consumer electronics or autos. It’s a U.S. industry that enjoys a positive trade balance right now, and one that can help close that trade gap even faster given the right conditions.

That industry is coal. In fact, the $14 billion of coal shipped globally last year comprises the only net positive addition to our nation’s balance of trade from the energy sector. Last year, the 126 million tons of U.S. coal exports supported 168,430 jobs at mines, railroads, ports and many other businesses located in dozens of states.

The fact is, the U.S. coal industry has doubled coal exports since 2008 and has already made a significant contribution to the president’s National Export Initiative.

According to a new study by Ernst & Young, coal exports create high-wage jobs that on average pay more than $96,000 a year, almost 50 percent more than the all-industry wage. At a time when our economy struggles to generate high-wage employment, exporting coal is obviously one solution. These jobs aren’t confined to coal mines but extend throughout the supply chain, from the rail and port terminals downstream to retail and wholesale businesses.

If coal’s star turn in the balance of trade drama surprises anyone, it’s likely because they are unaware that coal is booming everywhere else in the world. In fact, thanks to powerful demand from rapidly developing countries such as China and India, coal is the fastest growing fuel worldwide for the past decade and is widely expected to surpass oil as the world’s number one energy source by 2017. Some 1,200 new coal plants, are slated to be built— three-quarters of them in China and India— where importing coal is a top priority for steelmaking and for generating affordable electricity to keep pace with rapid urbanization.

For the United States with more than a quarter of the World’s coal reserves— more than any other country— this spells opportunity. For every million tons of coal we export that helps developing countries we create 1,320 jobs here at home. That’s the kind of win-win trade relation the president wants more of.

But the U.S. needs more port capacity to help the president with his goal. An expansion of the nation’s coal export infrastructure at ports on the Atlantic and Pacific coasts, the Gulf of Mexico and the Great Lakes, would help the United States potentially double its exports once again.

As long as we lack that expanded port capacity, other big coal producers like Australia and Indonesia will be happy to provide the coal if we don’t and keep the jobs and the export revenue that could be reducing our trade deficit.

A February 2013 report by the Bipartisan Policy Center recommended against restricting coal exports, for the simple reason that our balance of payments will suffer if those exports are curbed.

And the Center is correct. If we are serious about creating high-wage jobs and competing head-to-head with the rest of the world, U.S. coal exports offer an example of how to achieve both objectives. America has coal— the energy source that the rest of the world wants. Providing it to them will ensure our own economic wellbeing.

Hal Quinn is president and CEO of the National Mining Association— the voice of the American mining industry in Washington, D.C. Membership includes more than 325 corporations involved in all aspects of coal and solid minerals production.