The Last Domino

They’ve been mining coal in West Virginia for more than 250 years. For most of the last half of the 20th century Massey was a major player in the Court of King Coal. For the last two decades Massey Energy operated under the iron fist of its Chairman & CEO, Donald Blankenship. Don Blankenship hails from Stopover, a speck on the map about as far out as you can get into the eastern tip of Kentucky where it pokes into Virginia and West Virginia.

Those three states were Blankenship’s stomping grounds until 2010 when his reckless management style led to the deaths of 29 miners at Massey’s Upper Big Branch mine. That triggered his golden parachute retirement and the sale of the company the next year. Blankenship is the kind of “Bean Counter” we have all learned to fear. A bean counter whose relentless focus on profits ignores all else, in his case even safety. A bean counter who poured cash into politicians’ pockets to establish a regulatory atmosphere to fit his twisted management style.

 

These political “investments” and hundreds of thousands in fines regularly levied against Massey were seen as a cost of doing business. Still the Upper Big Branch mine was cited for more than a thousand safety violations in the three years prior to the explosion that killed 29 miners. The ventilation system that could have prevented that deadly explosion was not functioning properly, an uncorrected violation.

A tenacious federal prosecutor has been peeling away the cobwebs that surround the Upper Big Branch disaster. One-by-one U.S. Attorney Booth Goodwin is finding clues. One-by-one, individuals who bypassed regulations have fessed-up and pled guilty. It’s like a deadly row of dominos, as each one falls it tips the next in line; or in this case the next up the line.

Earlier this year Massey executive David Hughart admitted that he had tipped off workers when the inspectors were coming. When the judge asked Hughart who told him to alert the workers, he replied, “The Chief Executive Officer.” He, who was so all powerful he could not be named? Don Blankenship. The last domino is teetering at the top. Time will tell if he will face justice for lives lost and justice for families destroyed.

While Massey prospered under Blankenship’s demonic rule, one can’t help but wonder how it would have fared under an ethical leader. Would it have been cost effective to observe the law and avoid all those fines? Would it have been more profitable to have a workforce treated with respect, a more productive workforce perhaps? Would it have been better to consider the communities near their mines? Would it have been less costly to think about how their mines might impact the environment? Would an ethical business model have been better for all, especially for Massey’s shareholders? The answer across the free enterprise system is a resounding “Yes.”