Ukraine: digging for black gold

In a shift to capitalism, Ukraine has closed 35 of 220 mines; it plans to close half of those remaining.

When Aleksandr was born, he was given a medal. His birth capped 100,000 people for the town of Snezhnoye, one of Josef Stalin's model coal-mining settlements in the wealthiest region of the Ukraine. His miner father received a plush salary, and the family lived comfortably.

But that was 37 years ago. Today, Snezhnoye's population has shrunk to 67,000, and Aleksandr's life couldn't be more different. All but one of the town's 11 coal mines have shut down. Unemployment hovers at 50 percent. Potholes and deep black mud make the roads between isolated inhabitants almost impassible. The town has turned into a wasteland of abandoned buildings, rotting industrial equipment, and slag heaps the size of small mountains.

Aleksandr's family now lives on a meager diet of potatoes, while many of his neighbors starve. That's why he took the only work left, even though it is illegal. Three years ago, Aleksandr joined a gang of pirate miners digging up old mine shafts to steal the coal.

Illegal mining is one of the most dangerous professions in the world, but that doesn't stop several thousand men, women, and children as young as 11 from making their living this way in eastern Ukraine. "The Ukrainian government has abandoned us," Aleksandr says. "I know our mines are illegal, but I don't feel like a criminal. This is honest work. When the government returns its services to us, I will be happy to follow its laws and pay its taxes."

The miners are forced to pay tributes to organized crime, and several miners have been punished for speaking to journalists, which is why they will not give their last names.

Not far from Aleksandr, Ludmila crawls out of another mine with her teenage daughter, each lugging 100-pound sacks of coal on their backs. They are covered in acrid black dust and gasping for breath, but still smiling. Each sack will bring about $1.50 on the black market.

Ludmila's husband was killed in a mining accident 12 years ago, so now the women mine coal 12 hours a day a thousand feet below ground in tunnels so low the miners are bent almost double. "Of course, it is dangerous," Ludmila admits. "But if you don't work, you don't eat. At least, when you're afraid, you know you are still alive."

Accidents are commonplace – one of Ludmila's teammates, an 18-year-old boy, was killed last summer when the roof of the mine caved in. Even the Ukraine's official mines are among the most dangerous in the world, killing about 400 people a year. Experts say illegal mines are even more hazardous because of the lack of safety equipment.

But, with two small children and grandparents to support, Ludmila says she has no option. Snezhnoye was one of the places hardest hit by the fallout of Ukraine's transition to capitalism. In 1997, the Ukrainian government began downsizing its inefficient coal industry on the advice of the World Bank, and the town's heartbeat fell silent.

After the mines were closed, factories, schools, restaurants, and shops all went out of business, and those who still have work are often not paid for months on end. "The Ukraine can import coal cheaper than it can produce it, if you discount the economic impact," says Jerry Triplett, an American mine specialist working in the region. "The problem with shutting down coal mines is that the whole town depends on the mine. If you displace 3,000 workers from a mine, the economic impact will be that 25,000 people lose their jobs."

Apparently, this is just the beginning. Only 35 out of Ukraine's 220 mines have been closed so far, and the World Bank is calling for half the remaining mines to be shut down. A top World Bank official in the Ukraine, who asked not to be named, calls the country's mining region a "lost cause."

"Ex-mining regions always have unemployment and social unrest," the official says, "but the government shouldn't be using its scarce budget resources to support a failed mining industry. That is robbing more viable parts of the economy of the support they deserve."

Yet, both miners and some government officials, including the minister of fuel and energy, Stanislav Stashevskiy, counter that some of the closed mines have viable coal reserves, citing the illegal mining business as evidence.

Situated in the heart of the rich "black earth" belt, Snezhnoye still has high-quality coal near the surface. Its seams were mined as early as the 18th century and became the object of Stalin's economic plan in the 1930s.

Though the Dombas Basin region could feed most of the Soviet Union, Stalin forced the crops to be exported. As a result, a third of the Ukrainian population died of starvation, while Russian miners were moved in to take over. For three generations, they dug the coal that fueled Soviet industry out of the rugged steppe, and the mining settlements thrived.

"We were promised a sort of heaven on earth, and we had everything we could possibly need," Aleksandr says. "My father came from Russia to mine coal. It is true that even then mining was very hard work, and miners didn't live very long. But the country needed coal, and my father was a patriot."

Now, Aleksandr's family still keeps a portrait of Stalin next to the picture of his 10-year-old daughter, Yuliya, who is the only child left in his village. There is no clean water or telephone service to the settlement anymore, and the road connecting it to the outside world has been washed out.

The Ukrainian government does have a plan to revitalize the area, which involves shutting down mines more slowly than the World Bank would like and retraining miners. But it has already run out of funding in the program's earliest stages. The World Bank gave out $300,000 in small-business loans in the region in 1997, but those businesses went under. Now, the bank is withholding credit until more mines are closed.

As the moon comes up, Aleksandr joins a line of miners headed into the woods for the night shift at his hidden mine. "The mines are our salvation, because without them we would starve," he says. "I know my daughter doesn't stand a chance. She will probably end up working in the mines like everyone else. But I still have hope that someday things will get better."