Next in the Crosshairs: America’s Mining Industry?

This article reports on HR 699, the Hardrock Mining and Reclamation Act of 2009, introduced by Congressman Nick Rahall and co-sponsored by a number of Democratic Congresspeople. In the view of the writer, this bill would have a devastating effect on the industry–especially the smaller miners. (The publication in which the article appears seems to be oriented toward a readership of small miners.)

Anyone here in the mining industry, or follow the mining industry closely? Any reactions to this proposed legislation?

Maybe it’s not as bad as the writer suggests…OTOH, in view of the disastrous Consumer Product Safety Improvement Act, it would not be wise to put too much faith in the collective judgment and common sense of this Congress.

7 thoughts on “Next in the Crosshairs: America’s Mining Industry?”

  1. HR 699 is possibly the sanest piece of legislation I’ve seen in years. It corrects an outdated and dangerous Act. Many, many industry groups support it, including the jewelry industry, which actually needs hardrock mining to continue.

    Unfortunately, the old Act encourages companies not to mine, but instead file an “intent to mine,” then buy that prime real-estate on the cheap ($5/acre!), and sell it off for development, for a huge profit. Those companies that do mine, strip the ground using the most dangerous and hazardous methods, i.e. the cheapest, because the resulting Superfund clean-up is not their problem. These polluted former mining sites are scattered all over the American West, and the clean up of them consumes billions of dollars of taxpayer money, takes decades, and has a long term impact on the quality of life of surrounding communities, and the health of their residents. For example, people who live near the Haller Lake site in Idaho have extremely elevated levels of lead in their blood, with accompanying health issues. Unfortunately, the company that created the mess, like many, went bankrupt soon after (there is not actually all that much money in real mining; real estate is more profitable), so there is no entity to sue for damages. The government ends up stepping in to subsidize health care for the afflicted.

    HR 699 enacts a reasonable royalty, less than other extractive industries are already required to pay, and updates an Act that is frankly criminal in today’s terms.

  2. I heard (second or third hand) from a friend researching land in colorado:

    * Mining companies are legally required to do their own cleanup and site remediation.
    * So the owners make a new corporation to buy the land and do the mining
    * The profit gets constantly bled out of the company
    * When the mine taps out, the sacrificial corporation goes bankrupt
    * No one cleans up the site, ever. Unless the government steps in.

  3. BaS: The new law would require that companies clean up after themselves, but the current legislation specifically exempts hardrock mining– the government is always responsible. Please note that HR 699 applies specifically to a certain type of mining, which was granted special exceptions over 100 years ago. Other types of mining, and similar extractive industries, are entirely unaffected by HR 699.

  4. MW,

    HR 699 is possibly the sanest piece of legislation I’ve seen in years….

    So, an act that requires people to file an official notice with the Federal government in order to use an off-road vehicle in rugged rural areas is sane? This is not to say that the current mining law doesn’t to be updated but clearly this particular law is not focused on environmental protection but instead seems oriented towards protecting the property values of people with scenic vistas. It lets anyone shake down and harass mining companies big and small for profit.

    If the issue where environmental protection, they would simply require that all miners buy a bond to pay for clean up operations. The bonds would pay to insure a specific, mathematically fixed, level of pollution emanating from the site. Bonding companies would evaluate the site prior to mining and then monitor mining operations to make sure that they did not get stuck with the bill for a clean up. If you did that, then the free-market would automatically determine which sites could be safely and profitably mined. It would be easy and automatic and would not fail do to political meddling down the road.

    Instead, we see centralized micromanaging and trial lawyer bounty hunting which will target small operators just as this type of regulation does in all industries. Only big corporations with big legal departments will be able to mine. This is exactly what happened with the superfund, asbestos clean up and a host of other similar supposed environmental programs.

  5. There is of course a general and consistent distrust at this great site of all things governmental. However, when I learn, as I did a few days ago, that the largest contractor from our nation to both Iraq and Afghanistan, an offshoot of Haliburton(and you know the Cheney connection) does not pay a single cent in taxers because they claim headquarters in the Cayman Islands, then I have to say that I distrust the govt as it was run by “conservative” GOP when the war began and the no-bid contract went out. After getting ready to pay my taxes I can but ask: what about the private contractos, who have made, I suspect, a heck of a lot more than I did.

  6. Anonymous,

    So what. Corporations don’t pay taxes … people do. Any American employee of said firm will pay income and payroll taxes. Any American investor will pay income and capital gains taxes. Any income taxes the corporation would pay would get factored into the price they charge for their services. As their number one customer would be the Government …

  7. If you don’t want corporations basing themselves in other countries, ask your congresscritter why we have the highest corporate tax rates in the world.

Comments are closed.