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Copyright 1999 Federal Document Clearing House, Inc.  
Federal Document Clearing House Congressional Testimony

February 23, 1999, Tuesday


LENGTH: 3995 words


American Mining, the Economy, and the Public Lands: Locking Away Our National and Economic Security Testimony of Richard L. Lawson President National Mining Association Subcommittee on Energy and Mineral Resources Committee on Resources U.S. House of Representatives February 23, 1999 Washington, D.C. Chairperson Cubin, members of the committee, I am Richard L. Lawson, the president of the National Mining Association. Our members are the enterprises that deliver to public use most of the basic material resources required to uphold and strengthen America in daily life - the miners and producers of coal, metals and useful minerals; and the manufacturers of their equipment, and the suppliers of goods and services. Your oversight is timely and welcome. Our Nation has the world's largest and most useful combination of metal ores, minerals, and energy. We rank first or second in global production of about 20 essential metals, minerals and coal, and high in many more. We hold significant shares of world reserves. Our presence in world markets ensures free competition, imparts stability, and deters attempted cartelization for either economic extortion or political coercion. Most such resources occur in the West on the federal land that custom calls "public land," a term that emerging practices belie. Public land alone contains more resources in variety and in volume than major groupings of other nations - that is, the European Union and Japan. This gives us flexibility of policy - economic and security policy. Yet the administration is locking these resources away from public use in many ways in many venues - doing so by direct action and by indirect action. It is doing all things possible to discourage exploration and to prevent development. Many acts are unauthorized by the law or unjustified by the facts. The proximity of federal holdings also is being used to quash by intimidation private activity on private property. This month the administration put off limits to exploration 670 square miles of so-called public land in Montana. It is the most recent of almost half a dozen executive or regulatory confiscations. This month another major metals producer closed its last U.S. exploration office. Exploration budgets are down 50 percent. No exploration now means no production in the future. Mining companies must have something to mine. Arbitrary delays make financing difficult. They must go where they are allowed to produce minerals. This pattern of action is forcing them overseas and into volatile regions and volatile countries - to places that have yet to evolve stable political and economic institutions; that are not necessarily devoted to the principles of free market economics and trade; and that may harbor or develop economic and political ambitions. It is forcing future U.S. dependence for essential resources on these places as well. Some say they don't care if mining leaves the United States - that it doesn't matter in this new age. They think that a future can be secured without basic material resources. They think that if they produce words and ideas in this "information age" then nothing else is necessary. I know otherwise - that essential remains essential. I know that when anything threatens to destabilize the world economically or politically, America's young soldiers, sailors and aircrews will be sent into harm's way to make it secure. I had to issue such orders as the commander of U.S. Forces in Europe. You know it too. I care that the United States remains a major mining nation, and it has nothing to do with my present employment. I care because my pilot son in the Air Force will be one of the first called upon to secure the source of something essential, if we withdraw from world markets. I care for him and for the many thousands of our sons and daughters who will go with him. U.S. mining is an element of National Security. The policy question is: Do we produce these resources at home and keep our sons and daughters here? Or do we send the activity, and our sons and daughters, overseas? To call to mind the role of mining in America you need do only four things whenever you ride your subway to or from The Capitol: - Never forget that the rails, the wheels, the cars, the electric power that turns the wheels that move the cars on the rails, and the control system that coordinates everything - all of it began in a mine; - Remember that every American requires almost 47,000 pounds of mined materials a year - that almost every material thing you use at work or in leisure began in a mine or required something from a mine to make it, or grow it, or process it; - Remember that the federal taxes due directly and indirectly to mining typically equal more than 3 percent of all federal revenue - greater than the sum of the alcohol, tobacco, and other excise taxes; - And always look up at walls around the Rayburn boarding platform - look whether coming or going. Recall that on those walls are representations of history's foremost exponents of wisdom and law; and that Moses, the lawgiver, has a central place. When Moses gathered the people to tell them of the Promised Land to come the Scriptures say he spoke of: "...a land whose stones are iron, and out of whose hills thou may dig brass....A land wherein thou shalt ... not lack anything.... America is such a land. Let us determine to keep it so. My written testimony will touch on the following: 1 - Mining in America's Economy: Requirement, Resources and Utility; 2 - The Public Lands: More Minerals Than Europe, More Riches Than Arabia; 3 - Material Resources and National Security; 4 - Mining and Community: Good Jobs, Sustaining Taxes, Good Practices; and 5 - Our Pledge to America's Future: Technology to Resolve Concerns. In addition, there are attachments of statistical detail on mining and the revenues of government, on the value of mining products by state for the 50 states, and on the state-by-state comparison of average wages and mining wages. 1. Mining in America's Economy: Requirement, Resources and Utility Standard references say an advanced economy requires at least 75 different minerals to get the precious and base metals and alloys and inorganic chemicals that allow it to innovate and keep advancing. America possesses more than 60, and American mining delivers them. There is no state of the 50 states in which something is not mined. The references say the quality of a nation's standard of living and the vigor of its economy can be inferred from the use of mined resources. Americans require almost 47,000 pounds per person per year. For electric power alone we each use 20 pounds of coal a day. Most of the world's 6 billion people are closer to 500 pounds a year. They want their share. Be confident that they mean to have it. Resources controlled by the federal government will have a critical role in balancing U.S. policy in the future - critical for the better, or for the worse. Here's what some standard references say: - America's resources are in the combination of variety and volume the world's largest concentration of the useful metals and minerals; - Much of our prosperity is due to their abundance; - They give American workers important productivity advantages in the world competition; - They are most important to manufacturing; - Energy from mining is important to manufacturing and the rest of the economy - especially coal and uranium for electric power; - America requires more electric power than any other nation; - And so, the component industries of the mining industry have an importance in the economy disproportionate to their size. The greatest volume and variety of such resources are produced in the West and Alaska from what is called public land. Most reserves and almost all the prospects for new discoveries are on this so-called public land that the federal government closely controls. America generally ranks first, second, or third in world production of a large variety of mineral resources, and among them are: - The metals: copper, gold, silver, magnesium, molybdenum, lead, beryllium, germanium, and rhenium; - The minerals: boron, bromine, barite, diatomite, feldspar, gypsum, industrial garnet, industrial sand and gravel, lithium, mica, phosphate, perlite, salt, sulfur, soda ash, silicon, talc, and vermiculite. - And the two fuels that together account for almost 80 percent of America's electric power - coal (57 percent) and uranium (20 percent). We also deliver an appreciable share of world output of iron ore, zinc, the platinum-group metals, cadmium, hafnium, selenium, titanium and titanium oxide. Other minerals include iodine, kaolin and other clays, pyrophyllite, wollastonite, special bentonite, lime, potash, pumice, and rare earths. This is wide sample, not an inventory. It would be hard, and maybe not possible, to list every use for any of the major items mined in the United States and most of the lesser ones. Ores become metals, and metals with alloys become tools and capital goods, which become durable goods and services. The industrial minerals like salt, sulfur, phosphate, potash, and soda ash are essential to chemical and manufacturing processes. Some go to make both our computer screens and their glow. Others are critical to the fertilizers that raise the yield of foodstuffs. The industry's saying is this: If it can't be grown, it has to be mined. The extension is that if it is grown, the products of mining are required to fertilize or feed it; to harvest or collect it; to process it, cool it, or heat it; and to move it to market. Our material resources are the genesis of much activity and the feedstock of more - the material and intellectual feedstock of advanced technologies and new kinds of activity. The table of elements will not change, only the ways in which the elements are combined for materials. Present-day resources in new combinations beget improvement of existing products, and new products, and new kinds of activities. Their ready availability encourages such activity. The newer technologies and the next technologies depend on everyday resources in new combinations put to new uses: for example, lasers require silver for mirrors; and the World Wide Web hangs on connections of copper and gold. One advance builds on another. And, of course, almost every new thing requires electric power that is reliable and low in cost, a specialty of coal. The oncoming technologies that require high-temperature superalloys and superconductors will require resources from mining - American mining. They, in turn, will contribute to the more efficient generation and distribution of electric power. Electric power is the most widely required energy - industrial, commercial, personal. For context: power rates in the global economy per thousand kilowatthours compare as follows: Japan - $269 for household power and $185 for i ndustrial power; Germany - $204 for households and $1 01 for industry; European average - $137 for households and $79 for industries; and the United States - $84 for households and $47 for industries. Americans and American industry pay less than half what our primary economic competition pays for power. Fuel largely determines price. We'll use almost a billion tons of low-cost coal for power this year, much from public land. Whether it satisfies want or requirement, luxury or necessity, virtually all human economic activity depends on someone in a mine taking some useful thing from the earth so that others may make things or do things with it. 2. Public Lands: More Minerals Than Europe, More Riches Than Arabia On average the federal government owns one square mile of every two square miles of the mining West and Alaska. This 815,000 square miles is the equal in size to: The other leading industrialized nations of the world - Japan, Germany, Great Britain, France and Italy; plus Ireland, Denmark, Switzerland, the Netherlands and Belgium with room for several Luxembourgs left over. This federal sub-continent contains the following: In essential metal and mineral resources, we estimate it is richer than Europe and Japan, and many supplier nations on other continents; and in coal alone, a reserve that in energy content exceeds the combined oil of Iraq, Iran, Kuwait and Saudi Arabia. To the point: Nevada is an important gold state - 80 percent federal ownership; Idaho an important silver state - 62 percent federal; Arizona an important copper state - 43 percent federal; and Wyoming, the leading state for coal and soda ash - almost 50 percent federal ownership. Western mines deliver the bulk of: copper, gold, silver and molybdenum; and of lesser known but very important alloy metals such as the beryllium and rhenium that are required for National Security applications. In the minerals Western production delivers either the bulk of or all of: barite, boron, diatomite, perlite, potash, pumice, rare earths, and soda ash. Public land in the West holds about half the U.S. coal reserve. The largest coal-producing mines are in the West. The power plants with the lowest costs of operations and maintenance are coal-fired and are in the West - about 1 cent a kilowatt-hour. Some send power from coal mined on public lands across the mountains to California, where no coal is allowed. Closing the Escalante Canyons area by executive order confiscated from the public 60 trillion kilowatt-hours of low-cost electric power - about 20 years' worth at last year's national level of generation. This 30 billion tons of recoverable coal is the energy equal of the oil of almost two Iraqs. Utah is 64 percent federal land. This administration is using both executive orders and regulation to reorganize and restructure both the societies and the economies of the Western states doing so across a range of executive agencies in which an excuse can be found to exert a jurisdictional claim. More is involved than mining; but mining is a major target, directly and indirectly. More than 70 proposed regulations or sets of regulation are pending that touch on mining. In many cases the action proposed exceeds the authority granted by Congress, and in some cases moves forward without authority. Some lack scientific underpinning and others are contrary to scientific advice. Many are based on undemonstrated and undemonstrable need. It is as if much of the executive branch has joined to make good the promise of the Secretary of the Interior - a policy declared when Congress rejected his constrictive and punitive revision of the mining law. He promised"to explore the full range of the regulatory authority we now possess" to enact the provisions denied by Congress. In ways Congress neither considered nor intended these acts have a singular and collective intent: not to correct a flaw but to curtail the act of mining. In view of these most recent acts the range of authority presumed by administration officialdom appears to be virtually unlimited. Last summer the Secretary told the New York Times: "...the real action now is on landscapes and watersheds ... the offensive game, and all the fun, is outside of Congress." Here's how things stand in the "offensive game" across the agencies: - Substantial public land in the West has been closed off or proposed for closing; - There is reason to believe the drive to introduce endangered species in certain areas is a means of further expanding the "full range of regulatory authority" along with that of the species; - There are initiatives to extend the authority to proscribe by regulation deep into the country's most extensive river systems - the Columbia, affecting much of the mining West, and the Mississippi, covering the rest of the country; - Regulatory enactment is pending of the punitive federal mining regime that Congress rejected - rules to override state regulation in the West; - The environmental impact process takes almost 5 years, if there are no problems or interventions; - In one instance exploration was forbidden in a Midwest national forest that has been open by long practice, regulation and law; - And proximity to national parks, forests, or wildlife refugees has been used in at least three instances to coerce cancellation or withdrawal of private projects on private land - the threat of extended and expensive regulatory battles on permits. The federal government owns one square mile of every four square miles of land in the United States: 880,000 square miles of 3.5 million: almost 25 percent of the Nation and growing: more 500 national forests, parks, monuments, recreation areas, historic parks, sea and lakeshores, reserves and preserves, and so on, down to quarter-acre historic sites. There is no state in which the federal government does not own something. Every acre is part of some watershed or ecosystem. The government has begun to use these holdings as justification to control much more by reach of regulation. 3. Material Resources and National Security The world is generally at peace now, but it is never at rest. Someone always is watching and probing for an opportunity or weakness to exploit. There are many who would humble the United States, if they but had means and chance. Not all weapons are military. They also can be economic. National Security and preparedness are terms often applied to defense alone, but both have a second component - industrial capacity. Industrial capacity is to the projection of military power what muscle is to strength. To be secure the Nation must have the means of flexibility and freedom of action in all events. Preparedness requires a military establishment capable of supporting the foreign policies pursued and an economy able to support both the objectives of government and the aspirations of the people. Security seldom requires more; but it never accepts anything less. Among the nations of the world, declines in relative economic standing generally cause reactions: influence declines; there is maneuver in the hierarchy of nations; and the shifting throws more pressure on foreign policy and the military establishment. At home the people grow restive when the objectives of government and their personal aspirations are more than a short time in conflict. When nations study other nations in contemplation of policy there is no method of assessment or examination that does not consider economic structure, especially natural resources. The ongoing instabilities of the Persian Gulf and their connection to imported oil are but one example. Mining is critical to America's future security. Silver, zinc, titanium, and platinum are designated strategic and critical. Copper, gold, iron ore, lead, molybdenum, phosphate, sulfur and potash are considered essential to the U.S. and world economies. We produce the major share of the world's molybdenum, all in the West, and of phosphate and sulfur. Access to federal lands will be required to continue operations in the decades to come - to uphold the public good. Mining also upholds American security with efficiency and ever- improving technology. Technology is why we are a major supplier of copper, gold, and iron ore; it allows production from ores of a low metal content - ores that not long ago would not have been worth mining. Our technology extends and expands the reserve base of resources for the U.S. and the world. Better exploration and better production are important in a world of expanding requirements. When the President locked away 20 years worth of low-cost electric power, he said, "Mining is important ... but we can't have mines everywhere." When the Secretary of the Interior threatened an extensive and expensive regulatory fight to block a titanium mine on private property, he dismissed the product with the comment, "Titanium is a common mineral." Titanium in one form is used to whiten the filling of Oreo cookies and in another to impart high strength to airframes and jet engines. Titanium is a strategic commodity, and versatile too. One standard reference estimates that 90 percent of the metallic wealth ever produced in America came from mines whose combined surface would cover an area not much larger than 30 miles by 30 miles. The President and the Secretary seem bent on removing public lands from public use and purposes that serve the public. The result puts our National Security and our economic future at risk. Two questions must be asked and answered without quibble or qualification. Do we produce here the essential material resources we have in plenty, and keep our sons and daughters at home? Or do we concede supply and participation in world markets to others, and send our sons and daughters into harms way to keep them secure? 4. Minina and Community: Good Jobs, Sustaining Taxes, Good Practices Both statistics and performance show mining is a strong, positive force in a community. Miners' pay is 66 percent more than other industrial workers-an average $50,000 for miners to $30,000 for all others. Our baseline study shows that mining, and the economic activities associated with it, and the activities supported by it, typically cumulate directly and indirectly in the American economy as follows: $27 billion a year in revenue for local and state government; $57 billion in federal revenue, more than the excise taxes; $144 billion in personal income; $296 billion in mining-dependent business income; and a total $524 billion impact on the U.S. economy; and 5 million dependent jobs. U.S. mining leads the world in developing good practices - in production, in health and safety, in environmental remediation. When the industries of other nations want to improve, they come here to see how we do it. U.S. mining sets the world standard in reclamation and restoration. Mining is a temporary use of the land. Coal mine reclamation has returned to other productive uses a land area approximately equal in size to the State of Rhode Island. The states require reclamation of other forms of mining. When other nations want to improve, they come here to see how we do it. 5. Our Pledge to America's Future: Technology to Resolve Concerns America's mining industry is pledged to keep getting better - is an enthusiastic partner in the Industries of the Future program. The program is designed to bring to bear the intellectual power of the national laboratories, and other resources, on developing the technologies for the United States mining industry we will create in the 21st century. Our goal is to identify, develop, and deploy technology according to our vision of the future. Our vision is of an America secure in its resources - low cost resources. Our vision of the future includes: - Advanced production - minimum ground and community disturbance, lower energy consumption, improvements in miner safety and health; - Advanced reclamation and remediation with an emphasis on cleaner and more efficient production; - Greater utility of products and recycling where possible; - Lower cost products in support of America's competitive participation in the global economy and an ever-improving standard of living. In coal we are additionally committed to Vision 21 of the Department of Energy. We are aiming at 60 percent generating efficiency with coal by 2010 and near-zero emissions by 2035. We foresee complexes based on coal and high efficiency technology that deliver to public use at low cost an array of goods: electric power; natural gas; other fuels; fuel additives; chemical products; and the means of greater resource recovery from existing oil and gas fields. Some try to argue for the sake of politics that mining is the industry of an age gone by. But the standard references point out that one may judge the utility of a resource or an industry by the number of useful products that flow from it. We say mining is tomorrow, not yesterday. We say mining is the foundation for America's future.

LOAD-DATE: March 8, 1999

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