By JR on Monday, December 26, 2011
Nevada has the highest unemployment rate in the country and is one of the worst in foreclosures. “In my district,” Nevada Assemblyman Hansen reports, “one in seventeen houses is in foreclosure. One in eight is vacant. The people are economically desperate. Meanwhile we have an industry that would love to open up mines and create jobs with an average salary of $80,000. Unfortunately we also have a government that takes ten years to permit a mine.”
No wonder 77% of Americans believe the country is heading in the wrong direction.
“Couldn’t we streamline the process or eliminate some steps?” asks Nevada State Senator Settelmeyer. He points out that the high gold and silver prices present a huge opportunity but he’s afraid that if we do not strike while the iron is hot, gold prices may fall before the mining projects get approved and get into production. “We have the resources and people need the jobs.”
In 1900 silver and gold were found in Tonopah, Nevada. Within weeks of the discovery, there was digging and within a year the mine was fully operational. In 1900 dollars, the mine brought in $125 million. Today, it would be multi-billions of dollars.
The Comstock Lode was discovered in 1859 and during its six year run an estimated $50 million of ore was removed. The discovery was largely responsible for Nevada becoming a state and it is credited with helping the Union’s finances as it backed the paper money—assisting the Union’s ultimate victory in the civil war. If Comstock was burdened with today’s regulatory environment, the war would have been over long before an ounce of silver was legally extracted and the outcome could have been different.
Mining has played an important role in the development of the western United States—providing jobs and revenues. It should be doing the same now. In Nevada’s mining towns, the unemployment rate is among the lowest in the country: 5-7%—according to Tim Crowley President of the Nevada Mining Association who says there are hundreds of mining jobs available in Nevada. Skills from the hard hit construction industry can be transferred to mining.
General Moly plans to hire 450 people by the end of the year. There are major copper operations in permitting. Companies are looking at mining rare earths and lithium—both of which are essential for cell phones, batteries, computers, and wind turbines and solar panels.
Imagine the jobs and new wealth that could be created if mining was encouraged. Senator Settelmeyer says, “It is hard enough for companies to get through the regulatory process and get a permit. On top of that there is frivolous environmental litigation that lengthens the process—cutting off vital resources and delaying jobs.”
Last week environmental groups hailed a decision from the 10th Circuit Court of Appeals that upheld a law prohibiting roads on nearly 50 million acres of national forest. Lawyers for the Colorado and Wyoming Mining Associations contend that the 2001 Roadless Area Conservation Rule violated the law. Previous conflicting federal court rulings have both upheld and overturned the road-building ban.
Jane Danowitz, director of the Pew Environmental Group’s U.S. public lands program acknowledges that the roadless rule blocks “logging, drilling and industrial development.”
Expressing disappointment with the decision, Stuart Sanderson, President of the Colorado Mining Association said, “The decision does not reflect a practical understanding of the impact that the rule will have upon mining jobs or access to needed minerals here in Colorado and the U.S. It is important to develop high quality coal and other mineral reserves, both to ensure our nation’s energy security and reduce our dependence on minerals produced in other countries.”
How does this roadless decision impact mining and jobs?
In Montana’s Finley Basin there are known tungsten deposits. An Australian company wanted to bring revenue and jobs to the state by developing the resource. While the property was successfully drilled and recognized by Union Carbide in the seventies, it is now about 200 yards inside a roadless study area. The Forest Service was willing to offer a conditional drilling permit. Among the conditions were these requirements:
* The drill sites must be cleared using hand tools,
* The drilling equipment and fuel must be transported to the site by a team of pack mules,
* The mules must be fed certified weed-free hay, and
* Drill site and trail reclamation must be done using hand tools.
The company gave up. How can America remain competitive in a global marketplace when we are required to use pick axes and mules? How does this help America’s heavy equipment manufacturers like Caterpillar?
No wonder we are in trouble. We need these resources. They are salable both in the US and in a global market. The question is will we produce our assets—creating revenues, jobs, and new wealth? Or, will we allow countries, such as China, to have a monopoly and control the price?
The issue goes beyond mining. If we are not utilizing our own resources, we will have to buy them from other countries who are ramping up to take advantage of the boom. They can produce them more efficiently without the layers of bureaucratic red tape. Some countries are working to control the market and raise prices—which increases America’s cost of manufactured goods, the deficit, and reliance on foreign suppliers.
When America is struggling with the deficit and Americans are economically desperate, we need to be looking at more than spending cuts and tax increases. We need to eliminate redundant red tape in order to create new wealth, cheaper energy, and real jobs—all of which will contribute to a stronger America.