Friday, February 8, 2013

Mining companies rape the land and rape the taxpayer

Newmont gold quarry, Nevada
by Richard Mellor

In the various movements that have arisen in response to the capitalist offensive here in California, the student protests against cuts in education and fee hikes, opposition to foreclosures, job losses, housing etc. one issue that wouldn’t go away was that California is the only state in the Union that doesn’t charge the energy companies for the extraction of oil from the ground.

This became an issue in the upsurge and no doubt among political people it was well known, but so many Americans and Californians would not have known it.  Capitalism in the US is not Stalinist totalitarianism; it is possible to find information if you look particularly now with the Internet, but it is still a very secretive social system, especially when it comes to business activity and the role of the state, foreign policy etc.

The propaganda that myself and others write about on this blog fairly frequently, that there is no money in society, that we have to accept cuts, support “shared sacrifice”, that capitalism cannot afford to provide jobs for all, a secure and decent life etc., has a huge influence in our decision making and what we understand about the world. That’s what it is supposed to do which leads to sections of the working and middle classes squabbling among ourselves over who should take the worst hit, which section of the working class shall suffer most.

We don’t hear much about another little gem that the corporations get from the state, you know, the organ that supposedly governs for the people by the people. One of them is similar to the freebie’s the oil giants get extracting oil from California land.  It is the federal 1872 mining law, The General Mining Act that was introduced during the Ulysees S Grant administration.  This law allowed prospectors to extract gold and other minerals from the land without paying royalties.  The intention of the law was to encourage settlements and development of the frontier, a crucial necessity for capitalist expansion.

That laws now allows what even Bloomberg Businessweek calls “highly profitable mining companies to extract minerals for free.”  Given that they’ve been doing this for over a century that would amount to a considerable sum.  Not only that, the taxpayer has to foot the bill for the clean up after the corporations have extracted the wealth. This is the case with much of industry. The tab for this clean up could cost the taxpayer as much as $54 billion according to the EPA.

The US does charge royalties for oil, gas and coal extraction but the politicians in Congress, “Powerful mining industry allies” as BW describes them, folks like Majority Lead Harry Reid, are fighting hard for the corporations that they represent and that pay them handsomely.  They have resisted attempts to change the 1872 law. 

Others are trying to get some sort of “royalty and reclamation” fees passed to no avail, but there is a possibility an attempt will be made to do so again with a caveat that all the monies do not go to the federal government but partially to the states where mining is a major industry.

The importance of political action is the lesson here.  It is not some accident of history that this law has remained on the books is it?  It is not because they all forgot about it because it was buried in the archives under wherever the archives are kept.  This law exists because the section of the capitalist class that benefits financially from it has ensured it remained on the books and up to now, their competitors didn’t care. 

Both parties of capitalism, the Democrats and Republicans, ensure that the interests of their constituents are preserved.  Sure, they squabble over details as one section of the capitalist class competes against another for the right to plunder society, energy versus the tech industry, Hollywood versus agribusiness, or the financial sector.  We have seen a major war between the old established bourgeois and the private equity guys over carried interest, transparency and taxation.  But when it comes to the working class, the public or the vast majority of Americans who rely on wage labor as a means of survival these two parties ensure the interests of big business is paramount.  The Democrats could have changed this law long ago.

Socialist should support taxing oil that comes from the land and the mineral wealth too, but more importantly is worker's control and management of this industry and all industries crucial to the well being of society and our environment as another devastating aspect of mining is the environmental damage. There is also the theft of indigenous people's land both in the US and throughout the globe.  Those politicians advocating royalties will not concern themselves with these issues to any serious extent. They will still ensure profits are protected.  The first step towards solving this and other problems is nationalizing these industries. 

More about this issue here

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