A Bloomberg Business View that Makes Much Sense
The Gold-Rush Roots of U.S. Budget Woes
Don't you love when people dedicated to personal profit make a case for the common good? We excerpt this 2013 article from Bloomberg, Feb 7.
by the Bloomberg EditorsA mining law that dates to 1872 helps explain why it’s so difficult to disrupt the dysfunctional status quo. The General Mining Act, conceived during the Ulysses S. Grant administration to encourage development of the frontier, allowed prospectors to remove gold and other minerals from U.S. public lands without paying royalties. The law has long permitted highly profitable mining companies to extract minerals for free — resources that are the property of every American.
It’s just one of many outrageous giveaways — the subsidies, tax preferences, and exclusions enjoyed largely by energy and natural-resource companies — that Congress has been loath to eliminate, despite longtime efforts by fiscal hawks and environmentalists.
Ending any one of these outdated incentives wouldn’t close the U.S. budget deficit, which the Congressional Budget Office estimates will total $845 billion in 2013. Combine them, though, and the savings would add up to tens of billions over a decade.
The 1872 mining law dictates that taxpayers continue to foot the entire bill for cleaning abandoned gold, silver, and other mineral mines across the U.S., which has cost them more than $2.6 billion since 1998. The tab could swell to as much as $54 billion, according to the Environmental Protection Agency. The White House estimates a fee could increase annual revenue by $1.8 billion over the next decade.
The U.S. could also gain by charging royalties on the roughly $1 billion worth of hard-rock minerals extracted each year from public lands, much as it does on oil, gas, and coal. Royalties from those industries generated about $10 billion in 2011.
To read more
JJS: It’s not just extractors from public land who should pay the annual market value of minerals, but also extractors from private land. Nobody made the land and everybody makes it valuable. And not just extractors of resources but also drillers, loggers, farmers, developers, homeowners, land syndicates, everybody putting land to use. Plus users of the airwaves. And don’t leave out those producers and consumers who use the air, water, and land as their dumpsite for pollutants.
All those users, which totals all of us, should pay for our use, should pay as much as the land we use is worth, and pay not lone owners but our entire community.
Once we all get a share of Earth’s worth, we’ll be so secure we won’t need much in the way of government services, so we could trim the state way down. The budget issue would shrivel with it. But it all starts with feeling entitled to a fair share of Earth’s worth.
Editor Jeffery J. Smith runs the Forum on Geonomics and helped prepare a course for the UN on geonomics. To take the “Land Rights” course, click here .
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