Domestic mining is a key cog in the American economy. According to a recent report commissioned by the National Mining Association (NMA), it could be an even bigger cog if the federal government would get out of the way.
The new report by SNL Financial entitled “Mines to Market” details the significant economic benefits of domestic mining and explains how the current U.S. standard of living is vastly improved by the mass use of metals and minerals. Metals and minerals contribute to the production of buildings, vehicles, and bridges—and just about every electronic product we use.
While the report also notes that U.S. demand for minerals far outweighs the domestic supply, the primary takeaway should be the need to provide market access. Having open domestic and international markets will ensure robust supply to those who need the minerals. If it makes more economic sense for mineral users to import from other countries at a better price, they should do so. Furthermore, if American mining companies can capture opportunities in international markets, they should have the ability to pursue them.
The problem, however, is that we don’t have an open domestic market due to excessive government regulations that discourage mining projects in the U.S. Federal regulations and federal ownership of land prohibit the mining of several mineral-rich areas. The regulatory state and the growing federal estate have increased the threat to private property rights and discouraged mineral production. As Heritage wrote in its American Conservation Ethic, federal land ownership inhibits both economic development and environmental protection:
While crown jewels, such as Yellowstone or Yosemite, are appropriately designated as national parks, large swaths of the Federal Estate contain huge and untapped quantities of oil, gas, minerals, water, and timber that, with responsible practices, could fuel economic growth and job creation.
The current approach to managing the Federal Estate inhibits good stewardship of these lands. Access to this land and these resources is highly restricted because of poorly conceived environmental laws, heavy-handed regulation, and aggressive litigation by political activists. Rather than enact policies for the benefit of most Americans, competing and partisan efforts pressure elected leaders to enact policies that benefit special interests or powerful constituencies.
At the federal level alone, mining is regulated under several bodies of law: Section 404 of the Federal Clean Water Act, the National Pollutant Discharge Elimination System, Title V of the Air Quality Act, and an Environmental Impact Statement. State governments require additional permits and licenses. Any potential construction or mining project must have multiple approvals from federal, state, and local agencies.
The number of agencies involved in the process can vary, depending on the nature of the project, what organization owns the land, and in which state the project takes place. While an environmental review and permitting process for mining activity may be necessary, having a burdensome, duplicative federal regulatory process stifles investment, production, and job creation. The consultancy company Behre Dolbear stated that delays in approval were the “most significant risk to mining projects in the United States.”
The entire mining approval process may take as long as seven to 10 years. In Canada and Australia, the process takes only two years, despite the fact that both countries have strict environmental regulations.
The United States has an abundance of minerals and raw materials, but the long delays in approval and licensing limit access to them. States with plentiful natural resources have been handcuffed by Washington’s bureaucratic control, while production on private and state-owned lands has climbed significantly. The federal government should not stand in the way of states that want to replicate that success.
Thomas Lee is currently a member of the Young Leaders Program at The Heritage Foundation. For more information on interning at Heritage, please click here.