Sen. Larry E. Craig, R-Idaho, styles himself a rugged Westerner who believes in less government, a balanced budget and welfare reform - with one exception.
Craig is championing a multibillion welfare program called the 1872 Mining Law. The 121-year-old law was passed when national policy was to encourage settlement of the West with the lure of mineral rights and free land. But now it has turned into the ultimate free lunch: Individuals and corporations can prospect on federal lands for minerals and buy the land for either $2.50 or $5 an acre without paying any royalties if they strike it rich.The federal government has sold approximately 3.2 million acres - an area the size of Connecticut - at these fire-sale prices. According to the General Accounting Office, nearly 592 million acres of public land remain open to mining. Some estimate that these lands contain more than $85 billion worth of mineral reserves.
"Some of the biggest beneficiaries of the . . . mining program are large corporations, many of which are foreign-owned," says Rep. Mike Synar, D.-Okla., who has been crusading against the government giveaways. "Each year they take billions of dollars' worth of gold, silver, uranium, copper . . . from the public lands and don't pay one red cent of royalties to the American taxpayers."
Synar cites how the Department of Interior may transfer 2,000 acres of the Custer National Forest in Montana to the Stillwater Mining Co., which is owned by the Manville Corp. and Chevron. Stillwater would pay about $10,810 for this land in exchange for platinum and palladium deposits worth $43 billion. "The American taxpayers would get $1 for every $4 million in strategic minerals extracted from these public lands," fumes Synar.
Both the House and Senate passed bills this year that would reform the mining law, but the two measures differ sharply. After years of work, Rep. Nick Rahall, D-W.Va., pushed through a comprehensive bill that would charge an 8 percent royalty on extracted minerals, with the money being used to clean up some of the half-million abandoned mines created by the current law.
The Senate passed a bill sponsored by Craig, who has continued an Idaho tradition of befriending mining. Craig's predecessor, Jim McClure, retired to launch a lobbying firm that works overwhelmingly on behalf of mining firms. Craig's bill would impose piecemeal reforms and carries the full support of the industry.
Although the Clinton administration has been gung-ho for welfare reform for the poor, it's been approaching mining reform more gingerly. It's got one eye on equity and the other on next year's congressional elections in the West. As one Democratic House staffer told our associates Deborah Acomb and Jan Moller:
"Unless the administration weighs in, we're not going to get much, and the prospects aren't great for a real strong administration push on this one."