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Mamula and Bridges: Hardrock “Modernization” Bills Could Do More Harm Than Good

“Does America stand for self-reliance and innovative discovery of critical minerals for our economy and national defense and security? Or will Congress drive the fatal stake through the heart of our struggling domestic metals mining industry?”

According to a new Washington Examiner piece by Cato Institute Adjunct Scholar in Geosciences and ARPN expert panel member Ned Mamula and author Ann Bridges, we will soon find out. 

The authors of “Groundbreaking! America’s New Quest for Mineral Resource Independence” argue that two pieces of proposed mining-related legislation – touted as “modernizations, overhauls or replacements of the Mining Law of 1872” – would do more harm than good. 

Write Mamula and Bridges:

“At first blush, overhauling the Mining Law sounds appealing and overdue. But H.R.2579 seeks to boost royalties to 12.5% on new mining operations and 8% on existing mines for the “privilege” of extracting America’s public lands mineral wealth that is so vital to our nation’s defense, computing, communication, transportation, medical, renewable energy and battery technologies.

Under current mining law, hardrock (metal) producers already pay hundreds of millions of dollars annually in the form of private state royalties, and a variety of federal and state taxes on claim fees, mining activities, products and payroll, plus an existing 2% royalty fee on minerals extracted from Federal lands based on current market value of minerals delivered to a smelter.

To better place America on a path to mineral independence, we should be reducing the overall costs of mining, not adding to them.”

Mamula and Bridges lament that the bills under consideration “appear to dissuade new domestic exploration and production, including the all-important critical minerals and ‘green’ technology metals,” and that proposed fee increases “could well bankrupt existing miners operating on razor-thin margins.”

Already facing competition from massive Chinese and Russian state-owned companies — many of which may not be up to par when it comes to social and environmental standards — and politically-motivated market distortions, U.S. companies would suffer if the above-referenced bills were to move forward, say Mamula and Bridges. They conclude:

“In order to put our country on a course to achieve mineral independence, we should not penalize our mining entrepreneurs. Instead, we should incentivize them by reducing the overall costs of mining, enabling them to compete globally. We should also bring production home, by providing increased access to federal mineral lands.

Both bills would take America’s national interest in the wrong direction, even as China’s overt posturing of its rare earth monopoly bolsters its leverage against the U.S. negotiating position, which is weakened by a lack of any long-term strategic plan for domestic mining and critical minerals production.

To remain strong, our nation needs a dependable supply chain of critical minerals and metals that will only come from a durable Mining Law. The overhauls proposed in the two congressional bills would have crippling consequences that would reverberate through every sector of our economy and undermine our national security.

If passed, these bills would gut the entrepreneurial spirit of the Mining Law by imposing stricter anti-mining regulations, repressive royalties, and impossibly short lifetimes for mining claims. These changes would spell the beginning of the end for domestic hardrock exploration and mining and put thousands out of work. Worse, they would increase our already dangerous dependence on foreign sources for critical minerals.”

Click here for the full piece.

And for more context, see Ann Bridges’s piece – co-authored with Paul Driessen – entitled “Americans Declare Freedom, Not Fights,” in which they call for a “Declaration of Mineral Independence.”