Tag Archives: Polymet

Mozambique, Michigan, and the SEC Complaint Against Rio Tinto

Chinde_Rusting_boats

Rusting boats at the port of Chinde, where Rio Tinto proposed to barge Riversdale coal via the Zambezi River.

Yesterday, the Securities and Exchange Commission brought a complaint in New York City against Rio Tinto, charging Tom Albanese, the former CEO of Rio Tinto, and Guy Elliott, his Chief Financial Officer, with fraud. According to the complaint, Albanese and Elliott actively misled the Rio Tinto board, audit committee, auditors, and the investing public about their acquisition of the Riversdale coal business in Mozambique in 2011.

The fraud that Albanese and Elliott are accused of perpetrating looks awfully familiar to those who have followed the development of Eagle Mine and the controversy over County Road 595. Having noticed the parallel between Mozambique and Michigan back in 2013, when Tom Albanese was forced to step down, I now have to wonder whether prosecutors will take the company’s representations around the Eagle Mine into account when building their case.

In Mozambique, they told investors, coal would be transported by barge to the Indian Ocean port of Chinde. Although their technical advisors “highlighted the ‘showstopping’ risks” associated with the barging proposals before the acquisition, Albanese and Elliott blundered recklessly ahead. Then eight months later, the Mozambique government denied Rio Tinto a permit to transport the coal by barge down the Zambezi River. Suddenly, the coal business they had acquired for $3.7 billion appeared to be worth a negative $680 million. According to the SEC’s complaint, Albanese and Elliott “concealed and glossed over” the fact that they had no viable haul route for the 30 million tons per year they projected in their business plans, and misled investors as they raised $5.5 billion in US debt offerings.

In that very same period, Rio Tinto was also promoting Eagle Mine to investors and promising economic renewal in the Upper Peninsula, though they had not yet secured a transportation route — a haul route — for Eagle’s sulfide ore. In Michigan, it appears, the company took the same cavalier attitude toward planning and risk that the SEC complaint says got them into trouble in Mozambique.

Way back in 2005, John Cherry, who was then a Kennecott Minerals project manager and is now President and CEO of the Polymet project in Minnesota, characterized Eagle as a “direct ship” operation, “meaning that the rock would not be processed on site, thereby avoiding the storage of highly toxic debris left over, called tailings.” Presumably this is what Michigan DEQ’s Robert McCann had in mind in 2007, when he told The Blade that Kennecott’s permit “would require them to keep the ores underground, put them in covered rail cars, and ship them to Ontario for processing”; the Marquette Monthly told roughly the same story that year, only now there were trucks in the picture: “ore would be transported by truck and rail to a processing site in Ontario.” This seems to have been nothing more than a cover story.

Everything changed in 2008, when Rio Tinto bought the Humboldt Mill. Those permit requirements the DEQ’s McCann touted back in 2005? They were quickly abandoned. Covered rail cars come into the picture only after the ore is crushed, ground into a slurry, floated and rendered into concentrate at Humboldt Mill. A glossy 2010 company publication promoting Eagle Mine includes not a single word about how Rio Tinto and Kennecott plan to travel the 30 kilometers from mine to mill: “Happily, processing of the nickel and copper can take place in Humboldt, around 30 kilometres [sic] away, at a previously abandoned iron ore plant.” By 2011, the company had “considered more than a half dozen transportation routes” from mine to mill, according to a Marquette Mining Journal article by John Pepin published in February of that year, but they still had no viable haul route.

A good prosecutor with a rigorous and thorough discovery process would probably be able to determine whether the evasions and misrepresentations perpetuated on the public over the Eagle Mine haul route also amounted to fraud, or were part of a larger pattern of deliberately misleading statements. It’s clear Rio Tinto never came clean — and perhaps never really had a firm plan — on mine to mill transport at Eagle before it sold the works to Lundin Mining in June of 2013 and decamped. As long as regulators in Michigan continued to be more accommodating than those in Mozambique, the company seems to have been content to let the people of Marquette County fight out the haul route issue among themselves.

Save the Wild UP December Gala Keynote Address

This is the text I prepared for my remarks at the Save The Wild UP December Gala. My talk deals with the ethics of Lake Superior mining, connecting it with climate change, the loss of the wild and the dawn of the Anthropocene. It’s also a reflection on human ingenuity and human responsibility. The half-hour keynote makes for a long blog post, but I hope readers will find something here worth sharing and discussing.  

1

When you invited me to speak tonight, I tried almost immediately to come up with names of people who might be better suited to the task. In this crowd, I ought to be listening and trying to catch up.

I’m an outsider, and a latecomer to boot. Some of you were here when Kennecott and Rio Tinto first staked their claim to the Yellow Dog Plains. I didn’t fully appreciate the extent of the new mining activity in this area and all around Lake Superior until about 2012. That was right after Ken Ross and I had finished making 1913 Massacre, our documentary about the Italian Hall disaster.

I was so caught up in the story our film tells that I was under the impression that copper mining — sulfide mining — was a thing of the past in the Upper Peninsula.

Very near the end of 1913 Massacre, there’s an interview with an Army veteran who’s sitting at the counter of the Evergreen Diner, drinking a coffee and smoking a cigarette. He says that after the copper mines closed in 1968, attempts to re-open them failed because people were “bitching about the environment and all that shit and the water and the runoff.” The camera, meanwhile, is exploring the industrial damage left behind by the mining operation.

This is the one moment in the film where we had to bleep out some bad language before Minnesota Public Television would air 1913 Massacre on Labor Day in 2013. The only time anyone in our film curses is when the subject turns to protecting the water and the environment.

That these two things — a destroyed, toxic landscape and a hostility toward people who care about the environment — exist side by side; that people can watch a mining company leave a place in ruins, poison its waters, damage it to the point that it’s now a Superfund site, with high levels of stomach cancer and fish that can’t be eaten, and direct their anger and curses at people trying to prevent it from happening again: our film presents all that as part of what we’ve come to call “mining’s toxic legacy.”

The Army veteran went on to say — this part didn’t make it into the film — that people who bitch about the environment are “people from out of town.” He wasn’t complaining about environmental regulation or about big government; he was complaining instead about out-of-towners, strangers who make it tough for regular guys to make a living.

Strangers can be people from faraway, or just people from whom you feel estranged: people who don’t share your ways or speak your language; and it would be possible to talk at some length about the way the mining operations in the Keweenaw estranged people from each other and from the place they live.

Everywhere it goes, it seems, mining divides and displaces people. It’s never just about extracting ore from the ground. Mining is development and the power to direct it.

When strangers come to town or when people feel estranged, we need translators, guides and mediators. This is one reason why it’s so important to have a local, grassroots organization dedicated to the shared interests people have in the nature and culture of the Upper Peninsula.

You might look like the underdog right now. But I think you’ll agree that there’s a pressing need for a more responsible, inclusive and respectful conversation about development in this place. Save the Wild UP is in a great position to lead it.

2

Back home in Brooklyn, I have a fig tree. I planted it last spring. I just finished wrapping it for the winter. I love the work the fig tree involves — the care it involves — because it connects me to the memory of my grandfather and the fig tree he kept. My tree connects me to my family tree (my roots), to history, and in my imagination the tree belongs as much to history as it does to nature. The life of my tree depends almost entirely on my care. I sometimes wonder if there is anything wild about it.

There is a wild fig. The ancient Greeks even had a special word for it: φήληξ. They seem to have derived its name from another word (φῆλος) meaning “deceitful,” because the wild fig seemed ripe when it was not really so. The ancient world knew that wildness is tricky. It can deceive and elude us, or challenge our powers of discernment.

Nature, we claim, is our dominion, as if it (naturally, somehow) belonged to history, the world of human activity. Our economy organizes nature to produce natural resources. But the wild represents a living world apart from history and another order of value altogether.

We can’t assimilate the wild into an engineered and technical environment: it will cease to be wild the instant we try. The wild begins where engineering and ingenuity stop, at the limits of human authority and command. So “wild” is sometimes used to mean beyond the reach of authority, out of control.

But what’s wild is not alien. Sometimes the wild calls out to us, usually to ward us off. The wild is almost always in flight from us, leaving tracks and traces for us to read. It always responds to us, as wild rice and stoneflies respond to the slightest change in water quality, offering guidance if we are attentive and humble enough to take it.

The wild marks the limits of our powers, our ingenuity and ambition, and before it we ought to go gently.

We have not.

The headlines tell us that our carbon-intensive civilization, which brought us so many material advantages, is now hastening its own demise. We are entering an entirely new era of human life on earth. Some scientists and philosophers talk about the end of the Holocene and the beginning of the Anthropocene — the dawn of a new geological epoch of our making.

The story beneath the headlines is a record of loss. A map of the terrestrial biosphere shows that today only a quarter remains “wild” — that is, “without human settlements or substantial land use” — and even less is in a semi-natural state. Data from the Mauna Loa Observatory tell us that this year was the last time “anyone now alive on planet Earth will ever see” CO2 concentrations lower than 400 parts per million. Those levels started rising in the 1700s with the industrial revolution, spiked dramatically in the postwar period and have climbed steadily higher. Since 1970, the populations of vertebrate animals have dropped by 52 percent. The same report by the World Wildlife Fund tells us that freshwater animal species have declined by 76 percent since 1970.

That precipitous drop in freshwater species should set off alarm bells, especially here, on the shores of one of the largest freshwater lakes in the world. Since the 1970s, Lake Superior surface-water temperatures have risen and ice cover has dramatically reduced. Walleye can now live in more areas of the lake than ever before. There’s an earlier onset of summer stratification. By mid-century, according to the National Wildlife Federation, Lake Superior may be mostly ice-free in a typical winter.

Now I know it’s the holiday season and these aren’t exactly tidings of comfort and joy, but they are tidings all the same. And what they announce is this: we are responsible. We’re responsible for all this destruction of the wild — of the whole web of life — and for the changes sweeping over us. Denial will not let us off the hook.

Responsibility is not just about being held accountable for the damage you’ve done; it’s also about taking steps to limit damage, repair the broken world, reclaim it and make things better. We have that responsibility to ourselves and to future generations.

“Loss belongs to history,” writes the political philosopher Sheldon Wolin, “while politics and life are about what is still to be done.” But, he’s careful to remind us, loss still has a strong claim on the way we live now and on our future plans. The loss of the wild gives us a new responsibility that should inform our politics and our lives at every turn, direct the investments we make and the activities we sanction, and give rise to new conversations about what to do.

Saving the wild is now bound up, inextricably, with saving the human world — for ourselves and for future generations. We can appreciate in a new way Thoreau’s famous statement: “in wildness is the preservation of the world.”

3

Knowing all this, why don’t we act? Why haven’t we acted?

One answer to this question has to do with the word “we,” and our underdeveloped capacity for coordinated, collective action.

Mark Carney, Governor of the Bank of England, suggested another good answer in a speech he gave back in September to a group of insurance industry executives. Not exactly a bunch of tree huggers, but actuaries, people interested in accounting for risks and costs.

Carney talked about the future in terms of horizons, near versus long term. When we focus only on the near term, we don’t account for the true cost of our activities. That’s why for Carney, climate change is a “tragedy of the horizon,” or the tragic consequence of our inability to see and plan and take steps beyond the near term. Since “the catastrophic effects of climate change will be felt beyond our immediate horizons” — beyond the business cycle and the quarterly earnings reports, beyond the political cycle and the current election — we have deferred the cost of fixing the problem to future generations.

We’ve organized things — markets, politics, institutions — so that near-term interests win out over longer-term well-being and more sustainable arrangements.

Nowadays, if you look out at the Lake Superior horizon, you might see all the way to China. An unsustainable scheme of Chinese urbanization and economic growth fueled much of the new mining activity around the lake, and especially the exploration and exploitation of copper-rich deposits. Over the last decade or so, copper was used not just to build and wire new Chinese cities, many of which today stand empty; it was used mainly for collateral on loans. As much as 80 percent of the copper China imported was used to back loans. Today, as China unravels and the price of copper plunges, commodities investors are expressing remorse. Nickel’s down, too. The rush for Lake Superior minerals now seems to have been reckless — part of a larger market failure, with unforeseen risks and costs current and future generations are likely to incur.

Or look at the Polymet project in Minnesota. It’s an exaggerated case of not accounting for the long-term costs of mining. Currently, the Polymet Environmental Impact Statement says that water treatment will go on “indefinitely” at a cost of 3-6 million dollars a year. There is no way, so far as I know, to multiply 3 or 6 million dollars by a factor of indefinitely; and even the company’s most concrete prediction is 500 years of water treatment. Just to put that in perspective, the state of Minnesota has only been around since 1858: 157 years.

How is it possible that a proposal like this can be taken seriously? They promise jobs, a fix to a near-term problem; but there’s something else at work here as well: technology or, rather, misplaced faith in technology and human ingenuity. We make technology a proxy for human responsibility.

But technological advances that create efficiencies or solve problems for mining companies can carry hidden social and environmental costs: for example, a study done after the Mount Polley spill last year concludes that “new technologies, deployed in the absence of robust regulation” have fostered a “disturbing trend of more severe tailings failures.” Recent events in Brazil underline the point.

Great machinery, even full automation, will never amount to responsible stewardship. New technologies can have unintended consequences, distancing us from each other and from our responsibilities. Things corrode, repairs are made or not, entities dissolve, contracts are broken, obligations are forgotten, empires decline and fall, even within definite time horizons.

The industrial development that mining brings distorts horizons in another way. One theme of Tom Power’s research on the economics of the Lake Superior region and on what he calls wilderness economics is that “protecting the quality of the living environment…lays the base for future, diversified economic development.” Over-reliance on mining — and mining that damages or threatens the living environment — hinders economic diversification and makes the economy less resilient. It also requires us to discount the value of water and land it puts at risk, a value that is only going to increase over the long term, as freshwater becomes ever more scarce and as carbon capture afforded by peatlands and forests becomes more critical.

To allow that calculation for the nonce is not to concede that the market value of these wild places is their true value. The living world, creation and generation, is more than a bundle of ecosystem services, a tap and a sink for human activity. That way of thinking won’t save the wild; it is bound to open the door to the very forces that have already destroyed so much of it.

4

Let’s not lose sight of the larger point: if you take the long view, looking forward into the future and out across the horizon, protecting the land and water in this region actually looks like a more attractive investment than extracting all the ore from the ground.

That makes the capture of government by mining and extractive industry — from Marquette County to the state and federal levels — all the more troubling and deplorable. It directs investment and development down these risky and unsustainable paths, where short-term interests of multinational corporate actors are paramount and enjoy the full protection of law. The coercive power of the state, which ought to place constraints on corporate actors, is used mainly to benefit them. When things go south, society ends up bearing the cost.

This grassroots effort challenges that whole topsy-turvy arrangement. We have to continue to challenge it, at every opportunity, in every forum, recognizing that the results we’re looking for probably aren’t going to come on a quarterly basis or anytime soon. We have to lengthen our horizons.

At the same time, we have to re-open the conversation about how we are going to organize ourselves in this place, so that what remains of the wild UP can flourish and the people living here can thrive.

It’s imperative, too, that Save the Wild UP stay connected with other groups around the lake facing similar challenges. To take just one example: Kathleen’s recent Op Ed in the Star Tribune about Governor Dayton’s visit to the Eagle Mine. That made a difference to people in Minnesota: it was widely shared and talked about. People connected with it.

I have to believe that there’s power even in these little connections — and in conversation, cooperation and community. There is power where we come together, when we are no longer strangers and no longer estranged from each other. There would be power in an international congress where people from all around Lake Superior gathered to talk about responsible development. This isn’t the power the mining companies and the state can wield; it’s another kind of power, coordinated, collective, non-coercive, one we as a society have not done enough to realize.

We’re going to need that power to meet this current set of challenges.

Now you may have noticed that I keep using the word “we,” and I’m conscious that by including myself here I might be overstepping and intruding. But maybe that’s why I keep coming back to the UP: deep down, I know this is not a faraway or a strange place but a familiar place, where I have a stake in things — where we all have a stake.

The “wild UP” that we are organized to save is not just wilderness, waterfalls, wolves and warblers. It is the stage of humanity’s tragic predicament. It marks a boundary that we cross at our great peril. It can be a vital source of economic and social renewal.

Ultimately, saving the wild UP is about realizing the power and political authority we all have, everyone in this room, people across the UP and around the lake, to govern ourselves and make decisions about the future we want. What do we see on the horizon? What do we want for our children, grandchildren, our great-grandchildren and so on down the line? What do future generations require of us? What do we owe them?

That’s a conversation we need to keep having. And that’s why this organization deserves all the support we can give it, because Save the Wild UP connects us and shows us that we can be both powerful and responsible at the same time.

Thanks for listening so patiently, and thanks again for inviting me to the Gala.

delivered 5 December 2015

The Political Project of MCRC v. EPA, 3

Third in a Series

Wisconsin Governor Scott Walker, pushing jobs.

Wisconsin Governor Scott Walker, pushing jobs.

Sunlight and Skullduggery

When it comes to parceling out the land, water and future of the Lake Superior region to the highest bidders, few have matched the auctionary zeal demonstrated a couple of years ago by David Dill, a member of Minnesota’s House of Representatives. In the debate over the proposed Boundary Waters Land Exchange, Dill was among those urging that the state should exchange School Trust Lands in the Boundary Waters area for 30,000 acres of Superior National Forest. Since by law Minnesota would be bound “to secure maximum long-term economic return” from lands thus acquired, Dill proclaimed, “we should mine, log, and lease the hell out of that land.”

Dill understood this much: if there is hell to be found in Superior National Forest, there is probably no better way to bring it out.

The unanswered question in Minnesota and throughout the Lake Superior region is not, however, theological: it’s whether extractive industries and the developments they bring will actually deliver “long-term” economic benefit for the region, and not just a short-term spurt or boom, or another period of destructive plunder followed by long-term decline. That is not just a question up for debate by economists and other experts; it is, at root, a political question.

As I’ve suggested in my first two posts in this series, the complaint filed by the Marquette County Road Commission against the EPA is part and parcel of an effort to shut this question down, or exclude it from public consideration. This complaint is only incidentally about a haul road. It’s part of a political offensive that aims to stifle debate and hand the future of the region over to unseen powers. Those powers lurk under legal cover of the dark 501c4 “public welfare” organization funding the MCRC’s lawsuit against the EPA.

So with this lawsuit, the Road Commission pretends to political authority that goes way beyond building and maintaining Marquette County’s roads: it assumes the authority to direct economic development in Marquette County and decide what’s in the area’s best interest. In order to seize that authority, I’ve said, the complaint sets up an “anti-mining” straw man, and tries but fails to prove that the EPA had a “predetermined plan” to prevent the construction of County Road 595.

No surprise, then, that the argument gets especially tendentious whenever the complaint tries to demonstrate collusion or discover “anti-mining” attitudes within the ranks of the EPA itself; and where it comes up short, it raises questions about the motives and associations of those bringing these allegations.

Consider, for example, the report to Senator Carl Levin’s office by an unidentified “informant” (Exhibit 15), who alleged that at a meeting with “environmental and tribal groups,” EPA Regional Administrator Susan Hedman made remarks to the effect that:

1. the EPA will fight mining in Michigan,
2. that there will be no mining in the Great Lakes Basin,
3. that there was or will be an EPA sponsored Anti-Mining committee, and
4. that the KBIC [Keweenaw Bay Indian Community] tribe had received an EPA grant which [sic] they used the funds to sponsor an anti-mining activity.

The informant seems to have been lying in some places and exaggerating in others: Hedman claims she never made the remarks attributed to her. But the MCRC complaint doesn’t hesitate to repeat the informant’s false allegations, and it tries to build its case around Senator Levin’s staffer’s awkward summary of what she heard from an unnamed informant who proved untrustworthy in every particular.

True to pattern, the complaint casts both environmental groups and the KBIC as “anti-mining groups” as it doubles down on the informant’s lies. The detail about the EPA grants is wildly inflated. The EPA gave the tribe “hundreds of thousands of dollars,” the MCRC claims, even as the KBIC was “actively lobbying USEPA against local mining and against CR 595.” This turns the false report of an unspecified “anti-mining activity” to “actively lobbying,” and it neglects to mention that EPA grants to the KBIC are, in large part, to help the tribes cope with the lasting damage done by mining and industrialization. (In recent years, grants have supported things like a survey of tribal fish consumption habits to reduce health risks associated with contaminants in fish, or the tribal Brownsfield response program.)

The phrase “actively lobbying” is especially cheeky here, for a couple of reasons.

First, the Eagle Mine project went ahead without the full, prior and informed consent of the KBIC. A Section 106 hearing ignored testimony from tribal elders that the ground at Eagle Rock is sacred to the Ojibwe, and objections by the KBIC and the Ho Chunk to the location of the mine portal at Eagle Rock were summarily dismissed. Tribal appeals to the EPA went unheeded.

Second, if we are really going to start tracking lobbyists and money spent on lobbying efforts, then in all fairness let’s spread the sunshine around and give a full account of money and efforts spent actively lobbying for mining interests in northern Michigan and throughout the Lake Superior region over the last decade. Or if that is too arduous a task, a full accounting of the money behind this complaint would suffice.

The complaint also fails to mention that the EPA responded immediately to Senator Levin’s office with a full schedule of grants given to the KBIC and the charter of the “cross-media” mining group at EPA Region 5. Cross-media groups are formed to satisfy the Cross-Media Electronic Reporting Rule. The fearsome EPA-sponsored “Anti-Mining” group turned out to be a specter of the informant’s imagination, and really comes down to bureaucratic reshuffling in order to make electronic reporting easier. There’s just no red flag to raise.

Elsewhere, when the complaint tries to demonstrate “anti-mining” sentiment within the EPA itself, the best the MCRC can do is police tone. There is an EPA official who writes “sarcastically” to a colleague at the Army Corps of Engineers, and then there are a couple of sentences in a January 2011 email by Daniel Cozza, an EPA Section Chief. Cozza refers to Wisconsin as “the new front” and says that in a three-hour town hall meeting Governor Scott Walker was “pushing jobs” when promoting the Gogebic Taconite project.

I think the WI Governor’s additions to the Welcome to WI signs stating ‘Open for Business’ is a sign of things to come. I listened to the 3hour [sic] townhall meeting last night regarding the G-TAC or taconite mining project in the Gogebic Penokee range and sounds like they are pushing jobs.

This sounds pretty innocuous, and I am unsure where the offense is: “pushing jobs”? That’s a pretty apt description of the rhetorical tactics used to promote mining in midwestern districts and around the world for that matter. Job numbers are overstated, as Tom Power notes in his study of sulfide mining projects in Minnesota. In Wisconsin, Senator Tim Cullen, Chair of the Senate Select Mining Committee, said he was amazed that immediately upon signing a controversial mining bill into law in 2013, Scott Walker and his cronies were “telling the workers of Wisconsin, who need jobs, that the jobs are just around the corner….The people who understand the mining industry know the jobs are years away.”  Sounds like they were being pretty pushy to me.

Of course, “front” might suggest a battle or military campaign, or it might imply that Cozza sees himself or the EPA as embattled, fighting against the encroachment of mining projects — which of course the EPA is, and will continue to be if it is going to protect the environment against the resurgence of mining all around Lake Superior. Forbes Magazine, hardly a bastion of environmental activism, struck the same note when it ran an article on Gogebic Taconite’s Chris Cline with the title: “Billionaire Battles Native Americans Over Iron Ore Mine”; Dale Schultz, a Republican State Senator who broke with his party to oppose Wisconsin’s mining legislation, said his conscience would not allow him to “surrender the existing environmental protections without a full and open debate”: no one gasped in horror and astonishment at the white-flag battleground metaphor. Mike Wiggins, Chair of the Bad River Band of Lake Superior Chippewa, did not mince words and declared the Gogebic project tantamount to “genocide,” as it would kill the wild rice crop. The list could go on.

So the real objection is that some people working at EPA are not enthusiastically on board with the agenda of the mining company and its development plans for the area. They’re not supposed to be; they’re supposed to protect the environment. The complaint is still far from proving that the EPA itself, when making its specific determinations about CR 595, acted with bias or according to a predetermined plan.

It’s interesting, however, that the complaint should make an example of Daniel Cozza and his attitudes toward Wisconsin mining. Cozza has a long history with the environmental regulation of mining in Wisconsin, and he was working in EPA Region 5 when the Crandon Mine project unraveled, due to the inability of the mine’s backers, which included Eagle Mine developers Rio Tinto and Kennecott Minerals, to meet tribal water quality standards and deliver appropriate environmental assurances. Cozza is said to have caused “consternation” when he reminded Crandon Mining in a letter of its “duty to look at the cumulative economic and environmental impacts” of other mining projects in the region; and it was this big picture perspective that prevailed when Governor Tommy Thompson signed a mining moratorium into law in 1998.

To many people inside and outside the mining industry, Crandon seemed to signal the end of mining in Wisconsin, and there are still bitter feelings within the industry about the failure of the Crandon project. Having lost in the courts and the legislative arena, the industry and its backers resorted to other means, achieving their first big comeback victory in Wisconsin with Scott Walker’s 2013 mining bill.

By signing it, the governor also obliterated his past. He had voted for the mining moratorium in 1998 as a member of the Wisconsin Assembly. As governor, Walker worked to ease regulations, and did a decisive about-face during his 2012 recall election, when he received a $700,000 contribution from Chris Cline and Gogebic Taconite. That mind-blowing, mind-changing contribution came via the Wisconsin Club for Growth, a dark money 501c4 like Stand U.P., the organization now putting up other people’s money — whose? — for the Marquette County Road Commission’s lawsuit against the EPA. Corruption is in the cards.

Can Mining Be Saved?

TeslaGigafactory

The Tesla Gigafactory, currently under construction in Storey County, Nevada.

Andrew Critchlow, Commodities Editor at The Telegraph, speculates in a recent article that Elon Musk and Tesla might “save the mining industry” by ushering in a new age of renewable energy. Domestic battery power production at the Tesla Gigafactory (now scheduled to go into production in 2016) is bound to create such demand for lithium, nickel and copper, Critchlow thinks, that the mining industry will find a way out of its current (price) slump and into new growth, or possibly a new supercycle.

“Major mining companies are already ‘future proofing’ their businesses for climate change by focusing more investment into commodities that will be required by the renewable energy industry,” writes Critchlow; and the “smart commodity investor” will follow suit, with investments in “leading producers” such as — this is Critchlow’s list — Freeport-McMoRan, Lundin Mining and Fortune Minerals.

It’s a credible scenario, but it’s also terribly short-sighted. The big switch over to domestic solar power and battery storage Musk is hyping in the run up to the opening of the Gigafactory would no doubt give miners a short-term boost, but it will also take a lasting toll on the places where copper and nickel are mined, raise serious human rights concerns, and put even more pressure on the world’s freshwater resources.

After all, the copper and nickel used to make Tesla’s batteries are going to come from places like the Democratic Republic of Congo, where Lundin and Freeport-McMoRan operate a joint venture at Tenke Fungurume, and which has been at the center of the recent debate in the EU parliament over conflict minerals; Peru, where protests against Southern Copper Corporation’s Tia Maria project led the government to declare a state of emergency in the province of Islay just last Friday; or the nickel and copper mining operations around Lake Superior that I’ve been following here, where there are ongoing conflicts over free, prior and informed consent, serious concerns that sulfide mining will damage freshwater ecosystems and compromise one of the largest freshwater lakes in the world, fights over haul routes, and repeated complaints of lax regulatory oversight and political corruption.

Rice farmers clash with riot police in Cocachacra, Peru. The fight is over water. (AP Photo/Martin Mejia)

These are just a few examples that come readily to mind. It wouldn’t take much effort to name others (Oyu Tolgoi, Oak Flat, Bougainville) and to see that the same problems arise, to a greater or lesser degree, no matter where copper and nickel mining — sulfide mining — is done.

The mining industry and commodities investors have historically tended to minimize and marginalize the environmental and social costs of sulfide mining; so it’s really no surprise that Critchlow should argue that increased demand by battery producers is all it will take to “save” mining. Leave it to others, I guess, to save the world.

But the supply and demand model is reductive and misleading, even for those looking to make a fast buck. A recent Harvard study of company-community conflict in the extractive sector summarized by John Ruggie in Just Business suggests just how costly conflict can be. A mining operation with start-up capital expenditures in the $3-5 billion range will suffer losses of roughly $2 million for every day of delayed production; the original study goes even further, and fixes the number at roughly $20 million per week. Miners without authentic social license to operate lose money, full stop. So Critchlow’s is at best a flawed and myopic investment strategy that ignores significant risks. It also appears to shrug off legitimate human rights claims, and turn a blind eye to environmental degradation, and deadly violence of the kind we’re seeing in Peru right now. That’s irresponsible, if not downright reprehensible.

A Macquarie Research report cited by Critchlow claims that the switch away from fossil fuels to battery power in the home is all but inevitable. But if we make the switch to renewables and fail — once again — to address the ethics of mining, what exactly will we have saved?

Social License in a Less Exuberant Climate

The things I’ve written on the new mining around Lake Superior — most of which are gathered here — might amount to nothing more than a series of postscripts to my film 1913 Massacre. P.S., then P.P.S, and so on, a long envoi or send off, I suppose, or maybe a recognition that the story we told in our film never really ended, or is about to be repeated — first time tragedy, second time: it’s still too early to say. In any case, I’ve often been struck by the ways that the new mining appeals to the very history (or what people in the UP call their mining “heritage”) Ken and I encountered while making our film, in order to claim social license.

While I’ve focused on developments around Eagle Mine, which is situated on the Yellow Dog Plains just outside the city of Marquette, Michigan, I’ve also been trying to keep track of mining activity all around the lake — the Polymet and Twin Metals projects in Minnesota, the failed Gogebic Taconite project in Wisconsin, uranium exploration on the Eastern shore, and so on; and I’ve tried to emphasize here and when talking about the subject that Eagle along with those other projects constitute the first phase of a Lake Superior mining boom.

With no effective international oversight of the lake — one of the largest bodies of freshwater in the world — the mining companies have moved in, facing down what opposition local groups can muster, promising jobs and economic development, exploiting loopholes in state laws, and buying state politicians (as Gogebic bought Scott Walker) or enlisting the services of other lackeys and lickspittles in local and regional government (as, e.g., Eagle seems to have enlisted the services of the Marquette County Road Commission).

A larger commodities boom (or pricing bubble) ushered in this Lake Superior mining boom, and that bigger boom has started to go bust, as Chinese demand for stainless steel, copper and other metals — one of the main drivers of the boom — slows. So the story ripples out way beyond the lake, to developing economies on the other side of the world, and to a larger arena of commodity markets, over which huge commodity traders like Glencore and Trafigura preside, and where the metals mined around Lake Superior are not actually used to make things the world needs (as mining companies want us to believe), but warehoused by the London Metal Exchange and financialized in complex instruments like ETFs or simply as collateral.

It’s unlikely we’ll witness the great unraveling of this global complex that some doomsayers predicted, but the slowdown has already left some miners stranded and made some projects founder or at least become riskier to undertake. Shareholders are already feeling the pain and pressures on companies to streamline operations, discard assets or service their debt will continue to mount. On the ground, these troubles should occasion some reflection on just how closely mining, global financial markets and development are now intertwined; and that volatile combination is likely to make the future for communities around the Lake even more uncertain. How committed are these companies? Whose interests do they really represent, and to whom do they answer? How resilient are they? What happens when things fall apart?

Maybe in this less exuberant climate, all the confident assertions about future prosperity, tributes to mining heritage, promises of responsible stewardship, and bids for social license to undertake mining projects will receive closer scrutiny.

Postscript: after a response from Eagle Mine’s Dan Blondeau, I’ve updated this post with a link to our exchange over my remarks here on the Marquette County Road Commission. The Michigan DNR’s green-lighting on Thursday of Graymont’s proposal to develop 10,000 acres of public forest lands into an open pit and underground limestone quarry is yet another example of Michigan public officials eagerly serving mining companies — or doing their bidding, sometimes without having been explicitly bidden.

A World of Chinese Boxes

“Total use for greater wealth.” That was the triumphant banner under which the newly formed Bureau of Reclamation would parcel out and industrialize the water resources of the western United States at the beginning of the twentieth century. Now, as we are forced to appreciate just how scarce and precious freshwater and other resources really are, and as industrial civilization itself verges on collapse, it reads more like a fool’s epitaph.

We are, of course, still in the grip of the old industrial-era logic. I see it clearly in the arguments advanced in support of Lake Superior mining. When not pushing the jobs argument — or when an economist like Thomas Power calls their bluff — mining industry proponents and apologists regularly appeal to the utility (and the necessity) of mining around Lake Superior.

“These minerals,” one Michigan labor leader explained to me, “are gonna be extracted at some time. They have to be,” he continued, because they are “important for a lot of uses.” An imperative, mining carries certain duties with it: “The world needs the minerals” of the UP, he went on to explain, “and I think we have a responsibility to develop it right, extract it right, and share it.”

At least he acknowledges that the ore extracted from Lake Superior mining operations is destined for international markets. On the Public Television show Almanac a couple of months ago, at the start of the comment period on the Polymet EIS, Executive Director of Mining Minnesota Frank Ongaro asked us to pretend that mining Minnesota “copper, nickel, platinum” would somehow make us less “import-dependent” on those metals “for everything we use, every day in our life.” That was pure jingoism, and these arguments are misleading.

Just consider the news lately around the falling price of copper, which hit an eight-month low last week. The biggest story by far has to do less with slowing Chinese demand for manufacturing and building, and more with the “use” to which copper imports are now put by Chinese players in the commodities market. According to a Reuters story focusing on these “secretive” Chinese funds, “traders estimate more than half of copper imports into China were to raise funds using the metal as collateral over the past two years.” In a tweet that Aaron Klemz shared with me, CNBC’s Deirdre Wang Morris said it was more like sixty to eighty percent of all Chinese copper imports that were being “used as loan collateral.”

A March 13 Reuters article on the last week’s sell-off of copper by Polly Yam, Fayen Wong and Melanie Burton quotes “traders who structure financing deals” saying that “the selling of copper was due to speculators not breaches of financing deals. ‘Speculators are the main driver.'” I suppose that’s meant to be reassuring.

In a typical copper financing deal, an importer puts down nearly the full value of the copper in yuan as a deposit to a bank for a letter of credit.
The importer resells the copper into the domestic market to raise cash that can be used for other investments such as real estate.
The importer can also strike a hedged deal where the metal is stored in a bonded [or LME] warehouse in China or overseas in return for a loan from a foreign bank. In both cases, the importers no longer are exposed to the copper price.

And in all cases, copper — mined everywhere at great risk to water, watersheds, wetlands and the surrounding environment — is not being put to anything like the productive uses that most people imagine, or mining companies promote. From this angle, Polymet looks like Glencore’s bid to bring Minnesota into a Chinese collateral game. Things get even weirder when you consider the case of Eagle Mine in Michigan, where Lundin Mining has secured a $600 million credit facility to mine Lake Superior copper that will ship to LME warehouses owned by big commodity players and banks, and then serve as an object of financial speculation or as collateral in return for loans. It’s a world of Chinese nested boxes: credit swaps and derivatives will be spun around loans to mine copper to back loans in a huge urbanization scheme designed to move the Chinese toward a consumer society — and so on. It’s an unsustainable scheme, and after last week some analysts believe it’s already unraveling.

Orwell wrote in the industrial era about the critical role of mining in the “metabolism” of civilization. Now, in our post-industrial world, it appears that new mining will only hasten the cancer of financialization.

Update, 19 March 2014: For more on this theme, see Tyler Durden’s discussion of copper and “hot money” flows into China, here and here

Miner’s Almanac

It’s difficult for me to read the grim news of the chemical spill in West Virginia without thinking immediately of my friends in Minnesota. “A 23 year gap in oversight” is now listed among the chief causes of the spill of 4-methylcyclohexane methanol into the Elk River. How, in the wake of this disaster, or in light of any of the other industrial spills and explosions and disasters that seem to be in the news nearly every week, can anyone in Minnesota still seriously entertain the idea that Polymet Mining will maintain water treatment facilities for up to 500 years at its open-pit sulfide mine near Hoyt Lakes?

If Freedom Industries, the Department of Homeland Security and other government entities can’t keep track of one storage tank in West Virginia for less than a quarter century, how are we going to keep track of a toxic site on Lake Superior for five centuries? The whole thing seems so absurd, like a really bad joke, told with a sinister wink and a nod.

As I tried to suggest in a previous post, the debate over Polymet’s 500 year water treatment model projects responsibilities so far out into the future as to render them utterly meaningless, making a farce out of the very idea of oversight or even what in the ugly parlance of the regulator is called “environmental impact.”

But just a couple of weeks ago, in a roundtable on Polymet aired on Twin Cities Public Television’s Almanac program, host Cathy Wurzer dutifully took up her part in the farce, fidgeting with her fancy glasses to indicate that she was being serious and inquiring of her guests whether this “has this been done, this kind of treatment, over this amount of time, has it been done successfully elsewhere?” Really? I half expected someone to remind Wurzer that reverse-osmosis technology wasn’t exactly around in the year 1514. Instead, Kathryn Hoffman, an attorney with the Minnesota Center for Environmental Advocacy, politely answered: “we certainly have no models or examples of successful mitigation over that period of time,” and to her credit she kept a straight face and even managed to cite “over 42 exceedances” of water quality standards at Eagle Mine in Michigan, where water is treated through reverse osmosis – and the mine has not even yet gone into production.

Only later in the program did Becky Rom, of the organization Sustainable Ely, suggest that “it’s not rational to believe” that the facilities Polymet builds today will last “for hundreds of years.” That’s exactly right: it’s completely irrational. In fact, it’s a ridiculous fantasy – or a pathological delusion — to think that Polymet itself will be around fifty or one-hundred or five-hundred years from now, and “always in compliance” as Frank Ongaro, Executive Director of Mining Minnesota declared on the same program.

But that’s only the most egregious falsehood that Polymet and pro-mining groups are asking us to credit.

Pro-mining guests on Almanac were also trying to foist on the public the idea that the mining of copper and nickel at the Polymet site will be no different — – in terms of its potential effects on the land and water — from the mining that has been historically done on Minnesota’s Iron Range. That is patently untrue, but it tugs at the heartstrings and appeals to the nostalgia and pride that the immigrant mining story still inspires: that’s why Polymet has already secured a place for itself in Minnesota mining history on its website, and it’s also why Carly Mellin, who hails from the Iron Range and serves as Assistant Majority Leader of the Minnesota House of Representatives, played the heritage card at the end of the program: “we’ve been mining 132 years on the iron range and we still have an absolutely beautiful region of the state,” she said, in what sounded like a clearly rehearsed closing remark, “and I plan to continue for it to be beautiful after copper-nickel mining.” Lucky for her there was no time for people to press her on what exactly those plans are and how she plans to realize them.

For his part, Frank Ongaro kicked off the entire debate with a misleading statement that cast Polymet’s mining project as a matter of self-sufficiency – a project done in the national interest:

We’re sitting in Minnesota on one of the largest deposits of copper, nickel, platinum metals in the world – metals we’re import-dependent on for everything we use, every day in our life.

Carly Mellin reiterated the point a little while later. There may be some traces here of an earlier argument that proponents of HR 761 tried to advance – claiming that mining near the Boundary Waters was “necessary for U.S. strategic interests.” But here Ongaro is really making a cheaper appeal, to jingoism and state pride, and at first blush, he makes a certain amount of sense. Why import what we have in abundance here? If we have metals or other resources we need, why not use them instead of relying on imported stuff?

The copper and nickel taken out of the Minnesota ground will not stay in Minnesota and be smelted and worked as in the days of yore by hardworking Minnesota craftsmen into sturdy tools and smart technologies that twenty-first Minnesotans can use. Mining copper and nickel on the Iron Range may, in fact, have the unintended effect of exposing the region in new ways to the turbulence of the global commodities marketplace.

Rio Tinto’s play for Michigan copper was never about Michigan; it was part of a bet on continued Chinese growth and urbanization. The price of copper – U.S. copper, Chilean copper, Mongolian copper – rises and falls these days on Chinese demand. Copper and nickel mined on the Iron Range will not make us more self-sufficient or serve the strategic interests of the United States. At best, those minerals may be warehoused here for a while, in New Orleans and in other ports; but they are destined for the international market.

This is the cat Frank Ongaro was desperately trying to keep in the bag when Becky Rom called Polymet “a shell company” for Glencore Xstrata, the Swiss global commodities giant. (With about 35 percent of all shares. Glencore is Polymet’s largest investor.)

Rom: I think you have to understand that Polymet isn’t going to be around at year 20. This is a shell company that’s shielding its major investor —
Ongaro (clapping his hands): That’s not true!
Rom: Glencore, that’s known for corruption, and environmental and labor violations —
Ongaro: Every company that operates in the state of Minnesota –
Rom: and at the end…at the end —
Ongaro: –will have to follow state laws, period.
Rom: –at the end of twenty years when they have done extracting the metals and earning their revenue, all they will have as an asset is a polluted mine site. So…we the taxpayer…will carry…the burden for what is going to be in fact hundreds of years.

Eventually, of course, the truth will out. But with precious little time left in the 90-day public comment period that began on December 14th, it needs to come out now.

The Times Correction of Jim Harrison’s “My Upper Peninsula” Falls Short In Three Ways

The Travel section of the November 29th edition of the New York Times featured an article by Jim Harrison about traveling Michigan’s Upper Peninsula called “My Upper Peninsula.” It turns out Harrison’s Upper Peninsula is a place more fondly remembered than accurately observed, and the Times has had to make a number of corrections to his piece.

Probably the most egregious error in the original piece comes just a few paragraphs in, where Harrison explains to prospective travelers to the UP that “you can drink the water directly from Lake Superior,” as he himself used to do on his “long beach walks.” The water of Lake Superior is clean, he wrote in that first version, because “there is little or no industry, and all of the mines are closed.”

I was probably not the only person to send a letter to the editors reminding them that some UP mines are still open and that the Times itself had published a report, in May of 2012, on the new mining boom in the Upper Peninsula. My letter went on to say that the new sulfide mining (the mining of nickel and copper) along with new gold and uranium mining projects in the UP — and all around Lake Superior — pose a very serious risk to the big freshwater lake.

Just one project, the Polymet mine near Hoyt Lakes, Minnesota, will require water pollution treatment for a minimum of 500 years.

Last week, the Times published this correction:

Correction: December 4, 2013
An earlier version of this article misstated the state of mining in the Upper Peninsula; there are indeed some mines operating in the area — it is not true that all the mines are closed.

The passage about long beach walks now reads:

While camping I would study maps to try to figure out where I was other than within a cloud of mosquitoes and black flies, that irritating species that depends on clean water, of which there is a great deal in the U.P. There is little or no industry; therefore you could drink the water directly from Lake Superior — at least I always did on my long beach walks.

This new version tries to skirt the issue by consigning it to the past. Where Harrison originally wrote “you can drink,” now we are told “you could drink” the water. There is still “a great deal” of clean water in the UP, but this version takes refuge in “at least I always did,” to qualify the drinking. It could all have been a mistake.

But this correction doesn’t do the trick, for at least three reasons.

First, it doesn’t even come close to capturing what’s really going on these days. We still have no no reference to the Times original report on the boom. “It is not true that all the mines are closed” is a far cry from “many new mines are opening, and there is a mining and leasing boom” – which is a lot closer to the what the Times reported in 2012 and a lot closer to the facts: just look at the map of Lake Superior Mines, Mineral Exploration and Mineral Leasing published by the Great Lakes Indian Fish and Wildlife Commission. The problem here is only compounded by a couple of sentences near the end of the Harrison piece, which the editors let stand: “It’s not easy to cheerlead for the Upper Peninsula now after the extractive logging and mining. That bleakness is now mostly overgrown by forests except for a few slag piles.” Overgrown? Simply put, the bleakness that Harrison buries in the past is coming back to the UP.

Second – and this is a curious oversight for the Travel section – the new mining is going to endanger, or at least dramatically change, UP tourism, which is in large part about unimpeded access to wilderness areas and especially the freshwater wilderness of Lake Superior. Though tourism has been a growing sector of the UP economy, on its own it’s hardly enough to sustain the region (or any region for that matter). Mining proponents are usually quick to point this out. Most are very careful to say that they “don’t go around tearing down the tourism industry,” as one UP labor leader put it to me. Some are openly scornful of the contribution tourism makes to the regional economy. All acknowledge, as Harrison himself acknowledges, a tension between extractive industry and tourism; and doesn’t that tension belong at the center of any article about traveling to the UP?

Third, the corrected paragraph now makes very little sense. The editors have chosen to omit Harrison’s earlier statements about the disappearance of mining and recognize, in their correction, “some mines operating” in the Upper Peninsula. The paragraph about long beach walks simply states that “there is little or no industry” in the UP. I am not sure what this is supposed to mean: I guess “some” is supposed to be the equivalent of “little” or “none,” or mining doesn’t count as an industry. Be that as it may, the larger omission here has to do with the industrialization the new mining has already brought – the drilling, clear cutting, haul roads, and mine construction already underway are just the start — and how that will add to mounting industrial pressures on the lake: for example, the plan put forward by Enbridge to build a network of oil pipelines carrying diluted bitumen across the Great Lakes region, and to transport crude oil by barge across Lake Superior.

I realize, of course, that none of these observations are likely to find a place in the Travel section. Readers go there to encounter a world where nature is picturesque, and history and culture are placed on quaint and colorful exhibition. Advertisers count on it. The Travel section presents an exotic world, in the most literal sense, a world outside ordinary lived experience, fully exteriorized, a fantasy of escape. I suppose readers should look elsewhere in the paper of record to correct that impression, and to see the world as it really is.

Time Out of Mind

I leave tomorrow for Lake Superior. On Thursday the 24th, Ken and I are going to show our film at Michigan Tech, where there’s a conference called Writing Across the Peninsula, and then, on Saturday the 26th, at the DeVos Art Museum in Marquette. I’m going up a little early to do some exploring, traveling north along the western shore of the lake to Palisade Head and then inland (west), through Finland and into the area around Ely, Babbitt and Hoyt Lakes, Minnesota. That’s where Polymet Mining has proposed a huge open pit sulfide mine. It will be my first visit and maybe one of the few chances I get to see the area before the mining begins. After that, it’s never going to be the same. Or at least not in my lifetime — or in the lifetime of anyone alive today.

Polymet recently disclosed in a Preliminary Supplemental Draft Environmental Impact Statement that water runoff from its mine will have to be treated for the next five hundred years — “a minimum of 500 years,” just to meet water quality regulations. The proposal in its current form clearly violates Minnesota Rule 6132.3200, which requires that “the mining area” be “maintenance free” upon closure; but Polymet and its legions of apologists have already found some wiggle room here, arguing that state law allows for “perpetual treatment” as long as enough money is set aside and as long as the company can prove that it’s meeting federal and state water standards. For Polymet, it seems, this is just the start of a negotiation.

The Mining Examiner quotes Frank Ongaro, Executive Director of Mining Minnesota: “There’s no doubt it can be done, that it’s allowed. The concept is sound; the details have to be worked out by the experts.” I honestly don’t know how anyone can say things like this with a straight face. Five-hundred years: the experts just need to work things out. No doubt about it.

When I first heard about the five-hundred year disclosure, I tried to think of a place where mining was done five-hundred years ago: the best I came up with was Cerro Rico in Potosi, Bolivia, where conquistadores set up silver-mining operations in the sixteenth-century. Potosi is now considered one of the most polluted places on earth. Of course, the Spanish crown did not set out the sorts of guarantees that Polymet is willing to set out; but apparently the mining company shares the crown’s illusion that its empire will last forever. Or at least they would like us to think so: they would like us to set aside our doubts and entertain the fantastic idea that they will provide water-treatment facilities for the maintenance of their copper mine for the next five-hundred years.

Mind you, the country’s only been in existence for 237 years, and Minnesota was only admitted to the union in 1858 — 155 years ago. The EPA only started operations in 1970; its workers only just got back on the job yesterday, after being furloughed during the shutdown. Why are we being asked to believe in the perpetuity or even the resilience of the EPA, the Minnesota DNR, or any government institution or form of government? Who can say what’s going to happen fifty years from now, let alone five hundred? Will there be a Minnesota DNR or an EPA in 2063? Will there be a Polymet? Minnesota? How about 2100? 2413? Insofar as history is about holding people to account, this is nothing more than historical fantasy: there’s no guarantee or even promise of accountability when you are talking about five centuries. As Steve Timmer would have it, nobody is going to be around to keep Polymet’s grave clean.

Time out of mind is the phrase this whole proposal conjures for me. The expression comes from English law. “Time out of mind” or “time immemorial” is a time before anyone can remember: a property or holding, a way of passage or a benefit has been enjoyed so long that those who claim it no longer have to prove ownership or their right to it; nobody can remember a time when it wasn’t so. In this case we are being asked to project that far into the future — way past the horizon of what we ordinarily consider the future, way beyond the time anyone can foresee.

Projecting that far into the future, time out of mind, is also a distorting lens. It’s easy when looking that far ahead to overlook what we know will really happen to the area in the near term, just in the course of constructing and operating an open-pit sulfide mine. Mine pollution that lasts for five-hundred years is a huge and terrifying prospect, no doubt, but that dread prospect might also have the weird effect of eclipsing (or normalizing) the more immediate environmental and social consequences of mining and the industrialization mining brings. Water Legacy estimates that the Polymet project will take 6,600 acres of forests out of public ownership, destroy or impair at least 1,500 acres of wetlands and result in 168,000,000 tons of permanent waste rock heaps and 228,000,000 tons of tailings waste. Add to this the haul roads, the mill operations, air and noise pollution, the effects of clear-cutting and deforestation, shifts in population, economic distortion, and so on.

It’s important to pull back, change the lens, and see clearly what’s going to happen, what’s already happening, to the waters and the wilderness areas, the Lake and all life around it, within our lifetime, and what effect our actions now will have for generations to come.

Labor Day, 2013: Will Big Mining Do Better This Time Around?

On Labor Day, I’ll be in New York City, so I won’t be able to see the television broadcast premiere of 1913 Massacre on Twin Cities Public Television. How many will tune in? How will the broadcast cut of the film look and play on TV? Above all, I wonder, what connections will the Labor Day TV audience draw between 1913 and 2013? My comments here run this holiday weekend on MinnPost.

Many people Ken and I met in mining towns around Lake Superior while filming 1913 Massacre urged us to see the positive contributions the mining companies had made to the region. Some insisted that the Woody Guthrie song that had introduced me to the story of the Italian Hall disaster and brought me to Calumet and the Upper Peninsula in the first place had gotten it all wrong. The greedy bosses, company thugs and violent social strife that Woody sang about in “1913 Massacre” did not fit the story they knew. “We all got along just fine,” they protested.

When the mines were running, the towns thrived. The big department stores downtown were open. The churches (and the bars) were packed to capacity. Everybody worked hard and the work was sometimes dangerous, but on Saturday nights, the streets were jammed and the atmosphere festive. The company put a roof over your head then sold you the house at terms you could manage. The copper bosses built libraries, sidewalks and schools, gave land grants for churches, and even furnished luxuries like bathhouses and public swimming pools. The men who ran the mines weren’t just robber barons from Boston; they were public benefactors.

But there were limits to their benevolence. The mining captains regarded the immigrant workers – Finns, Slavs, Italians — as charges placed in their paternal care. They knew what was best for these new arrivals. They discouraged organizing. Faced with strikes on the Iron Range in 1907 or on the Keweenaw in 1913, they adamantly refused to negotiate, brought in scabs to do the work and Waddell and Pinkerton men to deal (often brutally) with the strikers. Even after the tragic events of 1913, Calumet and Hecla Mining Company would not recognize the union for decades.

The Keweenaw miners were on strike again in 1968 when C & H made a calculated business decision to pull out. No more jobs, pensions cut short; the good times were over. They left the waters poisoned and the landscape littered with industrial wreckage and toxic mine tailings.

The companies driving the new mining boom around Lake Superior these days promise to do better. They are dedicated to corporate social responsibility. They practice “sustainable” mining, tout their environmental stewardship and declare their respect for human rights. They have community outreach programs and promise to make substantial, long-term investments in the economic development of the regions where they come to mine. They work closely – some would say too closely – with regulators to create environmental impact statements and plan for responsible closure of their mines. They are eager to gain social license.

For the most part, these big multinationals operate with the support of organized labor and politicians who want to create jobs — and what politician doesn’t want to do that? But the high-paying, highly-technical mining jobs are unlikely to go to local residents; and the new mining is likely to have detrimental effects on local economies, as the economist Thomas M. Power has shown in studies of Michigan and Minnesota. Mining may provide some short-term jobs, but it can also drive away creative professionals and knowledge workers, destroy entrepreneurial culture, diminish quality of life and damage long-term economic vitality.

So promises of good times and plentiful jobs need to be treated with circumspection. Polymet has repeatedly scaled back its job predictions for its huge, open-pit sulfide mining project near Hoyt Lakes, Minnesota, and the company’s own figures suggest that only 90 of the promised 360 jobs – just 25% — will go to local communities. Local is, moreover, a relative term. Mine workers today tend not to live in mining towns; they will commute an hour or more to work. And hiring will always be subject to swings in metals prices, which are now dependent on two new factors: continued Chinese growth (and urbanization) and the entry of big financial firms into metals warehousing and trading.

There are limits to big mining’s benevolence as well. The last time I flew into Marquette airport, a glossy Rio Tinto poster advertised the company’s commitment to “build, operate and close Eagle Mine responsibly.” Nobody had bothered to take the sign down after Rio Tinto had done an about-face and sold Eagle, a few months earlier, to Vancouver-based Lundin Mining for dimes on the dollar. Rio Tinto’s commitments lasted only until it was time to flip their property. Overnight, Eagle Mine had become a “non-core asset” and the surrounding community none of Rio Tinto’s responsibility.

In Wisconsin, Gogebic Taconite has drawn the line between company and community much more starkly, with help from a paramilitary firm called Bulletproof Securities. Black-masked guards, dressed in camouflage and armed with semi-automatic weapons, protect the mining company’s property from trespassers and environmental protesters. Imagine what they might do in the event of a strike.

gogebicguard

Bulletproof Securities patrols Gogebic Taconite’s property in northern Wisconsin.