Pebble Mine Is A Welfare Queen
Large Open Pit Mines Employ a Private Profit and Public Risk Business Model
The Pebble Mine is a welfare queen, unable to support itself. The Pebble Mine will gobble taxpayer handouts faster and more voraciously than tens of thousands of food stamp recipients or tens of thousands of Medicaid beneficiaries. Ambler Mine and the Donlin Gold Mine are the same. These massive open pit mines have proven that they cannot stand on their own two feet, like other sound businesses. They do not adequately take responsibility for their operation. If you believe in free markets then you must be appalled by modern metals mines, which reap massive private profit while socializing the risk.
Alaska is seeing renewed interest in enormous, open pit metals mines. There are three very large proposals on the books; each in various states of pre-development: The Ambler Mine, Donlin Gold Mine and—back from the dead—The Pebble Mine.
Each of these proposals are in a different region of the state but they all have a handful of things in common: they are large, multi-billion dollar projects, they are all in sulfide rock, which means they will all create Acid Mine Drainage, they are each surrounded by rich, renewable subsistence and commercial wildlife resources, and they will all be, if permitted, welfare queens.
Large open pit metals mines are required to insure against environmental destruction by having bonds, which are held by the state. However, the track record shows when a mine failure occurs, these bonds are never enough. What happens when the bond isn’t big enough? You and I, the citizens and taxpayers, are forced to shoulder the burden. There is a name for this —Socialism. However, unlike like socialism, we the taxpayers underwrite the risk while the company makes off with the profit.
In Alaska, a profitable large mine pays a flat $4000, plus 7% of its "net income", which is to say they don’t pay very much. Consider the Mount Polley Mine, which is an order of magnitude smaller than Pebble, Donlin and, Ambler. When the Mount Polley Mine had a tailings dam failure, the British Columbian government was hit with a $40 Million cleanup price tag. The amount Alaska will see in tax revenue is nowhere near enough to cover such expensive and environmentally destructive cleanup operations. Alaska and Alaskans will hold the very short end of the stick if these irresponsible mines are permitted. We must radically change the way we do business with these enormous, multi-national corporations.
If you attend a meeting with a metals mine developer undoubtedly you will hear them say, “Trust us, trust our engineers, and trust the regulatory process. We know that there have been large, expensive, and environmentally destructive mine failures in the past but trust us, we won’t let that happen at Pebble, Ambler, Donlin, etc.”
Here is my point: don’t ask us to trust you. If these developers want to prove that they can honestly develop a mine that will not destroy the environment then convince a private insurer. Safeguard these mines against disaster not with insufficient bonds that are held by the state but rather with private insurance. Buy private insurance just like every other business.
State government has a dismal track record of adequately assessing risk. But, insurance companies, whose responsibility it is to protect their bottom line, are really, really good as risk assessment.
If we are going to consider developing these large metal deposits, which sit alongside valuable and renewable resources, we need to do much, much better. Insurance companies are the sort of partner large metals mines need to improve their safety, their engineering, their clout, and integrity.
You don’t have to care about wild Alaskan salmon; you don’t have to care about rural Alaskan communities who have been here for ten thousand years; you don’t have to care about clean water and air, for example, to know and understand that these mines are getting away with murder. Most Alaskans do care about our renewable resources and a healthy environment so let's come together and put the brakes on these really bad deals.
Our civilization needs and will continue to need metals. Our first goal should be to reach 100% recycling of metals and then we need to mine all the landfills. Metals have been so cheap for so long that many of us absent-mindedly throw it away. This has to stop. We need to improve upon our rates of consumption and take responsibility for our actions. Only after we have exhausted all of these options should we then consider opening new areas to development.
When and if we do allow open pit mines to be developed next to our precious renewable resources, next to our Alaskan communities, and next to our clean water, it has to be done really, really well. Private insurers will help make sure that these developers are not cutting corners. Private insurers will make sure that these developers are not just blowing smoke up our asses, which they currently are.
For an incomplete list of major tailings dam failures click HERE.