Babbitt attacks mining's gold heists

On the day he was not nominated to the Supreme Court, Interior Secretary Bruce Babbitt stepped up his campaign for reform of public-land laws in the West.

Brandishing an oversized symbolic check, Babbitt bashed the "outdated" 1872 Mining Law that forced him to hand over more than $10 billion in gold to a Canada-based company for less than $10,000.

"This is the biggest rip-off since the Yankees stole Babe Ruth from the Red Sox for pocket change," said Babbitt after signing a mineral patent transferring 1,800 acres of public land near Elko, Nev., to Barrick Goldstrike Mines. A federal judge ordered Babbitt to turn over the patent by June 20 of this year unless there was cause for denial. Babbitt has acknowledged that the company's application was valid, but the Goldstrike, the richest gold mine on public land in the United States, has proved a powerful symbol in the debate over mining reform.

"It's the biggest gold heist since the days of Butch Cassidy," Babbitt said. "But these folks stole it fair and square. The West has long since been settled but the giveaway continues unabated."

Now that Barrick owns the land, it will not have to pay a royalty to the federal government. A tax on gold extracted from public land is a central element of mining law reform.

Budget chief Leon Panetta joined in attacking the mining law that forced the government to "sign over to a foreign-owned company the rights to $10 billion worth of taxpayer-owned gold for less money than they charge NBA players for fighting during a game. This has turned from a needed incentive into a multibillion-dollar rip-off. And it has to stop."

The rhetorical flourishes continued as environmentalists and mining industry lobbyists swung into action. Phil Hocker, director of the pro-reform Mineral Policy Center, blamed the Senate for failing to pass legislation to replace the 1872 Mining Law. "In effect," he said, "the members of the Senate have been standing on the back porch of the capitol, ringing the dinner bell and shouting "Come and get it before it's all gone" to the mining companies."

Sierra Club lobbyist Kathryn Hohman added, "Barrick Resources picked the taxpayer's pocket, while pock-marking the public's land. The mining company got the gold and the public got the shaft."

Pat Garver, an attorney and lobbyist for Barrick, responded, "If you believe Babbitt, I ought to just be able to take that check to the bank. In fact, tonight we can do the same thing we did this morning: bulldoze around and claw gold from the ground. This didn't change anything for Barrick. We're glad he finally complied with the law. But this was mostly a press event. It was the opening salvo in Interior's efforts to get mining law reform."

The mining industry's chief lobbyist, Jack Gerard of the Mineral Resources Alliance, a group of more than 2,000 mining companies and industry organizations, said Babbitt "fails to recognize the sizable investment made by mining companies before extracting a single ounce of gold or silver or the millions of tax dollars and thousands of jobs generated by the industry." Gerard added, "The mining industry has been waiting at the bargaining table and is prepared to support reasonable reform this year."

The political battle over mining reform is heating up as Congress prepares behind-the-scenes for a contentious conference committee to resolve two very different mining reform bills that passed the House and Senate last year.

Both Rep. George Miller, D-Calif., and Sen J. Bennett Johnston, D-La., have named delegates to the conference committee. It will meet this summer to hammer out a reform bill with enough "strong" environmental provisions to satisfy the House while not provoking a filibuster from Western senators who say reform must be "fair" to the mining industry.

• Energy & Industry