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The Commons
More Kerry Mining Proposals
Posted by Andrew Morriss  ·  27 August 2004  ·  Federal Lands and Parks

Sen. Kerry is calling for charging royalties (which he claims will raise $600 million per year) rather than privatizing mineral resources as a means of funding national parks. His comments (from August 12) are reported here.

The Kerry plan is flawed in (at least) three important respects:
(1) it is DOA - no major change in the Mining Law of 1872 is going to make it through the US Senate, where western state senators form a bipartisan group blocking attempts to mine resource companies for federal revenue (and Kerry needs to ask strong mining law supporter Democratic Senator Tom Daschle about this, as Daschle is in a tight race in South Dakota).
(2) There is no relationship between mining and national parks - and so tying national park funding to even hypothetical mining royalties is bad policy. Moreover, as the state lottery experience (all the money is for education! Really!) shows, earmarked revenue sources usually produce shifts in unearmarked revenue away from the funded entity. Even if Kerry's plan passed and produced $600 million annually, the National Parks would be lucky to see even a fraction of that as a net increase.
(3) Destroying the successful privatization program that is the Mining Law of 1872 is bad policy - privatizing resources based on investment in discovery (what the law does) avoids the corruption problems that have plagued countries that charge royalties. Anyone want to swap Congo or Angola's mineral rights regimes for ours? That's what Kerry's plan boils down to.