Stop giving away Nevada’s gold
The blockbuster 3-D film Avatar depicts a greedy mining corporation exploiting the fictional planet Pandora, 4.3 light years from Earth. In the film, open pit mines scar the land, to the dismay of a humanoid species, the N’avi, who live in sublime connection with Nature. Delicious Hollywood-style violence ensues.
Pandora’s mineral treasure is called “unobtainium.” That’s a word real-life engineers coined for an imagined perfect problem-solving material, one that doesn’t actually exist. Perhaps Avatar director James Cameron feared movie-goers would be sympathetic to mining for something real, like gold or oil. We know the value of these. Gold makes technology possible—from iPhones to plasma screen TVs. Fossil fuels keep lights on and cars cruising.
In Avatar, avaricious corporateers are evil. In real life, we appreciate mining. We don’t fight companies that give us stuff we want.
As it turns out, Nevada is a gold mine. About 80 percent of U.S. gold production happens here. Since the 1800s, about 152 million troy ounces of gold have been mined in Nevada, according to a Nevada Bureau of Mines and Geology report. That’s 4.75 tons of gold. We’re rich.
And we’re generous to a fault. In Nevada, we solicit mines to dig our rich mineral deposits—asking little in return. “Please take our gold, Newmont and Barrick,” we beg. “We won’t ask you to contribute to social programs, prisons, cops or schools.”
Nirvana’s song “Rape Me” comes to mind.
It’s time to demand a share of our treasure.
As the state faces an expected $3 billion budget deficit for its next two-year budget, fearful leaders and wannabe elected officials seek new revenue sources. Mining is one of the last Nevada businesses that’s “still turning a profit hand over first,” says Bob Fulkerson of the Progressive Leadership Alliance of Nevada.
Fulkerson notes a disparity between how Nevada deals with gambling and mining industries. The mining industry packs more economic punch than gambling. Yet we tax gambling far more heavily.
In 2009, gambling lost $6.7 billion, according to the Gaming Control Board, yet still paid $1 billion into the general fund, Fulkerson notes. “Mining grew $5.7 billion but only paid less than one percent of that. The disconnect is huge.”
Longtime journalist Hugh Jackson, a former policy analyst for Public Citizen who’s worked on energy and environmental issues, offers “Nevada Mining Tax Deduction Facts” at his Nevada Gleaner website.
He notes that from 2000 through 2007, the mining industry in Nevada extracted and sold gold worth $25.5 billion from Nevada. For this privilege, mining paid state taxes totaling $125.3 million. That’s about a half a percent in state taxes. A pittance.
How does this happen? Jackson explains that mining companies, because of allowed tax deductions, pay taxes on about one-fifth of the resources they extract. Some years, mines make millions and don’t pay a dime to the state. Nevada’s largest gold mines, Barrick Goldstrike and Newmont’s Carlin Trend project, have reported nothing to tax in years when the mines have sucked out gold worth a half billion or more.
Changing and eliminating tax deductions could raise tens, maybe hundreds of millions for Nevadans.
Sound easy? It’s not.
Mining corps have plenty of money to help elect lawmakers who give ’em what they want. They can hire lobbyists—one per three legislators, Fulkerson says—to bend lawmakers’ ears in Carson and to influence media conversations.
One favorite scare tactic: Tax mines and Nevada will lose jobs. That’s silly. As long as the price of gold exceeds $1,000 an ounce, Barrick and Newmont aren’t going anywhere.
Nevada has the unobtainium that mining companies want. It’d be shortsighted not to make some modest demands on the gold barons’ profits.
Because when the gold’s gone, it’s gone.