A Mineral Alert; P. L. Poirot

Unbelievable as it may seem, an area larger than that encompass78 ing 25 of the 27 states east of the Mississippi River is no longer acces sible even for rnineral exploration, not to 1nention developrnent for min ing. Much of this withdrawn land is in regions where mineral deposits of economic significance are most like ly to occur - in the western United States and Alaska especially. Lots of laws and governmental agencies are involved in this story but the essence of the situation is that of 824 million acres of public lands potentially available for min eralleasing, 24 per cent were with drawn as of 1968 and 73 per cent withdrawn as of 1974; and of 742 million acres of public lands sub ject to the Mining Law of 1872, 17 per cent had been withdrawn from possible use in 1968 and 67 per cent as of 1974. Much of the problem developed in Alaska over the Native Claims Settlement Act of 1971. But other significant with drawals have been made in the name of National Parks, Military 1976 A MINERAL ALERT 79 Claims, Wilderness Areas, Wild and Scenic Rivers, Fish and Wild life Refuges, Utility Corridors, and Primitive and Roadless Areas, among others.

Special interest groups have gained political power· to have lands set aside exclusively for their own purpose, thus predud ing any other possible use of such land - even if two or more pur poses might have been. served si multaneously. At any rate, mining interests are deeply concerned about this recent trend of land withdrawal from mineral explora tion and use. Lest this .be construed as spe cial pleading by mining interests, let us view the matter in broad perspective. Of the total land area of 2,264 million acres in the 50 states, approximately one-third is federally owned/controlled - and not quite half of the latter is in Alaska. Private owners may have personal problems or difficult de cisions about the sale or use of their propertY,but there is no public or general problem over mineral rights or withdrawals on privately-owned land. The problem arises in the public sector - on land not subject to market regu lation and control.

This is the old, old problem of the wasteful use of scarce re sources. under a system of owner ship in common; the ancient problem of chronic famine and starva tion that still plagues people dedi cated to socialism; the problem of overgrazing the commons in old England, and in the early days in New England where all produce went into a common storehouse for withdrawal by "each accord ing to his needs"; the problem that has. only been solved in com paratively modern times in those comparatively few places where the people have understood and respected the institutions of pri vate ownership, specialized pro· duction, and voluntary exchange in open competition. This is the problem that currently perturbs mining interests with respect to exploring and developing mineral deposits on government lands. But on those same government hold ings is the same problem with respect to grazing rights, water rights, timber rights or any other potential use the market might indicate.

Private owners of land and other scarce resources are free to waste them as they choose, of course, but always strictly at their own expense. If a private owner chooses to hold. a given area as a park or preserve or for some other limited use, the market demand for other potential uses makes that owner painfully aware of the opportunity costs he bears to sat isfy his particular purpose. And 80 THE FREEMAN February he may be tempted, even per suaded, to allow a small mine open ing or an oil drilling rig or pump or even some supervised timber harvesting· on his otherwise scenic preserve. It is to his selfish inter est to develop and use as econom ically as possible every scarce and marketable resource available on his property. There is every in centive for him to conserve rather than waste what he owns. Not so on "the commons" - on that third of the land area of the United States remaining under Federal ownership and control.

Not the bids and offers of poten tial buyers and sellers out only the numbers of voters favoring or deploring a given use have real meaning to the government official in charge of the land. To open such land to the highest bidder in the market place would be to bring it under private ownership - and that would diminish or even close out entirely the job of that gov ernment official. So his only incen tive is to continue the land in some politically palatable but econom ically wasteful use - some purpose that millions pretend to applaud though unwilling to support it with their own resources. Yet, when public officials dictate the disposition of scarce and valu able resources, the millions who applaud are nonetheless obliged sooner or later to foot the bill. And that bill is falling due far sooner than many had supposed next week, or next month (or was it yesterday?) for New York City.

The bill already has fallen· due and is being paid for government mismanagement of natural gas and petroleum prices, production, marketing, and wasteful consump tion. The bill has fallen due and is being paid in countless "down towns" laid waste in the name of zoning and rent control and pub lic housing and urban renewal and related objects of urban plan ning. And there will be additional bills to be paid for urban and rural land utilization schemes and regulations. Whenever scarce and valuable resources are taken out of private ownership and control - with drawn from the market - and thrown into "the commons" there is a cost and the taxpayer will be obliged to pay. So let us beware the plans and controls and with drawals we applaud, for most cer tainly we will pay for them. No one knows precisely what the price will be or how long before the bill falls due for the recently accelera ted withdra wal of a maj or part of the public domain from mineral exploration and use. But we should be grateful to Messrs.

Bennethum and Lee for the early warning. , The Businessman and Free Enterprise BENJAMIN A. ROGGE THE QUESTION before this house is not whether the survival of capi talism is in doubt (this is admi t ted). The question for us, as it was for Lenin at an earlier time, is What To Do? His concern was how best to hasten the collapse of capitalism; our concern is how to postpone or ward off that collapse. Frankly, I feel more at ease· as the.·diagnostician than as the ther apist. Cancer is still easier to iden ify than to cure, and so is over expanded government. Admittedly, diagnosis must usually precede therapy. After· a lengthy diagnos tic examination, the doctor looks up at the patient in some puzzleDr. Rogge is Distinguished Professor of Polit ical Economy of Wabash College. This article is from a speech of September 16, 1975 before the Indianapolis Rotary Club. ' ment and asks,. "Have you had this before?" To this the patient re plies, "Yes," and the doctor says, "Well, you've got it again." Quite obviously something more than this is needed. Proper therapy usually rests upon diagnosis of the specific problem, including some notion of how the patient got into his fix, whatever it might be.