October 06, 2009 05:28 PM UTC

Goldman-Sachs owned Colorado Mining Company Wants More Corporate Welfare

• 3 Comments
• by: ClubTwitty

(Socialism-IOKIYAR – promoted by ClubTwitty)

The Politico is reporting on a little GOP-instituted earmark handing over $3 million in taxpayer dollars to Molycorp, a Colorado-based mining company owned by Goldman-Sachs.

A mining company owned by Goldman Sachs and two private equity funds is in line to get a $3 million earmark for work at a rare earth elements mine in Mountain Pass, Calif. – raising questions as to why Congress would take on some of the risk for a bailed-out investment giant that’s already making a profit.

..Rep. Jerry Lewis (R-Calif.) inserted the earmark for the mine into the House Defense appropriations bill…

But some government watchdogs question whether taxpayers should be asked to prop up a project that is already funded by wealthy investors who expect to make a profit.

“It’s probably good business, and we probably don’t need to subsidize it,” said Ryan Alexander, president of the nonpartisan Taxpayers for Common Sense.

This is only the start of the public largess that has been lavished on this mine.  Once public land, this area was ‘patented’ under the 1872 General Mining Law which allows purchase of the public’s assets–surface and mineral–for $5, or less, an acre.

Nor do the taxpayer subsidies for these multibillion multinational companies end there.  Under the 1872 Law–signed by President U.S. Grant–no royalties are paid back to the U.S. Treasury for hardrock minerals (unlike for publicly owned oil, gas and coal all of which require royalties for the taxpayers who own the minerals).  And the final costs are perhaps the biggest–when mining is done it often falls on the U.S. taxpayer–again–to foot the bill for clean up.  There are still tens of thousands of abandoned mines in Colorado alone, still polluting our streams and littering our landscapes.

The Mountain Pass mine itself has a troubled history:

BARSTOW, CALIF. — Nearly one year after seven toxic spills contaminated federal lands including Mojave National Preserve, the responsible company, Molycorp, has yet to begin the clean-up process. But the corporation has proceeded with a proposal to expand its mine near the park.

“This expansion was conceived before the California Desert Protection Act established Mojave National Preserve in 1994,” says NPCA Pacific Regional Director Brian Huse. “Molycorp’s proposal fails to address the project’s impacts on the park’s scenic, natural, and cultural values.”

Molycorp’s Mountain Pass Mine, which is located less than two miles from the preserve, was California’s number-one source of toxic pollution in 1991. The site has remained among the state’s top ten pollution sources since then, according to the U.S. Environmental Protection Agency.

And this isn’t Molycorp’s only problem mine:

On May 11, 2000, the Molycorp mine was entered into the Federal Register and put on the National Priorities List of proposed Superfund cleanup sites.

The Molycorp mine is located in northern New Mexico near Questa, New Mexico. Questa is a small community located in the Red River watershed. The Red River, once a blue ribbon trout fishery, has been contaminated by acid rock drainage created by both natural and manmade processes. The Environmental Protection Agency has initiated a Remedial Investigation/Feasibility Study (RI/FS) which will help in determining the best way to clean up the Molycorp mine site and restore the Red River to its former quality.

In spite of all the talk about bailouts and handouts and ‘socialism,’ when it comes to Congress both parties love to hand out taxpayer money to well-heeled corporations. $10 billion not enough? Here’s another $3 million to pad your profits.

While earmark reform is another matter, one reform that has been put off too long is bringing our ancient mining law into the 21st century.  Payments of adequate royalties back to the public which gave away its lands and minerals under these antiquated rules, to help fund the clean up of the terrible backlog of mining’s earlier mess, is one critical reform.  

Sen. Mark Udall sits on the Energy and Natural Resources Committee whose chairman, Sen. Bingaman, has a bill (S.796-pdf) to reform this 19th century law.  So far Sen. Udall has not joined as a sponsor and it’s time he does so.  

Please call one of his offices at:

DC-202-224-5941; Denver-303-650-7820; Grand Jct- 970-245-9553; Pueblo-719-542-1701; Durango- 970-247-1047; Greeley-970-356-5586;  CO Spgs: 719-471-3993.  

Urge Sen. Udall to co-sponsor S.796 and work to bring our mining laws into the 21st Century.