Is This Any Way to Treat the Job Creators?
It’s no wonder that, as the New York Times (NYT) headline declared: “Growth in jobs slows sharply to 3-year low.” Addressing the Labor Department’s disappointing December Jobs Report, CNNMoney’s headline states: “2013 ends with weakest job growth in years.” USA Today called it a “Big miss” and CNBC’s Jim Cramer sees the 74,000 gain in payrolls as “A disastrous unemployment number.”
USA Today surveyed 37 economists whose median forecast for the December jobs number was a gain of 205,000 jobs.
Not only did the report’s 74,000 jobs gain fall far short of the 205,000 jobs forecast, it is not the only number that portends a job market about which CNNMoney believes: “suddenly looks a lot weaker than economists had thought.” USA Today points out: “For the year, employers added 2.18 million jobs, slightly fewer than 2012’s total of 2.19 million.” It adds: “Payroll growth was weak across the board, with education and health services, a reliable source of job growth even through the recession, adding no jobs.”
The NYT coverage of the report opens: “Just when it seemed as if the economy was finally accelerating, the latest employment figures once again confounded expectation of better days ahead.” Nelson D. Schwartz states: “The one apparent bright spot in Friday’s report—a sharp drop in the unemployment rate to 6.7 percent from 7 percent—was tarnished because it largely resulted from people exiting the work force rather than because they landed jobs. The work force shrank by 347,000 in December, reversing a big gain from November, and returning the proportion of Americans in the labor force to its October level of 62.8 percent, the lowest in 35 years.” He points out: “Areas of the economy that had been healthy for most of 2013 reversed course as the year drew to a close, significantly cutting into overall job creation.” Schwartz concludes: “Employment is still about two million below where it was when the recession started.”
With even the friendlies firing shots at the “disastrous unemployment number,” the White House tried to get out in front of the story by holding a Tuesday, January 14, meeting with the Cabinet, where President Obama aimed to pick up “the pace of his jobs message.” According to the Associated Press (AP), White House senior advisor Dan Pfeiffer sent out an email Tuesday morning to the White House list of supporters claiming: “The president will use every tool he can to create jobs and opportunities for the middle class.” The AP article highlights Obama’s “determination to use the power of executive orders and administrative actions . . . to help advance his agenda.”
While I oppose this administration’s fondness for skirting Congress through the use of executive orders, here’s a case where an “executive order or administrative action” could really help “pick up the pace of the jobs message.”
If President Obama truly wanted to “create jobs and opportunities for the middle class,” he could tell the U.S. Forest Service (USFS) to work with—instead of against—people and companies who are ready to risk their capital in the development of our natural resources and create jobs.
While I am sure my readers could cite many similar stories, this one involves mining and mules. I have addressed this specific case three times before—first, July 2010, when the USFS approved the “Plan of Operation” for the Finley Basin Exploration Project in Montana.
My first column on this provides thorough details and I encourage you to read it, as you will be appalled by how the USFS works—and now, three and a half years later, it has only gotten worse.
Back in the ‘70s Union Carbide drilled several exploration holes on the site, “which is rated as having moderate to high mineral potential for the majority of the area.” It is believed that there is a minimum of $250 million in tungsten—which we currently import from China—and that the site also has potential copper, silver, molybdenum, and gold.
At the time I originally addressed this project, an Australian company wanted to invest in America, bring outside dollars in, and create jobs by exploring and developing the Finley Claims. But the USFS was so difficult to work with, after spending more that $500,000 over two years, the company finally packed up and went home.
The June 10, 2010, “Decision Memo” states that in order to explore the previously drilled sites, miners will have to “use a team of mules” and that “hand tools will be used to level the drilling pad and clear rocks, debris and any small shrubs.” Additionally, “all disturbances would be reclaimed using hand tools.”
Reading the Decision Memo, one gets the feeling that the USFS would rather not approve the mining proposal, but there were no real grounds not to. While explaining the “rationale” for the decision, the memo states that the company has the “legal right to conduct exploration activities” and that “The role of the Forest Service is to ensure that mining activities minimize adverse environmental effects. Congress has not given the Forest Service authority to unreasonably circumscribe or prohibit reasonably necessary activities under the 1872 General Mining Law that are otherwise lawful.”
After the Australians left, the 276 claims were purchased by experienced miners. Together, the partners in Finley Mining Inc. have more than 80 years experience in mining—with one having expertise in permitting and exploration and the other in project development and production.
Because the whole mule idea was unfeasible for the size and weight of the required equipment, the new owners submitted a revised Plan of Operations that allowed for use of the existing road Union Carbide built in the ‘70s. Despite the “Inventoried Roadless Area” designation, the old road is regularly used by off-highway vehicles for recreation. The road is totally usable and doesn’t require any construction. Yet, the USFS is treating the road as “new construction” and therefore denied the plan. The experienced partners have, in the past two-and-a-half years, now submitted five different plans of operation. Each time, the USFS comes back with some new ridiculous questions, such as: “In what order do you plan to drill the holes?”
The frequent excuse revolves around the various regulations—complying with the National Environmental Policy Act, Federal Land Management and Policy Act, and other Environmental Protection Agency rules and regulations. The USFS Specialists claim they are underfunded and understaffed and are unable to do the processes required before granting a permit.
Meanwhile, to hold the claims, these potential job creators, have to pay $40,000 a year to the Bureau of Land Management. They have spent more than $200,000 for applications, preparing the Plan of Operations, and on consultants and are no further along than they were three-plus years ago.
Since the USFS doesn’t have the staff or the budget to comply with the law, despite the hundreds of thousands of dollars they’ve already taken in on this one project, Finley Mining Inc. has offered to hire approved contractors who can do the needed surveys.
The Mining Act of 1872, as revised, lays out the rules and regulations in which exploration and production on federal lands can be conducted and does allow for mining activity within Inventoried Roadless Areas—as the original Decision Memo acknowledges. Access cannot be denied to someone who has a claim. Yet, access is denied.
This one project would employ 10 people in the initial exploration phase. Assuming the resource proves up, as the original drilling on these sites indicated, more drilling will take place and, in addition to the drill site workers, biologists, engineers, economists, and geologists will be needed for analysis. If all goes as expected, Finley Mining Inc. projects a minimum of 300 people would be hired for the construction and mining phases. The nearby Stillwater Mining has 1,740 employees.
If the USFS encouraged expansion, rather than simply interpreting and enforcing regulations, and managed the forest for the multiple use their mission mandates, the 300 construction workers could now be receiving a paycheck and paying taxes. Instead, we have policy-induced poverty.
If President Obama is serious about using “every tool he can to create jobs and opportunities for the middle class,” instead of appointing a new commission or doing a study, he’d issue an administrative action telling the USFS to comply with the law, to process permits within the 30 days required, and sign off on the Plan of Operations when it meets the existing requirements.
On Wednesday, January 15, Sen. Joe Manchin (D-WV) spoke at a forum on U.S. energy policy. He addressed the Keystone pipeline, saying that the president’s “delay in deciding the pipelines fate” is making it “harder for a Democrat to defend some of the Washington Democrat’s agenda.” According to the Real Clear Politics report, He also “criticized Senate Majority Leader Harry Reid for failing to call a vote on EPA regulation reforms” and is trying to “get Harry to look at the hard-rock mining.”
Yes, if Obama wants to use “every tool he can to create jobs and opportunities for the middle class,” he has plenty of them. The Finley Basin is an easy one. So is approving the Keystone pipeline.
Unfortunately for America’s un—and under—employed, reality tells us that the January 14 promise is just more hyperbole, more campaign-style platitudes. Is this any way to treat the job creators?