The Mining Myth: Sustainability and Development

The Mining Myth: Sustainability and Development by Binoy Kampmark

May 21, 2013

It has been a fiction that has held sway for a time. Mining booms create trickledown wealth. It is tagged as “sustainable” when it is premised on temporariness. Natural resources work for countries that possess them in abundance. Only on the periphery do we see the sense of foreboding that comes with these assets, be it the murder of such leaders as Patrice Lumumba in the Congo over fears that he might have handed over natural resources to the Soviets, or the fear of becoming a two speed economy, one dangerously reliant on commodity prices and extraction dues.

The latter is particularly relevant to the Australian context. Leaders like proclaiming the country as stable and untouched by the political fractiousness that tends to afflict other countries with similar pools of wealth. These scions of plunder are attempting to give lessons to other countries in the game, which is much like a thief teaching other thieves how best to open a safe in a sustainable, green way. This is the message at the Mining for Development Conference taking place in Sydney over May 20 and May 21.

The conference profile reads like a smooth document on dispute resolution and good governance, a manifesto of promise and environmental equilibrium. Mining, in short, is praiseworthy. It has had its problems, but the guests are keen to follow such standards as the EITI (Extractive Industries Transparency Initiative), the global standard for transparency of revenues from natural resources. And it has the blessings of AusAid, thereby surreptitiously linking aid to developing countries with a noble mining sector. If Coke would sponsor programs on nutrition, this is what it would look like.

A few comments from the International Mining for Development Centre’s director Ian Satchwell are worth noting. “The history of mining in many developing countries has not been a good one, and countries have done less well than they should from mining and oil and gas extraction in the past” (ABC, May 20). This may be the understatement of the week.

The next comment is also striking. “Where many developing countries have fallen short is that they have not had good experience getting mining revenue from mining companies and then the useful application of that revenue into investment in community and infrastructure.”

Is Australia any different from those “developing” economies where mining and development tend to be less matters of accommodation rather than matters of exclusion? The mining lobby has hardly been amenable to infrastructure projects that have any utility beyond the crude issue of getting more miners and finding more deposits. Empty pockets need lining. Local fat cats need feeding. Even an imposed mining tax has not provided the rewards the government promised.

That does not stop the agitprop from circulating, something that the mining initiates tell each other constantly. Indeed, leafing through such reports as those of Susan A. Joyce and Mark E. Smith in The Latin American Mining Report (Sep/Oct 2003), the fantastically misplaced praise for not only mining but its sustainable credentials is unmistakable. For the authors, “mining’s track record is not bad, having been the foundation for some of the biggest sustainable economies on Earth. This new challenge can in fact be our ally – mining’s belief in its contribution to economic development is a truth that shines well on the industry.” No mention of local disputes, environmental carnage and political disruption.

History is picked upon at the authors’ convenience – California being one such example. “Mining created the economic engine which opened up a distant and isolated region with lots of other potential – and for which the US had just finished fighting a war with Mexico.” Right out of manifest destiny’s top drawer.

Then come the benefits mining provides, the collateral benefits that make the authors thrilled that such an enterprise can be economically ennobling – the making of wheel barrows by Studebaker, or the pants by Levi Strauss for miners. Digging is good for soul, country and economy. But overall – and let’s scream out the word – it can be sustainable, an astonishing illusion that has assumed the form of holy mantra.

The speakers at the Mining For Development Conference have embraced the sentiment like cult followers of the next fashion. Professor Paul Collier, fellow of St. Antony’s College, Oxford, recalled the Ashanti Goldfields of Ghana, where the mining enterprise became a treatment enterprise for employees and residents suffering from malaria. “Mining companies in developing countries often develop roles outside their core competence.” Let’s just ignore those less savoury roles in mining’s blotted copy book.

The facts of the mining industry remain dark and disturbing. Deposits are to be found in developing countries that curse them rather than benefit them. Even the delegates admit that. Goodness, even the World Bank, in an extensive investigation of over 200 regions, has reached the same, numbingly obvious conclusion. And an easy point to forget is what developed countries tend to do to the unfortunates who find themselves sitting on unmined wealth. Instability is rarely a one-way street. Corporate complicity with brutal regimes tends to go hand in hand, a point skilfully evaded by the delegates.

The disastrous effects can also be felt in wealthier states, where the oxymoron of “sustainability” is demonstrated with disastrous import. The Redbank Copper mine on the Northern Territory-Queensland border is one such an example, a mine that leached heavy copper sulphide for two decades that turned Hanrahan’s Creek to a deadly hue of green and blue. Toxicity levels have killed the creek and potentially threaten pristine wetlands (Northern Territory News, Mar 15).

Michael L. Ross, himself a participant in the proceedings, should know what such wealth does. In 2012, his The Oil Curse: How Petroleum Wealth Shapes the Development of Nations examined the astonishing disparities that oil-rich countries have in terms of stability, the presence of autocracy and the chronic failures to distribute wealth, though he tends to ignore the insatiable appetites of countries all too keen to meddle in such areas as the Middle East. Then there is that gaping lacunae in the literature on what developing countries do with such reserves.

Hunger and insecurity regarding natural resources are terrible motivators, and that lesson should not be missed by those developed countries happy to gain their wealth by their remorseless and ultimately unsustainable digging.

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Binoy Kampmark was a Commonwealth Scholar at Selwyn College, Cambridge. He currently lectures in politics and law at RMIT University, Melbourne.

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