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By Root 2130 0

maintenance and inspections and by improved engineering design (such as double-hulled rather than single-hulled tankers), so that the oil spills that still occur today are mainly ones due to human error (such as the Exxon Valdez tanker accident), which can in turn be minimized by rigorous training procedures. Oil spills can generally be cleaned up within a few years or less, and oil degrades naturally. While mine pollution problems also occasionally appear as a quick visible pulse that suddenly kills lots of fish or birds (like the fish-killing cyanide overflow from the Summitville mine), more often they take the form of a chronic leak of toxic but invisible metals and acid that don’t degrade naturally, continue to leak for centuries, and leave slowly weakened people rather than a sudden pile of carcasses. Tailings dams and other engineered safeguards against mine spills continue to suffer from a high rate of failure.

Like coal, oil is a bulk material that we see. The gas pump gauge tells us how many gallons we just bought. We know what it is used for, we consider it essential, we have experienced and been inconvenienced by oil shortages, we are frightened of their possible recurrence, we are grateful to be able to get gas for our cars at all, and we don’t balk too much at paying higher prices. Hence the oil and coal industries may have been able to pass on their costs of environmental cleanup to consumers. But metals other than iron (in the form of steel) are mostly used for invisible little parts inside our cars, phones, and other equipment. (Tell me quickly without looking up the answer in an encyclopedia: where are you using copper and palladium, and how many ounces of each were in the things that you bought last year?) If increased environmental costs of copper and palladium mining tend to increase the cost of your car, you don’t say to yourself, “Sure, I’m willing to pay another dollar per ounce for copper and palladium, just as long as I can still buy a car this year.” Instead, you shop around for a better deal on a car. The copper and palladium middlemen and car manufacturers know how you feel, and they pressure the mining companies into keeping their prices down. That makes it hard for a mining company to pass on its cleanup costs.

Mining companies have much less capital to absorb their cleanup costs than do oil companies. Both the oil industry and the hardrock mining industry face so-called legacy problems, which mean the burden of costs from a century of environmentally damaging practices before the recent growth of environmental awareness. To pay those costs, as of the year 2001 the total capitalization of the entire mining industry was only $250 billion, and its three largest companies (Alcoa, BHP, and Rio Tinto) were capitalized with only $25 billion each. But the leading individual companies in other industries—Wal-Mart Stores, Microsoft, Cisco, Pfizer, Citigroup, ExxonMobil, and others—had capitalizations of $250 billion each, while General Electric alone had $470 billion (almost double the value of the entire mining industry). Hence those legacy problems are relatively a much heavier burden on the hardrock mining industry than on the oil industry. For example, Phelps-Dodge, the largest surviving U.S. mining company, faces U.S. mine reclamation and closure liabilities of about $2 billion, equal to its entire market capitalization. All of the company’s assets amount to only about $8 billion, and most of those assets are in Chile and cannot be used to pay North American costs. In contrast, the oil company ARCO, which inherited the responsibility of $1 billion or more for Butte copper mines when it bought Anaconda Copper Mining Company, had North American assets of over $20 billion. That cruel economic factor alone goes a long way towards explaining why Phelps-Dodge has been much more recalcitrant about mine cleanup than has ARCO.

Thus, there are many economic reasons why it is more burdensome for mining companies than for oil companies to pay cleanup costs. In the short run, it’s cheaper for a mining company