Mining news from Cuba and Bolivia does not normally make headlines.  Over the weekend this piece appeared on one of those sites devoted to “cooperation against bilateral trade and investment agreement that are opening countries to the deepest forms of penetration by transnational corporations.”  If this kind of post-commie rhetoric makes you cross, avoid this report: 

Representatives from four Latin American countries yesterday approved in Havana a declaration for incorporating geology and mining into the Bolivarian Alternative for the Americas (ALBA).  The text states: “We have identified actions that should be proposed to our governments to become part of future agreements on mineral resources to be included in the process of integration and greater cooperation being promoted by the ALBA.”  The document was signed by Yadira García, minister of basic industry (Cuba); José G. Delance, minister of mining and metallurgy (Bolivia); Emilio Rapaccioli, minister of energy and mines (Nicaragua); and Iván N. Hernández, deputy minister of Mining (Bolivarian Republic of Venezuela).   The agreement contemplates the creation of a group of experts from the member nations of ALBA, with mutual support in mining legislation, forming a shared geological data base, assessment of mineral potential, and market research.  It also covers the transformation of small-scale mining, the setting up of laboratories and a training system for the labor force, technical staff and professionals. 

So mining is not the evil I had come to think these folk think it is.  Looks like Cuba, Bolivia, Nicaragua, and Venezuela are about to go fast and furious to develop their mineral resources and open new mines.   At least that is what is appears from this report; I quote: 

Corporate globalization denies national governments the least vestige of sovereignty necessary to redistribute wealth. But Bolivia’s election result confirms that a large majority of people in the region expect widespread benefits from exploitation of their countries’ energy and other resources. Until recently, mining has always dominated Bolivia’s economy, in 2004 tin, zinc, gold, silver, lead, antinomy and tungsten made up over 40% of Bolivia’s export earnings. Foreign mining companies have discovered substantial sources of these metals in Bolivia and will be watching Morales for signs that may tip investment decisions one way or another. Morales will probably try and rebuild Bolivia’s State mining company COMIBOL that was cut back drastically like its state-owned oil and gas counterpart YPF in the “free market” smash-and-grab years of the 1990s.

This report, and many others like it on the web, proves one thing:  politics is the fight for control of resources, and whichever group gets control will exploit the resources to their benefit as fast as possible.   And mines represent a superb way to get at new resources.

The question that concerns us is: is it better for a mine to be operated by a free-market mining company or by a national government?   Do the local peoples benefit/suffer more as a result of the actions of foreign mining companies or as a result of socialist-government control of the resources? 

The answer probably depends on your innate perspective of justice, whether you are a shareholder of a Canadian mining company, or one of the local elite, or just another poor local laborer.   It would take a longer piece than a blog could bear to address innate perspectives of justice.  If you are a Sherrit mining company shareholder or other quisling, it makes no difference one way or the other.  If you are the local elite, like Castro and family, local control makes you rich, so it is clear how you will decide. 

Our concern thus boils down to the local laborer and the environment.  I suspect that in most cases, both the environment and the local workers will do better under a decent free-market mining company than as the un-free vassals of a local elite.  (See this link for considerable detail about Bolivia’s mining past to 2000.)

Dreary as the news is, it is hard to believe that in a dictatorship, the citizens would have done much better than they did at this mine—recall what happened to the 1.9 million people in the way of the Three Gorges Dam in China. 

And it is impossible to believe that anywhere but in a nation of free people under the rule of law, this mine closure would have happened.   

If you know of instances where the poor have truly done better under local elites (national or international, it all the same) than under rule-of-law, free-market economies & companies, let me know, and we will reopen the issue.