Tuesday, May 8, 2007

The Apex

[Another "lottery" example. Originally posted to my newsgroup, Dec. 8, 2006]

As I usually do before I write one of these essays on some subject where I can be caught in an error (as opposed to those reminiscences where it’s my word against anyone else and I’m sticking to my guns, Jack), I did a little background research on the subject of the Anaconda “Copper Wars.” Imagine my delight to discover that Don Rosa based an incident in “The Life and Times of Scrooge McDuck” on the situation.

The situation was this: part of the mining law of 1872 was a thing called the “extralateral right,” more commonly called “The Apex Law,” which said that someone who owned mining property where an ore vein came closest to the surface had the right to follow that vein in mining, even if the vein ran beneath someone else’s property.

There’s some irony in the story (my taste for irony being well-known by now), in that the law was written in part with the Comstock Load in mind, and several of the participants in that mining enterprise were behind the Amalgamated Copper Company, including George Hearst (father of William Randolf Hearst). But the law that had been written in part for them was then turned against them by a rascal named Frederick Augustus Heinze (nicknamed Fritz). Heinze was a geologist who first familiarized himself with the area of Butte, Montana, the location of the Anaconda mine. Then he made two important purchases, a small mining claim that had not been part of the Amalgamated consolidation, and a District Judge by the name of William Clancy.

The actual geology of the Butte area copper deposits was far more complex than the law had envisioned, but with Clancy on the payroll, Heinze obtained favorable rulings and then began basically looting the Anaconda mine. This led to more-or-less open warfare, with the Amalgamated interests obtaining rulings and injunctions from their own tame judges, Clancy overruling them, then gunplay and bloodshed taking place above ground between different law enforcement agencies, and below ground between miners for the different companies.

Eventually, Amalgamated bought out Heinze, who took his winnings east, where he was cleaned out by stock market swindlers. He died of drink at the age of 44.

Obviously Rosa had to omit a number of facts in adapting the tale for Scrooge McDuck.

The “Apex Law” has as its philosophical basis the good old American “winner take all” philosophy, leavened with the interesting notion of how hard it is to keep it all, what with all those unscrupulous characters running around. Another bit of background for this piece came from a paper “THE ORIGINS OF AMERICAN RESOURCE ABUNDANCE” by Paul A. David and Gavin Wright, which notes first, that the mineral resources of North America in the latter 19th and early 20th centuries were exploited much more rapidly than elsewhere, and second, that a great deal of this exploitation was assisted by obviously unscrupulous behavior, such as the sale of “mineral” lands as cheaper farmland by corrupt Federal agents, thereby avoiding legally required royalties.

Similar behavior allowed for the exploitation of coal reserves in West Virginia and Kentucky, where farmers sold “mineral rights” at a time when shaft mining was all that existed. Then strip mining was invented and it was held by the courts (populated by men like William Clancy), that the mineral rights contained an inherent easement that allowed their exploitation by any means. So some farmers then had their farms literally ripped out from under them.

A few years back on the Compuserve Sci-Math Forum, a geologist noted that there was now practically no “hard rock” mining east of the Mississippi, essentially because practically all the property east of the Mississippi is in private hands, and people have learned from the example of the West Virginia farmers. NIMBY is the most primal form of environmentalism, and it’s the one with the most steam behind it. You can decry NIMBY all you want, but you need to think long and hard about the MY part of it. It’s interesting how many people who are against environmentalism (and sneer at NIMBY), also claim to be in favor of private property. Maybe they’re just in favor of corporate property, which would explain a lot.

In the West, hard rock mining continues, but here’s another little irony: it’s almost exclusively on public lands. This makes American mining basically a socialist enterprise that is primarily conducted for private (corporate) benefit. Indeed, like logging operations, it’s not uncommon for the expenditure of public money (for things like logging road or environmental remediation) to exceed the franchise fees paid to the government for the mining rights.

So if you hear an old Trotskyite uttering the platitude “Socialism for the rich; Capitalism for the poor,” that’s part of what they’re talking about.


mine trash said...

JK.......... A coupe of comments/corrections for you to chew on. It's Comstock LODE (NOT Load; the second variety is what one has in his pants when he is talking about something regarding which he is ill informed). The term refers to a natural feature elongate in two dimension but not in a third, like a big shingle. Apex law dealt with how claims to these features should be adjudicated, especially if there are multiple veins or the ground is much disrupted by faults. Some deposits, moreover, are not very vein-like.
Your last comment about public land in the west (where many mines exist)is not very well informed either. There is so much public land here because the feds kept so much of it back as a kicker in the deals that admitted many of the western states. The Mining Law of 1872 had provisions in it for the ways in which "public" (meaning not privately owned land) could be improved and "patented" so it would be transferred to the tax rolls.
Ask yourself......before Manhattan was "purchased" from the Indians for a handful of beads, who "really" owned it, and was the Federal government ever "properly" reimbursed for it? No one EVER owns anything in perpetuity, but only has the use and refusal of it for a spell. Very few, even in the mining industry, would claim that mining rights should always over-top every other use. Some land is better left as moose pasture or farmland, but poor farmland over mineralized ground?? Pay for it and mine it, if that seems to be the best use.

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