Smokestacks, High Tech, and LDCS: Some Thoughts on the Mining Industry

This article, though not common feature material, should be of reader interest. Goth made this presentation as the keynote address at the 19th Annual Intermountain Minerals Conference in Vail, CO, in August. Introduction Working backward, what is an LDC? LDC stands for Less Developed Country. LDCs play a dynamic role in world supply and demand of basic materials. They occupy an equally important position in international marketing and finance. I will explain later some of my concerns with LDCs. First, I want to address an issue I think is of equal or even greater concern. Mining and High Technology Unfortunately, many people believe that America must make a decision now between being a smokestack-based economy or a high-technology-based economy. Some would have you believe that smokestack America is dead. Our only option is to turn to high technology, in a manner similar to countries such as Japan. Presumably, when we talk about high-technology industries we envision organizations that came into being within the last decade or so and incorporate microelectronics, biotechnology, and interconnected computers. The entire workforce is clad in lab coats and there are few employees in proportion to the work performed. High-technology industry is not labor-intensive work thanks to the efficient robots used. On the opposite side are smoke-stack industries, that we presume include the older, basic industries such as mining, agriculture, iron and steel manufacturing, ship-building, auto manufacturing, and nearly all forms of construction. These industries are judged to be labor intensive, requiring unsophisticated and untrained employees who succeed by the sweat of their brows rather than by advanced degrees in mathematics and physics. If these are indeed the presumptions about high technology versus smokestack industries, then I submit that those presumptions are a disaster. They are wrong and far from the truth. Smokestack industries, such as mining and the others mentioned, are indeed much older than some of the recently founded high-tech industries. But this does not mean that those smokestack industries are low-technology industries. On the contrary, American agricul¬ture is a very high-technology industry whose crop yields are the envy of the entire world. Mining uses virtually all of the advances available through modern technology. Far too many opinion leaders still envision mining as Humphrey Bogart and John Huston in the movie Treasure of the Sierra Madre. Yet there are many who hold the opinion that our basic industries are dead and that this country's future depends on specialized high-technology industries and services. That is tantamount to announcing we will continue to build space shuttle vehicles, but we no longer need launching pads and landing fields. The point is, we should not be wasting our time talking about "new" industries and "old" industries. We should devote our time and effort to industries that are effective and efficient in meeting our needs, in contrast to industries that are not effective and efficient in meeting our needs. Less Developed Countries That leads me to some of the problems I perceive with policies regarding the previously mentioned LDCs - Less Developed Countries. Far too many people do not realize that many of the smokestack industries being lauded in Less Developed Countries are being operated at a loss and to the detriment of worldwide industry. And the losses incurred