GOVERNMENTS have a strong agenda to pursue mining enterprises - even those that spark controversy, according to Murdoch University lecturer in Political Economy Dr Jeffrey Wilson, Western Australia.
He said it generated more land value on a "hectare by hectare" basis than farming.
Mining projects created investment and skilled jobs creation "at least during the construction phase" and -– unlike the farm sector – required companies to pay royalties on output in addition to tax requirements, Wilson said.
"Governments are also liable to dismiss some public opposition as not-in-my-backyard (mantras) and urban voters are sometimes ignorant of, or ambivalent toward these kind of politicised conflicts," he said.
When there were perceived risks to agriculture involved, governments considered the situation in the "here and now", rather than a "present/future" trade-off, because mining generally creating a greater return to the wider public.
"Of course, there are losers as well – farmers who might be dislodged or compelled into forcible acquisitions, locals who don't like to see the character of their community change, and the ongoing question about safety and environmental protection, which really varies on a case-by-case basis," Wilson said.
He said it was an inherent feature of electoral democracies that governments were not in office long enough to suffer the consequences and/or reap the benefits of the decisions they made.
One downside to this was that governments could often make decisions that had negative impacts well after they left office.
"Unless the electorate is highly attentive to these at the times –and due to what economists call 'discounting', individuals rarely are – governments largely pay little immediate costs for this," Wilson said.
"This is certainly true when it comes to environmental protection, but it applies to many other policies as well."
He said mining companies would be held liable for any long-term impacts of the projects through their mining leases and the environmental clauses within them. If another mining company acquired the lease, then the responsibilities were carried over onto them.
"Indeed, companies and markets price in the cost of these obligations and potential liabilities when they value assets in the resources sector," Wilson said.
University of Adelaide Politics and International Studies Prof Timothy Doyle said one of the problems with the mining industry was that it believed that anything below the ground belonged to them.
It was "not possible" to have a viable pastoral enterprise with that mentality. "You can't have farming interests above the ground if underneath the ground you've got no management," Doyle said.
"The environment is a 3D environment."
* Full report in Stock Journal, July 3, 2014 issue.
Malcolm Sutton
Stock Journal's news journalist and magazine editor.
Stock Journal's news journalist and magazine editor.
