Monday, February 10, 2014

Thomas Power speaks on economic impacts of mining: Part 1 - Houghton presentations

By Michele Bourdieu

[Editor's Note: This is the first of two video reports with excerpts from economist Thomas M. Power's presentations during his visit to the Keweenaw last November. This article will attempt to summarize Power's presentations in Houghton on Nov. 5 and 6, 2013. In the next article we will present excerpts from his talk and discussion at the Nov. 6 annual meeting of Friends of the Land of Keweenaw (FOLK), who hosted his visit and who have published his report on the impacts of copper mining in the Western UP.]*
During a public reception and discussion at the Super 8 Motel in Houghton on Nov. 6, 2013, Thomas M. Power, right, University of Montana research professor and professor emeritus and Principal of Power Consulting, talks about his experiences in Butte, Montana, and how he became interested in the economic impacts of mining. Also pictured here are, from left, Linda Belote of FOLK, Scott Rutherford of FOLK and John Slivon, Hancock City councilor. (Photo by Keweenaw Now)

HOUGHTON -- Thomas M. Power, noted authority on natural resource and regional economic issues, gave several presentations during his visit to the Keweenaw in early November 2013. Author of the report, "The Economic Impacts of Renewed Copper Mining in the Western Upper Peninsula," sponsored by Friends of the Land of Keweenaw (FOLK), Power visited the local area at FOLK's invitation in order to discuss the report’s findings and recommendations and to foster a community dialogue about the future development of the Western UP economy.

Power's report is one of a series of action research projects that FOLK is sponsoring under its grassroots Mining Education and Citizen Empowerment Campaign. The Campaign’s focus is on citizens and private and public institutions working together to assess the risks and benefits of a renewal of mining in our region.*

Power has been associated with the economics department at the University of Montana since 1968. He served as the chairman of the economics department from 1978 to 2008. In 2008 he retired from teaching and university administration, but he remains active as a research professor. His teaching, research, and publications have focused on natural resource economics and the intersection between natural resources and regional economic vitality and well being.

Thomas Power speaks at Michigan Tech

On Nov. 5, 2013, Power gave a formal public presentation, "The Economic Anomaly of Mining: Treasure and Tears" -- part of the Green Lecture Series at Michigan Tech.

Carol MacLennan, Michigan Tech associate professor of anthropology, who helped organize Power's lecture at the university and who also does research on industrial history at Torch Lake (a local Superfund site), introduced Power to the audience.

Carol MacLennan, Michigan Tech associate professor of anthropology, introduces Thomas M. Power to the audience at his presentation, "The Economic Anomaly of Mining: Treasure and Tears," on Nov. 5, 2013, at Michigan Tech. (Photos by Allan Baker and Keweenaw Now)

"I'm happy to have someone here -- like Tom Power -- to help us start a discussion about mining in the Keweenaw," MacLennan told Keweenaw Now. "I'm looking forward to multiple perspectives about this issue."

This introductory slide provides an outline of Thomas Power's Nov. 5 presentation at Michigan Tech.

During his Michigan Tech talk, Power first talked about the importance and the legacy of mining in his own state, Montana, "The Treasure State." He contrasted the attractive "treasure" aspects of mining, including highly paid jobs, with the instability of mining impacts ("boom and bust") and the "flicker" of instability caused by fluctuations in metal prices.

Economist Thomas M. Power speaks on "The Economic Anomaly of Mining: Treasure and Tears" on Nov. 5, 2013, at Michigan Tech University. Here he uses graphs to demonstrate the differences in pay between metal mining jobs and other jobs in Michigan -- a "promise" of higher incomes -- but he also points out the instability of mining. Click on YouTube icon for larger screen. (Videos at Michigan Tech by Allan Baker for Keweenaw Now)

Just as he indicated in his report for FOLK, Power demonstrated in his Michigan Tech talk how the highly paid metal mining jobs only last as long as the mine and don't actually bring prosperity to a community. The life of a mine often depends on world metal prices.* 

Here Power demonstrates how the instability of copper prices affects employment, giving examples from the former White Pine Mine near Ontonagon, Michigan, in the Western Upper Peninsula.**

Present-day mining means fewer mining jobs for blue-collar workers because of technological change, as Power notes in this slide. Miners are more highly trained and specialized, and in some mines robots have replaced workers.

Power gave several examples of how mining can discourage investment in a community because of its instability. It can also, he noted, leave communities with a "company town" culture -- a lack of entrepreneurial spirit, unemployment and economic distress after the mining company departs.

In this slide Power lists several of mining's negative characteristics and their economic implications.

Power concluded his Michigan Tech presentation with a question - answer session.***

Bill Fink of Houghton said he thought Power's presentation at Michigan Tech left many questions unanswered.

"He's obviously spent a great deal of effort documenting the obvious, but without giving us meaningful suggestions on what the Western U.P. should do about mining," Fink said. "Mining is not going to take us back to where we were in 1910; however, mining can be part of a balanced economic future."

Stephanie Tubman, a Michigan Tech Peace Corps Masters International student and teaching assistant who recently completed a masters in geology, said it was helpful to get Power's perspective since he has taught about mining in the past.

"It was interesting to get a longer-term perspective on the impacts of mining," Tubman said. "It helped me think more holistically about the topic."

James Havu, a Michigan Tech graduate student in geophysics, also commented on Power's talk at Michigan Tech.

"I think this is an important topic to the local area," Havu noted. "Mining is the local culture here. It's almost as if they are bringing that culture back."

Keren Tischler of Atlantic Mine said she thought Power's presentation was excellent.

"It helped me understand the economic fluctuations that are implicit in the mining economy and how communities can choose to respond to mining interests with that information in hand," Tischler said.

Andrea Hauge-Bacon of Houghton said Power didn't present any data, statistics or graphs that said mining was a good idea.

"The downside is very apparent, and it didn't sound like it's a good idea anywhere," she said. "You have to be a very highly qualified technician in order to work in mining today. There's no pick and shovel anymore except on a recreational scale."

Power joins residents in discussion of mining, reclamation

On Nov. 6, 2013, some Houghton - Hancock area residents who attended the talk at Michigan Tech, and some who missed it, had an opportunity for an informal discussion with Power at a reception held for him at the Super 8 Motel in Houghton.

Economist Thomas M. Power, University of Montana Research Professor and Professor Emeritus and Principal of Power Consulting, speaks about the negative economic impacts of copper mining on Butte, Montana, during an informal discussion with local residents in Houghton, Michigan, on Nov. 6, 2013. (Nov. 6 videos by Keweenaw Now)

Linda Belote (in hat) of FOLK asks a question on the community's share in the wealth of mining -- leading to a discussion of mineral rights and severance taxes.

In Houghton on Nov. 6, 2014, Power joins residents in discussing mining reclamation, the Superfund, and the need for mining companies to commit sufficient funds to clean-up and pollution prevention.

Dave Allen of Marquette, Upper Peninsula Environmental Coalition (UPEC) board member and conservation chair of the Sierra Club's Central U.P. Group, said he was familiar with Power's books but this was the first time he had a chance to hear him in person. He attended Power's presentations in Copper Harbor, Houghton and Baraga.

Dave Allen of Marquette chats with Thomas Power after the reception and discussion held in the Super 8 Motel in Houghton on Nov. 6, 2014. In the background are Scott Rutherford, left, of FOLK and John Slivon, Hancock City councilor.

"An impact analysis (like Thomas Power's report for FOLK) describes the whys and the wherefores of how we get to a certain place," Allen noted. "We've got a bunch of failed landscapes. How did we get to that point?"

Allen cited some of the impacts Power noted -- fluctuating copper prices, boom and bust, environmental damage, employees living out of the area -- as examples.

"He's giving you the information, and it's up to you to decide what to do with it," Allen added.

Editor's Notes:

* Thomas Power's report for FOLK, "The Economic Impacts of Renewed Copper Mining in the Western Upper Peninsula of Michigan," is posted on their mining education Web site. Click here for links to the Executive Summary of Power's report and the full report.

** Shortly after Power's visit, Highland Copper Co./Keweenaw Copper Co. announced on Nov. 19, 2013, their intention to acquire the White Pine Mine from Copper Range. See our Nov. 27, 2013, article, "Highland Copper Co. to acquire White Pine from Copper Range and continue Keweenaw mining exploration."

See also "Guest article: Mining industry has big plans for western UP and beyond," by Steve Garske, posted Jan. 22, 2014.

*** Click here, on the FOLK Web site, for links to the complete video recording of Power's Michigan Tech presentation on Nov. 5, 2013, and the Question-Answer session following that presentation.

Watch for Part 2 of this two-part series on Thomas Power's visit. It will include videos of his presentation and discussion in Baraga on Nov. 6, 2013. Coming soon ...

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