Moving on from the age of confrontation

Mining, along with many other aspects of our life, suffers from the unfortunate fact that we live in an adversarial society that is avidly fostered by our politicians.

Every day, either in parliament or the media, they abuse one another in the most insulting and destructive manner that they possibly can. Never once do they talk of the many pathways along which they could walk together to advance Australia. They just keep on insulting one another, imploring us to vote for whichever one is the best insulter.

As the result of their pathetic example, a culture of hatred now filters down through every aspect of Australian life. Sadly, it is now accepted as the norm for business and community negotiations — even family disputes. To win you must denigrate your opposition, rubbish their products and services and drive them to the wall so that the winner will take all.

Unfortunately, mining is suffering badly from the spreading of this community disease, which we can call “confrontation cancer”. Its symptoms are that it eats away at the very fabric of a mature society, and is more of a threat to Australia’s future than mining will ever be.

We have miners at war with, or defending themselves against, farmers, rural communities, environmentalists, indigenous people, trade unions, transport operators, economists, social commentators, religious leaders and others. But, it is important to note that the fault does not lie predominantly with miners. In fact, this is far from being the norm. All sides suffer from confrontation cancer and a good doctor will subscribe heavy doses of consultation, social planning and goodwill from day one.

An exploration permit granted by any government should be made conditional upon a miner agreeing, before digging a single hole, to hold preliminary consultations with all stakeholders in the region concerned, to discuss what may happen if viable mineral deposits are found and eventually mined.

Broad guidelines can be agreed as to how everyone may benefit, and this should include an acknowledgement by the Local Government that it may be called upon to provide social infrastructure that will enhance the lives of all who may work in the mines — including an improvement of the local environment far beyond the requirement of the mine to be environmentally friendly.

If consultation is based on goodwill every step of the way and broad agreements reached as early in the process as this, then this amiable atmosphere can prevail right through the process of exploration, mining and export of the resources, and the eventual total restoration of the land, water and vegetation.

Confrontation cancer can become an unlamented shadow on the horizon, and progressive Australians can generate many situations where everyone wins and Australia becomes a sustainably prosperous nation of enhanced social and environmental stature.

Above all, politicians can learn much from such practical examples of how friendly consultation can advance the nation as the result of a quality of intelligent discussion far above their appalling standards of destructive behavior.

Holes in the ground

Like many Australians, I used to worry that, sometime during this century, Australia would become a continent made up of thousands of holes in the ground, the legacy of the greatest mining boom ever. However, an objective study of Australian mining shows that the land currently being used by mines does not cover as much territory as that which is occupied by all of our shopping centre car parks, most of which are an incredible eyesore.

So, our problem is not how we can stop Australia from looking like a moonscape, but how can we make sure that there are plenty of minerals left for the benefit of future generations?

If history is a guide, we should not be worried unduly. In the long saga of mining worldwide, there have been regular booms and busts, just as there have been with the overall world economy — despite all the efforts of eminent economists to remove boom and bust cycles.

But, there is a very positive outlook also. Because mining is more difficult in Australia than in other parts of the world, our mining technology has become very advanced and will enable us to find more minerals, and do so at greater depths than previously envisaged, thereby creating an infinitely larger supply.

It also creates another revenue earner for us, as our unique expertise with minerals should be sold around the world to a greater extent than it is now.

We can be sure that Australia’s current mining boom will end abruptly sometime soon. Efficiently managed and adequately financed miners who relate well to their communities and the environment will survive and prosper, while others will go to the wall. What we have to decide is which ones deserve to survive and make sure that we work co-operatively with them in building a stronger nation. We must remember that mining provides less than 20 per cent of our gross national product every year. Our main effort must be to ensure that the remaining 80 per cent retains and advances its prosperity too — but we won’t achieve this by punishing miners.

We have a desperate need to improve our national productivity in all fields of endeavor through much greater efficiency than we achieve now.

Farmers and Graziers

The confrontation between rural producers and miners has reached a point of unnecessary hysteria, mainly caused by governments putting the whole problem in the too hard basket and running away from it as fast as they can, but also fuelled by local political zealots who are not landowners and whose sole interest is to use this issue to enhance their public profile. To my dying day, I will defend the right of a landholder to tell miners that they have no right to enter his or her property for any reason until a legal agreement is reached through a clearly-defined negotiating process that adequately compensates the owner every year throughout the life of the mine or gas well.

The gas industry is the main offender in this, and while there are some notable exceptions, too many gas drillers behave like Attila the Hun, and this must stop.

While the key issue is, and must always be, the preservation of prime arable land, there are too many farmers whose militancy goes beyond the bounds of reason and sanity. In fact, some of them are enjoying the battle so much, they will be grossly disappointed when it ends.

They will greatly advance their cause if they calm down, as miners do have some rights and not all of them want to destroy good land, nor do they want to buy it cheaply.

Once more, the disease of confrontation cancer is running rampant out in rural Australia, and must be cured so sanity can prevail. This will happen when governments produce an enlightened framework for negotiations. Then, we will get some real results in which everyone can win.

After all, Australia is a massive continent and can easily accommodate many more farmers, graziers and miners than we now have if we give them the infrastructure to do it in a sustainable fashion.

Fly In — Fly Out

Whether it be true or false, one of the greatest criticisms of the mining industry is that it takes wealth from the geographical heart of Australia and leaves little behind that will improve the social fabric and economical life of the Inland. Nothing typifies this more than the fly in/fly out system of providing workers for their mines.

Recently, the situation became inflammatory when one mining company said that it would fly mineworkers in and out from Asia — but, as usual, there are many sides to every story. The miners will emphasise that workers, whether Australian or otherwise, do not want to live out in the Never Never, and so they have no option but to fly them in and out.

At the same time, social workers will tell you that the system is placing great stresses on the families back home who are left alone for long periods. In the final analysis, they don’t want to be separated. Nor do the workers really want to live in mining towns where the entertainment generally consists of having a few drinks with your mates.

Part of the solution lies in providing the social infrastructure needed to make mining communities liveable. This will require the building of quality housing which is air-conditioned and insect-proof, church schools, satellite university campuses, health services, social and cultural centres, sports facilities, good restaurants and theatres, etc.

In the long term, these good investments will prove to be less costly than that of fly in/fly out.

Not surprisingly, the way forward is a combination of consultation, co-operation and innovation — with no confrontation between miners and governments as to whose responsibility it is to create attractive inland towns and to plan for their future post-mining.

Commonsense tells us that there is no point in having a prosperous nation that has a diminishing quality of life and is socially dysfunctional.

Railways and Ports

It is time that we faced the fact that we do not have railways and ports that are of a quality that will sustain our mines (or any of our industries). We have to admit that they are outmoded and inefficient, thereby placing a heavy burden of cost on exporters.

The long term neglect of providing modern infrastructure for the Surat and Galilee Coal Basins in Queensland and the new food producing regions of northern Australia, particularly the Kimberley, is a prime example of this.

Because of a lack of investment in infrastructure and its associated technology, as well as little interest in innovation, 45 per cent of revenue that we earn from mining and manufacturing is spent on transport and another 20 per cent on energy. We are not serious about being both productive and competitive. We have become content to run this nation on old world transport systems that price us out of markets. So long as we get more and more royalties to sustain our unrealistic lifestyle, we turn a blind eye to how Australia’s capacity to be a great trading nation is being slowly crippled. One day, instead of being recognised as the trading powerhouse of the Southern Hemisphere, we will be left behind by Africa and South America, and we will deserve it.

Commodity Prices

Mining prospers today because of the generally high commodity prices that prevail on world markets. When those prices drop significantly, as has happened persistently from time to time throughout history, we will experience our next mining bust, when only the efficient and the least indebted will survive.

The recession in Europe could be the catalyst this time, but I can see little evidence that Australia is preparing itself.

The only way to beat falling commodity prices is through increased efficiency, cheaper transport costs and a lower wage structure out in the minefields. We are asleep at the wheel!

Dollars

Without a doubt, mining has been a major force in driving the Australia dollar higher and pricing our exports out of the market — just as happened in the Netherlands when they ‘enjoyed’ the North Sea oil and gas boom that killed off just about every industry that they had. But, mining can’t be blamed for it solely. Economic weakness in the Northern Hemisphere has caused a loss of confidence in the US Dollar, the British Pound, the Euro, and the financial markets that support them. Australia, with its solid economy and reliable dollar, is now regarded as a safe haven, causing a lot of money to flow our way and sending our dollar a bit higher every month. This clearly shows that the excuse being used by our banks for their interest rate rise is less than honest. There is little difficulty in finding money that seeks a home in Australia.

A key element in the problems related to a highly-valued dollar is that the world expects Australia to keep opening new mines at a faster pace than most nations, because of the record of our State Governments in wanting more royalties every year. The dollar will drop in value when Australia makes it clear to the world that we intend to carefully manage the expansion of our mining industry by fostering only the orderly development of top quality mines.

Environment

It is extraordinarily popular to blame mining and the many uses of its mineral production as the cause of the world’s environmental problems. Unfortunately, the debate on pollution is carried out within a realm of very inexact science that will be a matter of controversy for generations to come. Nevertheless, it is best to take the responsible view that appropriate action should be taken progressively to tackle the perceived threats to a clean world, while noting that coal in particular will dominate the world of energy no matter what alternatives are offered.

Wind, solar, hydro, hot rocks, and all forms of renewables are often too costly and have no capacity to become major providers of energy. Gas production creates more environmental problems than coal could ever be accused of doing. Far too little has been invested in the science of clean coal, and there are too many people who want the whole initiative to collapse because they don’t want coal ever to become environmentally respectable.

A massive investment in the science of clean coal is needed right now, about ten times more than is currently being spent. Failure to do this will be irresponsible in the extreme, particularly as the cost can be shared between governments and miners. The same comments apply to the environmental issues surrounding all other minerals.

My personal experience in dealing with miners on behalf of the railways in which I am involved is that they want to be very environmentally responsible. Considerable evidence abounds to verify this. Can I suggest that you look at the website of the Sustainable Minerals Institute at the University of Queensland? Its Chairman is Charlie Sartain, Chief Executive of Xstrata Copper, and it is doing excellent pioneering research in a wide range of projects related to mining.

The problem is that miners enjoy little leadership from governments in their efforts to be good citizens, and experience no real sense that the community wants to work in co-operation with them. Their predominant experience of trying to deal with the community about the environment is one of confrontation, and there is no clear evidence that they will be applauded if they involve themselves in environmental partnerships that tackle the issues in a responsible way.

Instead of blaming mines for environmental disasters, we should face the fact that the world’s environment is damaged, not by mining alone, but primarily by the undeniable fact that the planet is severely over-populated.

Hope

We should all proceed with our quest to enjoy the good life in a responsible manner, and engage confidently with the mining industry in helping to make it the most enlightened nation-building enterprise in the world.

We should do this in the hope that a more competent and enlightened management of national affairs will see this nation through to a sound and stable future.

We will achieve this goal if we elect talented people to our Parliaments, irrespective of what Party they belong to. Party hacks should never again be elected. The same must apply to those who seek a career in the bureaucracy.

Abraham Lincoln’s Cabinet was comprised of powerful leaders from all the political Parties of the day, many of whom aspired to get his job as President of the United States. It was this government of genuine talent, led by a man of extraordinary ability, that enabled the Civil War to be brought to an end and America go on to become the most powerful nation on earth.

We can aspire to do likewise, but the way in which the Australian political system operates today renders it inadequate to be the vehicle that can lead us successfully into the future of a rapidly changing and enormously challenging world.