Survival lessons. (Competitive Enterprise Institute President Fred L. Smith, Jr.'s speech)(Transcript)

THE ENVIRONMENTAL DEBATE

Address by FRED L. SMITH, JR., President of the Competitive Enterprise Institute

Delivers to the Annual Meeting of the Gold and Silver Institutes, Los Cabos, Mexico, April 1, 1996

I'm honored to address this annual meeting of the Gold Institute. Although I've been working closely with your president, John Lutley, over the last year I first became aware of the problems facing your industry at an annual meeting of the (then) American Mining Congress in Las Vegas on risk management. Many of you have been to that event and know well the incredible display of mining technology exhibited there. As a policy analyst familiar with the political and economic issues affecting your industry but unacquainted with the reality, the show was extremely impressive. The gigantic earth moving equipment, the drills and massive array of machinery associated with coal strip mining - even the small incremental improvements in filters, lubricants and breathing masks - all attest to the ability of mankind to solve problems - to ensure the sustainable development of the resources of our earth. Yet, knowing as I did, the hostile propaganda that environmental groups have used with great skill to delegitimize all extractive industries, I found myself saddened by the thought that much of this gleaming technology might early in the 21st century be rusting in abandoned mines throughout the United States - and indeed, if current trends are not reversed, throughout the world.

Your industry is in trouble and my message today is that your industry needs a communications strategy based on both a credible message and credible messengers. To succeed you must change public attitudes by clarifying that gold and indeed all mined resources are essential to a safer and more prosperous society. You must also mount a more intense campaign through the interest group world of politics.

To win the battle you need allies - spokespeople who can defend your industry, who are less likely to be perceived as only interested in "making money." In brief, the gold industry is in a war of survival - a war of ideas and legitimacy. My message is that this is a war that you can and must win!

Let me briefly review CEI's role in the policy debate. CEI is a pro-market public interest group formed in 1984. We focus on regulatory concerns such as emerging financial instruments (derivative contracts, for example) and all major environmental issues. Like other public interest groups, CEI has a vision of how the world could, should work - we are ideological in the sense that we believe ideas matter. Our bedrock proposition is that private arrangements better advance the public interest. We therefore differ from the Naderite groups who believe that skillfully implemented political controls, run by the right people, will solve problems. In contrast, CEI believes that if you have a problem and government gets involved you have two problems. CEI is representative of a growing number of policy groups who hold these views.

CEI is a $2 + million organization with 30 staffers involved in many of policy issues. Our recent book, The True State of the Planet, effectively counters the anti-technology, anti-growth environmental establishment. It clarifies that sustainable development is not a goal to be achieved through bureaucratic central planning but a reality where resources are integrated into the private property, free market system. CEI's environmental work has received global recognition. In a review of True State, the Wall Street Journal named CEI the "best environmental think tank in the nation." CEI's relationship to the business community is that of ally - we support your right to compete and succeed or fail in a free economy - in effect, CEI might best be viewed as a Battered Business Bureau!

1. LESSON ONE: THE CHALLENGES NOW FACED BY THE GOLD INDUSTRY ARE GENERAL NOT SPECIFIC

Many in industry, especially in the mining industry - view their plight as unique.

Like Butch Cassidy in that famous movie, industry keeps asking: "Who are these people and why are they after us?" What could we have done to avoid these problems? But that misses the point, the enemy isn't mad at you, they're mad at economic and technological progress. It's not personal.

Certainly, mining is under severe attack around the world - the Ok Tedi mine in Papua New Guinea, the Freeport McMoRan mine in West Irian, Indonesia are typical examples. Once lauded as bringing economic growth to …