Mr. RAHALL. Thank you, gentlemen, for your testimony.

Mr. Mote, I would only note that the letters you have attached to your testimony appear to represent a mixed view. Some suggest changes such as those we have discussed earlier and all express concern over leasing. I would hope that you and both of the other members of this panel would go back and reassure your membership that this subcommittee chairman is not considering any leasing proposals and I hope that you can put their minds to ease in that regard.

We can, I believe, as an earlier witness has stated, have a win/ win situation and I think that is the attitude that we need to get across to your membership and dispel some of the fears that perhaps have existed in the past.

One fear I hope that you can dispel is that this subcommittee is considering any type of leasing proposal in a serious vein. That is not our intention.

Mr. MOTE. We appreciate that and we thank you for that.

Mr. HUBBARD. That will eliminate a lot of concerns of our membership.

Mr. RAHALL. The gentleman from Idaho.

Mr. CRAIG. Thank you very much, Mr. Chairman.

I have a general question and then a specific question of one of our panelists.

The three of you with your experience primarily with associations in dealing with all sizes of mining industry, can you say that the current Mining Law favors large over small or small over large?

Mr. MOTE. I would be glad to approach that. I've had about 30 years with large companies, then a short time with small companies and then about 10 years with an association, and I believe that the law as it now stands protects the large and the small miner equally.

I believe as long as the right to discover is there that the small miner will take advantage of it and has. I find that there are very few developments or present operations that were not discovered by the small miner, and that's even up to the past short while.

Mr. LANGLEY. Representative Craig, I would guess that probably the self-initiation concept is the most important to the small miner in the sense that I can think of any number of large mines in Montana that at one time were a small ore deposit that was discovered by a small miner. Those large mines come from what was once a small ore deposit discovered by a prospector working under the self-initiation concept.

So I would agree with Mr. Mote in that it does protect both parties equally.

Mr. HUBBARD. Our association has large and small members. The law firm I'm with represents both small and large miners, and I would agree with what the other gentleman just said.

Mr. CRAIG. Bill, could you go just a little further in explaining to us what you mean by a government arbitrator, and under what circumstances and situations are you addressing this idea?

Mr. MOTE. I believe that the administration of the Mining Law, the location of claims, the development of those claims and all of the permits and the permission to operate constitutes a series of

decisions by the land management agencies that are not well enough understood by either of the agencies to be consistent.

I believe that the Congress should have more information from the Bureau of Mines on decisions such as these that they make. There should be more of an input from the Bureau as an advocate for mining and yet not for the industry, but rather an advocate on the Government's side. So that the Bureau should be involved in helping not only to write the regulations that would come from any changes, but to interpret them on a ground and then to advise the Congress on the effect of those to see that they follow the intent of Congress. So I believe they have a place in every phase of industry. Mr. CRAIG. You don't think that is going on as well as it should right now?

Mr. MOTE. Not at all.

Mr. CRAIG. Can you cite some examples to clarify for us?

Mr. MOTE. Well, I think one of the major examples that we have seen lately was the charge to the Bureau of Mines to police the hazardous waste rules, and they were told to be involved. And after the rules were published, they were asked if they would like to read them. I think that this is fairly common in not bringing the Bureau into the economic mineral decisions.

Mr. CRAIG. OK. I'm beginning to get a flavor for it. In other words, when EPA decides to do something and they are dealing with mining they ought to go to the Bureau of Mines to do so.

Mr. MOTE. Yes, sir.

Mr. CRAIG. Well, I have yelled at the industry for a long time that they need to push hard to strengthen the Bureau of Mines and make it more of an advocacy group for the industry as a whole than it has been in the past.

Mr. MOTE. And we agree with you on that.

Mr. CRAIG. I think that we have fallen down there greatly.
Gentlemen, thank you all very much.

Mr. RAHALL. Thank you.

The final panel is Mr. T.S. Ary, the chairman of the national resources committee, National Association of Manufacturers; Mr. Brian Tognoni, Mineral Economics Corporation; and Mr. Don Fife, the National Inholders Association.

Gentlemen, we appreciate your patience through a long day, and you may proceed as you wish.

PANEL CONSISTING OF T.S. ARY, CHAIRMAN, NATURAL RESOURCES COMMITTEE, NATIONAL ASSOCIATION OF MANUFACTURERS; BRIAN TOGNONI, MINERAL ECONOMICS CORP.; AND DON FIFE, NATIONAL INHOLDERS ASSOCIATION

Mr. ARY. Thank you, Mr. Chairman.

My name is T.S. Ary. I'm chairman of the natural resources committee of the National Association of Manufacturers.

The Natural Resources Committee of NAM is unique among the industry groups in that it represents both the producers of natural resources as well as the processors and the consumers of the same

resources.

It is this particular blend of interests that leads NAM to be concerned with uncertainties and costs associated with our ever-in

creasing dependency on imported minerals and materials and the concurrent slack in the production and the general economic wellbeing of our domestic mining industries.

In times past we in the United States have been proud to believe and to proclaim that we were basically a self-sufficient nation and if we needed raw materials we produced them, if we need more food we grew it, if we needed more machinery we built it and if we needed new technology we developed it.

That's not true today. But it was the raw material demand, however, that led the need to develop the mineral wealth of our public domain which in turn would satisfy the increasing minerals appetite of our manufacturing complex.

In response, the Mining Law of 1872 was enacted to entice the adventure and the entrepreneur to risk investment funds in the search of ore in the remote and unexplored Wild West.

The act of 1972 provided the sense of stability to a wild and wooly industry which up to that time had been controlled by "sixgun" law. This stability removed much of the uncertainty of the investment community who refused many times to participate due to the questionable justice.

For the first time a Federal law in 1872 protected the discoverer of a valuable deposit. The law was successful then and is still successfully encouraging the search for minerals throughout our public lands in the settled and civilized West as well as in those frontier areas which we have left.

But one cannot discuss the Mining Law in the abstract or in the commercial void because the end use of the minerals and materials are in fact commodities which are the basis of the manufactured goods.

The end user and the mineral producer have a close mutually beneficial relationship in that the minerals and materials which are produced from domestic sources are the feed stocks which are manufactured into everything from the F-16 jet fighter to the microphone into which I'm speaking. In fact, even the recently heralded breakthroughs in the high-temperature superconductors have as a basis rare earth minerals in their chemical formulas, as even with the ceramics which could lead into the so-called superconductive second industrial generation are derived from a hole in the ground.

Therefore we must be interested in the sources and costs of mineral supplies as well as their end uses. To be overly dependent upon imported materials, especially from unstable or even hostile regions would result in a lack of satisfactory supply of raw materials for industry and concurrently materials essential to manufacturing or even the national defense.

The association and several witnesses earlier today are of the opinion that the present Mining Law is adequate and the most sensible and logical solution to provide this continued assurance that our mineral industry can fulfill its requirements of supplying new raw materials and maintaining its important role in our economy. The value of the existing Mining Law has been demonstrated over the past 100 years. It is impossible to place a value on its importance. Without it, we would have remained a developing country instead of the leading industrial country of the world.

As an example, allow me to review my experiences during the early search for uranium. In the 1940's and early 1950's our Nation was very short on uranium ores and concentrates. At that time all fissionable material was the property of the U.S. Government, and the Manhattan Project and its successors, the AEC were the only purchasers of the concentrates.

A call went out from the Directors of the Manhattan Project to expedite the search for a domestic ore supply. The Manhattan Project then organized the Union Mines Company to conduct exploration for a domestic supply of uranium.

Hundreds of man-years of effort was expended in their search, and they were unsuccessful in making a discovery. Following this attempt a call went out to the prospectors, the mining companies and the rock hound public at large. An incentive program was initiated utilizing the Mining Law of 1872 as a basis of discovery, ownership and the security of tenure to hold title to the lands until the deposits were depleted.

The program was so successful that the Atomic Energy Commission curtailed its buying program in an attempt to discourage additional discoveries.

Through the security of tenure granted under the Mining Law, the holders of the property were able to maintain the properties until new markets were located and developed which allowed the mothball properties to once again produce.

With the collapse of the market after the Three Mile Island incident, once again we were able to hold on to the deposits by doing annual development work while we worked to develop new markets.

These are but a few of the examples about which I could tell you, examples which can only be successful under a set of rules similar to our Mining Law, a century old concept that is flexible and still working.

The same type of results as you heard from Stan and the group are being experienced today in our recent precious metals project. Mr. Chairman, I have been in this mining business and exploration for over 40 years. I have been considered a small miner, an explorer, a company miner and a corporate executive, and I must admit that today I was offended by Mr. Greenwalt and his panel in their allegations that the corporate miners are irresponsible and do not worry about the abuses made by the small miners.

I was surprised that in that earlier panel, one of the gentlemen with his broad background in public land use did not tell you that the pits that were dug in Nevada north of Las Vegas were not the result of the General Mining Law of 1872, but they were a State requirement in those days. The States required that discovery pits be dug 10 feet deep on each claim. The prospectors followed the State law and completed their work.

Further, he didn't tell you that the mining industry initiated, encouraged, and supported that the changes be made in this discovery requirements in the States of Colorado, Arizona, New Mexico, Nevada, and California. We were successful in our attempts by maintaining some correspondence with the stock raising homestead people, with the wool growers and the Cattlemen's Association in

order to stop and curtail the digging of these pits which were useless.

We ended up making our discoveries by means of drilling, discoveries which were necessary in order to have a valid claim and to have a right that we could call a claim.

I listened today to a lot of people that don't know anything about the Mining Law which they're talking about. You can go out and locate 200 claims and you don't have a thing until you make a discovery. They have all glossed over the requirement to make a discovery. I can't understand what he means when he says that we are irresponsible, because I would like to know where their members were when we tried to get a large group of public land users to go with us into the Denny, California area to serve those dropouts who were using mining claims to grow marijuana and claiming to have valid claims. But I can tell you one thing, they were not present.

There were only a few of us who went with the Forest Service, with the U.S. Marshals and Dennie Carse of the Bureau of Land Management to serve those people and to bring them to justice and to get rid of those claims.

I'm a little sorry I brought this up, but as you can see I don't take it lightly when they make allegations about the mining companies are not being responsible when all I hear from them is a single use perception and concept for the public lands.

And while I'm departing from my prepared text, I would also like to address a statement that was made earlier about a small miner only producing 1 percent of the ore in the United States. Well, that seems low to me, but let's just assume it's correct.

Does this mean that the small miner should be left out of the picture? I don't' think so. The 1872 Act does not discriminate against anyone. It provides the same set of discovery rules and requirements whether you're a large mine or whether you're a small miner.

If some of the recommendations as outlined earlier are put into effect, the corporate giants will be the only ones left to handle the mining, and where would those small operators like Paddy Martinez, Charley Stein, Vernon Pick, Neil McNece and that group who made these large discoveries at Grants, Gas Hills and so forth be? The reason the small miner doesn't have a large number of productions is because he sells his discovery to the mining companies that are able to develop the small discoveries.

In closing I would just like to say that there are only a few things that we really need in the industry. We need the right of access to the public domain for the purpose of exploring and searching for new mineral deposits.

The wholesale withdrawals of our public domain as precluded activities under the Mining Law should cease and we should establish and maintain multiple use concepts for all the public lands. And in discussing the withdrawal question, more lands are withdrawn from leasing of the minerals than are withdrawn for mineral entry under the Mining Law.

So it would appear to me that those this morning that have been talking about leasing as the favored area for security of tenure are