By Mark J. Perry
March 2, 2020 at 5:00 am ET
There is so much work to do on the nation’s failing infrastructure — everything from highways, bridges and pipelines to “smart grids” and polar-orbiting satellites, along with opening new hard-rock mines to supply the vast amounts of minerals and metals needed to get the job done — that it doesn’t matter who does it. Large corporations and independent entrepreneurs can make it happen. But accomplishing what is needed will take regulatory reforms in environmental law we do not have yet.
The United States has not had a well-informed public debate about how duplicative government red tape has slowed infrastructure improvements. The energy industry has witnessed this problem firsthand and is well positioned to show how bureaucratic obstacles have slowed or blocked oil and gas production, especially pipelines. To site and install pipelines can take approval from as many as 20 federal, state and local agencies — and the process requires time-consuming environmental impact statements that show how the project complies with the National Environmental Policy Act (NEPA).
Hard-rock mining remains perhaps the greatest challenge of all. Nothing of importance can be built without minerals and metals. According to the National Mining Association, the United States has an estimated $6.2 trillion worth of mineral reserves. But no thanks to our labyrinthine permitting process, America’s dependence on other countries for imports of minerals has continued to grow. We’re now entirely reliant on foreign sources for 14 minerals listed as “critical” by the Departments of Defense and Interior. Our import dependence has nearly doubled in the past 20 years and is poised to get worse.
What’s most distressing about this situation is that it’s a product of our own making. Consider rare earth elements, used in everything from missile guidance systems and satellites to smart phones. As recently as the 1990s, the U.S. was the world’s largest producer of rare earths. Today, there is just one rare earth mine in the U.S., and it must ship its ore to China for processing. The United States relies on China for 80 percent of the rare earth minerals imported, including materials that are critical components of batteries needed for computers, cell phones, consumer electronics, defense and electric vehicles. In a trade war, this gives China a big advantage.
Though America has an abundance of rare earths and other minerals, we rely on other countries for urgently needed materials for energy, transportation and other infrastructure projects. Some countries like China and Russia have environmental standards that are considerably less rigorous than our own. Unfortunately, successive administrations never adopted a guiding strategy or even demonstrated a sustained commitment to mining policy. Instead of allowing our import dependence to grow, we need to streamline requirements for environmental reviews and frame strategies for repairing and upgrading our nation’s infrastructure.
These agendas should be ambitious — ranging from highways to satellites. Environmental reviews should be scaled back. Government agencies should adopt innovative ways to streamline common standards. Agencies should promote deregulation and encourage growth in new construction. By operating at the center of this changing network, the government should work in tandem with private industry to break the logjam over infrastructure.
Mark J. Perry is a scholar at the American Enterprise Institute and a professor of economics at the Flint campus of the University of Michigan.
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