Business, Finance & Economics

Miners vs. Farmers in Australia

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Strip mining for coal in Australia's Hunter Valley (Photo: Jason Margolis)

It's not easy being a farmer in Australia these days. They had 12 years of drought. The government is threatening to cut water supplies. And if that weren't enough, many farmers feel they're second fiddle to the mining industry.

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Take the example of Wendy Bowman.

"Next door to us, a mine was put right on our boundary. The dust and the blasting and the noise at night… The dust covered all the pastures. The cattle wouldn't eat the pasture some days because the dust was so thick and heavy."

Bowman lives in the Hunter Valley, a rich agricultural area in southeastern Australia, just north of Sydney. This area has good soils, but it also good coal reserves.

Bowman hates the coal companies, seriously hates them. This is what she said about a coal executive: "I heard he had prostrate cancer, and I thought, it couldn't of happened to a nicer person, actually."

She then added a hearty laugh.

Bowman and I drank lemonade on her front porch. She went on for about a half hour about how the coal companies have destroyed the environment, contaminated the ground water, and wrecked the community.

At this point, you might be thinking: I've heard this story before — the big mining company comes in and locals say they destroyed the local environment.

Yes, same story. But the story in Australia has an economic twist. The mines are making people here rich, very rich. Skilled boilermakers earn more than $300,000 a year. 18-year-olds can earn $150,000 a year driving trucks. Bowman says, those teens and all that money… it's a nightmare.

"You know all the young are drunk at night. They've got so much money they don't know what to do with it. They're spending it all on these hipped up, vrrmm vrrrmmm, vrrrrrmmm yutes and things that roar around town at night. It's very sad to see a very, very nice district end up like this."

That contempt that some farmers feel for the mining industry, well, the feeling is mutual.

"The farmland argument, it's a ridiculous argument. It's just a bunch of old cockies trying to preserve their way of life, which has no relevance to today's society," said Paul Howes, national secretary of the Australian Workers Union. (By the way, a cockie is Australian slang for a farmer with a little, insignificant farm.)

Howes says you want to know why mining salaries are so high? It's simple: supply and demand.

"In terms of bankers and lawyers, at the moment, they're a dime and dozen. I can get lawyers very easily. And I would argue that one boilermaker at the moment is worth 10 lawyers for our economy."

To Howes, it makes for an easy calculus: "I'm a dig is up, ship it out guy."

That attitude is making Australia rich. Dig it up, ship it to China.

But can agriculture and mining co-exist? Mitch Hooke, the CEO of the Minerals Council of Australia said, yea, they already do.

"At the moment, mining, there's this perception that it's just big trucks, bulldozers blowing up stuff. And it's all ugly, downright dirty, dangerous, and low-tech. Well, nothing could be further from than the truth."

Same question to seventh-generation farmer Tim Duddy: Can mining and agriculture co-exist?

"Absolutely not."

For Duddy, the question is personal; the mining companies are knocking at his door.

I went on a driving tour with Duddy through his home area, the Liverpool Plains. It's the next stop up the road from where I met Wendy Bowman.

Duddy said, "If they mine here the way they mine anywhere else, the agricultural resource will be destroyed, the water resources will be destroyed. And maybe not in one year, maybe not in five years, maybe not in 15 years, but in 20 years, perhaps, or 50 years. And this agricultural resource here is so productive, that it's got a thousand year life span."

Mining companies have promised to monitor the local water, take care of the environment and return the area to farming once they're done mining.

Farmers aren't buying this. They've organized a community effort, including a physical blockade to stop coal companies from coming here.

Mitch Hooke at the Mining Council said that's over the line. He said the state governments have the authority to approve or reject mining permits, not local farmers.

"This cannot generate into a debate about not in my back yard, the old NIMBY adage."

Tim Duddy responded, "Absolutely I've been accused of being NIMBY."

Duddy seems proud of that moniker. Mining companies have been writing generous checks to the state government for the right to explore and to local farmers for their land. One farmer got $5.2 million for a house that last sold nine years ago for $376,000, a tidy 1400 percent profit. Duddy said they've offered to buy his land too. I asked: how much?

"A lot," Duddy said, with a chuckle.

But Duddy said his land isn't for sale, at any price.

"I said to them (the mining companies) that they don't understand the love of land. And I don't understand the money. They love money as much as I love land."

Duddy will have tough road to hoe though. The reality is that the world still runs on coal: about a quarter of the world's energy comes from it. Coal generates more than three-quarters of Australia's electricity.

But those percentages might start shifting. The Australian government is on the verge of passing a carbon tax, which would discourage the use of coal. If that happens, score one for the farmers.

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