Update: The Exxon/Rio Algom Mine Controversy

To: Sociological Imagination

From: Al Gedicks

"Today we cannot merely assume that in the last resort men must always be governed by their own consent. For among the means of power that now prevail is the power to manage and to manipulate the consent of men. We do not know the limits of such power and we hope it does have limits, but these considerations do not remove the fact that much power today is successfully employed without the sanction of the reason or the conscience of the obedient."

C.W. Mills, The Causes of World War Three (1958)

"Some legislators in Madison want to stop mining. That's like asking over 10,000 working people to stop breathing. Don't they know that thousands and thousands of us work in jobs that depend on mining? Don't they know how important mining has been and will be to Wisconsin? We want to be part of it. Those high paying jobs belong in Wisconsin, not someplace else. Working together for the future. Crandon Mining Company."

Exxon television ad featuring Dennis Bosanac, president of United Steelworkers of America (USWA) Local 1114 in Milwaukee with the union seal in the background.

The permitting of new mines in sensitive areas where local residents place a high value upon a clean environment continues to be a major social problem for the mining industry in most industrialized nations (Prager, 1997; Hodges, 1995). Exxon/Rio Algom's proposed Crandon metallic sulfide mine continues to be one of the most controversial environmental issues in Wisconsin (Gedicks, 1988, 1995). With the introduction of the mining moratorium bill in the Wisconsin legislature, the citizens of the state got a rare glimpse into the power of multinational corporations to wield extraordinary political power and shape public perceptions about the modern mining industry.

Last spring (1996), the mining lobby convinced the Republican-controlled state Senate to adjourn a week early to avoid scheduling a vote on the mining moratorium bill (Wichman, 1996). Last January (1997), the bill was reintroduced into the legislature. Despite an unprecedented media, lobbying and mass mailing campaign, Exxon, RTZ-Kennecott and the Wisconsin Manufacturers and Commerce Association were unable to prevent an overwhelming vote in the Wisconsin Senate (29 - 3) in favor of the mining moratorium bill on March 11, 1997. The bill now goes to the Wisconsin Assembly where the mining industry will once again try to derail the bill. Exxon has already set up and funded the Coalition for Fair Regulation (CFR) in the hopes of mobilizing industries, such as the paper mills, which have not yet been part of the mining moratorium battle. The executive director of CFR is Peter Theo, formerly the director of governmental affairs for Exxon's Crandon Mining Company. The steering committee includes the largest mining and mining equipment manufacturers in the world: BHP Minerals (Australia), Exxon (USA), Flambeau Mining Corporation/Kennecott/RTZ (Great Britain), Bucyrus International, Nordberg, and P&H Mining Equipment (Harnischfeger). The coalition's first letter, sent out to businesses all over the state, asks "What if the state legislature, because of pressure from anti-growth activists, decides that plating manufacturers, paper mills or other industries should be banned? Where does it end? (Theo, 1997)."

Despite the exaggerated claim in CFR's letter and Exxon's claim in the ad cited above, the mining moratorium bill would not ban mining in Wisconsin. Instead, the bill requires that prior to obtaining a permit to mine in a sulfide orebody , the applicant must demonstrate that a similar mine has been operated and closed for at least ten years without pollution from acid mine drainage or heavy metal contamination.

On the eve of the Senate debate on the bill, Rodney Harrill, president of Crandon Mining Company (CMC), told a reporter that "Our opposition was way out ahead of us on this thing (Seely, 1997b)." To counterbalance the Indian, environmental and sportfishing coalition spearheading the mining moratorium campaign (Gedicks, 1997), CMC tried to mobilize the workers employed in southeastern Wisconsin's mining equipment manufacturing industry. Several dozen showed up at the mining moratorium rally at the State Capitol just before the Senate began debate on the bill. When the Senate debate began, they crowded into the public gallery to observe the proceedings. They all wore yellow tee-shirts and caps with "P & H" in bold black letters, courtesy of P&H Harnischfeger. This Milwaukee-based company is the world's leading supplier of underground and surface mining equipment (Bergquist, 1995).

CMC's television ad featuring USWA union president Dennis Bosanac is misleading for several reasons. First, if the Crandon mine is not opened, potential jobs in the mine will not travel out of state, because the ore cannot be moved. Nor will steelworkers in Milwaukee lose their mining-related manufacturing jobs if the Crandon mine does not open. Mining equipment companies like Harnischfeger and Bucyrus-Erie in Milwaukee will still receive contracts from outside Wisconsin. Second, while Exxon promises 400 permanent high-paying jobs in the Crandon area there is no assurance that these jobs won't go to already skilled miners who, after six months in Wisconsin, will become "local" residents. Many skilled miners were recently laid off at the White Pine copper mine and mill in the Upper Peninsula (Peterson, 1995). The recent (May 1997) decision of the Copper Range Company to withdraw its permit for acid solution mining at the White Pine Copper mine will provide further incentive for the remaining miners to seek jobs elsewhere.

Third, the Crandon Mining Company (CMC) ad never mentions that Exxon and Rio Algom, a Canadian mining company, are the co-owners of CMC. This is a significant omission because the ad leads the viewer to believe that the United Steelworkers (USWA) are supporters of the companies behind CMC. Nothing could be further from the truth. The USWA has been in the forefront against Rio Algom on the issue of worker health and safety at the Elliot Lake uranium mines in Canada. As the main union involved in uranium mining at Elliot Lake, the USWA expressed deep concern over the health effects of radiation from the early days of mining. The Ontario Workman's Compensation Board reported in 1969 that 16 out of 20 deaths of Elliot Lake miners were the result of lung cancer. A USWA survey showed that "Rio Algom had consistently underestimated hazards in virtually every part of the mining complex and mills, by deliberately under-reading radiation levels (Moody, 1991: 127)."

Exxon also has a poor track record in miner safety. In 1990 the Occupational Safety and Health Law Center (OSHLC) reported that Exxon had the nation's overall worst corporate mine safety record among the nation's largest twenty underground coal producers, according to its fifth annual mine safety ranking. Exxon was also at or near the bottom of the list in 1987, 1988 and 1989. "The numbers are staggering when you consider the resources that Exxon is capable of applying to the problem," according to J. Davitt McAteer, OSHLC's executive director. "Exxon management has failed to make the necessary commitment to mine safety. Much as it did after the Valdez disaster, Exxon has thumbed its corporate nose at the miners and their safety concerns (McAteer, 1990)."

When confronted with this information, Bosanac replied, "I wish I'd known that [before making the ad deal] (Grossman, 1997). The rank and file membership of United Steelworkers of America (USWA) Local 1114 voted Bosanac out of office in the elections following the Exxon ad. The local membership also passed a resolution citing Exxon and Rio Algom's poor records regarding worker health and safety and strongly supporting the Mining Moratorium bill.

In the weeks preceding the Wisconsin Senate vote on the mining moratorium bill, the citizens of the state were bombarded with slick television commercials promoting the wonders of modern mining technology and associating it with the warm, fuzzy images of the idealized version of life in the small, northern Wisconsin town of Crandon in Forest County, where Exxon and its Canadian partner, Rio Algom, want to construct a large underground zinc and copper mine at the headwaters of the Wolf River.

Conspicuously absent from any of Exxon's television ads were the Indians who will be the most directly affected by any mine contamination. The mine site is only a mile upstream from the tiny Mole Lake Sokaogon Chippewa reservation, which is famous for its wild rice. Swamp Creek flows directly from the mine site into Rice Lake, and any acidic contaminants would devastate the fragile wild rice crop. The Chippewa were not reassured when Exxon's biologist mistook their wild rice for a "bunch of lake weeds (Gedicks, 1993:61)." Later, Exxon maintained that any pollutants from the mine would travel along the rim of Rice Lake and cause no harm to the delicate ecology of wild rice. The tribe asked the U. S. Geological Survey to perform a dye test to determine the path of potential pollutants. The results showed the dye dispersing over the entire lake. Exxon's corporate attitude toward the fate of the tribe exemplifies the "discourse of dominance" which belittles the existing subsistence-based tribal economy to justify its resource extractive activities (Johnston, 1994).

While Exxon and its Crandon Mining Company (CMC) refuses to disclose the amount of money they spent for the series of television ads that played in the state's major media markets, Rep. Spencer Black (D-Madison), co-author of the mining moratorium bill, estimates the company spent more than $1 million . The Exxon ads were developed from focus groups organized in Milwaukee and Madison where participants were paid $40 to answer questions such as "What does up north mean? (Fantle, 1997a)."

The ads show geese flying over a lake, a sparkling stream and school kids. Mike Monte, the editor and publisher of the Pioneer Express, a local shopper newspaper in Crandon, pointedly asked in an editorial, "What does this have to do with the mining industry? (Monte, 1997b)." Mary Kay Grasmick, a spokeswoman for CMC, said the ads were intended to counter what she said was "misinformation" from mining opponents. She cited the characterization of the storage area for the 22 million tons of mine waste as a "toxic waste dump" as an example of misinformation by mine opponents (Seely, 1997a). But the ads did not address any of the controversial issues surrounding the proposed mine. The ads did not address the questions about groundwater and surface water contamination from acid mine drainage and heavy metals, the drawdown of local water supplies in the vicinity of the mine, the effects of discharging upwards of one million gallons of treated mine wastewater into the Wisconsin River every day for thirty years, etc.

The television ads are part of a consistent corporate strategy to avoid public discussion and debate about the numerous technical problems associated with their mine plan. In October, 1995, Exxon placed full page ads in the Crandon, Antigo and Rhinelander newspapers proclaiming that their Environmental Impact Report (EIR) is "based on one of the most exhaustive environmental studies ever conducted for a project in Wisconsin (Exxon, 1995)." However, Exxon's assurances about protecting the groundwater from any contamination from their mine waste dump has been challenged by Dr. David Blowes, the mine waste expert who was retained by the former Public Intervenor's Office to provide an independent review of Exxon's mine plan. In his comments on the company's mine waste plan, Dr. Blowes charged that the waste characterization studies did not follow standard operating procedures and provided inadequate data upon which to draw conclusions about the potential for acid mine drainage and heavy metal contamination (Blowes, 1995; Imrie, 1996a). Since acid mine drainage is one of the most serious problems with metallic sulfide mines, this is a most serious flaw in the EIR.

Another expert retained by the Public Intervenor's Office to evaluate Exxon's mine plan was Dr. Douglas S. Cherkauer, a groundwater expert who was asked to examine the impact of Exxon's proposed dewatering of the underground mine. Remember that the proposed mine is located directly at the headwaters of the Wolf River, a rich and sensitive watershed with high rainfall and numerous wetlands, springs and streams. During development and mining, Exxon will have to run pumps twenty-four hours a day to keep the shafts dry and safe for mining. One way to think of this is to imagine pulling the stopper out of the bathtub and then trying to stop the water from going down the drain. This drawdown effect will pull water out of the aquifer (underground waters) for several square miles, eventually altering flow to surface wetlands, lakes, streams and wells. According to the former Public Intervenor, "the protection of public rights in water is an absolute limit on DNR's ability to permit this project, so this issue becomes crucial (Arts, 1986).

Dr. Cherkauer has consistently criticized Exxon's overly optimistic projections about groundwater drawdown at the mine site. In a recent letter to the Sokaogon Chippewa Tribe, Dr.Cherkauer says there is no scientific basis for the latest groundwater drawdown projections by Exxon (Cherkauer, 1996) . Opponents of the mine have charged that Republican Governor Tommy Thompson and his chief aide, James Klauser, a former Exxon lobbyist, eliminated funding for the Public Intervenor's Office in the 1995-96 state budget to eliminate potential obstacles to permitting Exxon's proposed mine (Culhane, 1995). The move was widely opposed by Democrats, environmentalists, and conservation groups across the state.

Further questions about the methods used by Exxon to predict mine-related impacts to adjacent lakes have been raised by the Great Lakes Indian Fish and Wildlife Commission (Coleman, 1996), the U.S. Army Corps of Engineers (1996) and most recently, by the Wisconsin DNR itself (Carlson, 1997). Of particular concern to the DNR is the possibility that if Exxon's calculations are incorrect, the area of groundwater drawdown would be much larger than previously thought and would affect the waters of Mole Lake, Rice Lake and wells on the Mole Lake reservation (Monte, 1997a).

This could pose major problems for the project because reservation land is held in trust by the federal government for the Tribe. The Department of the Interior, which exercises this trust responsibility, has stated that this mine "may have a substantial and unacceptable impact on aquatic resources of national importance (Smith, 1994:2)." Moreover, the Sokaogon Chippewa have sought and been granted independent authority from the U.S. Environmental Protection Agency (EPA) to regulate water quality on their reservation. Tribal regulatory authority would affect all upstream industrial and municipal facilities, including Exxon's proposed mine in the Swamp Creek watershed. Because Swamp Creek flows into the tribe's Rice Lake, the Sokaogon have to give approval for any physical, chemical or biological upstream activity that might degrade their wild rice beds (Behm, 1995). Within a week of EPA approval of Sokaogon Chippewa water quality authority, Wisconsin Attorney General James Doyle sued the U.S. EPA in federal court, demanding that the federal government reverse its decision to let Indian tribes make their own water pollution laws. While the Wisconsin suit is pending, a federal court ruling in Montana has upheld the right of Indian tribes to set water quality standards on their reservations (Associated Press, 1996b).

Regardless of whether the ads addressed the issues of the proposed mine, were they effective in influencing public opinion about the mine? Based upon statewide telephone polls before and after the ad campaign, the evidence suggests the ad campaign did not increase public support for the mine. A public opinion poll commissioned by several Wisconsin Tribes in October 1994 showed one-third of residents in favor of additional metal mining in Wisconsin while 43% were opposed to more mines. Nearly one-fourth or respondents, or 24%, were undecided (Behm, 1994). Another poll, conducted by by the St. Norbert College Survey Center in cooperation with Wisconsin Public Radio was done after the Exxon TV ad campaign. While the respondents to the Exxon mine question were a subsample of the overall pool of 407 respondents, they are still suggestive of the general direction of public opinion. Among the 64% of the 407 respondents who said they had read or heard something about the propose Crandon mine, 48% said they opposed the project; 31% favored the project; and 22% were undecided (Mayers, 1997).
 

While the State of Wisconsin sought to overturn tribal sovereignty over reservation water resources, Exxon/Rio Algom tried to sidestep growing local resistance to mining by negotiating a "local agreement" with elected officials in closed meetings where local citizens were locked out and denied access to information about the meetings. Between 1993-96, the town board of Nashville, the township immediately adjacent to the proposed Crandon mine, met in closed session approximately thirteen times with CMC to discuss a local agreement

In Wisconsin, before mining companies can receive state permits to mine, they must have the approval of local units of government. Up until 1988, local approval took the form of zoning permission. Citizens had substantial input to this decision through both the zoning committee and their elected representatives at the town, city and county levels of government. However, in 1987 Kennecott Copper Corporation realized that it could not meet the tough environmental requirements contained in Rusk County's zoning ordinance and thus could not get a state permit to construct the Flambeau copper mine in Ladysmith. To get around what the company called "onerous existing local approvals," a Kennecott lawyer drafted the so-called "local agreement" law which allows mining companies to negotiate a local agreement in lieu of zoning permission. Such negotiations are confined to elected officials, usually in closed meetings. The bill was attached to the budget bill and passed without public hearings or debate in 1988 (Gedicks, 1993). Shortly thereafter, Rusk County gave in to the mining company's threat to sue for "deprivation of economic use of its property" and signed a local agreement before the Wisconsin DNR had even issued an environmental impact statement (EIS) on the project.

Seeking to prevent a similar outcome in the Town of Nashville, 230 out of 301 Nashville registered voters petitioned for a Special Town Meeting as allowed by state law, in order to hold a citizens vote on whether the town should enter into a local agreement with CMC before all the issues surrounding the mine had been discussed in a master hearing on the EIS and on the more than forty federal, state and local permits the company needs before they can begin mining. Among the major problems local citizens had with the local agreement was the attempt to exempt the mining company from all town zoning ordinances, regulations and laws and to limit the powers of local government and the courts to directly or indirectly prohibit mining. The agreement also gives final approval for the disposal of all wastes associated with the project. "This agreement is bad for our lands, drinking water, wildlife, economy and quality of life in nothern Wisconsin," said Dave Anderson, a local resident and technical director for the Forest County chapter of the Wisconsin Resources Protection Council (Anderson, 1996).

On December 7, 1996, over 350 town residents gathered to express their opinion on the draft local agreement. The town chairman, Richard Pitts, declared that the meeting was illegal and shut it down before it started. When Pitts was advised by Wisconsin Resources Protection Council attorney Kevin Potter that the town meeting can only be adjourned by a vote of those present, Pitts refused to ask for a second or a vote on adjournment. He was loudly booed by the crowd and met with yells of "Look at all the people who are here, can't you listen to us? (Fantle, 1996)." Local police were called and the crowd peacefully dispersed. "We were treated like Third World people," said George Rock, a mining opponent who owns a cottage in the township. "They've (the mining companies) done it for years in other countries, and now they're doing it in northern Wisconsin (Fantle, 1997b)."

The most telling comment about the controversy came from William Marquardt, one of three Nashville town board members who voted in favor of granting permission for the mine. He told a reporter that if there was a referendum on the local agreement, voters would likely reject it (Associated Press, 1996a). The town board also ignored the advice of State Rep. Lorraine Seratti (R-Spread Eagle), who urged the board not to sign any agreement until all the studies about the impact of the mine were completed. She reminded board members that the DNR had not even issued a draft EIS on the project. She also pointed out that the town may have wrongly given away some important rights, such as the right to object to the agreement at future hearings on the EIS and the mine permits as new information becomes available (Seratti, 1996).

Exxon used the full extent of its financial and political power to get the local agreements approved. They took out full page ads in the Crandon, Rhinelander and Antigo newspapers, bombarded local residents with a series of radio ads and even brought in a busload of mine supporters from Antigo to voice support for the local agreement at the Nashville township hearings. On December 12, 1996, over the objections of a crowd of 250 citizens, the town board voted to approve the local agreement with Exxon.

On December 31, 1996, five critics of the local agreement filed petitions to run for town of Nashville positions in the April 1, 1997 election. And on February 10, 1997, the Forest County Chapter of the Wisconsin Resources Protection Council filed a lawsuit accusing the Town Board and the Crandon Mining Company of holding more than a dozen illegal closed meetings to develop a local agreement. In announcing the lawsuit, Charles Sleeter, one of the plaintiffs and a candidate for town chairman, noted that it was being brought "as a class action on behalf of all citizens whose right to speak out and be heard by their elected officials has been ignored. It is brought on behalf of all residents and tribal members who live and work in the Wolf River and Wisconsin River watersheds in harms way of the potential havoc that this mine may cause and whose rights to clean air and water have been forgotten. These Local Agreements were hammered out in secret, behind closed doors. They are weak and ineffective. They do not protect the citizens of Nashville, Forest County, and the state or protect the rights of tribal members of the Native American nations who live in the two watersheds which will be directly affected by these Agreements...We can't let our communities be sacrificed by corporate greed or let 'feel good' television commercials, paid for by Exxon, cause us to forget what is right (Sleeter, 1997)."

In the April 1997 local election, four out of the five town board members were voted out of office in "one of the most bitterly contested elections in state history (Zaleski, 1997a)." The new town board for the first time in recent history includes a member of the Sokaogon Chippewa tribe. However, the new town board was not able to take office immediately because the ousted board members charged electoral fraud and demanded a recount. When the recount was completed and no irregularities were found, the defeated town board then charged that the Chippewa violated election laws by offering free hot dogs to tribal members for voting, even though the food was not tied to any particular vote. The incident was dubbed "Weinergate". The defeated town board then filed an appeal, alleging improprieties in the election but did not mention specific charges. In the meantime, the old board continued to conduct town business as if the election never happened.

Underlying the refusal of the old town board to step down was the fear over the pending lawsuit challenging the local agreement with Exxon. The old town board offered to hand over the keys to the town hall if Chuck Sleeter would drop the lawsuit (Fantle 1997b). Sleeter refused but had to go to court to seek a judge's order to remove the defeated candidates from office and gain access to keys to the town hall and official documents. "We are going to get the keys to the building. We are going to change the locks and we are going to start the process of an internal audit immediately," said Chuck Sleeter (Associated Press, 1997). One of the charges against the ousted town board was the misuse of public funds from the Wisconsin Mining Investment and Local Impact Fund Board to research Indian environmental law and treaties that would help Exxon get the needed state and federal permits to open the mine (Imrie, 1996b). At the same time, the town board refused to use public funds to conduct baseline water quality studies that could be used to document potential mine-related degradation of local drinking water.

Regardless of the outcome of the mining moratorium bill and the local agreement lawsuit, there is a growing grassroots environmental insurgency that is being fueled by a widespread public perception that the State of Wisconsin is biased in favor of promoting mining development in northern Wisconsin and that the costs of mine-related pollution are being unfairly imposed on them(ECCOLA, 1996). Governor Thompson's elimination of the Public Intervenor's Office and his newly won power to make the head of the Department of Natural Resources a cabinet position have done much to undermine public confidence in the fairness and justice of the state's environmental decision-making process. The grassroots mining resistance movement in Wisconsin is part of a growing national trend within the larger environmental movement which has seen the rise of community-based grassroots organizations which have challenged the distribution of the costs of environmental pollution and demanded better protection of their lives and property (Cable and Benson, 1993).

Ever since Exxon decided to build a 40 mile pipeline and dump its treated mine wastewater into the Wisconsin River near Rhinelander, there have been more than forty counties, villages and towns throughout Wisconsin that have passed resolutions opposing either the proposed Crandon mine or the pipeline to the Wisconsin River (Seely, 1996b). Exxon executives may have believed that they could save money and avoid public resistance to their proposed mine by abandoning plans to dump mine wastewater into the Wolf River, a state-protected Outstanding Resource Water (ORW), and diverting it to the less protected Wisconsin River. If so, they seriously underestimated the depth and extent of public opposition (Seely, 1996a). Following the groundswell of opposition along the Wisconsin River, State Rep. Eugene Hahn (R-Cambria) has introduced a bill to prevent Exxon from dumping wastewater into the Wisconsin River. In addition, several environmental groups, led by the Mining Impact Coalition of Wisconsin and the Sierra Club, have called upon all eight Great Lakes States' Governors to oppose any diversion and use of Great Lakes water (from the Wolf River watershed) outside the Great Lakes watershed (the Wisconsin River is in the Mississippi River watershed). Under the provisions of the Water Resources Development Act of 1986 (WRDA), any diversion requires unanimous consent from all eight governors.

Top Exxon executive Lee Raymond cannot avoid the Crandon mine controversy at his own annual shareholders meeting. Sister Toni Harris of the Sinsinawa Dominican Sisters of Wisconsin, who own shares in Exxon stock, attended the 1997 shareholders meeting in Dallas, Texas and submitted a resolution on "Executive Compensation." The resolution asked whether "top officer pay should be reduced when Native American and other local communities stand in public opposition to resource development projects of our Company? Should CEO compensation be affected when local resistance occasions long-term publicity detrimental to the best interests of our Company? (Harris, 1996)." Most shareholder resolutions of this kind usually do not receive more than 2 - 3% of the vote. The resolution received an astounding 9.6% of the vote, representing 83 million shares. While the resolution did not get enough votes to pass, it did receive more than enough votes to be automatically reconsidered on next year's agenda.

A final decision on Exxon/Rio Algom's proposed Crandon mine project is more than two years away. Many of the studies submitted by the company as part of their permit requirements have been challenged as inadequate and incomplete. With the governor's elimination of the Public Intervenor's Office and the transformation of the Department of Natural Resources into a politically controlled agency, these technical inadequacies need not have stood in the way of state approval of the mine permit. However, in the present context, where an organized, informed and growing grassroots environmental insurgency is underway, these glaring technical inadequacies will add to the sense of environmental injustice which has created a political quagmire for one of the world's largest and most powerful multinational corporations. When asked by a reporter whether Exxon would eventually decide that the Crandon mine project is just not worth the trouble, CMC president Rodney Harrill admitted that he's never been involved in a project "that's as politically out of control as this one (Zaleski, 1997b)."

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