Background

backgroundThe majority of the early development of the once great state of California stems mainly from the vast and rich gold deposits that God bestowed on the land. The gold rush of 1849 transformed the state from a wild frontier into the most prosperous and thriving economy of any in the United States. People from all over the world migrated to the state with the dream of striking it rich and the state prospered from their activities and successes. Many hard working and ambitious pioneers were rewarded for their risk taking and hard work and their financial success enabled supporting businesses to also prosper.

California’s reported gold production from 1848 to 1857 averaged 76 tons per year and during this decade its total production revenue equaled $550 million (at $15 per ounce) – about 1.8% of American GDP. While these numbers are impressive the “old timers”, with their labor intensive primitive mining techniques, only scratched the surface of the mineral wealth held in California’s resources. They only went after the easiest and richest mineable deposits, a practice known as “high grading”. While they did extract a good bit of the easiest gold they also laid a road map for what they left behind. The majority of the historical mines that they started still contain far more gold than what was removed and this can be cost effectively extracted with today’s modern mining techniques. Some of these ore bodies are among the richest on earth and offer prime opportunities, especially at today’s gold prices, for modern day miners.

HeadlampsFast forward to 2012 and while the gold is still in the ground the obstacles to removing it have changed entirely. Instead of reasonable federal and state governments that encourage natural resource development, these governmental bodies are now controlled by environmental lobbyists that thwart mining at every possible level. They accomplish this through extensive, overlapping and onerous regulations that make it almost impossible for any mining company (especially the smaller operators) to meet compliance. California has in essence killed the very industry on which it was founded and eliminated the vast and pervasive economic benefit it could provide for the state. The state government continues to tighten its strangle hold on mining, even though it is the national leader in state budget deficits and high unemployment rates.

 

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