The Economic Aspect of Geology

by C. K. Leith

The problems of the Peace Conference, and of other international agreements now pending, have required a still further systematizing of international information. One of the results has been the establishment of organizations of an international fact-finding character in our own and in certain other governments. In the chapters on the several minerals in this book, are summarized some of the salient features of the international situation developed by study of the kind indicated.

Knowledge of the physical facts of the world mineral situation is only a first step. Their interpretation and correlation, the study of the underlying principles, the formulation of the necessary international agreements and regulations, constitute even more difficult problems, which are far from solved.

There always has been some coöperation of governments in the mineral trade through the ordinary diplomatic channels. The question is now prominent whether, in view of the new conditions, it may not be necessary to develop better machinery—in the form of some international or supernational organization, possibly patterned on war procedure—in order to expedite the negotiations and to minimize possibilities of friction.

During the war, when the world demand exceeded the total world supply of certain commodities, such as nitrate and tin, international commissions were formed in order to make an equitable distribution of these minerals and prevent favored strong nations from taking too large a proportion of the total. This procedure presented no insurmountable difficulties. A canvass of the total supplies available and of the demands of the various countries ordinarily led to voluntary compromise in the allocation of supplies. Most of the regulations of these commissions were applied to mineral industries which were unable to meet the total demand. They were not tried out in cases where there were excess supplies; this process obviously would have been much more difficult, though perhaps not impossible.

The general success of international attempts to allocate mineral supplies during the war suggests the lines along which results might be accomplished during peace. The process is essentially a matter of getting at the facts, and then discussing the situation around a table,—thus eliminating the long delays and misunderstandings arising from the procedure through the older established diplomatic channels. How far such a procedure might be possible without the compelling common interest of war is debatable.

The great powers of the Reparations Committee, previously noted, and of the recently formed European coal commission, already indicate the general nature of the machinery for international control which might be exercised through a league of nations. It is not our purpose to argue for international control or for any specific plan of control, but rather to outline the problem. The question is not an academic one. Various kinds of international control are present facts, and the problem relates to the possibilities of more effective organization of existing agencies.

CONSERVATION IN ITS INTERNATIONAL RELATIONS

The interests of conservation, considering both its physical and its human energy phases (p. 362), seem to call for an international understanding in the use of mineral resources which will result in the minimum hindrance to their free movements along natural channels of trade. The essential fact of the concentration of mineral supplies in comparatively few world localities, and the fact that no nation is supplied with enough of all varieties of minerals, mean that artificial barriers to their distribution cannot but impose unnecessary handicaps on certain localities, which may be anti-conservational from a world standpoint. If the few countries possessing adequate supplies of high-grade ferro-alloy minerals, for instance, were to restrict their distribution by tariffs or other measures, the resulting cost to civilization through the handicapping of the steel industry would be a large one. Or if, for the general purpose of making the United States entirely self-supporting in regard to mineral supplies, sufficiently high import tariffs were imposed on these minerals to permit the use of the low-grade deposits in the United States, earlier exhaustion of the limited domestic supplies would follow, and in the meantime the cost to the domestic steel industry would be serious. Cost may be taken to represent the net result of human energy multiplied into raw material. The movement would therefore be anti-conservational. If each state in the United States were to start out to become entirely self-sustaining in regard to minerals, and by various regulations were able to prohibit the use of minerals brought in from without, or the export of its excess of minerals, the waste in effort and materials would be obvious. Nature has clearly marked out fields of specialization for different localities, and the effective use of mineral supplies is just as much a matter of specialization as the effective use of man's talents. If the United States, because of its vast copper deposits, is in a position to specialize in this line and to aid the world thereby, this should involve recognition of the fact that other countries are better able to specialize in other commodities,—thereby forming a basis for mutual exchange, which is desirable and necessary for world development.

This conservational argument against artificial barriers does not necessarily imply complete elimination of tariffs or other restricting or fostering measures. Within limits these may be necessary or desirable in order to maintain differences in the standard of living, or in order to permit the growth of infant industries; but to carry these measures to a point where they interfere with essential mineral movements determined by nature is obviously anti-conservational.

For some mineral commodities, international coöperation may prevent duplication in efforts and the development of excessive supplies in advance of the capacity of the world to use them. Partly because of lack of such coöperation, certain mineral commodities have been developed in such large quantities in various parts of the world that it may be many years before demand catches up with development. In the meantime, large and unnecessary interest charges are piling up. This financial loss measures the loss in effectiveness of collective human effort.