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MINERALS Crumbling Bedrock of U.S. Economy
Plain Truth Magazine
November-December 1985
Volume: Vol 50, No.9
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MINERALS Crumbling Bedrock of U.S. Economy
Gene H Hogberg

The U.S. is losing its domestic resource base. And its vision is clouded as to what is happening in one of the world's most strategic, mineral-rich regions.

   THE United States and the democratic free nations of the Western world may soon be faced with the gravest economic crisis since the days of the Great Depression.
   It could come from either of two sources.
   The first possibility is often propounded in the general news media: The unraveling of the globally interlinked banking system as a result of a major default by any number of debtor nations, such as Brazil, Mexico or Argentina.
   Every few months, the debt crisis flares anew. So far, repeated last-minute rescue operations extending debt servicing have prevented major defaults from occurring.
   The second probable cause of economic turmoil is far less perceptible to the average man on the street. It revolves around the deteriorating minerals base of Western society.
   In the United States, the once-formidable mining and mineral processing industries are suffering from suffocating governmental regulation, the impact of radical, unbalanced environmentalism and low-cost foreign competition.
   Coupled with this is a dangerous overreliance for key minerals on potentially unstable parts of the world.
   Very few people are aware that behind the increased unrest in southern Africa, for example, is a concerted effort to deprive the Western world of the mineral resources in that very critical area. More on this key factor later.

Executive Speaks Out

   Earlier this year, J. Allen Overton, President of the American Mining Congress, addressed the Commonwealth Club, a public affairs forum in San Francisco, with an enlightening speech. He warned those of us present that the United States is "losing its mining, minerals and minerals processing base" — the very foundation of modern society.
   "The stakes are high," declared Mr. Overton, "yet most Americans are not tuned in to the problem." As the United States shifts into more of a service-oriented and high-tech economy, the public at large and especially the younger generation no longer see the importance of maintaining a strong national mineral base.
   "It is not without reason," this top executive continued, "that minerals have been called the bedrock of civilization and, throughout history, the stepping-stones of human destiny.
   "Without minerals, we would have no factories or offices... no schools or hospitals... no highways or railroads or planes to fly in the sky... no communications networks or energy systems... no means of equipping the military that defends us or cultivating the agriculture that feeds us....
   "It can truly be said that our horn of plenty begins with a hole in the ground."
   Mr. Overton challenged charges of environmental extremists who have exerted intense pressure to severely curtail mining operations and even minerals searching, especially on federally owned lands.
   "What cannot truly be said... is that all our material bounty has been bought at the expense of raping and ruining the land. Moreover, we ought to remember that over the entire history of this nation, with all the material blessings that mining has produced, only a fraction of one percent of the land's surface has ever been touched by a miner's pick."
   Americans, Mr. Overton asserted, seem to have forgotten that "it takes stuff to make things."
   The average person doesn't stop to think that a process of several years is involved from the point of minerals exploration to on-site development, to extraction, smelting and manufacture of the primary products. Moreover, the basic components of the minerals process — the mines themselves, the smelters, the stamping plants — cannot be "turned on and off like a spigot," to use Mr. Overton's words. "Once lost, it will take years — if ever — to recover it."

Dangerous Dependence on Imports

   Throughout the American mineral industry presently is a severe double crisis of unemployment and depressed prices. Partly as a consequence, American industry has become dangerously dependent upon foreign sources of minerals at "the far end of vulnerable shipping lanes," as Mr. Overton put it.
   "We have been increasing our reliance on Zambia, Zaire, South Africa and other nations that are marked by social, political and economic instability," he continued. The Soviets, on the other hand, "have spent billions of rubles to develop their mineral mother lode in Siberia, and recently completed a new 2,000 — mile railroad to connect it with the heartland of its military manufacturing complex."
   He was referring to the new Baikal-Amur Mainline railroad, or BAM, a major adjunct of the older Trans-Siberian line.
   How dangerously dependent is the United States now on foreign sources? Let Mr. Overton continue:
   "Just recently the Secretary of the Army testified before Congress that the United States is more than 50 percent dependent on foreign sources for 23 of 40 critical materials essential to the U.S. national security, while the Soviet Union is totally independent of foreign sources for 35 of these same critical 40 materials."
   The Soviets are following any and all courses open to them to foster weakness in the minerals area on the part of the United States and the Western world in general. This includes — and the issue must be seen for what it really is — the promotion of social strife throughout mineral-rich southern Africa, as well as influencing uninformed reactions to what is truly happening there.

"Persian Gulf of Minerals"

   What the Middle East in general and Saudi Arabia in particular are to petroleum, southern Africa, and specifically the Republic of South Africa, are to nonfuel minerals.
   Africa's heavily mineralized region stretches from Shaba province in Zaire southward into South Africa's Transvaal province, with its fabulously rich golden reef. This region has been called "the Persian Gulf of minerals," with South Africa as its "Saudi Arabia."
   In the case of four strategic minerals-chromite, manganese, vanadium and the platinum — group metals — the Soviet Union would become the dominant supplier if South Africa were ever forced out of the world market.
   The threat of economic sanctions against South Africa is now a grave possibility as a result of reaction to the state of emergency, which its government declared this past summer in an attempt to quell rioting in the Republic's urban townships.
   "By creating unrest or provoking civil war within the area," speculated the Journal of Commerce, more than five years ago, as if anticipating what has in fact occurred, "the Soviet Union could bring the Western industrialized world to a total economic collapse."
   Without access to the region's vast storehouse of mineral wealth, noted this respected business daily, "jet engines, automobiles, oil refineries and nuclear or conventional power stations could not be built. Operations of a train or a computer, a cutting tool, a mine or an electromagnet would be impossible."

Why Unrest Now?

   What is really going on In South Africa? Why all the unrest and accompanying worldwide condemnation and pressure at this present time? It does indeed seem strange considering the recent unprecedented series of social changes and political reforms instituted by the government of State President P.W. Botha.
   To obtain the answers to these and other questions the author recently talked with visiting political and business leaders from South Africa. These individuals, who represent a broad spectrum of interests and opinions, were visiting Southern California while on a nationwide tour of key U.S. cities. They were attempting to shed light — instead of heat — on what is happening in their troubled land.
   Among the two delegations were 18 parliamentarians in South Africa's new tricameral national parliament. These included representatives of the Indian and coloured peoples as well as delegates from the Afrikaner and English-speaking communities. They ranged from liberal through moderate to decidedly conservative points of view. The visitors also included four officials, plus one businessman, from two of the black national states within South Africa, the states of Lebowa (consisting primarily of the North Sotho people) and Gazankulu (made up largely of the Shangaan and Tsonga peoples). Three of these officials were parliamentarians; the fourth was the Chief Minister — head of government — of Gazankulu, Professor Hudson Ntsanwisi.
   All those I talked to — black, white, Indian, coloured — deplored the violence taking place. And at the same time they were firmly opposed to the campaign in some quarters of the United States to force local, state, university and union pension funds to sell off shareholdings in the more than 300 American companies doing business in South Africa.
   The goal of those calling for disinvestment is actually divestment — forcing those companies to pull out of the country entirely. (These traveling officials, including the black leaders, found to their dismay that many local U.S. officials did not want to hear their side of the story.)
   There was no doubt in the minds of those I talked to as to who was largely responsible for the current state of unrest — radical groups inside the townships (the white cities are unaffected to date) who have been inciting young school — age and unemployed youths to violence. The principal guerrilla organization, backed by the South African Communist Party, has vowed to make the black urban areas of the country "ungovernable." This is the reason for the growing number of attacks on local black council officials and policemen — anyone accused of "collaboration." Much of the mayhem also takes place between rival forces competing for power.
   While the instigators grab the headlines, the vast majority of South Africa's black people, according to the June 26 Intelligence Digest of Britain, "are saddened and shocked by the behavior of their youngsters, stirred up to a frenzy by professional rabble-rousers hired by one revolutionary organization or another."

Parliamentarian Speaks Out

   But, once again, why the revolutionary mentality now? The c1earest answer came from a most eloquent member of the visiting South African parliamentarians, Salam Abram, a member of the new Indian chamber (which is called the House of Delegates).
   "There are," Mr. Abram said, "elements within our borders who do not want to see reform succeed." They fear that the country's new governmental structures (gradually admitting Indians, coloureds and eventually perhaps urban blacks into the process) could, as Mr. Abram said, have "an even chance of success." Success would keep a prosperous society in the Western camp. Revolutionaries bent on seizing power must turn those not yet in the system against the system before it's too late. Never forget, added Mr. Abram, that the fall of the Western — style free enterprise system in South Africa is a major Soviet objective. To facilitate this aim, he said, the Communists turned the revolutions in two former Portuguese colonies flanking South Africa — Angola and Mozambique — to their side.
   But, again, why is Moscow so interested? Minerals provide the key to the answer, along with South Africa's strategic location along the Cape route sea lane, around which is transported much of Western Europe's oil from the Middle East.
   The defense of the United States and much of the rest of the Western world hinges upon continued access to South Africa's treasure trove of minerals. The late Soviet leader Leonid Brezhnev once boasted that the key to Soviet world domination is the isolation of the mineral resources of the Middle East and southern Africa from the West.

A Critical Element

   Let's look at some of these minerals, first of all chromium. The United States has no chromium reserves and limited resources. Yet this mineral is so critical in the area of national defense that without it missiles, ships, submarines, aircraft and weapons support systems could not successfully be built. Regarding chrome, a report from the U.S. Department of the Interior, Bureau of Mines, says, rather matter-of-factly: "The problem for the United States is one of national security."
   Chrome is considered to be the single most important strategic mineral to modern civilization. It has also been called the "most unsubstitutable metal in the world." There is no replacement for it in the manufacture of corrosion-resistant steel.
   Without chrome, said former steel executive E.F. Andrews, "we can't build an automobile — and I'm not talking about the trim, we can't make jet airplane engines, we can't drill an oil well, we can't dig a mine."
   Chrome is considered so vital that for years the United States specifically exempted chrome from the list of embargoed imports from Rhodesia, as Zimbabwe was formerly known.
   Chrome is so indispensable that, according to Mr. Andrews, "we would have to revert 40 to 50 years in our standard of living and our technology in order to do away with chrome completely." Chrome is, more than any other metal, the Achilles' heel of the U.S. economy. Without it America would be brought quickly to its knees.
   Yet the cruncher is that the United States is almost totally dependent upon imports for its chromite ore and South Africa is the largest free world producer of it. And by adding Zimbabwe, the proven reserves of southern Africa as a region constitute roughly 97. percent of the total world's resources. The other large current producer? The Soviet Union.

Manganese, Other Minerals

   Another indispensable metal is manganese. Once again, U.S. domestic production currently is negligible. Manganese is essential to the production of steel. There is no known substitute for it. Without its qualities to capture impurities, steel would tear, crack and break. "When we can do without steel, we can do without manganese," reports the U.S. Department of the Interior.
   Statistics vary considerably about the primary deposits and reserves of manganese (as they do concerning most metals), but according to one source 50 percent of the world's known recoverable reserves of manganese lie in South Africa — with the other 50 percent inside the Soviet Union.
   The Soviets have striven for self-sufficiency in manganese. The United States, Japan and Western Europe, according to a U.S. Department of the Interior report, "are all nearly completely deficient in manganese that is economically mineable." They rely on imports, mainly from South Africa, Gabon, Brazil and Australia.
   Two other groups of metals further reveal the critical dependence of the West on southern Africa.
   First of all there is the platinum group of metals (PGM), a family of six closely related metals. One of the principal uses of PG M now is to act as catalysts to control automobile emissions. And every year the demand increases as emission control standards tighten.
   According to another U.S. Department of the Interior report, "nearly all of the world's supply of these metals currently are extracted from lode deposits in three countries — the Republic of South Africa, the U.S.S.R. and Canada."
   Finally, there is cobalt. This space-age metal is necessary for the super-hard alloys used in the aerospace industry. Every jet engine requires 200 pounds of the metal. Cobalt is also essential in the manufacture of integrated circuits.
   The United States, the world's aerospace leader, must import 97 percent of its cobalt supply, most of it from Shaba province in Zaire, which produces two thirds of the entire Free World supply.
   Zaire twice, in 1977 and 1978, almost fell to invading Communist-backed forces striking out from Angola. With one of its neighbors, Sudan, coming under pressure from radical Libya, some experts are once again concerned over Zaire's future.
   Moreover, "three Z" countries to the north of South Africa-Zaire, Zimbabwe and Zambia (another major cobalt producer) must ship their ores out by way of South African railroads and ports. They thus are vulnerable to world sanctions as well as any countermeasures by Pretoria.
   Space does not permit an examination of other critical minerals, such as gold, uranium, tungsten, vanadium, columbium and titanium.

Deadly Trap Being Set

   From all appearances, the United States and the rest of the Western world are walking straight into a trap, as we near the biblical crisis at the close of the age.
   South Africa today is in the midst of rapid social change — reforms that Hoover Institution expert L.H. Gann says are down played by "liberal academicians and journalists." Revolutionaries are determined to halt this process. They need help from the West — in the form of disinvestment.
   If those agitating for disinvestment of U.S., British, Canadian and other Western industries succeed, Member of Parliament Abram told me, then additional millions of blacks could be thrown out of work — better able to be marshaled into the forces of revolution!
   (There is no doubt that some young people, in joining the disinvestment bandwagon, are motivated by idealist intentions, or simply do not see the outcome of their actions. Then, too, as Newsweek magazine pointed out in its May 13, 1985, issue, many student demonstrators simply want to show that "the spirit of protest is alive and well.")
   Mr. Abram's analysis was backed up by a report in an inside financial newsletter that reports, in the boldest of terms:
   "The Soviets do not believe they can conquer South Africa militarily. Their plan is instead to surround and isolate South Africa, precipitate economic sanctions and disinvestment in the West, harass South Africa along her four country 1500 — mile border, and foment internal revolution among her 16 million Blacks."
   It is no coincidence that the campaign of protests in the United States began in earnest a little more than a year ago after a high power meeting between revolutionary leaders and their American supporters at the United Nations. So revealed Arnaud de Borchgrave, editor of the Washington Times.
   How do those whom the revolution is supposed to help feel about disinvestment? Public opinion surveys reveal that black South African workers are significantly against disinvestment. But overseas organizers say the workers must be willing to sacrifice their jobs in order to gain their "freedom."
   Even more is at stake. Employment in South Africa is crucial to the various small politically independent — but economically very dependent — states in South Africa. In the mountainous highlands of Lesotho, for example, live less than a million and a half people. There are no resources in Lesotho to speak of. A large percent of Lesotho's adult males work in South Africa, mostly in mining, generating more than 60 percent of the mountain kingdom's gross national product.
   As Casper Uys, a Conservative Party member from southeastern Transvaal, told me: "Lesotho is a mining state — with no mines!" Swaziland, Botswana and Mozambique are also critically dependent upon South Africa for labor markets.

Who Would Be Hurt Most?

   Further escalation of violence In southern Africa is certain to result in demands in the United Nations for a total trade embargo against South Africa. But U.N. sanctions would be largely ineffective.
   Short of international sanctions, the United States, in years ahead, may unilaterally adopt a trade boycott as a result of the divestment pressure. But the United States stands to lose more than South Africa in the process.
   Not long ago, in Los Angeles, the former South African ambassador to the United States, Bernardus Fourie, told newsmen that he wouldn't be "so arrogant" as to suggest that the United States was dependent upon South Africa for key mineral resources. But he added with a smile that the United States could also go to the Soviet Union for the same supplies — if they would sell them, and at affordable prices.
   For many years The Plain Truth has alerted its readers that, based upon biblical prophecy, the United States and the democracies of Northwestern Europe are headed for a time of national calamity. (Read our free book The United States And Britain In Prophecy to see why in full detail.)
   One cannot help but wonder whether the sanctions and embargo trap will backfire. If so, what will happen to the social fabric of America when millions are forced out of work as mineral-starved industries can no longer produce steel, automobiles, jet airplanes, railway stock, agricultural machinery, computers and communications gear, food-processing equipment, surgical instruments and virtually the entire range of defense hardware.
   Farfetched? Don't be too sure. The revolution 'that some intend for a country thousands of miles away may instead convulse America to its foundations.

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Plain Truth MagazineNovember-December 1985Vol 50, No.9
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