EXCHANGE 
 
r 
 
Report of Proceedings 
 
 of the 
 
 American 
 Mining 
 
 Congress 
 
 Seventeenth Annual Session 
 
 PHOENIX, ARIZONA 
 December 7-11, 1914 
 
 Published by the 
 
 AMERICAN MINING CONGRESS 
 
 At the Office of the Secretary 
 
 Denver, Colorado 
 
 1915 
 
E. A, MONTGOMERY, 
 
 Director, Los Angeles. Ca! 
 
 SAMUEL A. TA" 
 
 D. V. BRUNTON, : 
 
 MT, Dtavtr.Coto. 
 
 CARL SCHOLZ, 
 
 President of American Minine < 
 
 L. A, FRIEDMAN, Wm .. JAMES F, CALLBREATH V E. L. WOLCOTT, ' ., 1M FALCON JOSUN, 
 
 Director, Lovelocks, Nev. KM Secretary, Denver, Colo. A ****** SeowUry, Denver, Colo; R*l Director, Fairbanks, AUska 
 
 OFFICERS AND DIRECTORS. 1915 
 
Report of Proceedings 
 
 OF THE 
 
 American Mining 
 Congress 
 
 Seventeenth Annual Session 
 
 Phoenix, Arizona 
 December 7-11 
 
 1914 
 
 Published by the 
 
 American Mining Congress 
 
 At the Office of the Secretary 
 
 Denver, Colorado 
 
 1915 
 
PREVIOUS SESSIONS OF CONGRESS 
 
 
 DATE. 
 
 
 CITY. 
 
 PRESIDENT. 
 
 1st 
 
 July, 
 
 1897* 
 
 Denver, Colo. 
 
 Hon. Alva Adams, 
 
 1st 
 
 July, 
 
 1897 
 
 Denver, Colo. 
 
 Hon. L. Bradford Prince, 
 
 2d 
 
 July, 
 
 1898 
 
 Salt Lake City. Utah, 
 
 Hon. L. Bradford Prince, 
 
 3d 
 
 July, 
 
 1899f 
 
 Milwaukee, Wis. 
 
 Col. B. F. Montgomery, 
 
 3d 
 
 June, 
 
 1900 
 
 Milwaukee, Wis. 
 
 Col. B. F. Montgomery, 
 
 4th 
 
 July, 
 
 1901 
 
 Boise, Idaho. 
 
 Hon. L. Bradford Prince, 
 
 5th 
 
 Sept., 
 
 1902 
 
 Butte, Mont. 
 
 K L. Shafner, 
 
 6th 
 
 Sept., 
 
 1903 
 
 Deadwood and 
 
 
 
 
 
 Lead. S. D. 
 
 Hon. J. H. Richards, 
 
 7th 
 
 Aug., 
 
 1904 
 
 Portland, Ore. 
 
 Hon. J. H. Richards, 
 
 8th 
 
 Nov., 
 
 1905 
 
 El Paso, Texas. 
 
 Hon. J. H. Richards, 
 
 9th 
 
 Oct., 
 
 1906 
 
 Denver, Colo. 
 
 Hon. J. H. Richards, 
 
 10th 
 
 Nov., 
 
 1907 
 
 Joplin, Mo. 
 
 Hon. J. H. Richards, 
 
 llth 
 
 Dec., 
 
 1908 
 
 Pittsburgh, Pa. 
 
 Hon. J. H. Richards, 
 
 12th 
 
 Oct., 
 
 1909 
 
 Goldfield, Nev. 
 
 Hon. J. H. Richards, 
 
 13th 
 
 Oct., 
 
 1910 
 
 Los Angeles, Cal. 
 
 Dr. EJ. R. Buckley, 
 
 14th 
 
 Oct, 
 
 1911 
 
 Chicago. 111. 
 
 John Dern, 
 
 15th 
 
 Nov., 
 
 1912 
 
 Spokane, Wash. 
 
 Samuel A. Taylor, 
 
 16th 
 
 Oct, 
 
 1913 
 
 Philadelphia, Pa. 
 
 David W. Brunton, 
 
 17th 
 
 Dec., 
 
 1914 
 
 .Phoenix, Ariz.^ ^ 
 
 viari Scholz, 
 
 *Temporary. 
 
 
 t Passed 
 
 to Ju 
 
 .*&, ;HH)4j ... * 
 
 . - ' * 
 
 ADDRESS. 
 Pueblo, Colo. 
 Santa Fe, N. M, 
 Santa Fe, N. M, 
 Cripple Creek, Colo. 
 Cripple Creek, Colo. 
 Santa Fe, N. M. 
 Cleveland, Ohio. 
 
 Boise, Idaho. 
 Boise, Idaho. 
 Boise, Idaho. 
 Boise, Idaho. 
 Boise, Idaho. 
 Boise, Idaho. 
 Boise, Idaho. 
 Rolla. Mo. 
 SaltLakeCity.ITtah 
 Pittsburgh, Pa. 
 Denver, Colo. 
 Chicago, III. 
 
INDEX 
 
 Alaskan Question, Report on 153 
 
 Annual Assessment Work, Proposed Law Concerning 62 
 
 Auditing Committee's Report 93 
 
 By-Laws, Amendment of Ill, 115 
 
 Communications 58, 59, 60, 61 
 
 Compulsory Arbitration, Appointment of Committee on 84 
 
 Financial Statement of Secretary 108 
 
 Mine Accidents, Report of Committee on 63 
 
 Mining Investments, Report of Committee on J>5 
 
 Nominating Committee, Report of 126 
 
 Officers and Directors, Announcement of 97 
 
 Resolutions, Committee on 26 
 
 Report of 62, 93, 94, 95, 101, 104. 107 
 
 Revision of Mineral Land Laws, Report of Committee on 65 
 
 Taxation, Report of Committee on 27 
 
 Workmen's Compensation, Report of Committee on 80 
 
 SPEAKERS 
 
 Allen, R. C Response to Address of Welcome 20 
 
 Debate on Mine Taxation 35-52 
 
 Bass, Debate on Mining Investments 57-58 
 
 Discussion Concerning Federal Land Leasing- 79 
 
 Congratulatory Remarks 102 
 
 Beddow, Rees H Debate on Proposed Law to Suspend Assessment 
 
 Work for 1914 62-63 
 
 Benton, Harry J Debate on Mining Investments 56-58 
 
 Bond, Josiah Discussion Concerning "What Is the Matter With 
 
 Mining?" 85-86 
 
 Brunton, Fred K Response to Address of Welcome 19 
 
 Burgess. Charles W Response to Address of Welcome 19-20 
 
 Callbreath, James F Announcements 25. 26, 
 
 27, 53, 54, 58, 59, 61. 63, 73, 80, 84, 93. 97, 111, 126 
 
 Debate on Mining Investments 55-56 
 
 Concerning Report of Committee on Mine Invest- 
 ments 63-65 
 
 Debate on Compulsory Arbitration 82-84 
 
 Debate on Resolution No. 2 93 
 
 Debate on Resolution No. 4 94 
 
 Debate on Resolution No. 5 95 
 
 Speech of Thanks 97-100 
 
 Debate on Resolution C 107 
 
 Discussion Concerning "What Is the Matter With 
 
 Mining? 1 ' 89-91 
 
 Report on Finances 108-110 
 
 Discussion Concerning Change in By-Laws 112-115 
 
 Debate on Needs of Western Mining 115 
 
 Campbell, Debate on Mine Taxation 33-35 
 
 Cates. L. S Debate on Mine Taxation 41 
 
 Carmichael, Norman Speaking for the Committee on Resolutions 84 
 
 Reports of Committee on Resolutions 
 
 93, 94, 95, 101, 103, 104, 106, 107 
 
 Chalmers, On Raising Capital for Mining 124 
 
INDEX 
 
 ADDRESSES 
 
 The President's Annual Address Carl Scholz, Chicago, 111. 123 
 
 Recent Legislation Affecting the Arizona Mining Industry, 
 
 Walter Douglas, Eisbee, Arizona 14tl 
 
 The First Move Walter G. Swart, Denver, Colo. 144 
 
 The Leasing System and Conservation Jesse Knight, Provo, Utah 150 
 
 Federal Legislation for Alaska Falcon Joslin, Fairbanks, Alaska 153 
 
 Conservation of Mineral Resources: State or National, 
 
 Dr. William B. Phillips, Austin, Texas 160 
 What Must Be Done to Stimulate the Mining Industry, 
 
 E'. P. Spalding, Spokane, Wash. 167 
 The Proper Advertising of Mining Opportunities, 
 
 Dr. James E. Talmage, Salt Lake City, Utah 172 
 
 The Mining Industry of Arizona Charles B. Clapp, Tucson, Arizona 177 
 
 Conservation of Western Water Power Resources, 
 
 E. A. Wedgwood, Salt Lake City, Utah 181 
 
 Give the Miner a Square Deal J. C. Thoresen, Salt Lake City, Utah 190 
 
 E Pluribus Unum Edward G. Reinert, Denver, Colo. 193 
 
 Acetylene Mine Lighting .A. Cressy Morrison, New York City 200 
 
 A Federal Leasing System John F. Shafroth, Denver, Colo. 207 
 
 Why Optimism? George Otis Smith, Washington, D. C. 2L7 
 
 The Adjustment of Industrial Disputes Affecting the Public Service, 
 
 James A. Emery, Washington, D. C. 227 
 
 Compulsory Arbitration Samuel O. Dunn, Chicago, 111. 230 
 
 RESOLUTIONS 
 
 No. Subject. 
 
 1 Exportation of Copper. 
 
 Introduced by Page 
 George H. Dern 53 
 
 2 Mining Law Revision Will L. Clark 
 
 3 Mineral Lands on Indian Re- 
 
 serves , 
 
 4 Federal Aid for Mining 
 Schools 
 
 5 Federal Experiment Stations. 
 
 6 Uniform Mine Signals 
 
 7 Radium Investigations 
 
 A Bureau of Mines 
 
 B Mining Legislation 
 
 C Thanks.., 
 
 L. S. Judd 78 
 
 Charles H. Clapp 
 
 and others 78 
 
 William B. Phillips 
 and others 79 
 
 W. G. Swart. . . . 79 
 
 Disposition 
 Adopted 
 
 Adopted as 
 Amended . 
 
 Adopted as 
 Amended . 
 
 Adopted as 
 Amended . 
 
 Page 
 
 , . 62 
 
 .101 
 
 W. -G. Swart 79 
 
 Norman Carmichael.101 Adopted 
 
 Norman Carmichael.103 
 
 Norman Cannichael.107 Adopted 
 
 Adopted Do 
 
 Adopted 9 
 
 Adopted as 
 Amended . 
 
 . 95 
 .101 
 
 Adopted 104 
 
 .107 
 
OFFICERS AND COMMITTEES, 1915 
 
 OFFICERS. 
 
 CARL SCHOLZ. President. 
 
 HARRY L. DAY, First Vic'e President. 
 
 M S. KEMMERER, Second Vice President. 
 
 GEORGE H. BERN, Third Vice President. 
 
 J. F. CALLBREATH, Secretary. 
 
 EXECUTIVE COMMITTEE 
 CARL SCHOLZ. CHARLES S. KEITH. WALTER DOUGLAS. 
 
 DIRECTORS. 
 
 D. W. BRUNTON, Denver, Colo. FALCON JOSLJN. Fairbanks, Alaska, 
 M. S. KEMMERER, New York. SAMUEL A. TAYLOR, Pittsburgh, Pa. 
 
 E. A. MONTGOMERY, Los Angeles, L. A. FRIEDMAN, Lovelocks, Nev. 
 Cal. CARL SCHOLZ, Chicago, 111. 
 
 W. J. RICHARDS, Pottsville, Pa. HARRY L. DAY, Wallace, Idaho. 
 
 GEORGE H. DERN, Salt Lake City, CHARLES S. KEITH, Kansas City, Mo. 
 Utah. WALTER DOUGLAS, Bisbee, Ariz. 
 
 COMMITTEES, 1915 
 
 STATE VICE PRESIDENTS. 
 
 Alaska B. F. MILLARD, Valdez. New York CHAS. H. SMITH, New 
 
 Arizona W. B. TWITCHELL, Phoenix York. 
 
 Arkansas C. C. WOODSON, Hunting- Nevada C. B. LAKENAN, Lovelock. 
 
 ton. New Mexico T. H. O'BRIEN, Dawson. 
 
 California CHAS. E. KNOX, Berkeley Ohio W. R. WOODFORD, Cleveland. 
 Colorado IRVING HOWBERT, Colo- Oregon HAROLD N. LAWRIE, Port- 
 
 rado Springs. land. 
 
 Georgia W. H. FLUKER. Thomson. Oklahoma JAMES ELLIOTT, Mc- 
 Idaho JAMES F. MCCARTHY, Wallace. Alester. 
 
 Indiana J. C. KOLSEM, Terre Haute. Pennsylvania MORRIS WILLIAMS, 
 Illinois F. W. DE WOLF, Urbana. Philadelphia, 
 
 Kansas JOSEPH FLETCHER, Fron- South Carolina H. L. SCAIFE, Clin- 
 
 tenac. ton. 
 
 Massachusetts FRANKLIN PLAYTER, Texas DR. W. B. PHILLIPS, Austin 
 
 Boston. Utah DR. J. E. TALMAGE, Salt Lake 
 
 Michigan J. A. CURTIS, Detroit. City. 
 
 Maryland J. M. FITZGERALD, Baiti- Virginia E. A. SCHUBERT, Roanoke. 
 
 more. 
 
 Missouri W. L. SCHMICK, St. Louis. Wisconsin H. O. GRANBERG, Oshkosh 
 Minnesota F. O. HAMMER, St. Paul. Wyoming W. D. BRENNAN, Cheyenne 
 Montana FRANK R. WICKS, Butte. West Virginia C. A. CABELL, Carbon. 
 Nebraska FRANK A. MANLEY, Washington COU W. T. PERKINS, 
 
 Omaha. Seattle. 
 
 REVISION OF MINERAL LAND LAWS. 
 E. B. KIRBY, St. Louis, Mo., Chairman. 
 
 L. V. RAY, Seward, Alaska. E. B. KIRBY, St. Louis, Mo. 
 
 WILL L, CLARK, Jerome, Ariz. D. C. McDONALD, Ely, Nev. 
 
 E. H. BENJAMIN, San Francisco, Cal. C. T. BROWN, Socorro, N. M. 
 VICTOR C. ALDERSON, Denver, Colo. H. H. SCHWARTZ, Portland, Ore. 
 J. H. RICHARDS, Boise, Idaho. ISADORE BROMAN, Austin, Tex. 
 
 WM, SCALLON, Helena, Mont. W. H. KING, Salt Lake City, Utah. 
 
 HORACE V. WINCHELL. Minne- L. K. ARMSTRONG, Spokane, Wash. 
 apolis, Minn. EDWIN HALL, Lusk, Wyo. 
 
OFFICERS AND COMMITTEES, 1915 
 
 ALASKAN AFFAIRS. 
 
 FALCON JOSLIN, Fairbanks, Alaska. WILLIAM GRIFFITH, Scranton, Pa. 
 GEORGE C. HAZELIT, Cordova, Alaska.T. C. McDONALD, Seattle, Wash. 
 M. D. LEEHEY, Seattle, Wash. 
 
 WORKMEN'S COMPENSATION. 
 
 S. A, TAYLOR, Pittsburgh. Pa. DAVID ROSS, Springfield, 111. 
 
 J. W. DAWSON, Charleston, W. Va. T. L. LEWIS, Bridgeport, Ohio. 
 W. R. WOODFORD, Cleveland, Ohio. 
 
 PREVENTION OF MINE ACCIDENTS 
 
 W. R, INGALLS, New York City, Chairman. 
 DR. JAMES DOUGLAS, New York City, J. R. FINLEY, New York City, N. Y. 
 
 N. Y. JOHN HAYS HAMMOND, New York 
 
 J. P. CHANNTNG, New York City, City, N. Y. 
 
 N. Y. 
 
 STANDARDIZATION OF ELECTRICAL EQUIPMENT. 
 In Coal Mines. 
 
 GEORGE R. WOOD, Philadelphia, Pa., Chairman. 
 
 S. A. TAYLOR, Pittsburgh, Pa. H. M. WARREN, Scranton, Pa. 
 
 J. R. BENT, Oglesby, 111. G. A. SCHREIER, Divernon, 111. 
 
 G. T. WATSON, Fairmont, W. Va. W. A. THOMAS, Pittsburgh, Pa. 
 
 In Metal Mines. 
 H. S. SANDS, Denver, Colo., Chairman. 
 
 C. A. CHASE, Denver, Colo. SANFORD B. BELDEN. Columbus, O. 
 
 MINERAL STATISTICS. 
 
 GEORGE W. RITER, Salt Lake City. Utah, Chairman. 
 
 OTTO RUHL, Joplin, Mo. FREDERICK BURBIDGE, Spokane, 
 
 Wash. 
 
 FORESTRY RELATIONS. 
 
 ROBERT L. MARTIN, Denver, Colo., Chairman. 
 
 F. J. ALEXANDER. Denver, Colo. HENRY I. SEEMAN, Denver, Colo. 
 
 J. W. DEANE, Aspen, Colo. CARNEY HARTLEY, Denver, Colo. 
 
 MINE TAXATION 
 In Metal Mines. 
 
 D. L, WEJBB, Denver, Colo. JOHN WELLINGTON FINCH, Denver, 
 PROF. L, A. YOUNG, Urbana, 111. Colo. 
 
 PROF. H. A. E. CHANDLER, Phoenix, WILL L. CLARK, Jerome, Ariz. 
 Ariz. 
 
 MINING INVESTMENTS. 
 
 W. R. ALLEN, Butte, Mont., Chairman. 
 
 R, F. COLLINS, Spokane, Wash. J. F. ERISMAN, Denver, Colo. 
 
 JOHN R. BURTON. New York City, CHARLES A. MITKE, Bisbee, Ariz. 
 N. Y. 
 
 FREIGHT AND ORE TREATMENT RATES. 
 
 IMER PETT, Salt Lake City, Utah. W. MONT FERRY, Salt Lake City, 
 HARRY JOSEPH, Salt Lake City, Utah. 
 
 Utah. ARTHUR THOMAS, Salt Lake City, 
 
 GEO. H. DERN, Salt Lake City, Utah. Utah. 
 
OFFICERS AND COMMITTEES, 1914 
 
 CARD SCHOLZ. President. 
 
 HENNEN JENNINGS, First Vice President. 
 
 M. S. KEMMEREB, Second Vice President. 
 
 HARRY L. I>AY, Third Vice President. 
 
 DIRECTORS. 
 
 SAMUEL A. TAYLOR, Pittsburgh, Pa. CARL SCHOLZ, Chicago, 111. 
 
 D. W. BRUNTON, Denver, Colo. HARRY N. TAYLOR. Kansas City, Mo. 
 HENNEN JENNINGS, Washington, JOHN MAYER, Kansas City, Mo. 
 
 D. C. WILL L. CLARK, Jerome, Ariz. 
 
 E, A. MONTGOMERY, Los Angeles, GEO. H. DERN, Salt Lake City, Utah. 
 Cal. 
 
 M. S. KEMMERER. New York. HARRY L. DAY, Wallace, Idaho. 
 
 JAMES DOUGLAS, New York City. W. J. RICHARDS, Pottsville, Pa. 
 
 COMMITTEES 
 
 PROGRAM. 
 
 WILL L. CLARK, Jerome, Ariz. W. G. SWART, Denver, Colo. 
 
 J. F. CALLBREATH, Denver, Colo. 
 
 REVISION MINERAL LAND LAWS. 
 
 EJ. B. KIRBY, St. Louis, Mo., Chairman. 
 
 Alaska -L. V. RAY, Seward. Minnesota HORACE V. WINCHELL, 
 
 Arizona WILL L. CLARK, Jerome. Minneapolis. 
 
 California E. H. BENJAMIN, San Missouri E, B. KIRBY, St. Louis. 
 
 Francisco. Nevada D. C. McDONALD, Ely. 
 
 Colorado VICTOR C. ALDERSON, New Mexico C. T. BROWN. Socorro. 
 
 Denver. Oregon H. H. SCHWARTZ, Portland. 
 
 District of Columbia HENNEN JEN- Texas ISADORE BROMAN, Austin. 
 
 NINGS, Washington. Utah W. H. KING, Salt Lake. 
 
 Idaho J. H. RICHARDS, Boise. Washington L, K. ARMSTRONG, 
 
 Montana WM. SCALLON. Helena. Spokane. 
 
 Wyoming EDWIN HALL, Lusk. 
 
 FEDERAL LEGISLATION. 
 
 Metalliferous Mining. 
 
 E. A. COLBURN, Denver, Colo. DAVID D. HOAG, Joplin, Mo. 
 
 R. J. EVANS, Salt Lake City, Utah. J. C. ADAMS. Butte, Mont. 
 IRVIN E, ROCKWELL, Bellevue, Idaho. WALTER DOUGLAS, Bisbee. Ariz. 
 
 Alaskan Affairs. 
 
 FALCON JOSLIN, Fairbanks. SUMNER S, SMITH, Juneau. 
 
 JAS. R. HAYDEN, Seward. CHARLES ESTMEREf, Iditarod. 
 
 WM. MALONEY, Nome. 
 
 Coal Mining. 
 
 W. L. SCHMICK, St. Louis, Mo. CHAS. M. MODERWELL, Chicago. 111. 
 
 HUGH SHIRKIE, Terre Haute, Ind. SAMUEL A. TAYLOR, Pittsburgh, Pa. 
 CHAS. S, KEITH, Kansas City, Mo. J. J. TIERNE7Y, Philadelphia, Pa. 
 THOS. W. DAVIS, Saginaw, Mich. THOS, W. BREWSTER, St. Louis, Mo. 
 
 GEO. H. CAPERTON, Rush Run, W. C. E. MAURER, Cleveland, Ohio. 
 Va. F. P. WRIGHT, Bevier, Ky. 
 
 HYWEL DAVIES, Lexington, Ky. 
 
 Workmen's Compensation. 
 
 S. A. TAYLOR, Pittsburgh, Pa. DAVID ROSS, Springfield. 111. 
 
 J. W. DAWSON, Charleston, W. Va.. T. L. LEWIS, Bridgeport, Ohio. 
 W. R. WOODFORD. Cleveland, Ohio. 
 
10 OFFICERS AND COMMITTEES, 1914 
 
 Prevention of Mine Accident. 
 
 W. R. INGALLS, Chairman, New York City. 
 
 DR. JAMES DOUGLAS, New York. J. R. FINLEY, New York. 
 J. P. CHANNING, New York. JOHN HAYS HAMMOND, New York. 
 
 U. S. BUREAU OF MINES. 
 Metal Mining. 
 
 E. H. BENJAMIN, San Francisco, Chairman. 
 
 IT. N. LAWRIE, Portland, Ore. GEO. E. COLLINS, Denver, Colo. 
 
 J. F. MCCARTHY, Wallace, Idaho. W. B. SHACKELFORD, Webb City, Mo. 
 
 Coal Mining. 
 
 E. T. BENT, Chicago. 111. JOHN H. JONES, Pittsburgh, Pa. 
 MORTON L. GOULD, Indianapolis, Ind. ERNEST CHILSON. Raleigh, W. Va. 
 
 U S. GEOLOGICAL SURVEY. 
 
 J. F. MERRILL, Salt Lake City, Utah. H. M. PARKS, Corvalis, Ore. 
 DR. R. D. GEORGE, Boulder, Colo. W. L. CREDEN, Butte, Mont. 
 
 SE'ELEY W. MUDD, Los Angeles, Cal. 
 
 STANDARDIZATION OF ELECTRICAL EQUIPMENT. 
 
 In Coal Mines. 
 
 GEORGE R. WOOD, Chairma.n, Philadelphia, Pa. 
 
 S. A. TAYLOR, Pittsburgh. Pa, H. M. WARREN, Scranton, Pa. 
 
 J. R. BENT, Oglesby, 111. G. A. SCHREIER, Divernon. 111. 
 
 G. T. WATSON, Fairmont, W. Va. W. A. THOMAS, Pittsburgh, Pa. 
 
 In Metal Mines. 
 
 H. S. SAJSFDS, Chairman. Denver, Colo. 
 
 C. A. CHASE, Denver, Colo. SANFORD B. BELDEN, Columbus, O. 
 
 Mineral Statistics. 
 
 GEORGE W. RITER, Chairman, Salt Lake City, Utah. 
 OTTO RUHL, Joplin, Mo. FRED'K BURBIDGE, Spokane. Wash. 
 
 COMMITTEE ON FORESTRY RELATIONS. 
 
 General Committee. 
 ROBETRT L. MARTIN, Chairman, Denver, Colo. 
 
 F. J. ALEXANDER, Denver, Colo. HENRY I. SEEMAN, Denver, Colo. 
 E. G. RE1NERT, Denver, Colo. J. W. DEANE, Denver, Colo. 
 
 Mine Taxation (Metalliferous). 
 
 D. L, WEBB, Denver, Colo. WILL L. CLARK, Jerome, Ariz. 
 PROF. L. A. YOUNG, Urbana, 111. PROF. H. A. E. CHANDLER, Phoenix, 
 JOHN WELLINGTON FINCH, Denver, Ariz. 
 
 Colo. 
 
 Mine Taxation (Coal). 
 
 R, V. NORRIS, Chairman, Wilkes-Barre, Pa. 
 WM. J. MURRAY, Denver, Colo. W. W. KIEFER, Pittsburgh, Pa. 
 
 Mining Investments. 
 
 W. R. ALLEN, Butte, Mont. JOHN R. BURTON, New York City. 
 
 J. F. ERISMAN, Denver, Colo. R. F. COLLINS, Spokane, Wash. 
 
 LYMAN A. SISLEY, Chicago, 111. 
 
REPORT OF THE PROCEE0IN&S 
 
 OF THE 
 
 Seventeenth Annual Session of the American 
 Mining Congress 
 
 Elks' Theatre, Phoenix, Arizona 
 December 7-11, 1914 
 
 MONDAY, DECEMBER 7, 1914. 
 Opening Session 
 2 O'clock P. M. 
 
 The Congress was called to order by Hon. Joseph H. Kibbey, chair- 
 man Local Reception Committee. 
 
 CHAIRMAN KIBBEY: Gentlemen, the honor of calling this Congress 
 to order has devolved upon me, and the first thing in order will be an 
 invocation by the Rt. Rev. William J. Scarlett of our Trinity Church pro- 
 Cathedral. 
 
 (Invocation.) 
 
 CHAIRMAN KIBBEY: On behalf of our local committee, Ex-Gov- 
 ernor Sloan will now give some expressions of appreciation of the honor 
 we feel for the meeting of this Congress here in our state. I have the 
 pleasure of presenting Ex-Governor Sloan. (Applause.) 
 
 HON. R. E. SLOAN: Mr. Chairman and Gentlemen of the American 
 Mining Congress: I have been, as the Chairman has said, delegated in 
 behalf of the local committee to say a word and it is a very pleasant duty 
 of welcome to the visiting members of the Congress and to express our 
 appreciation of the honor conferred upon our town and our state in the 
 selection of Phoenix as the place for the holding of your seventeenth an- 
 nual session. I am also commissioned to say that by the expressed wish 
 I may, indeed, say command of your executive officers, we are limited 
 !in what we may do for you in the way of entertainment of a social char- 
 acter. It was suggested to us that the American Mining Congress is 
 composed of business men who meet for business purposes only, and that 
 social engagements therefore tend to interfere with the very serious and 
 important work of the convention. We appreciate this and we acquiesce 
 in it. We do appreciate the fact that the American Mining Congress is 
 a working body; it was organized for that purpose; It was organized 
 upon large plans. It was its design as I understand, that by this means 
 there should be brought together representatives of the various branches 
 of the great basic industry of mining so that these representatives might 
 confer together upon matters of vital concern to the business of mining, 
 to consider in a concrete way the matter that immediately relate to min- 
 ing. Not only so, but to consider the more general questions, such as 
 that of conservation of our natural resources, upon lines, however, that 
 
12 OFFICIAL PROCEEDINGS 
 
 will admit of their broad development and utilization. Not only so, but 
 you frfcet to coiislde^and it is your purpose that you meet and consider 
 what .is perhaps sfm iriore important the conservation of human life 
 made dangerous by the hazards of the occupation of mining. Not only 
 so,- bst' ihctd-exifeiBy,:' perhaps, it is your purpose to recommend from time 
 to date needed legislation upon the subject of mining. Permit me to say 
 that there is one thing about the American Mining Congress that should 
 commend it, in my judgment, and that is that it has not been organized 
 for the purpose of reforming, nor has it ever undertaken to reform any- 
 body or to uplift anybody by means of ill-considered or "freak" legisla- 
 tion. In my judgment laws are needed, but too much law is as bad and 
 possibly worse than too little law, and there is danger in the tendency 
 toward over-legislation that our government shall become top-heavy in 
 this direction. You have been active, however, in a sensible, business- 
 like way in effecting legislation. I recall that this Congress has been 
 instrumental in securing the Bureau of Mines. I believe that you are in a 
 fair way also to bring about a much-needed revision of the mineral laws of 
 the United States. There is certainly room for such an organization as 
 this, for no other organization can so well present the views, the wishes 
 and the requirements of the mining business to Congress and to the state 
 legislatures, and to the country. There are many functions that this 
 Congress has to perform and will perform. Just now, when half the world 
 is at war, business and industries of every kind, including mining, have 
 been feeling the effects of that war. Perhaps due to this cause the field 
 of activity of this Congress has been widened. Let me suggest another 
 thing: America, as well as all the world, has been at school these last 
 four months, and we have been learning a valuable lesson. Whether 
 Germany shall succeed or fail in her gigantic effort to defeat her enemies, 
 she certainly has been giving the world a valuable object lesson in effi- 
 ciency. She has taught us that exact scientific knowledge, thoroughness 
 in method and the application of sound business principles are essential 
 to industrial supremacy as they are to modern warfare. She has also 
 taught us that no people without these can hope to compete in the future 
 with a nation that possesses them. Now, this may be a needed object 
 lesson for America, and I think it is, and that we are beginning to realize 
 more and more that the future industrial supremacy of our country rests 
 not upon the richness and plentitude of our natural resources but upon 
 the efficiency of the men and methods employed in their development and 
 utilization. (Applause.) Now, I do not know that this lesson is particu- 
 larly needed in the mining industry. To some extent I presume it is; 
 but to the extent that this Congress is directed <and it seems to me that 
 its work is primarily so directed to the securing of greater efficiency, 
 it deserves the support and encouragement of us all whether we are en- 
 gaged in mining or not. Business, Gentlemen, is a unit: whatever affects 
 one industry or one enterprise or one business affects other industries 
 and other enterprises and other businesses to the same extent. We real- 
 ize that in our own state, Arizona, in common with other copper-produc- 
 ing states, has been feeling acutely the decline in copper. We have come 
 to realize from this that we are dependent in a large measure upon that 
 industry for our prosperity. Let me suggest another thing in this con- 
 nection that we should all look with interest to the course of events 
 in so far as our government is concerned in dealing with this industry. 
 We should all hope, at any rate, that our government will be able to 
 maintain, and will adhere to, the policy that copper in neutral vessels 
 consigned to neutrals at neutral ports may not be seized as contraband 
 of war by British and French ships without clear proof that Germany or 
 Austria is to be its ultimate destination. (Applause.) I see from this ap- 
 plause that if any prop or props in the way of public sentiment are 
 needed to sustain our government in that position this Congress is ready 
 to supply them. 
 
 Now, gentlemen, it is not my purpose to make a speech; it is not my 
 
AMERICAN MINING CONGRESS 13 
 
 business to make a speech to you. You have a very interesting and com- 
 prehensive program for this session of your Congress. Permit me, in 
 closing, to express the hope that it may be carried out without a break 
 and, that you may all extract from it and from your visit to Phoenix not 
 only pleasure but profit to yourselves and to the interests you represent. 
 The Committee, I wish to say, is whole-heartedly at your service to 
 achieve that end. (Applause.) 
 
 CHAIRMAN KIBBEY : On behalf of the state of Arizona, and speak- 
 ing for the state at large as well as for the city of Phoenix, Hon. George 
 P. Hunt, Governor of Arizona, will now extend to you some remarks of 
 welcome. (Applause.) 
 
 GOVERNOR HUNT: Mr. President, Gentlemen of the Mining Con- 
 gress : It is with a keen realization of the great importance of this occa- 
 sion that I com before you this morning to address, in behalf of Ari- 
 zona's miningl men, the City of Phoenix, and the State of Arizona, a cor- 
 dial welcome to the many distinguished visitors from other states who 
 have come together to participate in one of the most notable gatherings 
 that annually marks America's industrial life. I speak with the utmost 
 certainty when I give assurance that the mining men of Arizona, and the 
 representatives of the city and state governments as well, feel highly 
 honored by the holding of this Congress in the Capital of the State, and 
 regard this occasion as an exceptional opportunity to demonstrate the 
 whole-hearted nature of Arizona's hospitality. We, who for several 
 months past, have had a part in preparing the scene of this convention, 
 have freely given our most earnest efforts toward insuring our visitors 
 of sessions both pleasureable and profitable, and even though it should 
 prove that some things have been left undone for the attainment of such 
 a purpose, you who have come from afar, may at least be assured of the 
 sincerity of our good will, of our unqualified desire to please and of our 
 deep personal satisfaction in being allowed to entertain a body of men 
 whose names, collectively, stand for all modern advancement in the de- 
 velopment of the mining industry throughout the United States. As 
 Governor of Arizona, a state comprising many colossal mining projects, 
 whose reputation has gone abroad throughout the land, I warmly wel- 
 come all of you, and express the earnest desire that many of you as in- 
 dividuals may have frequent opportunity to revisit Arizona and share in 
 her business development. 
 
 For many years past, with the exception of two or three, it has been 
 my fortune to live in one of the most promising mining centers of this 
 state, and to observe, in that connection, the vitally important part which 
 the mining men of this country have taken in the development of Ari- 
 zona's mineral resources and the consequent upbuilding of our business 
 structure as a whole. In the life of the city, to which I refer, and which 
 is characteristic of numerous centers of population in Arizona, the ar- 
 rival of each train, with the possibility that some great captain of in- 
 dustry might be incoming, constituted a very important event of daily 
 recurrence. This constant and consuming interest in all newcomers was 
 perfectly natural in the light of the fact that the arrival and departure 
 of many a noted engineer or far-famed capitalist marked a new con- 
 tribution to the industry of the entire mining district within which my 
 home city was situated. My chief purpose in dwelling on this particular 
 phase of Arizona's industrial life is to emphasize the intimate and all- 
 important connection of the mining industry to Arizona's present and 
 future welfare. My further object is to illustrate the vast responsibility 
 resting upon each captain of industry, who directs the different mining 
 enterprises of the state, and who is frequently instrumental in opening up 
 new avenues of commerce tending to enrich this young but vigorous com- 
 monwealth in which most of us, who are acting in the role of host today, 
 have made our homes for many years. The picture, which I have drawn, 
 may, furthermore, assist in enabling you, who are Arizona's guests, to 
 
14 OFFICIAL PROCEEDINGS 
 
 realize, in some degree, how remarkably Arizona's people are impressed 
 by the Tast significance of this gathering in the Capital City of the State. 
 
 With a consciousness, therefore, of the important and far-reaching 
 relation of tills Congress to the mining industry of Arizona, and of the 
 entire United States as well, we may reasonably anticipate that the ses- 
 sions to be held during the next few days will lead to the solution of 
 many serious problems confronting the management of mining com- 
 panies at this particular period, and may result in an even greater meas- 
 ure of harmonious co-operation than has prevailed heretofore. It is no 
 exaggeration to assert that the true source of progress and human well- 
 being is harmony, and that the "work-together" spirit bears a direct re- 
 lation to civilization's advancement. 
 
 Although there is a certain ineptitude in citing the German nation of 
 today as an illustration of the possibilities to be realized through co- 
 ordination of efforts, all of us. who have followed her career since the 
 European war began, must necessarily have been dumbfounded by the 
 remarkable spectacle of a great commercial empire being suddenly 
 transformed into an enormous fighting machine, the maintenance and 
 movement of which have proceeded with the regularity of clockwork. 
 Lacking a stupendous endeavor toward co-ordination, such monumental 
 efficiency could never have been realized, and therein we find, unfortu- 
 nately, a contrast between the German nation, where all men work to- 
 gether in the common interest, and the United States where competition 
 between countrymen and between industries as well has been carried to 
 the Nth power. 
 
 Without decrying American individualism, is it not possible for the 
 leaders of American industry to immeasurably accelerate business and 
 social advancement by instituting a new era of co-operation that will ex- 
 tend not only to commercial enterprises, but which may also eventually 
 be made to characterize the conduct of our State and National govern- 
 ments in the furtherance of the general welfare? To eliminate needless 
 friction between individual industrial leaders, between corporations and 
 proletariat, and between the employer and employed, is as commendable 
 and beneficial a purpose as could possibly animate our public men of 
 today to whom the guidance of mammoth industries and of govern- 
 mental organizations are entrusted. I firmly believe that no man can 
 promote the welfare and happiness of others without, at the same time, 
 reaping the greatest reward of all the fullest measure of success in his 
 chosen line of work. 
 
 Should it be possible, in the sessions of the American Mining Con- 
 gress, to crystallize such a spirit of mutual helpfulness and universal co- 
 operation as has been merely suggested by the words which I have 
 spoken, a vastly significant movement will have been inaugurated and 
 this new direction given to the energy and thought of those who are 
 members of this gathering would surely and inevitably give the Ameri- 
 can Mining Congress an enviable and unprecedented place in the com- 
 mercial history of this country. 
 
 With all the warmth of feeling which I possess, and with reassur- 
 ance of Arizona's hope that every member may leave this scene, at the 
 conclusion of the meetings of the next few days, carrying with him 
 constructive ideas for future application, and pleasant memories of good- 
 fellowship, I conclude my words of welcome to you whose presence con- 
 fers a new and signal honor upon our state. 
 
 CHAIRMAN KIBBEY: Speaking for the people of Phoenix, its 
 mayor, Hon. George U. Young, will address a word of welcome to you. 
 I have the honor of presenting the mayor, Hon. George U. Young. (Ap- 
 plause.) 
 
 MR. YOUNG: Mr. Chairman and Delegates to the Sevententh Annual 
 Session of the American Mining Congress: Phoenix, the Queen City of 
 
AMERICAN MIXING CONGRESS 
 
 the Southwest, appreciates the honor conferred upon her in this gathering 
 of men, attempting things of such mighty import, and from this appre- 
 ciation there comes a welcome now found only in * partially free and 
 
 untrammeled West. 
 
 It is not onlj paradoxical, but wonderful, that a gathering of this 
 kind *"*1 intent should exchange mutual honors with this wonderful fittle 
 city, not yet fully alire to its great mining possibilities, and there are 
 several of us who will rejoice if this fact be revealed by this particular 
 session of the American Mining Congress. 
 
 Phoenix, lithe, tawny and beautiful, in her young strength, reclines 
 transcendent and radiant as an iridescent dream, on her throne of silver. 
 copper and gold, filamented. decorated and adorned with the trailing ar- 
 butus, orange blossoms and the relrety purple of alfalfa bloom. The air, 
 laden with the perfume of orange, hyacinth and colnmtine. frm.* hiHed 
 many to sleep in the dangerous realm of egotism, comfort, peace and 
 prosperity, and at the worn out sentinel's "All's well," tern orer for an- 
 other season of rest and sleep, but there are others of less seLlshJie^s, 
 greater experience and more extended vision, who Lare Vrnwn. and do 
 know, that in union there is strength, and the greatest strength is found 
 when the holy face of motherhood and angelic face of rhildfrond. sup- 
 ported by the brawn and strength of the miner, look forth in happiness 
 through the wreath of KmllaT and rose produced and nurtured 17 the 
 patience and intelligence of the farmer. 
 
 This is a wonderful gathering of men, upon which mighty respon- 
 sibilities rest, and a meeting held in the most portentous true in inrziin 
 history. This statement is made without fear of contradiction by the 
 
 Mining is the one peculiar industry known to man. It is a developer 
 of man as no other vocation, because the weak, timid and cowardly can 
 have no place in it and righteously do their work, for the best verse! 
 man in mining- is but a pioneer in an unknown realm. 
 
 The greater the proficiency of one in mjnir^g the more that one feels 
 his inefficiency and lack of knowledge. There are no permanent etiiie 
 posts in this vast region, and but few proven truths, therefore, the mtr.- 
 ing industry stands first in all the world. Not in money, income or other 
 material things, but in that power to develop in the faithful and cour- 
 ageous man those latent but basic truths, which, if righteously followed. 
 make better men and women, a higher citizenship and a greater fiational 
 permanency. 
 
 Mining is also the one industry which has been brought into the worst 
 repute by writers of national fame, but colossal ignorance. The "crook" 
 and the "get-rich-quick artist" have also utilized its possibHiiies in prey- 
 ing upon the duplicity of the equally as crooked or ignorant investor, who 
 dreams his dream of avarice, and thinks he can get valuable mining stock 
 on the basis of a two to five One Dollar certificate for twenty-five cents. 
 
 It has stood all these buffets, and ag-nfn has had to stand the awful 
 burden of theoretical mining engineers, through whom h.as come that vast 
 amount of wrong information now most tenaciously followed by the great 
 majority of legitimate investors. Through this class of mining engineers 
 who know nothing of the difference between a money-sp-tnains ability 
 and a money-creating ability investors have been taught to believe mil- 
 lions are required when thousands would sun^ce, and in many instances, 
 hundreds would do where thousands are demanded. In other words, the 
 lack of practical experience and the application of good, common sense 
 should inform the wise investor that it's a pretty safe buy if he can fiad 
 a mining prospect that has been turned down by from ten to twenty of 
 this class of raiding engineers. 
 
 The application of this theoretical mining knowledge the past few 
 years, has practically driven the prospector from the field and has placed 
 
16 OFFICIAL PROCEEDINGS 
 
 the average mining prospect in the same category with the human patient 
 and his physician. Most any ordinary patient may be able to stand the 
 experiments of one physician, but when that physician calls a consulta- 
 tion, and the unfortunate patient has to withstand the onslaught of all 
 of them, it is a wise precaution for him to make hiis will. The same with 
 a mining prospect, struggling along under fifteen different opinions, made 
 up by fifteen different engineers. 
 
 Will this congress of men realize its great responsibilities at this 
 session, and especially its greatest responsibility, which is the life and 
 permanency of this great nation? Will you delegates keep in mind you 
 are representing the one industry now left which develops individuality, 
 as individuality is being destroyed in all other lines, and when individ- 
 uality is destroyed that nation sooner or later must fall and perish from 
 the face of the earth 
 
 Will you realize the pendulum of human progress is now swinging 
 backward in the life of man, and no man in this great audience will live 
 to see that time again, when the awful material fight for animal existence 
 can be laid aside, or secondly carried, while methods for mental culture 
 and human advancement are being studied and experimentally applied? 
 
 Our brothers in Europe, in less than three months time, have de- 
 stroyed the constructive efforts of centuries in human uplift. Be our 
 sympathy where it may, the ghastly truth stands revealed, that should 
 the aggressive nation perish, the nation first in practically all the sci- 
 ences, and especially in the science of Government, the most divine sci- 
 ence of them all, when that nation is lost in the vortex of memory, it 
 drags with it the work of a world. May it not be so, but our brothers 
 of nearer kin and blood are having to tent with the disciples of supersti- 
 tion and ignorance, because of their own past inertia and destruction of 
 individuality in national make up. 
 
 Many will say: "The United States is left to light the way." Possi- 
 bly What will be the result of this, the Seventeenth Session of the 
 American Mining Congress? We are all familiar with the corruption of 
 corporate methods in the near past. It made a people mad, with the re- 
 sult that today this nation groans under the weight of grievous legisla- 
 tion, and an expense account under which no nation can exist and prosper. 
 
 One's misfortune is another's fortune, whether applied individually or 
 in the aggregate, and today we stand in the dawn of an era of national 
 prosperity. It cannot last, because of the impulse contained therein, and 
 in less than fifteen years, those of us then living, will see this great gov- 
 ernment tottering to its very foundation, unless meetings of this character 
 perceive the weakness of the foundation, and have the patience, intelli- 
 gence, unselfishness and patriotism to cease building at the top and com- 
 mence lasting repairs on the foundation, which is, the expansion and 
 uplift of the individual man. 
 
 What are the truths gleaned? First: Most people know of govern- 
 ment, but few people know what it is. Second: Until unselfish and in- 
 telligent instruction is taught of what a sacred responsibility the ballot 
 is, the preservation of this government depends upon the limitation, not 
 an expansion of the franchise. Who will first start the movement re- 
 quiring a voter to pass an examination on the subject of democratic gov- 
 ernment before being allowed to vote? Which will be the first mining 
 company to start and support a school where its employees may be in- 
 structed in government taught by a teacher not teaching government for 
 the benefit of that company or the mining industry, but for the general 
 uplift of democratic government? 
 
 Few laws, plain ones and in simple terms, may the delegates to this 
 Congress record themselves in favor of, and thus there will come forth 
 from this beautiful little city, in the land the fool said "God forgot," the 
 first faint cry of a new wisdom in Israel. 
 
AMERICAN MINING CONGRESS 17 
 
 As one of the few individual mining men of the city of Phoenix, 
 proving his faith by his works, it is more than a pleasure to welcome you 
 as men engaged in a mighty work. 
 
 As the Mayor of Phoenix, it is not only my great pleasure, but great 
 honor, to tell you Phoenix welcomes you once, twice, thrice and em- 
 phasizes this welcome with three cheers and a tiger. 
 
 The City Manager has been asked to remove the lid for you as far 
 as within his power. We want you to go to your homes with your hearts 
 tilled with love for Phoenix, and as time grows older, when you have 
 handed your lance and armor to the younger man, and you sit by the 
 quiet of your fireside, may memories come to you of this occasion as 
 sweet as the odor of lavender and old rose, and may you think of Phoenix 
 as a precious old cameo, circled by bands of gold, set in pictures of cop- 
 per and silver, which will be at that time the truth, for some of the big- 
 gest mines any country now contains will be proven to exist on the 
 fringes of these watchful waiting mountains surrounding Phoenix. 
 
 Again Members of this Convention as the Mayor of Phoenix, per- 
 mit me, in behalf of the people, Commission, City Manager and myself, to 
 bid you a gladsome welcome, tell you the latch string hangs on the out- 
 side, bidding you enter, take what you desire, and if there is anything 
 you do desire and cannot find, kindly request it of us and we will be glad 
 to find it for you. 
 
 CHAIRMAN KIBBEY: The Secretary of the Congress has a letter 
 from the President of the United States which he will read. 
 
 The White House, Washington, October 2, 1914. 
 Mr. J. F. Callbreath, Secretary, 
 
 American Mining Congress, Washington, D. C. 
 My dear Mr. Callbreath: 
 
 To the Members of the American Mining Congress: I regret exceed- 
 ingly that owing to the press of circumstances it will be impossible 
 for me to greet you in person at the Seventeenth Annual Session of the 
 American Mining Congress, at Phoenix, Arizona, in December. 
 
 I am well aware of the important part played by your great organiza- 
 tion in the creation of our Bureau of Mines and am sure that the good 
 work of that bureau in attempting better to safeguard the lives of the two 
 million men employed in the hazardous mining and metallurgical indus- 
 tries will continue to redound to your credit, as well as to the credit of 
 the bureau itself. It will always be a tribute to your foresight and energy 
 that this new federal organization, in the short period of its existence, 
 with the kindly co-operation of state and other agencies, has been able, 
 by persistent and intelligent effort, to turn an isolated, local movement 
 for greater safety into a great national movement for "Safety First" that 
 has already gone beyond the mining industry into every industry of the 
 country. I venture to say that thousands of lives have been saved by 
 that movement and that many thousands more will be saved in the 
 future. 
 
 Gratifying as the results of this life-saving campaign may have been, 
 however, there is still vigorous work for your Congress to do. I am in- 
 formed that during the last year more than three thousand men were 
 killed and one hundred thousand injured in the mining and metallurgical 
 industries of the country. At the same time, those in authority tell me 
 that from their observation and experience one-half of such deaths and 
 three-fourths of such injuries may be regarded as easily preventable. 
 
 I suggest this situation as an opportunity for further endeavor on 
 your part to cut down this excessive toll of death and injury. I can as- 
 sure you of the fullest co-operation of all the proper governmental agen- 
 
18 OFFICIAL PROCEEDINGS 
 
 cies; and also of my earnest desire for your active and continued as- 
 sistance. 
 
 There is one other problem connected with the mining industry in 
 which the Federal Government is vitally interested, and that is proper 
 conservation and proper use of the mineral resources of the nation. I 
 realize that you, too, are interested in this problem and wish merely to 
 call it to your attention because of its fundamental importance to the 
 present and future prosperity of the nation. I am happy to say that the 
 profligacy of the past in the use of these resources is not being con- 
 tinued, at least not on so large a scale. There is, however, great oppor- 
 tunity for further reform along these lines and in this your organization 
 can be of invaluable service. 
 
 Sincerely yours, 
 
 WOODROW WILSON. 
 
 CHAIRMAN KIBBEY : The President of the Congress will respond to 
 the address of welcome, and upon my presentation of him to you my 
 functions will have ceased and he will from thenceforth preside over 
 your deliberations and direct your further proceedings. I have the pleas- 
 ure of presenting to you Mr. Carl Scholz, President of the American 
 Mining Congress. (Applause.) 
 
 PRESIDENT SCHOLZ: Ladies and Gentlemen and fellow members 
 of the American Mining Congress: In behalf of our organization I want 
 to accept the very cordial and hospitable invitation and reception given 
 us by the city of Phoenix. It is indeed a rare pleasure to receive such 
 a warm welcome as has been accorded to us here today by your former 
 Governor, your present Governor, the Mayor of the City and the very 
 able Reception Committee. 
 
 Phoenix is, indeed, a fitting place for a meeting of this kind, being the 
 center of a very wealthy mining district, one to which this state owes a 
 great deal. I am sorry that I, myself, know so little about the state, but 
 from what little I have seen it has indeed been a surprise to me. I ex 
 pected to find Phoenix a wild western place, instead of which I have beer^ 
 pleasantly disappointed. These flowers do not look like evidence of a 
 wild western desert; they speak with a warth of Southern hospitality 
 which we so greatly appreciate. Living, as many of us do, in the northern 
 and eastern cities, where ice and snow are now so much in evidence, we 
 certainly look with much pleasure upon the signs of spring. 
 
 I regret that personally I am very little known to you delegates. 
 Having been engaged in the coal mining industry, my acquaintance among 
 metal men is rather limited, but I can see right now that in the very few 
 days I will be here I shall make a good many friends, because coal min- 
 ing is very closely allied to the metal industry. 
 
 So much has been said about the effect of the foreign war upon the 
 industry that I am not going to trouble you with a further discussion o.^ 
 that subject, but I think you will agree with me that although we are 
 surrounded by wars which interfere with our commerce, our industries 
 are progressing favorably and advancing quite rapidly. 
 
 I will now open the Congress for business, and will call upon the 
 delegates from the various states for their responses to the eloquent ad- 
 dresses of welcome to which we have listened. 
 
 The first on the program is the state of California, and we will hear 
 from Mr. Seeley W. Mudd of Los Angeles. 
 
 MR, MUDD, of California: Mr. President and gentlemen: I think it 
 is hardly fair to a great state like California to have me designated to 
 respond in her behalf, and especially upon sudden notice. It is a great 
 state, and the response should be a great one by a great man. I am sorrv 
 that it cannot be so arranged. I am free to say, however, that I think 
 
AMERICAN MINING CONGRESS 19 
 
 California has been and is as fully behind the Congress as any of tho 
 states. I do not mean by that that California has done its full duty by the 
 Mining Congress; I think few states have done that. I trust that this 
 meeting may be one where there may be a large measure of support 
 started for the Congress. The Congress has proven its value by its work. 
 If you will look back ten years or longer and remember what the Con- 
 gress was then I think you will find that the tone today is better, the 
 interest greater and the influence of the Congress has been very much in- 
 creased. I think, therefore, we may reasonably look forward to a greater 
 field of usefulness. The usefulness must come from individual effort 
 combined into a united effort. That can only come through proper sup- 
 port by the different states. I trust that this meeting will result in a 
 more adequate support from this time forward, and that California will 
 not be second to any of the states in contributing to that added support 
 to which the Congress is entitled. (Applause.) 
 
 PRESIDENT SCHOLZ: It will be my pleasure to call upon Mr. 
 Brunton, the son of a former president of the Congress, to reply on be- 
 half of the state of Colorado. 
 
 MR. FRED K. BRUNTON, of Colorado: Mr. President and fellow 
 members of the American Mining Congress: I did not come prepared for 
 any speech, and I cannot say much, because this is my first attendance 
 at a meeting of the American Mining Congress. I would like to thank 
 the people and citizens of Phoenix and Arizona for the hospitality and 
 the hearty welcome they have shown us and leave the floor to some of 
 the older members who may have more to say about it. (Applause.) 
 
 THE PRESIDENT: Accepting Mr. Brunton's suggestion that we call 
 upon one of the older members, I am going to call upon Mr. Harry Day, 
 who has been very active in the Mining Congress for many years, to reply 
 on behalf of the state of Idaho. 
 
 MR. DAY, of Idaho: Mr. President, ladies and gentlemen: In rising 
 to respond on behalf of the state of Idaho, I feel very much in the same 
 situation as my friend from California. We have people in Idaho who 
 can make a speech. A good many of them are in politics; some of them 
 are in the mining business; but, unfortunately, none of them are here 
 today. I simply want to express on behalf of Idaho our deep appreciation 
 of the cordial welcome and most generous hospitality which have been 
 tendered us on all sides. I am sure we will have a pleasant and very 
 profitable session of the Mining Congress. (Applause.) 
 
 THE PRESIDENT : Mr. Charles W. Burgess is going to represent the 
 state where they say, "You have got to show us," namely, the state of 
 Missouri. 
 
 MR. BURGESS, of Missouri: Mr. President and members of the 
 American Mining Congress: We seem to be all in the same boat. This is 
 my first notice that I represented Missouri and would be expected to re- 
 spond on behalf of that state. I am sure that other delegates from Mis- 
 souri will arrive later. But we do accept with fullest appreciation the 
 most hearty welcome and generous hospitality that have been extended 
 to us here. We know what the American Mining Congress has done in 
 our district. I remember a few years ago we thought they were "kickin' 
 our dog aroun','' but our dog in this case happens to be a yellow dog. His 
 name is Jack. We thought we were not given a square deal and wished 
 to have legislation along the tariff line. We lacked the necessary organ- 
 ization, we were not equipped for anything of that sort, but we found in 
 the American Mining Congress the agency through which we could pre- 
 sent our case. I just give that as a typical example of some of the needs 
 that the American Mining Congress supplies in case of necessary action 
 in the mining business, and it is constantly extending its influence and be- 
 
20 OFFICIAL PROCEEDINGS 
 
 coming a more powerful agency for the promotion of the mining industry 
 along legitimate lines. 
 
 I thank you for the opportunity of saying a woM on behalf of Mis- 
 souri. (Applause.) 
 
 THE PRESIDENT: I am going to call on Mr. R. C. Allen, state geol- 
 ogist, of Michigan, to speak on behalf of that state. 
 
 MR. ALLEN, of Michigan: Mr. President, Gentlemen: It is indeed 
 an honor to be called upon to speak in behalf of the state of Michigan. I 
 am advised that there is no one else here to represent our state, the honor 
 thus falls upon me by default and I am consequently afraid that Michigan 
 will not receive her just dues. 
 
 It is indeed a pleasure for us who live East of the Rocky mountains 
 to get this far West, and I wish that I had words to express adequately 
 our appreciation of the hospitality of the people of Phoenix and Arizona. 
 I have been among you only twenty-four hours. I came here a total 
 stranger, but I adopted one of your good western customs and began get- 
 ting acquainted by talking to the first men whom I met. Yesterday as 
 I wandered about your city here and there I discovered that every man 
 whom I met and accosted was a genial, whole-souled, good fellow and 
 moreover was perfectly willing to talk about Phoenix. (Applause.) 
 
 We have in Michigan a lot of boosters for our state. We have a 
 Northern Peninsula Development Bureau, a Western Michigan Develop- 
 ment Bureau, and an Eastern Michigan Development Bureau, and we have 
 an official at the State Capitol who is an expert professional booster for 
 the whole state, but with all this fine equipment we must confess that 
 we are merely amateur boosters compared with the people of Arizona. 
 Many of our people find their way out into the West and after a few of 
 these trips those of us who come back find that our "boosting" hearts are 
 fainter, for the lure of the West is upon us. We believe that the West 
 is a good place to come to and when we depart we always wish to come 
 back for another visit even if not for permanent residence. 
 
 I am sorry that more Michigan men are not here. Michigan ought to 
 be more strongly represented for Michigan, as you know, was the first 
 state in the Union to introduce the mining of copper and iron ore on a 
 large scale and we are still mining both, on a larger scale than ever be- 
 fore. I think that one of the reasons for our small representation refers 
 to the fact that the problems which confront the mining men of the West 
 are in large degree those that we in the Lake Superior region do not have 
 to contend with. We have no government mineral lands and very little 
 government land of any description, therefore the national policies of con- 
 servation sit very lightly on us, in fact they hardly touch us. But we who 
 are close to the mining industry and the men who are in the mining in- 
 dustry are of one and the same fraternity, and we extend to you men of 
 the West a word of sympathy in your endeavor to secure some govern- 
 mental relief in certain directions from the difficulties under which you 
 are laboring. 
 
 And now on behalf of the Governor of Michigan, the mining men of 
 Michigan, and the people of Michigan, permit me to say again that we ap- 
 preciate most thoroughly these cordial, kind-hearted, genial words of wel- 
 come from the people of Phoenix and of Arizona. (Applause.) 
 
 THE PRESIDENT : Mr. L. A. Friedman is going to tell us something 
 about the great mining state of Nevada. 
 
 MR. FRIEDMAN, of Nevada: Mr. President and fellow members of 
 the American Mining Congress: This is rather an unexpected pleasure, 
 as, while I have been a member of the American Mining Congress for a 
 number of years, I am not here representing any organization, nor am I 
 here as a delegate. I just happen to be here. Being largely interested in 
 
AMERICAN MINING CONGRESS 21 
 
 Nevada, in the development of mines and the production of gold, of which 
 the whole world at this time seems to need so much, I thought I would 
 come and attend this convention. For this I had two reasons : in the first 
 place I thought I might learn something; my second reason was that I 
 thought that in the years of experience I have had in mining if I have 
 gained any knowledge that might be of any benefit to the mining indus- 
 try, if I could do anything or make any suggestion that might be of any 
 benefit to the industry, I would be here and willing to do so, and since I 
 have come here I have met so many intelligent and sincere men that I 
 am truly glad I am here. I have not been delegated here, consequently I 
 am not in position to speak for the state of Nevada, although I wish to 
 state this that you can all bet your lives that the state of Nevada and 
 its mines are all right. 
 
 I thank you. (Applause.) 
 
 THE PRESIDENT: The sister state of New Mexico, which I think 
 came into the Union at the same time as Arizona, will be represented by 
 Mr. W. A. Fleming Jones, speaking for the state of New Mexico. 
 
 MR. JONES, of New Mexico: Mr. President and delegates to the 
 seventeenth annual session of the American Mining Congress: In com- 
 mon with the gentlemen who have preceded me, I can only say that noth- 
 ing was further from my thoughts than being asked to respond to the 
 addresses of welcome on behalf of the state of New Mexico this after- 
 noon; but since I have been called upon I will try to say a few words 
 which will give you an idea of our appreciation of the sentiments that 
 have been expressed by the gentlemen who have welcomed us. These 
 words of welcome are the more acceptable to us when I recall, that some 
 eight years ago, through the efforts of a particularly zealous delegate in 
 the Congress of the United States, an act known as the joint statehood 
 bill was passed by which we were authorized to come into the Union as 
 one state. We voted on the proposition, and New Mexico was strongly 
 for it while Arizona did not care to be wedded to us in just that way; in 
 fact some of your citizens were unkind enough to say that they didn't 
 see how they could take a good egg and a bad egg and make a good ome- 
 lette. Now, I do not know whether they referred to us as the good egg 
 or the bad egg. However, that is all past and gone, and I hope there is no 
 feeling on the subject now. At the time of the celebration that was held 
 in El Paso in 1911 after the final passage of the statehood bill it was my 
 privilege to meet Governor Sloan of Arizona and other gentlemen from 
 this state, and I am quite sure that all feeling over the joint statehood 
 proposition is entirely a thing of the past. Our interests are almost the 
 same as yours. We have great undeveloped resources, and I am sure that 
 we can and will co-operate with a view to their development. I am not 
 here as a representative of the state of New Mexico, but of the town of 
 Las Cruces, in the southern part of the state, but I think I can say in be- 
 half of the people of the state and of my town that we deeply appreciate 
 the sentiments that have been expressed. I thank you. (Applause.) 
 
 THE PRESIDENT: It is a far jump from New Mexico to Ohio, but 
 Mr. C. D. Jury will tell us how he got here and what he has found and 
 how well he likes Phoenix. 
 
 MR. JURY, of Ohio: Mr. President and gentlemen of the Congress: 
 It would be a long story for me to tell you how I got here, but it is a 
 pleasure to tell you what I have found in the few hours I have been in 
 Phoenix. It could be summed up in one word "Welcome." I had not 
 expected to be called upon to respond for the great state of Ohio, but 
 Ohio sends you greetings, and Ohio is with the American Mining Congress. 
 We know that it can do a good work, and my only regret is that our state 
 is not better represented here. On behalf of the mining interests of Ohio 
 
22 OFFICIAL PROCEEDINGS 
 
 I want to assure you that the work of the Miring Congress is greatly ap- 
 preciated by us. (Applause.) 
 
 THE PRESIDENT: Next to Arizona in age of statehood is the state 
 of Oklahoma, quite a young baby, some seven years old, and I am going 
 to call on Mr. D. C. McAlpine to tell us something about Oklahoma. 
 
 MR. McALPINE, of Oklahoma: Mr. President, on behalf of our state 
 I would say that Oklahoma is progressive and desires to assist in every 
 movement that is for the benefit of mining in general, and of course that 
 includes the work of this Congress. In the work of the Bureau of Mines, 
 which is a product of the American Mining Congress, the state of Okla- 
 homa and the mining men of that state are assisting in every way possi- 
 ble to bring about better and safer conditions of mining as well as the 
 conservation of oui< resources, and we are glad to be represented in this 
 Mining Congress here in Phoenix. (Applause.) 
 
 THE PRESIDENT: The last session of the Congress was held in the 
 great state of Pennsylvania, and we have with us a gentleman from the 
 city of Philadelphia, Mr. William B. Rudderow, who will tell us some- 
 thing about Pennsylvania and his home city. 
 
 MR. RUDDEROW, of Pennsylvania: Mr. President, I want to say 
 that I am a young member of the Congress. I have a great deal to learn 
 and not very much to say. I have not been in the mining business, and 
 therefore I am not in position to make any remarks on that subject that 
 will be of interest to you. I thank you, however, for the invitation to 
 speak in behalf of my city and state, and desire to express my apprecia- 
 tion of the cordial welcome and splendid hospitality extended to us by 
 the people of Phoenix and Arizona. (Applause.) 
 
 THE PRESIDENT: One of the first presidents of the American Min- 
 ing Congress that I knew well was Mr. John Dern, who is also well known 
 to you, and I was very sorry to learn that he could not come here today, 
 but I was pleased to meet a chip of the old block this morning in the 
 person of his son, Mr. George H. Dern, of Utah, who will tell us something 
 about his state. 
 
 MR. DERN, of Utah: Mr. President and gentlemen of the American 
 Mining Congress: Utah people have the highest regard for their next 
 door neighbors of Arizona, and are always glad to visit them. Possibly I 
 should use the word "always" with some reservation, for I remember that 
 I was up here in the little mining camp of Chloride one day in July, when 
 It was 118 degrees in the shade, and very little shade, so I felt that I had 
 had a warm reception. But I have also been down here in the winter 
 season, and I know that the Arizona winter climate is the finest on earth, 
 Toarring none. But anyway, we don't hold the Arizona people responsible 
 for the kind of weather they have down here, hence we are happy to meet 
 with them at any time, and on behalf of the Utah delegation I want to 
 thank them for their friendly welcome, and express our appreciation of 
 their bounteous hospitality. 
 
 Speaking of hospitality, I have heard that in South American coun- 
 tries if you express admiration for your host's horse, or watch, or any 
 other possession, he at once offers to make you a present of it. Now, 
 we in Utah have a very ardent admiration for a certain strip of land 
 lying betwen our southern boundary and the Colorado River. If I am not 
 mistaken, we have occasionally given audible expression of this admira- 
 tion within the hearing of Arizona, but the 1914 maps show that this 
 strip is still a portion of the state of Arizona. Of course, it is not for 
 us to find fault with our neighbor for not having adopted the South Amer- 
 ican standard of hospitality. If she had, we should be under the painful 
 necessity of becoming equally polite, and declining the proffered gift 
 with thanks, and then we would be right where we are now. But I think 
 
AMERICAN MINING CONGRESS 23 
 
 Utah long ago learned to keep the commandment, "Thou shalt not covet 
 thy neighbor's Arizona strip." And so we are the best of friends, not- 
 withstanding the fact that we are such near neighbors, which I have ob- 
 served is not always conducive to close friendship. But all these moun- 
 tain states are coming more and more to realize that state boundaries are 
 artificial boundaries, that their interests and their problems are identical, 
 and that they ought to join forces and work togther. 
 
 I have often heard of the wonderful Hassayampa River, of whose 
 limpid waters every loyal son of Arizona takes a drink, and thenceforth 
 never again speaks the truth. If we had a Hassayampa River in Utah 
 there might be some advantage in coming so late on the program of these 
 responses, because one would know by that time how hard to boost in 
 order to make one's own state look more important than all the rest as a 
 mineral producer. However, not having the benefit of the magic waters. 
 I must confine myself to the literal truth. With becoming modesty, I 
 shall neither attempt to catalog Utah's mineral resources in detail, nor 
 give you any of that keen delight which conves from listening to a lot 
 of statistics. 
 
 So I will put it mildly and say that Utah has gold enough to pave 
 the streets of the New Jerusalem. She has silver enough to put an appro- 
 priate lining on every cloud, be it political, industrial, financial or other- 
 wise. She has copper enough to make all her rival states turn green with 
 envy. Perhaps that is putting it pretty strong when we go up against 
 Arizona, but then, copper is a white elephant just now anyway, and the 
 people who have copper are to be pitied rather than envied, so we will 
 let that pass. 
 
 Utah has so much lead that its very weight keeps her from rising to 
 an eminence beyond the view of ordinary states. She has a whole county 
 full of iron, that has not been touched, and that will some time make 
 her the Pennsylvania of the West. She has coal galore; and I want to 
 tell you right now that nobody need worry about this old world running 
 short of fuel, so long as Utah is on the map; and we have no immediate 
 intention of getting off the map. Our hydro-carbon deposits are stu- 
 pendous, and are growing into a very important industry. These and 
 countless other resources have scarcely been scratched, and we there- 
 fore feel that we are not over-sanguine when we expect some day to be 
 the very first state in mineral production, instead of the second, third or 
 fourth, or wherever we are placed now. 
 
 In ore-dressing and metallurgy, Utah is second to none, either in 
 magnitude of operations or in advanced methods. The immense concen- 
 trating mills of the Utah Copper Company, at Garfield, treating 20,000 
 tons of copper ore per day, are among the modern wonders of the world. 
 The smelters at Murray, Midvale, Garfield and Tooele are among the 
 largest and most up-to-date that have ever been built. The cyanide pro- 
 cess, which has revolutionized gold mining, had its first successful Ameri- 
 can application in Utah. Vacuum slime filtration, which subsequently 
 revolutionized the cyanide process, and vastly broadened its scope, was 
 invented in Utah. And now we are coming along with a new method of 
 chloridizing roasting, by means of which siliceous gold, silver and copper 
 ores are treated with remarkable cheapness. This promises to rank as 
 another great metallurgical achievement. 
 
 In short, Utah mines have contributed liberally to the world's wealth, 
 and Utah men have contributed liberally to mining science and to the 
 store of human knowledge. I thank you. (Applause.) 
 
 THE PRESIDENT: All the wealth of our mines would not avail us 
 very much if we had not somebody to buy our products, and I am going to 
 call on Mr. H. C. Holthoff of Milwaukee to tell us what the great state of 
 Wisconsin thinks about the mining business. 
 
24 OFFICIAL PROCEEDINGS 
 
 i 
 
 MR. HOLTHOFF, of Wisconsin: Mr. President and members of the 
 American Mining Congress: I did not come prepared to make a speech. 
 About all I can say is that the state of Wisconsin appreciates the hearty 
 welcome we have received at the hands of the state of Arizona and the 
 city of Phoenix, and to express the hope that the session of this Congress 
 may result in material benefit to the mining industry. (Applause.) 
 
 THE PRESIDENT: When we speak or think of Texas we have in 
 mind a long-horned Texas steer or the large grain and cotton fields of 
 that state. But Texas is also a great mineral state, as many of us know, 
 and Dr. Wm. B. Phillips can tell more about it than all of us put together, 
 because he is making a study of it and I am going to call on him to tell 
 us what his discoveries are. 
 
 MR. PHILLIPS, of Texas: Mr. President and Members of the Ameri- 
 can Mining Congress: I am always prepared to make a speech. I am 
 very much obliged for the opportunity. (Laughter.) But I feel so in 
 the dark. This is the first time I have ever had the pleasure of ad- 
 dressing an audience composed largely of ladies and being unable to 
 say "My fellow citizens." 
 
 I am reminded of a famous speech that was delivered in the city of 
 Louisville, Kentucky, some years ago. At a great banquet there a silver- 
 tongued speaker was asked to respond to a toast to Woman, and every- 
 body expected a magnificent speech, because he was a splendid orator. 
 He rose and waited until there was complete silence, and raised his glass 
 and said, "Here is to woman, may God bless her. Formerly our superior, 
 now our equal." (Laughter.) 
 
 I wish to express, on behalf of Texas, our appreciation of your most 
 cordial welcome and generous hospitality on this occasion. I cannot 
 come West, into this part of the country, without feeling the greatest 
 obligation to Arizona and Phoenix for the affectionate and whole-souled 
 character of their hospitality. Together, I think Arizona and Texas could 
 rule the world. You have enough gold and silver in Arizona to pay off 
 the national debt; we have enough iron to run the furnaces of the world 
 for a thousand years; you have enough copper to copperplate the sun, 
 moon and stars and all the other flag stations of the Universe. (Laugh- 
 ter.) We have enough coal to melt all the Antarctic ice, and we have 
 enough oil to lubricate the wheels of time and to grease the mills of 
 the gods that are said to grind so slowly; we have enough natural gas 
 in that state and some out of it just now to melt the whole world and 
 leave of it only a pile of sinter surmounted by a salamander solemnly 
 waving its tail and calling for enchiladas and tobasco sauce. 
 
 When one gets to speaking about Texas he speaks for three weeks. 
 I have never seen a man from that state, even if he had only passed 
 through the state, who had any sense of time whatever when he began 
 to speak about Texas. But I will not tire your patience. I would, how- 
 ever, invite you to come over into the state of Texas at any time; and, 
 speaking of latch-strings, we haven't any. We took the door down long 
 ago and threw it away. 
 
 Some time ago there was a killing in our state a very rare occur- 
 rence (Laughter) and when we are so fortunate as to have the same 
 law in Texas as you have in Arizona of course there will not be any 
 killings at all. The man charged with the murder consulted his attorney 
 and wanted to know what on earth he should do. "Well," he said, "you 
 haven't any case at all. You had better get out of here." "Well," said 
 the client, "I would like to know where I am going. Ain't I in Texas 
 now?" (Laughter.) He came to Arizona, and would have been here 
 now but for the fact that the rumor of prohibition reached him in time 
 and he went back home. (Laughter and applause.) 
 
AMERICAN MINING CONGRESS 25 
 
 THE PRESIDENT: Very few of us know that Florida does anything 
 else but grow grape fruit and oranges, but it has some phosphate mines, 
 and therefore is a mining state. Florida is ably represented here by Mr. 
 F. E. Marriner, who will respond on behalf of that state. (No response.) 
 
 Is there any other state represented here which has not been called 
 upon. If so, will the gentleman please rise and be heard from? (No 
 response.) 
 
 There doesn't seem to be. I have called on thirteen states. Thirteen 
 is my lucky number, and I hope that it may be an omen of the success 
 of this meeting. 
 
 I want to make one announcement before we proceed, namely, that 
 the meeting at the Woman's Club that was called for 7:30 has been post- 
 poned to 8:30, I presume to afford additional time for primping, so don't 
 be one hour too soon. 
 
 MR. JOHN W. FOSS, of California: Mr. President, I move that a 
 committee be appointed to formulate a response to the letter from the 
 President of the United States. 
 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT: I will appoint the committee later. 
 
 SECRETARY CALLBREATH: The committee on resolutions is 
 made up of one member from each of the states represented in the con- 
 vention, chosen by the members of the delegation present. This plan is 
 followed so that the control of the resolutions committee may be entirely 
 removed from the management of the Mining Congress, in order that the 
 resolutions may thoroughly and fairly represent the sentiment of the 
 delegates. Will you kindly, therefore, assemble your state delegations 
 sometime this afternoon or evening, or at least before the opening session 
 tomorrow morning, so that at the opening of the meeting tomorrow morn- 
 ing as the states are called you may make response nominating the per- 
 son whom you expect to serve upon the committee on resolutions. 
 
 I might say that heretofore the responses to the addresses of welcome 
 by the various states have taken so much time when notice was given 
 to those who were to be asked to speak that it was thought better this 
 time not to give notice. 
 
 THE PRESIDENT: On the committee suggested by Dr. Foss I will 
 appoint Dr. John W. Foss, Mr. Geo. H. Dern and Mr. J. F. Callbreath to 
 draft a letter to President Wilson in reply to his communication read here 
 this afternoon. Is there any other matter to come before the Congress 
 now? If not, we will take an adjournment. 
 
 The following telegram was sent to President Wilson: 
 
 The President, the White House, Washington, D. C.: 
 
 Sir The American Mining Congress, in Seventeenth Annual Session 
 assembled at Phoenix, Arizona, gratefully acknowledges your kind letter 
 of greeting and encouragement. We especially appreciate your deep in- 
 terest in the movement to reduce the hazards and the waste in the mining 
 and mineral industries of this country; and the members of the Mining 
 Congress pledge you their hearty co-operation in carrying forward the 
 great movement looking to the accomplishment of these purposes. 
 
 We respectfully ask your further aid in securing the enactment of 
 such much needed legislation as will make effective the yet unfulfilled 
 pledges of the majority party given in its last national platform and 
 often repeated, looking to a proper enlargement of the now inadequate 
 work of the national government for increasing safety and efficiency 
 and for the general advancement of mining as one of the nation's two 
 great foundation industries. 
 
 CARL SCHOLZ, President. 
 
 December 7, 1914. J. F. CALLBREATH, Secretary. 
 
 Meeting adjourned. 
 
2S OFFICIAL PROCEEDINGS 
 
 EVENING SESSION. 
 (At the Woman's Club Building.) 
 
 8:30 p. m. Meeting called to order by Mr. Power Conway. President 
 Carl Scholz was presented and delivered the President's Annual Address, 
 which will be found at page 129 of this report. After the address the ladies 
 of Phoenix tendered a delightful reception to the officers and delegates. 
 
 TUESDAY, DECEMBER 8, 1914. 
 Morning Session, 9:30 O'clock A. M. 
 
 THE PRESIDENT: The first thing in order is the reading of the list 
 of members of the Resolution Committee, and the secretary will call the 
 roll of members of the different states, which will respond by giving the 
 names of their respective members of that committee. 
 
 The Committee on Resolutions. 
 
 Arizona Norman Carmichael 
 
 California Seeley W. Mudd 
 
 Colorado W. G. Swart 
 
 Florida F. E. Marriner 
 
 Idaho Harry L. Day 
 
 Michigan R. C. Allen 
 
 Missouri Charles W. Burgess 
 
 Mississippi F. G. Jewett 
 
 Montana D. McKenzie 
 
 New Mexico Rees H. Beddow 
 
 New York J. R. Burton 
 
 Nevada L. A. Friedman 
 
 New Hampshire C. M. Donohoe 
 
 Oklahoma D. C. McAlpine 
 
 Pennsylvania W. V. Rudderow 
 
 Texas S. H. Worrell 
 
 Utah Imer Pett 
 
 Wisconsin H. C. Holthoff 
 
 THE PRESIDENT: The report of the committee on Taxation of 
 Metalliferous Mines will be presented by Mr. D. L. Webb of Denver, 
 chairman of the committee. 
 
 MR. WILL L. CLARK, of Arizona: Mr. President, so far as I know, 
 I am the only member of the committee present. Mr. Webb has asked me 
 to present the report, and I have a word of explanation to make. As is 
 common in these Mining Congress committees, unless the committee is 
 continued for several years and it has an opportunity to meet at the 
 convention, a new committee like this usually does not have any meeting 
 at all. I have had some correspondence with Mr. Webb, who has taken 
 the suggestions made by the members of the committee and endeavored 
 to embody them in the report. For that reason this report is not alto 
 gether satisfactory either to Mr. Webb or to myself, but in order to bring 
 up the discussion we thought best to present it. Yesterday afternoon I 
 was given the proof of the report. As it is quite long I will not attempt 
 to read it at this time, because it has been printed. I will send up the 
 report. I suppose after any discussion that may come up it will then 
 be proper to determine what shall be done in regard to its adoption, so 
 I will not now make any motion to that effect, but if desired, it may be 
 referred to the Committee on Resolutions. 
 
 SECRETARY CALLBREATH: Some members of the convention do 
 not seem to have copies of the report. There are plenty of them ready 
 for distribution in the rear of the hall. 
 
AMERICAN MINING CONGRESS 27 
 
 THE PRESIDENT: Mr. Thomas E. Campbell will lead the discussion 
 on this paper under the five-minute rule. 
 
 SECRETARY CALLBREATH: Before proceeding, may I suggest 
 that that five-minute rule be disregarded in this instance? I do not think 
 that it is possible for any one to discuss a question so large as the ques- 
 tion of taxation in five minutes, and I would suggest that a more extended 
 time be allowed. 
 
 MR. BERN: If the members are expecting to discuss this paper it 
 seems to me it would be a good idea to have it read so that we may have 
 some knowledge of the subject before the discussion begins. A printed 
 copy has just been handed to us and nobody has had a chance to read it. 
 
 THE PRESIDENT: The purpose of distributing the copies in ad- 
 vance was to give a chance for everybody to inform himself; but if it 
 is deemed desirable to do so it will be read. 
 
 SECRETARY CALLBREATH: The report was agreed upon so late 
 that this is the earliest possible moment we could have it printed. 
 
 A DELEGATE: Mr. President, I move that the report be read. 
 
 (Motion seconded and carried unanimously.) 
 
 (The report was thereupon read by the secretary, and is as follows:) 
 
 Report of Committee on Mine Taxation. 
 
 Denver. Colorado, Dec. 7th, 1914. 
 Mr. Chairman and Members of The American Mining Congress: 
 
 Gentlemen: The Committee on Mine Taxation of the National Tax 
 Association, in reporting to the Association's meeting, held at Buffalo in 
 October, 1913, said: 
 
 "The subject submitted to the committee is an exceedingly complex 
 one, and on many of the phases the committee feels the need of longer 
 time for study and investigation. For that purpose it is recommended 
 that the committee be continued." 
 
 It appears that the action heretofore taken by the American Mining 
 Congress as such, and by its individual members in their respective local- 
 ities, has begun to bear fruit; and has resulted, at least, in persuading 
 the members of the National Tax Association, as well as the various as- 
 sessors and tax commissioners who are members thereof, that the taxa- 
 tion of mines is a subject worthy of careful consideration, having its own 
 peculiarities, requiring special treatment and of sufficient importance to 
 justify a standing committee. 
 
 It is the belief of this committee that mining claims, for taxation 
 purposes, may always be safely divided into two distinct classes, i. e., non- 
 producing mining claims and producing mining claims. 
 
 Non-Producing Claims. 
 
 No matter for what reason a mining claim may be non-productive, it 
 should be classed as a non-producing mining claim, and no value at- 
 tached for taxation purposes, by reason of the existence of known mineral 
 contents, unless that mineral is being actually marketed at a profit. 
 
 The Legislatures of different states have shown surprising variations 
 when guessing (it can be termed nothing else) at the value of non-pro- 
 ducing mining claims for taxation purposes; for instance, in Montana 
 non-producing mining claims are assessed at a value of $5 per acre, while 
 in Nevada they are assessed at $50 per acre, and in another state, under 
 the tax law, it is provided that the non-producing claims, when owned by 
 
28 OFFICIAL PROCEEDINGS 
 
 a corporation, may be assessed at a value represented by the capital stock 
 of the corporation. 
 
 One of the members of this committee, in a paper submitted at the 
 last convention of The American Mining Congress, suggested that the 
 proper criterion for the assessment of non-producing mining claims was 
 the price at which the Federal Government sold the ground to the pat- 
 entee, to-wit: $5 per acre; and submitted the query that if this was not 
 proper, in fact the only, criterion of the value of such ground, then what 
 was? This committee has neither seen nor heard a direct answer to this 
 query; but the committee of the National Tax Association, above referred 
 to, did say: 
 
 "The mineral content and value of unexplored and undeveloped ore 
 bodies, patented mines and mining claims, is frequently so uncertain that 
 for this class of property there is ample justification for conservative 
 treatment, and even for postponing the full possible claim of the state 
 until actual knowledge of the situation can be obtained." 
 
 Along this same thought the committee notes an expression in the 
 report of the Wisconsin Tax Commission for 1910, where it is stated: 
 
 "It would be more logical and tend to better administration if the 
 lands (non-producing mining claims) were assessed without regard to the 
 minerals." 
 
 This committee appreciates that non-producing mining claims ought 
 to be assessed and a reasonable tax collected therefrom; but since no 
 man can tell whether a non-producing mining claim is of any value, until 
 actual operation begins, it submits that the only fair and reasonable rule 
 is as follows: 
 
 "Non-producing mining claims should not be assessed upon a value 
 higher than adjacent land, not assessed for mining purposes, is as- 
 sessed." 
 
 Producing Mining Claims. 
 
 It is safe to say that the producing mining claims will pay the great 
 bulk of the mining taxes in any state, wherefore this committee has de- 
 voted more attention to the question of the proper basis of taxation of 
 producing than of non-producing mining claims. There appears to be two 
 well denned theories for the taxation of producing mining claims. One, 
 an ad valorem tax, and the other an income tax. 
 
 This committee is firmly of the opinion that a tax upon the net in- 
 come of producing claims, is the only method which is fair to the state, 
 in the first place, to the mining industry, in the second place, and be- 
 tween the various producing claims of a state or district, in the third 
 place. 
 
 The vices of the ad valorem system of taxation of mining claims be- 
 come apparent upon a superficial study of the subject, and become ex- 
 pensive and disagreeable realities wherever and whenever the system 
 is in vogue. 
 
 The State of Michigan, when putting a system of taxation of mines on 
 an ad valorem basis into operation, went so far as to employ a very com- 
 petent engineer to make an appraisal of the value of the mines and min- 
 eral lands within each taxing district. This was an attempt by that state, 
 of course, to operate the ad valorem system upon as fair a basis as was 
 possible to the state and the mining industry. The value of the mines 
 to be taxed upon that system was calculated upon the following main 
 factors : 
 
 A. Ore reserves. B. Average annual production. C. Cost of pro- 
 duction. D. Average price to be obtained for product. E. Average an- 
 nual profit, and, F. Rate of interest or value of money. 
 
AMERICAN MINING CONGRESS 29 
 
 It would seem, at first blush, that the factors taken into considera- 
 tion ought to result in a proper valuation of the mines for taxation pur- 
 poses; but that such uncertainties as would render the system impracti- 
 cable for taxation purposes were bound to obtain have been very closely 
 demonstrated in a recent scholarly article by Mr. Heath Steele, of New 
 York, who says: 
 
 "No one can dispute that a stated annual income for a certain num- 
 ber of years has a present value easily determined at a fixed rate of in- 
 terest. If this were all for a correct appraisal, I should not question the 
 fairness of this system of taxing. But as my idea of the principle in- 
 volved requires a system which takes from each in the same proportion, 
 there must be no liability of error in the method of assessment. Working 
 from this point of view, let us take up each main factor as previously 
 stated. 
 
 "A To arrive at the amount of ore to be considered in an ap- 
 praisal of this kind we must not only consider fully developed ore but 
 all indications for further extensions of ore bodies beyond mine openings. 
 Here we run into difficulties much greater than are encountered in meas- 
 uring developed ore. The developed ore factor is more or less approxi- 
 mate, but estimates of further extensions are bound to vary greatly from 
 fact. However, these are not the only obstacles in the way of a correct 
 statement of ore reserves. The average content of valuable minerals is 
 a very difficult factor to determine correctly for a large ore reserve and 
 is in most cases a guess, regardless of elaborate sampling and inferences 
 that may be drawn as to the uniform contents within certain blocks. 
 The best we can do is to concede that the ore reserve factor is an esti- 
 mate consisting of two basic factors, both of which may be wrong. 
 
 "B The factor of average annual production not only serves to de- 
 termine the length of life but the average annual profit. If the rate of 
 production is greater than estimated the profit will be more or vice 
 versa. B. is dependent upon A. and is subject to the errors of A. 
 
 "C The cost of production may be closely estimated. I say esti- 
 mated because no matter how much of a record one may have to judge 
 from, future expectations in connection with costs are no more infallable 
 than the assumption of the ore reserve factor. This is particularly true 
 where metals of changing value are involved, for, granting the cost per 
 ton of ore is the minimum, a lowering of the grade of metal content will 
 increase the cost of the metal. 
 
 "D The factor of average price to be obtained for the product is 
 a presumption and nothing else. One man's judgment may be better 
 than another's because he has studied the supply and demand and is 
 conversant with all market governing factors, but we cannot grant him 
 the powers of a true prophet. 
 
 "E This factor, the average annual profit excepted, is the sum of 
 all the errors of A., B., C. and D.,, all of which will reflect in the profit. 
 If the average price to be received for the product is a correct assump- 
 tion, so far as it relates to the average price for the whole period, the 
 average annual profits may be the sum estimated. But the present value 
 obtained by this calculation and the present value that may be obtained 
 at the exhaustion of the mine with the actual annual earnings as a basis 
 will hardly be the same. This is particularly true with the metals that 
 fluctuate widely in price. If, during the first half of the operating period, 
 the price of metal should be lower than the average used, the actual 
 present value of the property will be less than estimated. If higher 
 prices are secured the value will be raised. A fair check will only be 
 made when a practically uniform price prevails or the highest prices are 
 received during the middle of the period. 
 
30 OFFICIAL PROCEEDINGS 
 
 "F The rate of interest is a factor that may be adjusted to suit the 
 individual in private work. For taxation purposes the worth of money 
 is a debatable question, but a rate should be used that will represent the 
 actual earning^ power of the money without special effort. If the busi- 
 ness is hazardous, all factors of safety will properly have been provided 
 in the basic factors. 
 
 "Here it is shown that the only calculation involved in mine ap- 
 praisal for which we can absolutely vouch as being correct is the de- 
 ferring of the expected annual income at a fixed rate of interest. We 
 may have errors in each of the five main factors together with those 
 in the basic factors of which they are composed. I do not think that the 
 most ardent advocate of mine taxation on a valuation basis will, if he con- 
 siders the presumptive character of the data necessarily involved, con- 
 tend that an equitable distribution of tax burdens can be accomplished 
 by this method. It is impossible to value any mine correctly until it has 
 been worked out, therefore, if we attempt to value a number of mines 
 in a taxing district some will surely be assessed too high and some too 
 low." 
 
 It is because of those things pointed out by Mr. Steele that such 
 great students of taxation as Professor Skelton of Queen's University, 
 Kingston, Ontario, has said: 
 
 "The positive reason for preferring the tax on the output is its 
 greater certainty. Any estimate of the value of the minerals in the 
 ground must, it is felt, contain a large element of guess work diligent 
 and scientific guess work it may be, but guess work still." 
 
 and Professor Edward A. Seligman, McVickar Professor of Political 
 Economy of Columbia University and President of the National Tax As- 
 sociation 1913-14, said: 
 
 "The difference between the earnings system' and the ad valorem 
 system is the difference between publicity and secrecy, between certainty 
 and arbitrariness, between simplicity and complexity, between precision 
 and guess-work in short, between modernism and medievalism. 
 
 "If, then, the earnings tax is to be preferred to the ad valorem tax, 
 the question remains, Shall it be gross earnings or net earnings? As a 
 matter of principle it is conceded by all writers that net earnings ap- 
 proach more closely to the ideal method." 
 
 If, then, an ad valorem system of taxation of producing mines is 
 wrong and the experience of mining men, tax experts and college pro- 
 fessors who have made it a special study, to say nothing of the practical 
 demonstration of it when in operation, all show it to be wrong then 
 there remains but one other method for the taxation of producing mining 
 claims, to-wit, a tax upon income. 
 
 The first question to be determined upon a tax upon income is 
 whether the whole or any portion of the gross production should be in- 
 cluded in the valuation of the mine for taxation purposes. 
 
 There is no question in the minds of this committee that no portion 
 of the gross should be included; and the point may be illustrated by the 
 existing conditions in Colorado and Arizona; such being, we believe, fair 
 examples of the results obtained and to obtain wherever the gross pro- 
 ceeds are considered in valuing a mine for taxation purposes. 
 
 The Colorado law provides that one-half of the gross plus all of the 
 net shall be the value of the producing mine for taxation purposes. A 
 couple of very extreme examples will illustrate the possibilities of this 
 law in its operation, as between producing mines under differing condi- 
 tions; for instance: 
 
AMERICAN MINING CONGRESS 31 
 
 First Extreme: Mine A. B. produced $100,000 gross in given year; 
 its entire expense was $1,000; its net therefore is $99,000. Its tax value 
 therefore would be calculated thus: 
 
 1/2 Gross $ 50,000 
 
 All net 99,000 
 
 Tax value $149,000 rate 3% $4,470. approx. 4%% of net. 
 
 Seond Extreme: Mine C. D. produced $100,000 gross in a given year; 
 its entire expense was $99,000; its net therefore is $1,000; its tax value 
 therefore would be calculated thus: 
 
 % Gross $ 50,000 
 
 All net 1,000 
 
 Tax value $51,000 rate 3 % $1,530. 153% of net. 
 
 Of course no mine producing $100,000 gross per year is going to have 
 either $1,000 or $99,000 net, but some figure between these extremes; 
 however, it is a simple calculation to demonstrate what two mines pro- 
 ducing $100,000 gross per annum, one with a net of $50,000 and the 
 other with a net of $25,000, will have a differential running against the 
 mine with $25,000 net (on a 3% rate) of approximately 50%. 
 
 In fact, in a recent case decided by the District Court of Teller 
 County, Colorado, the actual disparagement existing between two well 
 known mines, are shown in the words of the court, as follows: 
 
 "By way of illustrating the inequality resulting in this case, I call 
 attention to the following: 
 
 "It is shown by the evidence that the Cresson Company's gross pro- 
 ceeds for the year 1913 were $537,603.58; its net proceeds $373,140; 
 assessment under the Act 1913, one-half gross proceeds plus net, $641,- 
 941.79. The Portland Company's gross proceeds for the year 1913 were 
 $862,642.34. Its net proceeds, $315,160; assessment under the Act 1913, 
 one-half gross proceeds plus net, $746,481.17. It will be noted that the 
 gross proceeds of the Portland exceeds those of the Cresson Company 
 by over $325,000; that the net proceeds of the Cresson Company ex- 
 ceeded those of the Portland by nearly $58,000, while the Portland was 
 assessed under the Act of 1913 on over $104,000 more than the Cresson. 
 Such gross inequality as the above cannot be avoided if the Act of 1913 
 is to be upheld as a valid exercise of the legislative power. It is mani- 
 festly arbitrary and unjust, and lacking in the uniformity required by the 
 constitution." 
 
 The same results in a lesser degree must obtain in Arizona, where 
 the law provides for the valuation of a producing claim for taxation pur- 
 poses upon a basis of 12%% of the gross plus four times the net, using 
 the same extreme examples that were used to illustrate the Colorado 
 situation, it will be found that the mine with $99,000 net will pay a tax 
 equivalent to 12%% of its net; and a mine with $1,000 net will pay a 
 tax equivalent to 50% of its net; and in the examples illustrating the 
 Colorado difference between the mines with a net of $50,000 and $25,000 
 there will be a differential against the mine with a $25,000 net of ap- 
 proximately 8%%. The reason, of course, that there is not such a 
 difference between the $50,000 net and the $25,000 net mines in Arizona, 
 as there is in Colorado, is because in Arizona only 12%% of the gross 
 is used for valuation purposes. That the Colorado law works out as 
 illustrated in the above examples and in the Cresson-Portland case, is 
 verified by the fact that in the year 1913 the gross production of the 
 Colorado metal mines was $35,450,585 (U. S. Geol. Sur., 1913, p. 227). 
 While metalliferous mining properties were assessed for the same year 
 $46,042,047 (Colo. Tax. Com. Rept, 1913, p. 129). Thus it will be seen 
 
32 OFFICIAL PROCEEDINGS 
 
 that the metalliferous mines of Colorado paid taxes on approximately 
 $10,600,000 more than they made in the year 1913. 
 
 Not only do states, which provide for the assessment of all or a 
 portion of the gross and all or more of the net, offend man's natural 
 sense of right and justice, but they likewise offend two fundamental 
 principles of law concerning taxation which have been written into most 
 if not all of the! constitutions of the various states of the Union. These 
 constitutional provisions vary in their terms, but the sense of them is 
 the same and the following excerpts from a state constitution will serve 
 to illustrate the principle that is written into most of them. 
 
 (a) "All taxes shall be uniform upon the same class of subjects 
 within the territorial limits of the authority levying the taxes. 
 
 (b) "All taxes shall be levied and collected under general laws 
 which shall prescribe such regulations as shall secure a just valuation 
 for taxation." 
 
 The lack of uniformity required by such constitutional provisions, 
 the gross inequality inhibited, and the absurdity of such a system of 
 taxation are all at once manifest from the above examples. 
 
 Everyone knows that uniformity in taxation implies equality in the 
 burden of taxation, and that all taxes must be uniform on the same 
 class of property within the jurisdiction of the authority levying and 
 collecting taxes and that this uniformity must be such as to result in 
 equality of the burden. 
 
 There can be no claim of uniformity or equality where a profitable 
 mine pays taxes at the rate of 4*% of its net, and an unprofitable mine 
 pays taxes at the rate of 153% of its net. 
 
 Not only this, but it will be readily seen that a system which taxes 
 both gross and net must of necessity result in a double taxation. For 
 instance, where the taxing scheme is to tax one-half the gross, plus all 
 of the net, then one-half of the net is twice taxed, i. e., first, when it is 
 taxed as net, and second, when it is taxed as a portion of the gross. 
 
 The same Committee of the National Tax Association in thei report 
 say: 
 
 "We are opposed for the class of mines now under consideration to 
 the so-called gross and net methods of taxation. Gross income bears 
 no uniform relation either to net income or to value. A mine with a 
 gross income in any year 5 of $100,000 may have lost money and have no 
 more ore to mine, or it may have made $50,000 and have thirty such 
 years to look forward to in the future, or it may have made $10,000 net 
 and have five years of similar business to look forward to in the future. 
 With mines of very short life the gross income method tends to make 
 the tax excessive. With mines of long life and relatively low cost of 
 production, the method tends to yield an insufficient tax. As between 
 mines, it is almost always unjust and unequal." 
 
 CONCLUSIONS. 
 
 If this committee is right in its conclusions that an ad valorem 
 system of taxation is not applicable to the mining industry from any 
 angle; and that an income tax, which includes any portion of the gross, 
 is wrong for the reason assigned; then it remains only to determine 
 what is a proper system of taxation on the net alone. 
 
 Upon this question men may conscientiously differ a great deal. 
 This committee feels, however, that a few salient principles for such 
 taxation will be accepted as fair to all concerned, i. e. : 
 
 (a) That a uniform system for determining what is meant by the 
 term "net proceeds" should be adopted by the law making power. 
 
AMERICAN MINING CONGRESS 33 
 
 This is a principle which, following the Interstate Commerce Com- 
 mission, has been written into the laws of many of our states that have 
 provided Public Utility Commissions. These commissions are required 
 to adopt uniform systems of accounting, so that the amount earned by 
 each public utility in the state may be shown. There seems no good 
 reason why a uniform system of accounting cannot be prescribed for the 
 various mines of a state. 
 
 (b) That if a tax upon the net proceeds only of mines of a state 
 would be insufficient to produce the revenue necessary for the state's 
 purposes, or to produce that necessary revenue would run the rate of 
 taxation inordinately high, then a fair system of capitalizing the net 
 proceeds at a figure which, at the prevailing rate of taxation would pro- 
 duce the required revenue, would be a proper system. 
 
 Respectfully submitted, 
 
 D. L. WEBB, Chairman, 
 
 L. A. YOUNG, 
 
 H. A. E. CHANDLER, 
 
 JOHN WELLINGTON FINCH, 
 
 WILL L. CLARK, 
 
 Committee. 
 
 THE PRESIDENT: I am very glad this paper was read, because I 
 think we have all gotten a clearer idea than we would have had without 
 reading it, and we are now going to discuss it, and I am going to ask 
 Mr. Campbell, who is a member of the new State Tax Commission, to 
 come upon the platform to lead this discussion. 
 
 MR. CAMPBELL, of Arizona: Mr. President and Gentlemen of the 
 American Mining Congress: I feel highly complimented by being called 
 upon to lead this discussion, and in fact until yesterday about noon 
 time I did not know that the honor was to be conferred upon me. The 
 result is that I have made absolutely no preparation. It is a question 
 upon which so many mine owners and mining organizations and tax 
 official differ that I think the discussion should be, as -much as possible, 
 informal. Now, as has been well said by our good Secretary, you cannot 
 get very far into the discussion of taxation in five minutes, and in fact 
 we have discussed matters of much minor importance and it has taken 
 us a week and then we didn't get anywhere. The result will be that in 
 the few minutes allotted to me on this question I am going to confine 
 myself to the particular phases and principles of taxation which are 
 represented by the report before us at this time. There are just twc 
 problems confronting us, namely, whether the mine shall be assessed 
 on the ad valorem system or the old general property tax system, or upon 
 the so-called net production system. The argument as presented by the 
 report which has been read is, I think, very worthy so far as it treats 
 of the assessment upon the gross or net profit, but when it refers to the 
 question of the ad valorem tax, particularly with reference to the Michi- 
 gan system, I feel that it does not go sufficiently into the fundamental 
 principles of ad valorem taxation. I feel, likewise, that it does not go 
 sufficiently into the application of that tax as it is applied in Michigan, 
 so that you do not by the report get exactly the true conditions. The 
 question of taxation upon net results is, of course, absolutely that of 
 an income tax. Now, very few states in the Union which apply taxes 
 of this kind are in a position to apply any income tax. Arizona and I 
 speak of local conditions because I am more familiar with them is 
 blessed in the fact that it can apply any sort of a tax that can get the 
 money; in fact that has been our past experience; so that it could apply 
 here. However, in treating the question as to the relative merits of 
 these two systems I am quite as much at sea as many of you are, not- 
 withstanding I have given this question considerable thought and study 
 
34 OFFICIAL PROCEEDINGS 
 
 and have discussed it with a great many men from all parts of the state 
 and with economists from all over the country. The reason is owing 
 to the particular class of property with which you are dealing. Another 
 reason is comparing its income or its revenue produced for the benefit 
 of the state with other classes of property, which fact must always be 
 borne in mind. In other words, fundamentally, our whole system of 
 taxation is built upon this plan the ability of the taxpayer, or the 
 property, if you please, to pay its proportion of the burden of taxation, 
 and that is fundamental in the application of the general property tax 
 as it is fundamental in the application of all classes of taxation under 
 our form of government. There are so many questions radiating from 
 the different points of view as to the application of this tax that it is not 
 altogether just a concrete case. You might say we apply this argument 
 to this particular class, but we will not make it local, but in the last 
 analysis it absolutely is local, my friends, and you all know that, so 
 that I am not prepared to say at this time that I favor the ad valorem 
 system of taxation or the application of the net income system of taxation 
 by special legislation. I have very decided views upon that question 
 which would embody the use of both or all factors entering into the 
 appraising of this or any other class of property. 
 
 Now you know that I was quite right when I said I had made no 
 preparation on this subject at all. I think probably I was called upon 
 at so late an hour in order to throw a sort of bomb into the proposition, 
 and if I have succeeded in that I feel that I have done well. As a mem- 
 ber-elect of the Tax Commission you will also appreciate the position 
 I occupy here in Arizona, not at this date having qualified in office, and 
 that I am in no position to speak for the commission upon this question, 
 which, no doubt, in its recommendations to the coming Legislature, so 
 far as Arizona is concerned, will have considerable weight. Being more 
 or less of a quasi-judicial member of that commission, I am hardly in a 
 position to state, and in fact it would be indelicate for me to state, that 
 I believed as a commissioner that this or that tax is correct, so that you 
 will pardon my embarrassment at this particular time. 
 
 I do not know that I can say any more on the question at all that 
 will be of interest to you. I hope, however, Mr. President, that I may 
 have the privilege later on in this discussion of asking questions for 
 the purpose of getting light upon this subject, because it is the biggest 
 question that we tax men have to deal with in Arizona. 
 
 I thank you, Mr. President, and I thank you gentlemen of the Con- 
 gress for calling upon me to lead in this discussion. 
 
 THE PRESIDENT: We would like to hear from other members 
 on this subject of such great interest to all of us. 
 
 MR. HULL: Mr. President, in regard to the assessment of mining 
 property, we find that other people who have property have to be as- 
 sessed upon it, and I think that we should establish a uniform price 
 for the land. I believe there should be a valuation put upon it. When 
 it comes to the mining industry and the production of minerals the 
 assessment of the mines should be upon the net proceeds of the mines. 
 My idea is that there should be a value placed upon all lands that are 
 patented. I believe that if we undertake to levy taxes and assess only 
 upon the net proceeds of the mine the people around the country would 
 object to that and would down this institution. Let us get the people in 
 line and work for these things and make a reasonable assessment on 
 the land, because the farmer has to do the same. We have to work to- 
 gether, and the farmers have got to work with us instead of trying 
 to down the mining industry. They are the ones that depend upon us; 
 they depend upon what we are doing; they receive the benefit, and 
 every man in the United States receives the benefit from the remunera- 
 
AMERICAN MINING CONGRESS 35 
 
 tion that comes from these mines, even if there is no profit to the man 
 that is producing and working upon them. (Applause.) 
 
 THE PRESIDENT: Death and taxes are two things that none of 
 us can escape, so that we ought to have a very full discussion of this 
 subject. 
 
 MR. CAMPBELL: Mr. President, I do not want to be presumptions, 
 but inasmuch as there are two schools of thought on this matter, and 
 inasmuch as the committee has recommended the net income tax and 
 has made reference to the Michigan system, which is the pioneer in the 
 use of the ad valorem system, and inasmuch as we have Mr. Allen, their 
 mine appraiser, with us, I know we would all very much enjoy hearing 
 from him upon this question. (Applause.) 
 
 THE PRESIDENT: Mr. Allen is going to favor us with a discussion 
 of this matter. Will you please come forward to the platform, Mr. 
 Allen? 
 
 MR. R. C. ALLEN, Lansing, Michigan: With your permission, Mr. 
 President, I would prefer to speak from the floor. Being misled by your 
 sunny and semi-tropical climate, and induced by the attractions of your 
 beautiful valley, I went out last evening for a walk without an overcoat. 
 When I arose this morning I found that I had lost the use of my neck 
 and a part of one arm. Before I get through with this discussion per- 
 haps some of you will regret that I did not also lose the use of my 
 voice. 
 
 Before beginning this discussion I want to say most emphatically 
 that I am not an expert in matters of taxation, neither am I an econo- 
 mist. However, for the past three or four years it has been my good 
 fortune, or misfortune, as the case may be, to have had a part in the 
 administration of the Michigan ad valorem system of mine taxation. 
 After reading the report of this Committee, I have become somewhat 
 alarmed, for I had never before fully appreciated the precarious position 
 that I seem to occupy. In Michigan the general property tax extends 
 to mines, and we are required to assess mines on the full ad valorem 
 value, which is defined in law as the exchange value or sale value. In 
 the capacity of appraiser of mines I am required, under penalty of six 
 months in jail, to appraise these mines at not more nor less than what 
 they are worth! (Laughter.) I am now informed by this Committee 
 that it is impossible to do any such thing, so I hope you will appreciate 
 my anxiety to learn something about this question of how mines may 
 be taxed or rather how they may be appraised on the ad valorem basis. 
 
 Gentlemen, it seems to me that we will never make very much 
 progress toward a permanent solution of these questions of mine tax- 
 ation until there has been brought about a better understanding between 
 mining and other classes of people in regard to methods of assessing 
 mining property for taxation. You may be interested in a little bit of our 
 domestic history. The state of Michigan is a mining state. I think 
 that the value of our production exceeds that of Arizona. We have 
 about two hundred million dollars' worth of mining property, that is to 
 say, in deference to this report of the Committee, we think we have, and 
 that is what we appraise them at. For a great many years the subject 
 of mine taxation has agitated the people of Michigan. There is now and 
 always has been in Michigan, as in this and other states, a large class 
 of people who believe that the mining interests are not now and never 
 have been sustaining their just and due share of the tax burdens. So 
 far as Michigan is concerned, that belief was largely justified until the 
 state, through its Tax Commission, took charge of the assessment of 
 mining properties. We have now executed our fourth re-appraisal of the 
 iron mines and it must be said that the work of the Tax Commission 
 has gone a long way toward the solution of the problem of mine taxation 
 
36 OFFICIAL PROCEEDINGS 
 
 in Michigan. It has also resulted in a much better spirit between the 
 mining interests and the rest of the people, because the publicity given 
 to the methods of mine valuation has amounted to a campaign of edu- 
 cation. To the farmer, for instance, has been brought some of the im- 
 portant facts concerning the mining industry; these have carried con- 
 viction that the industrial difficulties in the mining communities are of 
 the same order as those which prevail among the farmers; and with 
 this interchange of ideas there has grown up something like an era of 
 good feeling. 
 
 Now, I hope that the American Mining Congress does not make any 
 definite expression concerning the report of this Committee. I believe 
 the subject is so large, that it has so many ramifications, that it is so 
 complex, and also in view of the fact that we will have only a few 
 minutes to- consider the report, and the further fact that the majority 
 of the delegates of this Congress are not here, that it will not be wise 
 for the few of us who are here to take any action in the matter. It 
 appears to me and we are talking informally here, I understand that 
 this report is really somewhat in the nature of special pleading. We 
 must of necessity look at the subject of mine taxation from the double 
 point of view of the mine operator or owner and of the other taxpayers ; 
 we have got to consider the position of the general taxpayer as well as 
 the position of the mine owner. I might say frankly that there are very 
 few mine owners or operators or professional men connected with mining 
 who would not agree at once with this Committee in their recommenda- 
 tion that the proper tax is the tax upon net earnings if we look at the 
 problem from the one viewpoint alone, considering merely the interests 
 of mining investors. But this organization exists for the purpose of 
 bettering conditions in the mining industry, and while we are trying to 
 do that spreading the Gospel as it were we should be willing also to 
 look at our problems from the popular standpoint, to be willing to co- 
 operate with the rest of the people in making conditions generally 
 better. Now in Michigan we think that anything that is good for the 
 mines is good for Michigan, and anything that is good for Michigan 
 ought to be good for the mining industry. Now many states, either from 
 necessity or through preference, are committed to the general property 
 tax. Michigan is one of them. It is not my intention to discuss the 
 merits or demerits of the general property tax, but that we have it and 
 cannot divorce it is the practical condition that confronts us. The 
 people of Michigan must be convinced that mining property is being 
 treated in exactly the same manner as all other property. Neither the 
 law nor the people can be satisfied with anything short of that. A tax 
 on production or a tax on net income does not, in Michigan, seem to 
 meet the conditions because it affords no means of tax equalization. 
 
 The history of our ad valorem tax dates from the year 1911. We 
 were then considering in the Legislature the wisdom of enacting a 
 specific tax on production a tonnage tax. The mining men of Michigan 
 have always fought any kind of tax based upon income or production 
 and it has been as consistently supported by the farming element. After 
 the matter was thoroughly discussed and threshed out in the Legislature, 
 as a compromise measure a bill was passed which directed and em- 
 powered the State Tax Commission to make an appraisal of the mines. 
 In order that the whole procedure might be divorced from local or 
 political influence or bias it was deemed advisable to secure for this 
 work an engineer and assistants who had no financial or political inter- 
 est in Michigan and consequently would not be liable to be prejudiced 
 in favor of the Michigan mines. 
 
 Inasmuch as the Michigan system has been summarily dismissed 
 in the report of the Committee on taxation of metalliferous mines I 
 should like to introduce at this point an explanation of this system as 
 applied to iron mines. It has not yet been extended to Michigan copper 
 
AMERICAN MINING CONGRESS 37 
 
 mines except as a test of the valuation made by the county Boards of 
 Supervisors. Such extension is, however, contemplated by the Board 
 of State Tax Commissioners. 
 
 The Michigan System of Iron Mine Appraisals. 
 
 The final results of the appraisal of iron mines for the purpose of 
 taxation are determined through the application of four distinct pro- 
 cedures. 
 
 First. It is the duty of the State Geologist and his assistant, who is 
 a competent mining engineer, to secure adequate information on which 
 to base the value of each mining property. To this end there is required 
 to be made by each mine operator an annual report to the Board of 
 State Tax Commissioners, as of date December 31st of the year pre- 
 ceding, comprising: (1) A detailed financial statement, duly executed 
 before a notary public, of the operations of each mine or mining property 
 owned, operated or controlled by him on forms officially designed for 
 the purpose, covering a period of the preceding five years. (2) The 
 financial statement is required to be supplemented by a complete set of 
 accurate mine maps showing each mine level, cross sections, records of 
 drill holes, pits, shafts, etc.; also a map showing the boundaries of 
 each property and the relation of the ore bodies to adjacent properties. 
 All maps, plats, records, etc., as are required are signed, dated and duly 
 executed by the operator or a responsible official of the company, as the 
 case may be, and form a part of the report of the operator to the Board 
 of State Tax Commissioners. 
 
 Second. The State Geologist and his assistant make an annual ex- 
 amination of the mines above and below ground for the purpose of 
 calculating ore reserves and obtaining such other data as may have a 
 bearing on values. When this is done the value of each property is 
 calculated by the appraiser through methods which will be explained 
 later. 
 
 Third. After the appraiser has calculated the value of each property 
 his findings are reported to the Board of State Tax Commissioners who 
 consider, with the appraiser, each of the several properties in detail and 
 take formal action on the figures recommended by the appraiser. 
 
 Fourth. The figures which are tentatively determined by the Board 
 of State Tax Commissioners are reported to the operators, who are 
 given an opportunity of appearing before the Board of State Tax Com- 
 missioners in a public hearing and submitting additional arguments or 
 information having to do with the value of their respective properties. 
 At the conclusion of these hearings the various properties are again con- 
 sidered in detail by the Board of State Tax Commissioners when the 
 final values for assessment purposes are fixed and reported to the as- 
 sessors of the various assessing districts by whom they are placed on the 
 tax rolls. 
 
 Theory and Method of Appraisal of Iron Mines. 
 
 Stated in briefest manner, the value of an iron mine is the present 
 worth of the sum of money representing the calculated difference be- 
 tween total receipts from sales of ore and the cost of marketing based 
 on the entire tonnage which the mine may be expected to produce. 
 This difference exceeds by a large amount the actual profit to the oper- 
 ators for it includes the items of royalties and makes no allowance for 
 sinking charges for general exploration which are necessarily large and 
 continuous in order that the industry may be sustained and perpetuated. 
 
 We have now to consider how the total expected profits, thus de- 
 fined, may be calculated. The calculation is the product of three factors, 
 viz: (1) Total tonnage of available ore; (2) average annual excess per 
 ton of receipts over actual cost of operation; (3) the present worth of 
 
38 OFFICIAL PROCEEDINGS 
 
 one dollar to be paid in equal annual installments for a period of years 
 equal to the productive life of the mine. The methods by which the 
 numerical value of these factors are determined are as follows: 
 
 1. The factor of tonnage. There is no general method or set rule 
 for measuring tonnage which may be applied indiscriminately to all iron 
 mines. It is necessary to adopt the method of calculation to the indi- 
 vidual property because of dissimilarities in the natural or geologic con- 
 ditions in the various mines and districts. The ore which is expected 
 to be realized is considered under two classes, the ore in sight and the 
 prospective ore. In the undeveloped properties much the greater part 
 of the ore must be considered as prospective pending the development 
 of the ore body by underground mining. The amount of developed ore 
 in the producing mines may be calculated with comparative ease, but 
 the amount of prospective ore must be determined in the judgment of 
 the appraiser by the use of principles of geologic and mining practice. 
 In nearly all of the mines there are certainties, probabilities and possi- 
 bilities for the occurrence of ore beyond that which is actually de- 
 veloped. As a matter of actual practice the amount of prospective ore 
 on which the mines are assessed for purposes of taxation exceeds the 
 total amount of developed ore. For instance, on January 1, 1914, there 
 were 81,261,238 tons of developed ore in the mines, to which was added 
 by the appraiser 116,208,087 tons of prospective ore. These figures do 
 not include 4,954,830 tons in stock on the same date which is treated 
 as developed ore but assessed as personalty in distinction from realty. 
 In estimating total reserves in a mining property the appraiser attempts 
 to ascertain the total amount of ore which may reasonably be expected 
 to be produced from the property. 
 
 2. The factor of profits. The term profits is here used to express 
 the algebraic difference between receipts and actual costs as above 
 defined. The actual cost and profit per ton is ascertained for each 
 operating mine from its actual operating financial record over a period 
 of five years preceding. By the use of the five-year period large fluctu- 
 ations in the total valuations on account of sharp annual variations in 
 costs and receipts have been eliminated. 
 
 It is obvious of course that an undeveloped property has no oper- 
 ating record from which profits may be calculated. For these properties 
 the expectations are measured by the experience of mines under oper- 
 ation under similar conditions in the district in which the undeveloped 
 property is located. 
 
 3. The life factor and interest rate. The product of total reserve 
 tonnage by a demonstrated, assumed or calculated profit per ton, ex- 
 pected to accrue from operation, is in most cases far in excess of present 
 value because the rate at which ore can be mined from a given property 
 is limited by both physical and market conditions. Only a fraction of 
 the total reserves are annually marketed and the income is therefore 
 realized in annual installments over a period of years as the ore is mined 
 and sold. The total value of an iron mine resides in the ore, and it 
 follows that when the ore is exhausted all assets are dissipated, except 
 of course the junk or second-hand value of the equipment and the value 
 of the land for non-mining purposes. An ore body in process of mining 
 is, therefore, a vanishing asset and the valuation of an iron mine in- 
 volves the determination of the present value of this asset. 
 
 The time or life factor must therefore be taken into account. The 
 productive life of an operating mine is in practice calculated as the 
 ratio of total ore reserves to the average annual shipment based on the 
 experience of the preceding five years. The life factor of an undeveloped 
 ore body is measured in the same manner on the assumption of an aver- 
 age shipment indicated by other developed properties in the same class, 
 
AMERICAN MINING CONGRESS 39 
 
 with proper allowance for the time necessary for development to the 
 producing stage. 
 
 After ascertaining the average annual installment of profits and 
 the number of such annual installments which is represented by the 
 number of years of productive life, the total is reduced to present worth 
 by the annuity method, using an interest rate of 6% for both principal 
 and sinking fund. In many cases the sum thus calculated is reduced by 
 a safety or hazard rate which varies from nothing up, according to the 
 actual hazards indicated by the physical condition of the property, state 
 of development, etc. 
 
 The above methods are applicable in general but are modified by 
 such considerations as are pertinent to certain individual cases. Such 
 modifications are applied in accordance with the judgments of the ap- 
 praiser and the Board of State Tax Commissioners. It will not be neces- 
 sary here to explain the multiplicity of cases which demand the appli- 
 cation of judgment involving departure from the general method set 
 forth above. 
 
 Since the Finlay appraisal of 1911 we have made three re-appraisals 
 of iron mines, and it seems now that Michigan is committed to the ad 
 valorem system of mine taxation. There is a class of people in Michigan 
 known as the Grange, a farmers' organization, who are attempting to 
 initiate a specific tax upon the production of the mines, but the members 
 of the Grange are among the strongest supporters of the ad valorem tax. 
 They say, "By all means let us have this ad valorem tax; it is a good 
 tax, and we want the mines to pay a tax on their ad valorem value; but 
 in addition to that we want them also to pay a surtax in the form of 
 a specific tax on production at a rate that will practically double their 
 taxes. In other words, we believe that a mining property should pay, 
 in proportion to its value, a double rate of taxation." That is the argu- 
 ment back of their campaign, and they are making it squarely and 
 openly. That is the condition the mines are facing today in Michigan, 
 and perhaps it constitutes one reason why the mining men of Michigan 
 are solidly back of the ad valorem system. 
 
 Now the statement is made here in the report of the Committee that 
 the ad valorem system of mine taxation in Michigan is wrong in theory 
 and has failed in practice. I would like to ask the Committee whether 
 they got this information from any organization of Michigan mining men 
 or from the Michigan State Tax Commission or from the Michigan 
 people, for the facts, I assure you, are quite the contrary. We do not 
 believe that the ad valorem is a perfect tax, but it has more nearly met 
 the conditions in Michigan than any other tax we have ever had, and 
 we have had some experience with the specific tax. 
 
 The position taken here (referring to report) by Mr. Heath Steele 
 and I notice he is quoted with approval by this Committee not only 
 magnifies the difficulties in arriving at an ad valorem value of a mine, 
 but also his argument is inconsistent all the way through. I wish to 
 make a few remarks on these various matters in the order in which he 
 has taken up the discussion. 
 
 We all know, of course, that it is ordinarily impossible for an en- 
 gineer or geologist or anybody else to closely approximate the amount 
 of prospective ore in a undeveloped mine; but there is a lack of clear 
 thinking as concerns the importance of this consideration in mine valu- 
 ation for taxation. Is it a fair assumption that if the appraiser fails to 
 foresee and to measure every ton of ore that exists within the boundaries 
 of a property he will, through that circumstance alone, fail to establish 
 the approximate value of that property for exchange purposes? Look 
 at it in this way: Here is the city of Phoenix. The Salt River Valley 
 may be invaded by locusts at some future time, with the consequence 
 that all of the crops will be destroyed or damaged for several successive 
 
40 OFFICIAL PROCEEDINGS 
 
 years. Don't you suppose that such a catastrophe would affect the value 
 of lots in this city? But under Mr. Steele's reasoning unless the ap- 
 praiser of lots in the city of Phoenix has foreseen the arrival of these 
 locusts and the destruction of crops and has taken account of it in his 
 estimates of values he has failed to arrive at the true value of the lots. 
 The experts who take the position that Mr. Steele has taken here must 
 thereby abandon at once their own professional viewpoints. Mines are 
 valued for purposes of sale; they are valued as a basis for expenditure 
 in plant installation; they are valued as a basis for the marketing of 
 stocks and bonds, and for other commercial purposes. In fact the chief 
 business of a great many expert professional men in this country is the 
 rendering of these valuations. These experts will admit that they are 
 quite competent to go out and examine a property, no matter what state 
 of development it is in, and advise the client as to its value for purposes 
 of investment. Then why refuse to recommend such valuation for pur- 
 poses of taxation? Now, gentlemen, let us lay hold of this fact what- 
 ever a property is worth for commercial purposes it is also worth for 
 purposes of taxation. That is the underlying principle of the ad valorem 
 system of mine taxation. The valuation of a mine for taxation is merely 
 the best possible estimate of what that property is worth in the market 
 in the condition in which it is found on the day of the appraisal. If the 
 mine turns out to have produced ten times the amount of ore that was 
 estimated to be there that is no proof that the valuation on the date on 
 which it was made was not correct, because there was taken into con- 
 sideration all of the elements, all of the conditions, and all of the cir- 
 cumstances of whatsoever character which then did affect the value of 
 that property for exchange purposes. The values which are hidden in the 
 ground, which are not known to be there, which are there undiscovered, 
 do not exist; they do not exist until they are actually discovered, and of 
 course an appraiser is not expected to include that which does not exist 
 in his valuation. 
 
 A DELEGATE: Do you take prospective values into consideration 
 at all? 
 
 MR. ALLEN: We do. I will get to that just a little bit later. By the 
 way, Mr. President, I hope you will ring me down at any time. 
 
 THE PRESIDENT: You shall have the floor as long as you wish it. 
 We are very much interested in your talk. 
 
 MR. ALLEN: Note this. (Reading from report of committee.) 
 
 "The factor of average annual production not only serves to deter- 
 mine the length of life but the average annual profit. If the rate of pro- 
 duction is greater than estimated the profit will be more or vice versa. 
 B. is dependent upon A. and is subject to the errors of A." 
 
 Now, for practical purposes the life of a mining property may be 
 forecasted for purposes of valuation for the current year's taxation by 
 an observation of the ratio of total ore reserves to the average produc- 
 tion of the mine in, say, four or five or seven preceding years. Remem- 
 ber, neither Mr. Steele nor the committee seems to take this into ac- 
 count. Let your forecast stand but for one year. You are then not look- 
 ing far into the future; you are continually readjusting your forecast 
 entirely on the basis of past experience; therefore, as conditions change, 
 your appraisal insofar as it affected by the life factor is automatically 
 readjusted to the changed conditions. 
 
 "The cost of production may be closely estimated." (Reading from 
 report of Committee). It certainly can. The cost of production is a 
 matter of record on the books of the mining companies. Now, in Michi- 
 gan, as before mentioned, each mining company presents to the Tax 
 Commission on the first of the year an itemized cost-sheet made up on a 
 uniform plan and formally executed, showing what the cost of mining 
 
AMERICAN MINING CONGRESS 41 
 
 has been for the preceding five years. From these cost sheets the ap- 
 praiser is able to figure the cost of production. From the same sheet he 
 also knows the exact amount of money which is received for the product, 
 and from the two figures he is able to calculate the profit or loss per ton, 
 as the case may be. There is no guess work about this. We do not take 
 account of what is going to happen in the future. We say, here is the 
 full operating experience of this mine; we will use it as the basis for a 
 forecast to stand for one year only; next year we will drop an old year 
 and take on a new one; so that our forecasts will always be made on 
 the basis of the preceding five years' experience. Now you will see if 
 that system is carried along from year to year it will wipe out most of 
 these objections which are based upon inability to make accurate fore- 
 casts. 
 
 MR. GATES: Are their expenses not allowed in making that state- 
 ment 
 
 MR. ALLEN: In making up the cost statement all operating ex- 
 penses are allowed including taxes as an operating expense. We do 
 not allow capital charges or royalties. We allow any amount of money 
 for development on the particular properties appraised but we do not 
 allow cost of prospecting in scattered localities outside the boundaries 
 of the mining properties themselves. In other words we must conclude 
 in this work that the mining men are themselves the best judges of what 
 is good mining business, and if they think it is good business to spend 
 money in development work in trying to improve their properties by cre- 
 ating additional values, then that is good business for Michigan; and 
 that money has of course got to be sunk by the proceeds of the ore ac- 
 tually mined. 
 
 We do not question the motives of the mining men in their expendi- 
 tures; we do not substitute our judgment for theirs, when it comes to 
 matters of that kind. Those expenses must be allowed if they have ac- 
 tually been incurred. And I want to say here that in three years' experi- 
 ence with this system in Michigan I have never found one single case 
 where I even suspected that the mining men were trying to "put some- 
 thing over" on the State Tax Commission or upon the appraiser. (Ap- 
 plause.) 
 
 MR. L. S. GATES: What about the capital expenditures? 
 
 MR. ALLEN: If the property has been bought, the company will 
 doubtless make provision for a sinking fund with which to replace the 
 capital outlay. This is not a proper charge under our system. We also 
 figure royalties as profits for royalties must be paid out of profits on 
 the ore. 
 
 A mining property which has never made a profit or which has no 
 reasonable prospect of making a profit pays no taxes as a mine. It 
 represents a total loss. We wipe it off; we do not call it a mine; it is 
 so much land. Whatever the land is worth as a farm or for city lots or 
 for anything else, it will be assessed for on that basis, but it has no value 
 as a mine. But the legislature has required the appraisal of all reserva- 
 tions of mineral rights. That has lead to the division of mineral lands 
 into three classes known as A, B and C. Those which have reasonable 
 possibilities of ore occurrence were put into those three classes. In all 
 other lands, irrespective of whether there were reservations of the min- 
 eral rights in deeds or not, the mineral rights were appraised at zero. 
 In other words, the state of Michigan does not intend to tax mineral 
 lands wherein there are no certain evidences of mineral values. 
 
 MR. GATES: What constitutes the lands classed as A, B and C 
 
 MR. ALLEN: It would be rather difficult and would take a good deal 
 of time to explain that. The classification is made on a geological basis. 
 
42 OFFICIAL PROCEEDINGS 
 
 The class A lands are the best class; class B are the second class, and 
 the class C lands are the third class. The ratio of value between these 
 classes is estimated to be 12* to 7^ to 2%. Personally, I made the 
 recommendation that these lands be not taxed, because evidence of in- 
 trinsic value is lacking, but that if they must be taxed the valuation be 
 a nominal one. Finally, after threshing the question over, the Tax Com- 
 mission concluded to adopt that ratio and assessed the mineral lands at 
 $12.50, $7.50 and $2.50 per acre respectively. It is an arbitrary valuation. 
 I do not believe that any higher value should be placed upon lands which 
 are merely presumed to have mineral value in consequence of their 
 geological situation or proximity to mines, etc. 
 
 To return now to the point at which I was interrupted, likewise, 
 referring to "B," the average annual profit assumed is governed purely 
 by the operating record of the mine as shown on the books of the com- 
 pany. This forecast, like all others, stands for one year only. 
 
 Under "F" the report says: "The rate of interest is a factor that 
 may be adjusted to suit the individual in private work. For taxation pur- 
 poses the worth of money is a debatable question, but a rate should be 
 used that will represent the actual earning power of the money without 
 special effort. If the business is hazardous, all factors of safety will 
 properly have been provided in the basic factors." 
 
 Now, I might say that this question of interest rate to be used in 
 amortizing capital or in figuring present worth is still a bone of con- 
 tention between the mining men of Michigan and the Tax Commission. 
 The question of interest rate revolves about the question of the elimina- 
 tion of the hazards of mining. Mining is a hazardous business. The ap- 
 praiser must in some way or other in his calculations of values make 
 due allowance for the hazards of mining. Now, that can be done in a 
 number of ways. As Mr. Steele suggests, it may be done by taking a 
 conservative position on the value of other factors, or it may be done by 
 allowing a large rate of interest on capital in the calculation of present 
 worth of expected profits, say ten per cent. The mining men are not will- 
 ing to agree that a smaller rate should be used. Practically, we get at 
 it in this way: We realize that hazard rates must be varied to suit the 
 varying hazards from mine to mine. There are some iron mines in Mich- 
 igan in which the investment is safer than ownership of some bank stock. 
 Some mines have been running for many years, year after year, at a 
 steady profit, with almost unvarying physical conditions in the mine, 
 and plenty of good ore. There are practically no hazards in such a mine 
 on a conservative estimate of tonnage. On the other hand we have 
 mines wherein the ore is low grade, the mining conditions are unsatis- 
 factory and the hazard rates are high. Consequently we have to vary 
 the hazard rates in accordance with the varying conditions. Now, if we 
 were to be ultra-scientific and do the thing just right, the hazard rates 
 should be treated as a function of the interest rate. That would involve 
 a sliding scale of interest rates to be applied in the judgment of the ap- 
 praiser and would introduce another element of complexity. We con- 
 cluded finally to treat capital at the common rate of six per cent, and the 
 sinking fund at the same rate, for the reason that in practice profits or 
 income from mining are invested and reinvested in the mining business 
 and by the mining companies themselves are treated as so much new 
 capital. If that were not the case the application of the six per cent rate 
 to a sinking fund could not be justified. The hazard rate which is ap- 
 plied to individual properties ranges all the way from nothing to a fifty 
 per cent cut from the ultimate figures and is in the nature of a flat per- 
 centage. Allowance for hazards is a matter requiring the exercise of con- 
 servative good judgment and no other factor in the calculation demands 
 more careful attention from the appraiser. 
 
 I think I have already been given more time for the discussion of 
 this question than I have been entitled to, and I fear that I have abused 
 
AMERICAN MINING CONGRESS 43 
 
 your courtesy. I will be very glad to answer any question you may like 
 to ask about the Michigan system, and in closing my remarks I would 
 like to emphasize a few things to which I referred a while ago. In view 
 of the tremendous influence on public sentiment that is exercised by the 
 American Mining Congress and it is a tremendous influence we should 
 avoid committing ourselves to any general program of mine taxation. 
 We must remember that the conditions under which mining operations 
 are carried on vary greatly. Problems in mine taxation are varied not 
 only in consonance with the diverse character of the mines throughout 
 the country but also with the different social and political aspects of the 
 question in the different states. I would not go so far as to say that the 
 ad valorem tax, under your conditions in Arizona, is the best tax for 
 Arizona, but I believe that the mining men of Michigan will support me 
 in the statement, as I know the Tax Commission will, that it is the best 
 system for Michigan. It is the best system we have ever been able to 
 devise in Michigan. It has taken four years to develop it, and it is going 
 to take several more years before either the mining men or the Tax 
 Commission will be entirely satisfied with the work. It is a distinctly 
 co-operative enterprise. The mining men of Michigan are cordially back 
 of it, and we work together. Any man, no matter what his training has 
 been or what his ability may be, who starts out to make mine appraisals 
 on the wholesale plan, such as the appraisals in Arizona or in Michigan, 
 and who does not have the active and cordial co-operation of the opera- 
 tors themselves, is going to fall down, because he is tackling a job which 
 is above the power of a single human being unaided to accomplish. 
 Gentlemen, I thank you. (Applause.) 
 
 THE PRESIDENT: Gentlemen, Mr. Allen's discussion has been very 
 interesting and is developing many new aspects that perhaps many of 
 us haven't thought about. We would like to hear from others. 
 
 MR. DAY: Mr. President and Gentlemen: It may interest you to 
 know something of the experience of practical miners and prospectors 
 and mill men in the state of Idaho on the taxation plans in operation 
 there. In our state we have been working for ten years under a net 
 profit system. In thinking over our experience in connection with the 
 report of the committee I cannot help being struck with the similarity 
 of our experience and their views. Some ten years ago the question of 
 taxation of mines was first agitated in the state of Idaho. Contrary to 
 the experience of our friend from Michigan, the mining men were not 
 only willing but even anxious to have established some equitable system 
 of mine taxation. With that end in view they co-operated in the state 
 legislature with the best thought of the state in all sections and the 
 joint result of their efforts was a net profit law which has since been 
 in satisfactory operation. In accordance with the suggestion, or rather 
 in advance of it, the first thing they did was to lay down what we may 
 call a standard method of accounting, or cost sheet. It is not in such 
 great detail as that described by the gentleman from Michigan, but it 
 has been very satisfactory for the purposes for which it was intended. 
 A certain amount of expense is allowed to be deducted, freight and 
 treatment, actual cost of mining, taxes, and actual cost of rehabilitation 
 or repair of mines is allowed to be deducted from the gross proceeds. 
 The net profit then is taxed upon the regular basis paid by all other 
 property, on an average of 3%, 3%% or 4%, according to the county in 
 which the property is situated. In addition to this, the mines are taxed 
 upon all real and personal property, such as mills, machinery and im- 
 provements of whatever description on the surface or underground at 
 the same rate as other property is taxed, and it has worked out I won't 
 say entirely satisfactory, but satisfactory to a large majority of the 
 people of the state. It is quite true that it is not entirely satisfactory 
 to every one. In the last legislature there happened to be a young man 
 
44 OFFICIAL PROCEEDINGS 
 
 from Kansas who had been 18 months in the state of Idaho, and as soon 
 as he got into the state of Idaho, or shortly thereafter, he introduced a 
 bill to raise the taxes of mines to ten times their net profits. This 
 gentleman had never seen a mine; he had never worked a day or an 
 hour underground, had never mined or milled or marketed a pound of ore 
 in his life, but he introduced this bill. The bill was killed, of course, and 
 the gentleman left the state. He had no interest in the state, and no 
 interest in the mining business; and the agitation in favor of "soaking" 
 the mining men with extraordinary assessments upon his property, no 
 matter how earnestly he has worked for it, emanates largely from that 
 kind of people who have nothing at stake and who do not realize what 
 it means. I am speaking feelingly on this matter, as I have had a large 
 experience as prospector, miner, mill man and operator and have lived 
 for 25 or 30 odd years on the Pacific coast. 
 
 Now, the Committee has suggested here, on page 2: "The mineral 
 contents and value of unexplored * * * cannot be obtained." It 
 seems to me that is very clearly put. And in the quotation from the 
 Wisconsin Tax Commission's report for 1910, it is stated: "It would 
 be more logical and tend to better administration * * * without 
 regard to the minerals * * * " 
 
 In regard to the assessment of non-producing mining claims, it seems 
 to me they should not be assessed at all. They are only an expense to 
 the owner; he doesn't get anything out of it. He keeps up the assessment 
 work each year or he forfeits his title, and he puts in as much more as 
 he can dig up. He has great faith in his ground, and every owner of a 
 claim knows there is a bonanza in it and he puts all the money he can 
 get into that claim. He puts that money into circulation and is employ- 
 ing labor and putting in his own time perhaps and taking a chance of 
 getting something out of it, and as long as it produces nothing it should 
 not be assessed. 
 
 A DELEGATE : Doesn't that refer to non-producing patented mining 
 claims? 
 
 MR. DAY: It says, "non-producing mining claims." I believe the 
 Committee's suggestion is well made, that such should not be taxed. I 
 further believe and this is based upon experience that patented min- 
 eral ground should be taxed at its cost price, that is, for instance, at $5 
 an acre, the price the government charges for non-producing mineral 
 land, and that is certainly all it should bear, in fairness and justice, and 
 d take it that all any of us wants is a fair deal. I believe the great 
 American people are entirely fair and want to treat the mining industry 
 fairly if we can only get our case before them. 
 
 Reference has been made by several of the gentlemen who have 
 preceded me to the matter of the equity of a mine, that is, the amount esti- 
 mated for taxation purposes, and the term "ad valorem" is used in this 
 report. What is the meaning of the term "ad valorem"? Simply "accord- 
 ing to value." And we then come down to analyzing the matter, and 
 the question is presented as to what is the worth of a mine. Is it what 
 you think it is worth, or what the public thinks it is worth, or what the 
 people who buy and sell stock on an exchange think it is worth the 
 speculative value? None of these items constitute the value. The value 
 of the mine is what you get out of it after it is worked out the ultimate 
 value. Then if we would be equitable in the matter we would agree to 
 be charged on that value, and I think we are all willing to be taxed on 
 that basis or should be willing to be so taxed. How are you going to 
 arrive at it? Are you going to arrive at it, as our friend from Michigan 
 has outlined, by taking the books of the mining company for seven 
 years past and prognosticating the future from that? How would he 
 apply that to this year when the price of copper in this state has dropped 
 
AMERICAN MINING CONGRESS 45 
 
 to such a degree that a large number of mines throughout the West are 
 closed down? 
 
 MR. ALLEN: Why, this year would average up with the preceding 
 years. 
 
 MR. DAY: I understood you took seven years' prior production and 
 based the next preceding year on that. Is that correct? 
 
 MR. ALLEN: No, I think you misunderstood me. Each year we 
 make our forecast on the basis of the experience of the preceding five 
 years. The mines are annually reappraised. Therefore this year, which 
 is a very poor year for Michigan copper as well as iron, will be averaged 
 in with four fair years, and the books will show that the average earning 
 power of a ton of ore or a pound of copper is reduced ; consequently, the 
 valuation of the mines automatically goes down. If we have another 
 bad year it will go down further. And then when we get some good 
 years they will come up again. But by taking a five-year average we 
 eliminate sharp fluctuations. That is the reason we take five years. 
 
 MR. DAY: I don't undertake to criticize the Michigan law or its 
 operation for the reason that I haven't made a thorough study of it, but 
 at the same time it has only been in operation four years, and I under- 
 stand the conditions of iron and copper mining in Michigan are vastly 
 different from those obtaining in the Western mines. I understand that 
 they have very large conglomerate deposits and differ very much from 
 anything we have in the Western country, and therefore I conceive their 
 conditions are not applicable to us here in the West. Now, in regard 
 to the net profit proposition, as I have said, we have found this almost 
 entirely satisfactory in fact I think it is entirely satisfactory to those 
 people who belong in the state, who have their property interests there, 
 which tie them to the state for a long term of years, and I think those 
 are the people who are entitled to consideration in this matter, and, 
 personally, I feel like heartily indorsing the report of the Committee, 
 with the possible exception of the article on the last page: "(b) That 
 if a tax upon the net proceeds only of mines of a state would be insuf- 
 ficient to produce the revenue necessary for the state's purposes, or to 
 produce that necessary revenue would run the rate of taxation in- 
 ordinately high, then a fair system of capitalizing the net proceeds at a 
 figure which at the prevailing rate of taxation, would produce the re- 
 quired revenue, would be a proper system." In other words, they would 
 capitalize the profits, as I take that to mean. It is only a suggestion by 
 the Committee. It seems to me from a lifetime of experience that such 
 capitalization of the profits of mines as a basis of taxation is not a sound 
 proposition. Those of you who have put in your lives at the business will 
 readily understand how the hazards of mining differ. There is the un- 
 certainty as to values, the cost of materials, labor conditions, and a. 
 thousand and one things that go to make the business extraordinarily 
 hazardous. Yesterday I was talking with one of the most distinguished 
 members of this conference, Dr. Holmes of the Bureau of Mines, and 
 he has lately criticized the mining companies very sharply, the metal- 
 liferous mines, for the large number of fatalities and accidents under- 
 ground, and it is suggested that at least half of the fatalities and three- 
 fourths of the casualties were uncalled for or could have been prevented 
 by proper methods. Now, that is certainly a very harsh criticism. As 
 much as I respect Dr. Holmes and I do respect him sincerely I think 
 he is making a very sweeping statement in that respect. I do not think 
 the mines are so largely responsible for that as his statement would 
 tend to show; but it only tends to illustrate one of the hazards of the 
 business which a great many people who have not had wide contact 
 with it do not understand. The business is judged as every other 
 business on the top of the ground which can be seen up one side and 
 down the other. A short time ago I was in a political convention iiL 
 
46 OFFICIAL PROCEEDINGS 
 
 our state and we were talking over this very matter of the taxation of 
 mines. A resolution was before the house to go into the platform, a 
 plank with reference to the taxation of mines as they are taxed. I op- 
 posed it, and in the course of the debate I came into conflict with a 
 farmer, a very sincere man, and we argued the matter back and forth, 
 and I finally said to him, "Would you be willing to pay taxes on your 
 growing crop?" He said, "No." I said, "That seems to me akin to taxing 
 the ore in the ground, and the ore that is out of sight;" and he said, 
 "Well, I never thought of that;" and he quit right there; and I am going 
 to quit right here, too. 
 
 I thank you for listening to me so long. (Applause.) 
 
 THE PRESIDENT: Gentlemen, we still have some time left before 
 lunch hour for further discussion, and we will be very glad to hear from 
 you fully and freely. 
 
 MR. J. H. MULHOLLAND: Mr. President and Gentlemen of the 
 Congress: In presenting the views of a newcomer in the mining busi- 
 ness, gathered from past experience, I would like to do so in a few 
 words. I was born in Canada and lived most of my life there, and in 
 Western Canada we have an adaptation of Henry George's single tax. 
 I do not want to inject a discussion of single tax into this meeting, but 
 we have had some experience up there, and I wish to call attention to 
 this side issue, possibly, in the taxation of mines. We have come to 
 the conclusion in Western Canada that it is not proper to fine a man for 
 improving his property. That basis was not arrived at through any 
 abstruse consideration of economics, but simply because we have large 
 areas of land in Western Canada held by corporations that would not 
 improve it but held it solely for speculative purposes. The Canadian 
 Pacific Railway held some 25,000,000 acres of land in alternate sections. 
 A farmer there would go in and homestead on the even numbered sec- 
 tions, while the odd numbered sections would be held by the Canadian 
 Pacific. When a school district was to be formed, or anything of that 
 sort, the taxes to support such institution were levied, and the man who 
 had improved his farm, put a fine house on it, and a barn, and fenced 
 it, stocked it, plowed it and brought it into cultivation was, under the 
 old system, taxed for those improvements. He had enhanced the value 
 of the four sections surrounding him belonging to the corporation, and 
 with which nothing had been done; he had raised the value of the land 
 in his community; and they decided that they were not going to fine 
 this man for improving his property. I think the same thing will apply 
 to mining. Why should a man fine himself or why should his state fine 
 him for improving his property, putting a well on it, putting machinery 
 into it, or developing it? I approve of taxes on the original value, if it 
 can be arrived at in the same fashion as is done in Michigan, or, if that 
 cannot be successfully done, on the basis of the net income from the 
 property; but the machinery for producing that income, or the ma- 
 chinery which establishes the ad valorem value of the property, which- 
 ever system is used, is not a proper subject of taxation. I wish to com- 
 mend this idea to your consideration. (Applause.) 
 
 THE PRESIDENT: You may be interested to know that one of our 
 companies, operating in Oklahoma, at the first legislative session in 
 that state seven years ago, was placed under the gross income tax, 
 which was inaugurated by the first legislature, of 2% on the gross income 
 of mines. We, of course, strenuously resisted it but it was fastened 
 upon us, and some of the operators paid it. Our company took the 
 position that we would not pay it, so at the succeeding legislative session 
 some of the legislators came around and asked if we would consent to a 
 gross revenue tax if it were reduced from 2% to %%. I took the po- 
 sition that if 2% was wrong %% or 1-10% was wrong, and the last infor- 
 mation I had as I left home last Friday was of a decision by the United 
 
AMERICAN MINING CONGRESS 47 
 
 States Supreme Court finding in our favor, that the tax was illegal and 
 could not be enforced. A number of properties had paid the Vz% as- 
 sessment, but our company had not. We felt that a tax on the net 
 income might be proper, but we did not think a gross income tax was 
 just, and our views have been vindicated by the United States Supreme 
 Court. 
 
 Gentlemen, we still have some time left for further discussion of this 
 question. 
 
 MR. ALL/EN: Mr. President, pardon me for taking the floor again, 
 but I want to make clear to some of the members and delegates who are 
 not familiar with the application of the Michigan system that the valu- 
 ation of a mine includes the value of the ore in stock as well as the 
 value of the machinery, equipment, shaft house, rails, the power plant,, 
 and in fact the whole thing, because the cost of these is reflected in the 
 cost sheet, the record of the whole operation, and the money which is 
 put into power plants and power stations and machinery has all got to 
 be returned by the income from the ore. We make the ton of ore in 
 the ground the basis of all values. 
 
 THE PRESIDENT: I would like to ask one question there, Mr. 
 Allen. Did you say that interest rate was not allowed? 
 
 MR, ALLEN: Yes. 
 
 THE PRESIDENT: I understood you to say interest was not al- 
 lowed as an item of cost. 
 
 MR. ALLEN: It is not. Not interest on borrowed money. That 
 is a capital account; it is not allowed in figuring the cost of mining for 
 the reason that full allowance for return of investment or capital is 
 made in figuring present worth of expected profits. 
 
 THE PRESIDENT: How would you treat bonds if the property is 
 bonded? Is that borrowed money? 
 
 MR. ALLEN: Yes. That is not a proper item to enter into the cost 
 sheet, from our point of view. But I was going to explain one condition 
 that we have in Michigan which shows how the system works out in 
 practice. There is a certain mining company that has a number of 
 iron mines. They have spent a large sum of money in putting in a 
 hydro-electric plant with distributaries. These distributaries extend 
 through various assessment districts. We could have them pro rate the 
 cost and upkeep of that power plant to their individual mines, and the 
 value which is put upon the mines would in this case include the value 
 of the power plant with its distributaries as a part of the main plant 
 But inasmuch as the power plant is assessable in two or more districts 
 we have them enter the actual cost of the power delivered to the mines 
 as a mining cost and the power plant is assessed as a separate concern. 
 It is merely emphasizing a point which was brought to mind by the 
 discussion of Mr. Mulholland, that under the Michigan system the basis 
 of valuation is the ton of ore, because the ton of ore has got to pay all 
 the bills; and all the cost of operation, whether it be for railroads or 
 power plants or what not. It is of course understood that such equip- 
 ment must be used exclusively as an agency of ore production. 
 
 MR. HEREFORD: I would like to ask a question. I cannot quite 
 understand this system of ad valorem valuation. As I understand you, 
 the ad valorem value of a mine is based by you upon its profit-producing 
 qualities, is it not? What is the difference between that and assessing 
 net profits? Net profits you can ascertain directly, can you not, from the 
 books of the company at the end of the year? The profit-producing 
 qualities of a mine you can only get at either by its past history in 
 producing profits or by guess work. In other words, isn't your ad 
 
48 OFFICIAL PROCEEDINGS 
 
 valorem assessment after all nothing but an assessment upon the sup- 
 posed value of the property calculated upon the assumption that it will 
 earn so much money? 
 
 MR. ALLEN: Exactly. 
 
 MR. HEREFORD: Both are the same. You are assessing upon the 
 profits of the property. Now, under the net profit plan you have the 
 books to demonstrate thoroughly and fully what that profit is, but under 
 your system it would be guesswork as to what the net profits may be. 
 Now, pardon me for such a long question, but I am anxious to know. 
 
 MR. ALLEN: I am very glad that you brought that up. I find in 
 the final paragraph of this report of the Committee that they foresee 
 that in the practical application of the tax on net receipts they are 
 going to be forced into a capitalization of profits. Now, the ad valorem 
 system of mine taxation is, as you say, based upon the earning power 
 of a ton of ore, and therefore is merely the present worth of expected 
 dividends, nothing more nor less; but according to the Committee the 
 necessary application of the system which is here proposed will force, 
 under certain contingencies, a capitalization of profits, and then we 
 get back to practically an ad valorem system, however, with all its vices 
 and none of its virtues, for it provides no means for ascertaining the 
 rate of capitalization, which must be governed only by the necessities of 
 government, and no means for adjusting the burden in proportion either 
 to the value of the properties or their relative abilities to pay the tax. 
 And here is another thing we want to keep steadily in mind that we 
 in Michigan are forced to the ad valorem tax as a matter of equaliza- 
 tion of tax burdens. Keep that right in mind. It is a matter not only 
 of mine assessments and mine valuations but a matter of tax equaliza- 
 tion. Under our present laws we cannot discuss mine taxation on any 
 other basis, because we are prohibited from adopting any other method. 
 This last paragraph is not very clear to me. Let me read it: 
 
 "(b) That if a tax upon the net proceeds only of mines of a state 
 would be insufficient to produce the revenue necessary for the state's 
 purposes, or to produce that necessary revenue would run the rate of 
 taxation inordinately high, then a fair system of capitalizing the net 
 proceeds at a figure which, at the prevailing rate of taxation, would pro- 
 duce the required revenue, would be a proper system." 
 
 As I understand that, the government's needs must first be de- 
 termined, and then somebody, some taxing authority, must arbitrarily 
 determine how much of that burden has got to be borne by the mining 
 property and how much of it has got to be borne by other properties. 
 After ascertaining the rate of taxation on other property, they will then 
 arbitrarily capitalize the mines at an amount which is sufficient, under 
 the rate applied to other properties, to raise the amount of money de- 
 sired. Gentlemen, is that the substitute offered by the Committee for the 
 so-called non-scientific ad valorem taxation? Can you imagine anything 
 more unscientific, more absurd, more bunglesome, more illogical than 
 such a procedure as that? In other words, the taxing authority, if I 
 understand this paragraph correctly, must determine arbitrarily how 
 much money they are going to get out of the mines and then go out and 
 get it, capitalizing the mines at a figure which will be necessary to 
 produce the revenue which they desire at the rate of taxation applied 
 to other property. 
 
 MR. HEREFORD: I haven't quite got the point I would like to 
 understand. If I understand you, the ad valorem taxation is the taxation 
 for the expected profits of the mine. Am I correct in that? 
 
 MR. ALLEN: Yes. 
 
 MR. HEREFORD: Why is not the taxation of the net value a tax- 
 ation upon the absolute value of the profits of the mine? Why is the 
 
AMERICAN MINING CONGRESS 49 
 
 ad valorem, which is based upon expectation, equal to that which is 
 definitely determined and settled by the actual books showing the net 
 profits? Now, after all, you seek the same object. The one proposition 
 involved is the taxation upon the value of the mine. That is the one 
 object, whether you call it ad valorem taxation or taxation of net pro- 
 ceeds. Now, under your theory you tax the net proceeds of the cor- 
 poration. Under the one you come to the company and say, "Well, we 
 expect you will make so much money," and under the other proposition 
 the company goes to you and says, "Here are our books; here are our 
 net profits; tax us upon them. We will give you the facts." And there 
 is another thing that I think contains a little force in that connection. 
 I think in Arizona we spend many dollars for every one we get out of 
 the ground. It is not true in Michigan to the same extent. It has been 
 said that it costs $5 to $10 of the money spent in the mines of the 
 country to extract $1 of profit. Now, under those circumstances we 
 capitalize our optimism in this Sunny West what we expect to do to a 
 great deal larger extent than you do in Michigan. The result of that 
 is, if you ask a man to sell his mine, "No." The chances are he will 
 lose every dollar he has put into it, but he would not sell it for a million, 
 therefore you couldn't get your ad valorem value of that mine in any 
 way except by guesswork. How can that be subject to the actual de- 
 termination of the value by the books of the company? 
 
 MR. ALLEN: I would answer you in this way: In the first place, 
 the ad valorem system taxes nothing but that which has a demonstrable 
 intrinsic value. I tried to make clear in the beginning that from the 
 standpoint of the mining investor and the mine operator, the tax on net 
 income is the more just and proper tax. Looking at it from that view- 
 point alone I would favor the tax. I am not advocating the ad valorem 
 tax as a substitute for the tax on net earnings except where it is de- 
 manded by the state laws, and I thought that I made myself clear that 
 I was not advocating the Michigan system for Arizona. I don't know 
 whether I would do it or not, because I don't know enough about Ari- 
 zona to determine that matter. But I want to say again that every 
 problem in mine taxation in our state is also a problem in tax equaliza- 
 tion, and I should like to ask you, if I may, how, under your proposed 
 tax, the tax proposed by this Committee, you are going to equalize the 
 amount of taxes paid by the mines on the one hand and other property 
 on the other hand. I do not know that in Arizona you need to equalize 
 taxation, but we do need to do it in Michigan; and if we substitute for 
 the ad valorem system the tax on net earnings we have no measure of 
 the relative burdens of taxation on mine property and other property. 
 Do I make myself clear? 
 
 MR. HEREFORD: Yes, sir. I will say frankly that I haven't given 
 the subject of mine taxation sufficient consideration to justify me in 
 doing anything more than asking questions; but since I have put myself 
 in a position where I should answer, I will give you my view in regard 
 to it. I think mines should be considered for the purposes of taxation 
 as they are generally in law. You can sever the mineral contents of the 
 land from the land itself and sell the title to each of them separately, 
 and I think taxation should be based to some extent upon the value 
 of the land as land, but that the taxation of a mine as a mine should 
 be based upon its production of profits. The idea of taxation, I think, 
 is to put the burden of taxation upon those who are able to carry it. I 
 think it is a wise thing to so frame your laws that every man can have 
 an opportunity to make a living; therefore I think that, so far as pos- 
 sible, taxation should be borne by those who are best able to stand it 
 and in proper proportion. The question of taxation cannot be reduced 
 to an exact science, but if you will accept it under the laws of reason 
 that everywhere obtain in the mining world, I think we will get nearest 
 to the ideal taxation. Now, it is a recognized fact that the surface and 
 
50 OFFICIAL PROCEEDINGS 
 
 other portions of lands which are available for minerals can be sold 
 separately and apart from the mineral contents of the land, and I think 
 land should be taxed I should say, roughly, without having given it full 
 thought land as such should be taxed, wherever any title is held to it, 
 separate and apart from the mineral it contains. But I think lands 
 should be taxed very largely in proportion to the mineral in them regard- 
 less of whether or not there is a paying business, just the same as any 
 other business. I think the land and the minerals should be taxed sepa- 
 rately. I cannot see how there is any difference, for the purposes of 
 taxation, between your ad valorem plan as you explain it and that of 
 taxation of net profits. The taxation is based upon the earning capacity 
 of the property, whatever it is, and I think the wisest way is to stick to 
 the rules insofar as the title to the property is concerned. Mineral is 
 one thing and land is another. Now, I don't know whether I have made 
 myself clear. I didn't intend to give my own views, because I do not 
 pretend to know enough about the subject to feel that they are of value 
 to the Congress; but I am simply endeavoring to get some light on this 
 matter. 
 
 MR. ALLEN: Now, just to carry your thought a little bit further: 
 In Michigan, in the iron and copper regions, the business of mining 
 overshadows all other industries. The mine values in some districts 
 are better than 90% of all values. Now, in those communities the local 
 activities, the local government, and the county government and the 
 state government must be supported and must have an income whether 
 the mines work or do not work. The people cannot stop living and we 
 cannot stop educating the children. There are times in Michigan when 
 every mine in some of the assessment districts is shut down. There 
 are no profits, and there is no production. Under your system there 
 would be no income for the government. We have got to take a little 
 bit broader view, as I suggested in the beginning, of this discussion of 
 mine taxation. The needs of the government must first be considered. 
 And there is another point: The local communities, the township and 
 the county, and the state, too, need a certain and steady source of in- 
 come. Under your system the taxes each year would have to be levied 
 on the income of the preceding year. If there was no income then, there 
 are no taxes now. 
 
 MR. HEREFORD: You don't take into consideration the value of 
 the land as such? 
 
 MR. ALLEN: I am speaking of the land in these mining communi- 
 ties. I will venture to say that the land values in your mining communi- 
 ties in Arizona are not very high; they don't look so to me. There is 
 nothing there to tax but the mineral value. That is largely true in the 
 mining regions of Northern Michigan. We have cut the timber off and 
 there is little value there for timber any more, and there is very little 
 value in the soil in some districts. I hate to say it, but some of the 
 poorest of our soil is not any better than you see on your hills, despite 
 the fact that we have more than 30 inches of rainfall. Some of it will 
 not bring $5 an acre and the best undeveloped stump land not more 
 than $15. Now, inasmuch as the minerals are practically the only value 
 in some of these communities, if you take away the income which would 
 be provided by a tax on net income of the mines, as you propose, then 
 when the mines cease temporarily to operate the local communities are 
 left high and dry, with no money. The schools must suspend, and there 
 is no money to put into roads and other necessary public works. 
 
 MR. HEREFORD: Why should the mine which you say does not pay 
 bear that tax when the land doesn't bear it? You say there is no money 
 there unless you get it out of the mine, and the mine doesn't pay, and 
 still you want to make the mine pay the tax. 
 
AMERICAN MINING CONGRESS 51 
 
 MR. ALLEN: Now you are getting right to the point. You have 
 clinched one of the arguments why the ad valorena system, practically- 
 considered, is a better system of taxation than your tax on net incomes 
 right there in that statement, because there is value in those mines 
 whether they are for the time being producing or not for causes which 
 are familiar. 
 
 MR. HEREFORD: How do you know? 
 
 MR. ALLEN: Well, that is merely begging the question. 
 
 MR. HEREFORD: You are guessing. 
 
 MR. ALLEN: We are not guessing. Pardon me for speaking so 
 abruptly. I get a little bit out of patience with that word "guessing." 
 General suspension of operations in Michigan have never been due to 
 the exhaustion of ore even in a single limited district. Such suspensions 
 are due solely to bad market conditions. A mine holding reserves of ore 
 is valuable even though it may for the time being be inoperative. We 
 are not guessing; in making a reasonable forecast based upon past 
 experience you use exactly the same kind of judgment, exactly the same 
 processes of thought, that you use in the every day business life that 
 you lead. There is nothing certain in mine taxation or any other kind 
 of taxation, but to say that the appraiser is merely guessing at the value 
 of mining property, in the light of the four years of experience we have 
 had in Michigan, is a palpably absurd statement and unworthy of a 
 place in a serious discussion. I want to say that when you get right 
 down to the itemized cost sheets of the mining companies, most of your 
 hazards, all of your guesses and practically everything else, with the ex- 
 ception of estimate of prospective ore, comes out in the wash, because 
 you have got an actual measure of the productive power of the ton of 
 ore and the average earning capacity of the properties. In merely ex- 
 tending your forecast for one year's valuation on the basis of the ex- 
 perience of the preceding five years you are doing no violence to con- 
 servative reasoning. The forecast usually comes pretty close to experi- 
 ence for the very reason that it is based on averages and we find as we 
 go along from year to year that we come mighty close to "guessing," 
 if you prefer the term, to what the conditions are going to be. 
 
 MR. J. C. GOODWIN: I understood you to say a while ago that 
 your lands in Michigan are divided into two classes mineral and non- 
 mineral. In this country we have what we call prospects, which do not 
 show any mineral to amount to anything. We patent those claims. Those 
 claims, as I understand, we pay taxes on of so much without regard to 
 any mineral contents in them, just so much on a claim. Now I under- 
 stand in Michigan your mineral claims that do not produce anything 
 are put into three classes, A, B and C, as you said a while ago, and that 
 the land value is taxed on what might be underground as minerals just 
 the same as our claims in this state. 
 
 MR. ALLEN: I am sorry to state that we do tax at a very nominal 
 rate all lands, classified as mineral lands, which have prospects of pro- 
 ducing ore. I think the time is at hand when we are going to quit doing 
 that. The claim you speak of, if in Michigan, would not be taxed. The 
 mineral value would be considered as zero, and it would pay no tax. 
 There is a reference made to that matter by the Committee in quoting 
 the Wisconsin Tax Commission, and I would like to ask the member of 
 the Committee who is present if the words in parentheses are those of 
 the Committee or of the Wisconsin Tax Commission: The quotation to 
 which I refer is as follows : "It would be more logical and tend to better 
 administration if the lands (non-producing mineral claims) were assessed 
 without regard to minerals." 
 
 MR. CLARK: This matter came to me in the shape of telegrams and 
 reports. It purports to give, however, the words of the Tax Commission. 
 
 \ ' '- * V .7, ;-t O I | y / 
 X ,- . <'* / 
 
52 OFFICIAL PROCEEDINGS 
 
 MR. ALLEN: It occurred to me that the words in parentheses were 
 the words of the Committee; and it also occurred to me that the ideas 
 of the Wisconsin State Tax Commission were a little bit misrepresented 
 here. We have no such term as "mining claim" in Wisconsin or in 
 Michigan. In speaking of lands here the Wisconsin Tax Commission 
 is doubtless talking about lands in the sense that I am talking about 
 mineral lands, and not lands which are known to contain ore bodies 
 but which are non-producing. For instance, if we have ten million 
 tons of iron ore in a property it is taxed whether it is worked or not 
 because it is valuable. It would be taxed in Wisconsin, and I do not 
 expect ever to see the people of Wisconsin allow any such taxable 
 asset to escape, because it is against the whole practice of the taxing 
 authorities in Wisconsin, and I think that inasmuch as Wisconsin has 
 only recently, within a year or two, adopted the Michigan system for 
 the taxation of iron mines, it will hardly be fair to quote the Tax 
 Commission in this connection as favoring the non-taxation of mineral 
 lands which are known to contain ore bodies but which do not produce 
 ore. They are speaking here of mineral lands which may be supposed 
 to contain ore but which are not known to contain ore; in other words, 
 the kind of thing that geologists and mining men would refer to as a 
 "favorable prospect," or a "likely looking piece of land." or something of 
 that sort. 
 
 MR. UTTER: Mr. President, I would like to ask the gentleman 
 from Michigan two questions. We understand the spirit of the American 
 citizen is for fair dealing for all parties. Does a farmer pay taxes on 
 his land and on his improvements and also pay taxes on his net profits 
 say his apples and his alfalfa and his potatoes and so forth? Does the 
 merchant who pays taxes on something less than the wholesale cost of 
 his goods also pay a tax on his net profits, in Michigan or any other 
 state? I think the same rule should apply to all taxable property. 
 
 MR. DERN: Mr. President, it seems to me that possibly such di- 
 vergence of opinion as has been manifested here is due to the fact that 
 we are considering two different sets of conditions. Possibly, as Mr. 
 Allen has said, the Michigan system of mine assessments is the best one 
 for Michigan conditions, but for various reasons, as stated by Mr. Day 
 and others, it is not applicable to Western conditions. In the copper 
 and iron mines of Michigan they frequently have immense available 
 ore reserves, upon which a valuation can be placed. We have very few 
 mines out West in which a great tonnage of ore is developed beforehand, 
 and yet some of them are very profitable. I know of a mine that during 
 the first half of a twelve months' period was paying good, healthy divi- 
 dends, and during the second half it was levying good, healthy assess- 
 ments. Now it is entirely possible that if this mine had been examined 
 at the time specified by law for making the annual assessment, no 
 reserves would have been found, and hence there would have been no 
 value to assess. During the ensuing year a good body of ore might have 
 been developed, on which the mine would make a lot of money. By the 
 time the next assessment came around this ore body would have been 
 worked out, there would be no value in sight to assess, and consequently 
 the state would have been deprived of any revenue whatever on the ore 
 extracted. This is by no means an uncommon occurrence in our lode 
 mines out West. 
 
 I am reminded of an incident I heard the other day. A gentleman 
 was developing a mine in the Tintic Mining District of Utah, and during 
 a certain period the mine did not look very well, and he was rather dis- 
 couraged. He went to a neighbor, who had been operating in the camp 
 for many years, and said: "I have found that the ore bodies of Tintic 
 are very irregular. What has been your experience?" The neighbor 
 replied. "My experience has been much the same, only more so. Why, 
 even with my mine, which is now paying big dividends, there have been 
 
AMERICAN MINING CONGRESS 53 
 
 times when I have been worried to death, wondering where I would get 
 ore enough to meet the pay roll. It used to keep me awake nights. Well, 
 that condition would sometimes last for several months, and then it 
 would suddenly get worse." 
 
 I apprehend the miners of Michigan do not have that condition to 
 go up against. I think so far as the Western mines are concerned the 
 idea of assessments on ore reserves is rather impracticable. There are 
 a good many mines that are shipping ore to the smelters that never 
 have any ore blocked out. I know of many mines in Utah that take out 
 the ore as fast as they uncover it, and unless we are going to assess 
 prospective values and guess at what might be found in the future 
 which would be a pretty risky method of taxation I should think that 
 possibly there would be less revenue to the state from an ad valorem 
 tax than there would be from a tax upon net proceeds. 
 
 In Utah our law is, substantially, to tax all patented mining claims. 
 Of course unpatented claims are not assessed, because they are not 
 owned by the state, but by the Federal government. And a man who has 
 to spend a hundred dollars a year in assessment work in order to hold 
 his claim, and has to raise money enough to get it patented, would not 
 be given a fair chance if he had to pay taxes as well as do the assess- 
 ment work each year. But the patented mining claims are assessed 
 at the rate of $5 an acre. That is the price that has been paid to the 
 government, and it is assumed that is a fair price. As a matter of fact 
 this is very often more than the land is really worth for any purpose 
 that it can be used for, but as men are willing to pay this price for it, 
 the land is presumed to be worth it. All improvements are assessed 
 under the general property tax at their fair value. And then the net 
 proceeds of the mine are assessed also. I think in Utah that law is very 
 generally approved. Sometimes we hear some criticism from the cow 
 counties that the miners are not paying their share of the taxes, but I 
 believe in general the law is very highly approved by all classes of 
 citizens. I think the makers of our constitution showed considerable 
 wisdom when they framed our system of assessing mines. 
 
 SECRETARY CALLBREATH: It seems to me it is so long after 
 the noon hour that this discussion should be continued this afternoon. 
 
 THE PRESIDENT: This is such an interesting subject, and one 
 which provokes such diversified argument that I think we had better have 
 it out this afternoon. 
 
 Meeting adjourned. 
 
 TUESDAY, DECEMBER 8, 1914. 
 Afternoon Session. 
 
 THE PRESIDENT: Gentlemen, I am going to ask Dr. Phillips to 
 take the chair this afternon and preside at the meeting. 
 (Dr. William B. Phillips in the chair.) 
 
 CHAIRMAN PHILLIPS: The Secretary reminds us that the intro- 
 duction of resolutions is the first order of business. Are there any 
 resolutions to be introduced at this time? The custom is that the resolu- 
 tions are to be introduced in writing, read to the convention and referred 
 to the Resolutions Committee without debate, the debate to take place 
 upon the report of the Resolutions Committee when that is finally made. 
 Are there any resolutions ready at this time? 
 
 MR. DERN: Mr. Chairman, I have a resolution I would like to 
 present. 
 
 SECRETARY CALLBREATH: This will be Resolution No. 1, intro- 
 duced by George H. Dern of Utah, and it reads as follows: 
 
54 OFFICIAL PROCEEDINGS 
 
 Resolution No. 1, Introduced by George H. Dern of Utah. 
 
 Whereas, The welfare and prosperity of the States of Arizona, Cali- 
 fornia, Colorado, Idaho, Michigan, Montana, Nevada, New Mexico and 
 Utah, and of the Territory of Alaska, are to a very great extent dependent 
 upon the mining industry, and especially upon the mining, milling and 
 smelting of the ores of copper, and the mining of the coal necessary to 
 render the handling of such copper ores possible; and 
 
 Whereas, The mines of the states and the territory above mentioned 
 produced about 1,100,000,000 pounds of copper during the year 1913, 
 valued, according to government reports, at about $173,000,000, to which 
 amount should be added the value of the gold and silver contained in 
 said copper ores, worth at least $27,000,000, making a total value of 
 about $200,000,000; and 
 
 Whereas, There are over 100,000 persons engaged directly in the 
 mining, milling, smelting and transportation of copper ores, and in the 
 mining of the coal used in connection with the production of said copper 
 ores, and about 300,000 people directly dependent upon those so em- 
 ployed in said industry; and, in addition thereto, not less than 100,000 
 persons indirectly dependent upon the industry for their means of liveli- 
 hood, making a total of more than 500,000 people who are affected by 
 the curtailment of the output of copper; and 
 
 Whereas, On account of the war conditions now prevailing, the ex- 
 portation of copper to European countries has been greatly restricted, 
 which has already resulted in a curtailment of about 50% in the copper 
 production of said states, and has caused hardship and suffering among 
 those connected with the industry; and 
 
 Whereas, If this calamitous condition is prolonged, it will continue 
 to disastrously affect the entire population of said states and territory, 
 or at least 8,000,000 people, and throw out of employment many thousands 
 of persons who are now dependent upon the said industries for their 
 livelihood; 
 
 Now, Therefore, Be it unanimously resolved, by the American Mining 
 Congress, in Seventeenth Annual Convention assembled at Phoenix, Ari- 
 zona, that in order to prevent such great disaster to said states and to 
 the Territory of Alaska, we earnestly appeal to the Government of the 
 United States to use its great offices to keep open every available market 
 for copper and give full protection to the producers of the metal in the 
 shipment of same in neutral vessels to neutral ports. 
 
 Be It Further Resolved, That a copy of this resolution be transmitted 
 by telegraph to the Secretary of State of the United States of America. 
 
 CHAIRMAN PHILLIPS: It will be referred without debate to the 
 Committee on Resolutions. Are there any other resolutions to be sub- 
 mitted? If not, we will continue the discussion that was interrupted 
 at the noon hour. 
 
 SECRETARY CALLBREATH: Mr. Chairman: A few days ago 
 when it was agreed between Mr. Webb and Mr. Clark as to the form 
 of this report I wrote to each of the other members of the committee 
 suggesting that, having had a copy of the report as then prepared, I 
 would like to have them state whether they would approve the report 
 and allow their names to be used in connection with it, and asking them 
 to wire me if they had any objection, assuming that if they had made no 
 protest to the form of the report that they were practically in accord 
 with its provisions. 
 
 MR. WALTER DOUGLAS: Mr. Chairman: In view of the fact that 
 the discussion on the question of mine taxation has occupied perhaps a 
 
AMERICAN MINING CONGRESS 55 
 
 longer time than had been anticipated, I move that future remarks on the 
 subject be under the five minute rule. 
 
 (Motion seconded and carried unanimously.) 
 
 CHAIRMAN PHILLIPS: We will be pleased to hear from anyone 
 on this subject under the five minute rule. 
 
 MR. BERN: Mr. President, as the matter is finally before the 
 house, in line with the remarks I made this forenoon, I move that the 
 last paragraph of the report of the Committee on Mine Taxation be 
 stricken out and that the remainder of the report be adopted and de- 
 clared by the American Mining Congress as being the proper basis 
 for mine taxation in the Rocky Mountain and Pacific Coast mining 
 states. 
 
 CHAIRMAN PHILLIPS: Does that relate to "b" on the fourth 
 page? 
 
 MR. BERN: Yes. 
 
 (Further discussion called for.) 
 
 (Motion seconded and carried unanimously.) 
 
 CHAIRMAN PHILLIPS: The next order of business is the report 
 on Mining Investments, Chairman, Hon. W. R. Allen of Butte, Montana. 
 
 SECRETARY CALLBREATH: I am very sorry to say that Mr. 
 Allen is not here. He fully expected to be here, and we have had no- 
 word from him that he would not be here. The last word was about 
 two weeks ago when he fully expected to be here. This is a very 
 important subject, and I hardly know how we should treat it in the 
 absence of the report, but it seems to me that we ought not to pass it 
 by without some consideration of the means by which we may stimulate 
 mining investments in the West through the treatment of this subject. 
 I wish that we might have a discussion upon it in a general way, not 
 only the means of protecting mining investors, but the means of secur- 
 ing mining investments, the means of bringing to the West the capital 
 it needs for the development of its mines, the means when that capital 
 is brought to us to see that it is directed into those channels where it 
 may hope for success, and that it may be steered away from channels 
 of fraud and deception which are 1 commonly known to mining men, that 
 the West may profit by the development of its enterprises, that the 
 East and the whole world may profit by the increase in gold which is 
 so necessary in our world commerce. It seems to me there is so- 
 much that can be worked out through an effort of this kind that we 
 ought not to pass it by merely because the chairman of the committee 
 has failed to make his report. I might say while I am on my feet that 
 there is great agitation in this country as to how we may assume control 
 of the trade of South America, which ought to come to this country. 
 Heretofore, as most of you know, the South American trade has been 
 largely controlled by European countries. It has been much more diffi- 
 cult for us to get from this country to South American ports, very much 
 more difficult, than it was for European nations. Ordinarily, in order 
 to get to those ports we have gone first to London and then back across 
 the ocean to South America. The channels of trade heretofore have 
 been altogether towards Europe from the South American countries. 
 Now that trade relation has been, to a large extent, cut off. The South 
 American people want to patronize us. We have the goods and the 
 ability to sell them if they had the money to buy; but in connection with 
 the European control of this trade they have furnished the credit which 
 has enabled the South American people to do business. Our Eastern 
 economists have talked much about the great opportunity which has 
 been given the United States to reach after and control this trade, but 
 they have stopped short at the point where they found that we were 
 
56 OFFICIAL PROCEEDINGS 
 
 unable to extend the credits which are necessary to handle that trade. 
 The reason we cannot do it is because we haven't moi^ey enough in this 
 country to take care of their business as well as our own. A certain 
 amount of credit is necessary in all business transactions, but when 
 the burden of credit upon gold is too great the structure falls and 
 breaks to pieces. We have about reached the limit of credit that can 
 be based upon our gold supply. In order to extend and care for the 
 credits which are necessary to control South American trade we need 
 an increase in our gold supply. It seems to me this Congress ought to 
 be able to work out some plan by which we may better stimulate the 
 production of gold in the West. If we do that we will serve the West, 
 we will serve the country, and we will create a new channel for our 
 manufacturing industries. Whenever one business prospers, in this 
 country, every other business must, to an extent, prosper with it, I 
 hope this Congress will discuss this subject to see whether or not we 
 may arrive at some plan by which the produciton of gold in the Western 
 states may be stimulated. (Applause.) 
 
 CHAIRMAN PHILLIPS: Is there a gold miner in this convention? 
 
 MR. HARRY J. BENTON, of Arizona: Mr. Chairman, I cannot 
 understand why this convention has been called. It has simply been 
 called, as I understand, not to help the poor miner, the gold producer, 
 the prospector. I am not speaking for myself alone, but I know of a 
 great many miners who have rich gold properties in our beautiful state 
 of Arizona yet they have not the money to develop those properties. 
 They have got ten, twelve, fifteen in fact I personally have shipped 
 ore that went $59.39 to the ton to the Copper Queen smelter. After 
 mining, came transportation on this ore, and the settlement I received 
 left me $14.19. Can a gold miner produce any gold in our beautiful state 
 of Arizona, or any other state, with these exorbitant prices for railroad 
 transportation and smelting, when they dock you for the silica, when 
 they say you have not enough silica, or too much moisture, or not 
 enough moisture, and one thing and another all the way through? If 
 you are mining men here and have ever been 10 or 20 or 30 or 50 feet 
 underground you understand many of these things. You cannot ship 
 ore in the state of Arizona if it goes less than $35 to $40 a ton. Talk 
 about your gold, you can't do a thing with it. I have 35 tons of ore 
 blocked out in a mine. I have got 22 claims with over 3,000 feet of 
 work done on my property. What can I do with the ore. Nothing. I 
 dannot ship it to the smelter. I am broke. A mining man without 
 capital cannot do it. I know when the United Verde mine could have 
 been bought for $300. Tom Brady could have bought your Copper Queen 
 mine for $7,000. You don't know these things, but I do. These are 
 millionaire miners, but where is the poor miner going to get off? Where 
 is your proposition? Here is another thing I want to illustrate to you 
 gentlemen. Here is a prospector that goes out and looks for mining 
 claims. He thinks they are worth while. He will go and put his 
 good money in there and put down his prospect hole, and the next year 
 he comes along and he has to put a hundred dollars on each one of four 
 or five claims. Has he the money? I want to say to you gentlemen there 
 is not a mining man here except millionaire miners, that ever did his 
 legitimate assessment work every year according to what the law re- 
 quires. The law says you have to put a hundred dollars on each claim. 
 Show me a prospector here. And if he has ten claims, where will he 
 dig up that thousand dollars a year to do that work These are facts. 
 I want to say to you gentlemen there is not a mining man in the state 
 of Arizona that has forty-dollar rock who can ship that ore. You can't 
 mill it unless you have the mill, and if you can't mill it you can't ship 
 it, and your railroads and smelters take the whole of your profit, and 
 when you get through you cannot buy a side of bacon or a sack of beans. 
 These are my sentiments, gentlemen. 
 
AMERICAN MINING CONGRESS 57 
 
 MR. BASS: Mr. Chairman, I don't know who the gentleman is who 
 has just made that speech, but I will wager that he is a miner. I have 
 had a little experience of that kind myself. Now, I am mining in the 
 biggest hole in the earth. I didn't dig it myself; it is the Grand Canyon. 
 But I know this, that by the time I get my ore on the top and get it over 
 to the railroad I can't ship it, because I couldn't really get enough money 
 out of it to pay the freight, and yet I have the highest grade ore in 
 Coconino county, and asbestos, too some of you may need it in the 
 future if you have no use for it now. But I cannot ship it because the 
 freight is too high. We can ship it down to the smelters here anywhere, 
 almost, even to El Paso, for a very nominal rate, 90 cents a ton I believe 
 they charge from the Grand Canyon over their road to the smelter in 
 Yavapai county. I have a car of ore lying there, and when I got ready to 
 ship it, of course, about the time I was ready copper went down, and it 
 lays there yet. I know a man up there that shipped a carload of ore, and 
 when he received his returns he didn't get enough to pay his expenses, 
 and he paid his transportation and quit. Now, they take the smelter 
 returns, and by the time they get through with the moisture and silica 
 and all that stuff we are all in debt, so we quit. Why is it that they 
 can ship that fluxing ore for 20 cents a ton and we have to pay $7. I 
 don't understand it. And there is where your trouble is. That is what 
 stops your mining. You can't do it. There is no use in talking, you 
 go in debt if you undertake it. Now, my ore carries well in gold. I 
 have the original forms of copper away down in the Grand Canyon, 
 and when I get it up there of course I can't get capital to help me. I 
 am nothing but a prospector, but I have spent thousands of dollars, I 
 have hundreds of tons on original fissure veins, in schist, and anybody 
 that has ever mined copper knows that schist is the home of copper, 
 and if we could go down there and develop it we would have another 
 United Verde, and I have the pleasure of knowing all about the United 
 Verde. But the great trouble is this: They take their smelter returns, 
 and if they leave you enough to buy a sack of beans you are mighty 
 lucky. Now, if I ship lumber over our road I can ship a car of good 
 lumber for the same price I can ship culls. They don't charge any 
 more to ship mahogany than they do for culls; but when it comes to 
 ore it is a different proposition. There is where the trouble is. Now, 
 I wanted to say something on this taxation question. My five minutes 
 isn't up, is it? 
 
 CHAIRMAN PHILLIPS: We are not under the five-minute rule. 
 
 MR. BASS: And that is this that if we expect to get capital to 
 come into our mines in Arizona we must stop this bogus mining loca- 
 tion, that is, the location of bogus mines speculative locations loca- 
 ting mines under the mineral laws and holding them for speculation. 
 We have seven miles of it right up where I live, and if I should under- 
 take to talk about getting some capital down in the Grand Canyon they 
 would laugh at me, because they have been hornswoggled too much on 
 bogus mining claims. If we could stop that we would do a good thing. 
 Then when we get people to go down where God Almighty has opened 
 up the earth we can show them something better than can be found in 
 any other place in the state of Arizona, and I venture to say that I 
 will show you that we have conditions existing there that will make it 
 possible to get capital to come in there. You take the last map just 
 issued by the Geological Survey of the United States; it shows it is 
 there, but we can't get the capital. It is impossible. But if you could 
 put taxation on some of these bogus claims so that they couldn't afford 
 to hold them without development they would turn them loose and we 
 would get people in there who would put money into real mines. They 
 go back East and raise money on options, and the people come out and 
 spend $5,000 or $6.000 and throw the matter up and go back and say, 
 "You haven't any mines." 
 
58 OFFICIAL PROCEEDINGS 
 
 MR. UTTER: Mr. President, I think we have a remedy for the 
 trouble stated by our Arizona brother in some of the matters that have 
 been mentioned. If they will all remove to New Mexico I can assure 
 them fair railroad rates and fair smelter charges; and then in New 
 Mexico we can ship ores up to the value of $50 a ton for a dollar a 
 ton freight. We have a smelting charge of $5 to $6, and those are mat- 
 ters that are of vital importance. Some of those, and most of them 
 I think make a graduated freight charge, and that is worthy of consider- 
 ation, so that if our Arizona brothers will just step over the line their 
 troubles will be over, I think. (Laughter and applause.) 
 
 MR. BASS: I would hate to have to move to New Mexico while I 
 am in office. (Laughter.) 
 
 CHAIRMAN PHILLIPS: Any further discussion on this subject? 
 
 MR. BENTON: Mr. President and Gentlemen: Why is it when 
 you ship a carload of cobblestones you pay so much freight on it, but it' 
 you ship a carload of gold rock the higher the gold contents the higher 
 your freight rate will be? Does it cost any more to haul a carload of 
 cobblestones than a carload of ore? A ton is a ton, whether it is cobble- 
 stones or gold rock; yet you ship a carload of gold rock, and what is 
 the result? If it goes $12 to the ton you are taxed maybe $8 freight, 
 and if it goes $50 you are taxed $14. Where does the difference come in? 
 We are here in this convention to right these things, and I pray to God 
 that you will stand up and do these things like men, like American 
 citizens, and stand by the poor miner who produces. The man who 
 takes these values out of the ground robs nobody; he goes out in the 
 hills all by his lonesomeness; for days and weeks he is out in the hills 
 by himself and his burro, and sometimes he has no burro, and he has 
 to live on a sack of beans that he has packed. And finally he finds the 
 precious metal that everybody loves and everybody grasps and wants. 
 What does he get out of it? Not a dime. The other fellow comes in 
 with the capital and says, "Oh, well, I will give you a hundred dollars." 
 The poor fellow is nearly starved. What is he going to do? He takes 
 that hundred dollars, and the other fellow makes millions out of it, and 
 then they will tell you, "We are the mining men." My first experience 
 in mines was in Leadville, Colorado, in 1878. I know the game all the 
 way through, and I went broke and am broke today. I tell you right 
 here, gentlemen, I am a stayer, though; I mortgaged my home, even 
 the bed and the carpets that my dear wife walks on, and put it in my 
 mines, because my wife has faith in them. Understand me? I am a 
 stayer. I am a miner. (Applause.) 
 
 CHAIRMAN PHILLIPS: Any further discussion of this matter? 
 If not, we will pass to the next paper, which is on Mining Development, 
 by Mr. E. G. Reinert of Denver. 
 
 Mr. Reinert's paper will be found at page 193 of this report. 
 
 CHAIRMAN PHILLIPS: The next paper on the program is a 
 paper by George Otis Smith, Director of the United States Geological 
 Survey, entitled "Why Optimism." 
 
 SECRETARY CALLBREATH: I am in receipt of this letter in con- 
 nection with Dr. Smith's paper: 
 
 Washington, November 28, 1914. 
 Mr. J. F. Callbreath, Board of Trade Building, Phoenix, Arizona: 
 
 My Dear Mr. Callbreath I am very sorry to have to advise you that 
 it will not be possible for me to attend the Phoenix Congress. I had 
 had every expectation of being with you until after a final conference 
 with Secretary Lane regarding the trip West which I had planned. He 
 and I agreed that my absence from Washington at this time was out of 
 
AMERICAN MINING CONGRESS 59 
 
 the question. Congress will be in session here during the time that I 
 would be in the West and appointments have already been made for 
 hearings before the Senate Public Lands Committee, the first of which 
 falls on December 9. I have, however, been working evenings on the 
 address which I expected to deliver and I take some little pleasure in 
 rncjosing it. Since my idea has been to strike a note that might be 
 encouraging to some of the mining men in attendance on the Congress, 
 I hope that possibly you can arrange to have it read as scheduled. In 
 the event that you follow the plan of other years and print some of the 
 papers for distribution at the Congress, I should be perfectly willing to 
 have charged to me some of the expense in connection with my paper 
 and I should appreciate receiving a hundred copies or so. 
 
 On page 4 you will find the omission of two numbers, the figures 
 for which will not be available until after the first of the month when I 
 will transmit them to you, by wire if necessary. The only actual omis- 
 sion is after the words "fourth week by." The second space may be 
 filled by simply adding the figures for the four separate weeks of the 
 month. 
 
 Please present my regrets at not being able to attend the Congress 
 to any inquiring friends and with best wishes for the success of the 
 Phoenix meeting, believe me. 
 
 Yours very cordially, 
 
 GEORGE OTIS SMITH, Director. 
 
 SECRETARY CALLBREATH: The paper is here, Mr. Chairman. 
 
 CHAIRMAN PHILLIPS: Gentlemen, is it your pleasure that this 
 paper be read? The Secretary will please read the paper. 
 
 SECRETARY CALLBREATH: May we have a volunteer? 
 
 MR. F. L. RANSOME, Washington, D. C.: As I suppose I am the 
 only member of the Geological Survey here, I shall be pleased to read 
 the paper if it is desired. 
 
 Dr. Smith's paper will be found at page 217 of this report. 
 
 CHAIRMAN PHILLIPS: I understand the paper entitled "The 
 Needs of the Zinc Mining Industry," by Mr. Otto Ruhl, is not here. 
 
 The Secretary has received some communications to be presented to 
 the Congress. 
 
 New York, December 9, 1914. 
 J. F. Callbreath, Secretary American Mining Congress, Phoenix: 
 
 Greatly regret it will be impossible for me to attend Congress. 
 Wishing you successful meeting and envying you the opportunity of 
 spending a few days in a delightful climate among congenial friends, I 
 am, with best wishes, JOHN HAYS HAMMOND. 
 
 San Francisco, Cal., Dec. 1, 1914. 
 Mr. J. F. Callbreath, Jr., Secretary American Mining Congress, Denver, 
 
 Colorado: 
 
 Dear Callbreath I am very sorry indeed that it will be impossible 
 for me to attend the meeting of the Congress this year. I have wanted 
 very much to get down there and meet you and my other friends, and 
 this desire is all the stronger since I see the very attractive program 
 that has been laid out. I really feel though, that with the pressure of 
 many things I cannot spare the time to make the trip. Please express 
 my regrets to any friends who may inquire. 
 
 With best wishes for the meeting, I am, 
 
 Cordially yours, H. FOSTER BAIN. 
 
60 OFFICIAL PROCEEDINGS 
 
 Denver, Colo., December 7, 1914. 
 American Mining Congress, Phoenix, Arizona: 
 
 Congratulations upon the completion of your seventeenth year of 
 activity in behalf of mining. Please accept regrets for my inability to 
 appear in person upon your program. Am sure your gathering will be 
 a momentous one. Upon question of mining investments, there will be 
 none to discuss if agents of the government are permitted to restrict 
 the generous development of the West, thus shutting off the ambitions 
 of both Eastern and Western citizens who desire to participate in the 
 creation of Western industries upon the public lands. We are for con- 
 structive, not destructive conservation. Please smash the destroyers for 
 us. EDWARD G. REINERT. 
 
 Chicago, 111., December 8, 1914. 
 James F. Callbreath, Phoenix: 
 
 Congratulations to the Congress. Mining men should be interested 
 in establishing proper credit for their securities and some form of pro- 
 tection for the investor, that they could not be discriminated against on 
 account of making such investments. Financiers know that prosperity 
 depends on operators of mines and the soil. J. F. ERISMAN. 
 
 New York. December 7, 1914. 
 J. F. Callbreath, care Mining Congress, Phoeniz, Arizona: 
 
 At last moment find it impossible to attend convention. Unfinished 
 business here prevents my leaving. I assure you it is a disappointment 
 to me that I am not privileged to meet with you and take part in the 
 affairs of the Congress, though I trust my absence may not detract in the 
 least from the success of the meeting. E. A. MONTGOMERY. 
 
 Columbus, Ohio, December 4, 1914. 
 
 Mr. J. F. Callbreath, Secretary the American Mining Congress, Denver, 
 Colorado : 
 
 Dear Sir I am very sorry to have to advise that it will be impossible 
 for me to get away to attend the meeting of your honorable body. I had 
 built up fond hopes that I would be in shape to attend this meeting, but 
 owing to some difficulties that we have been contending with in some of 
 the mining propositions here at home, I feel that I would be doing an 
 injustice tp the state by leaving at the present time. 
 
 Hoping that your meeting will be a success and that everything will 
 go well with you and wishing you all the best of good luck, I am, 
 Very truly yours, J. M. ROAN, 
 
 Chief Deputy and Safety Commissioner of Mines. 
 
 Bisbee, Ariz., December 4, 1914. 
 To the Delegates to the American Mining Congress, Greeting: 
 
 We, the directors of the Warren District Commercial Club, for and 
 on behalf of the business men and residents of Bisbee and the Warren 
 District, the greatest copper producing district in the Southwest, do 
 extend to you a cordial invitation to visit Bisbee and the mines of the 
 Warren Mining District during your stay in Arizona, and assure you 
 of a hearty welcome here as well as an experience which must prove 
 interesting and highly instructive. 
 
 We regret that it has been found impossible to have the railroads 
 run a special excursion train here, but all who travel over the Rock 
 Island and the El Paso & Southwestern roads have stop-over privileges 
 and the railroads have stated that they will make a special party rate 
 from Phoenix to Bisbee of a single fare plus one-third for the round 
 trip to parties of 15 or more. Information relative to the formation of 
 
AMERICAN MINING CONGRESS 61 
 
 such parties may be obtained from the delegates from this club, this 
 city and Cochise county or by application to the local ticket agents in 
 Phoenix. 
 
 It is our sincere hope that many of you will take advantage of this 
 rate and the opportunity to visit this wonderfully mineralized district 
 that produces more than one-third of the copper that is taken from the 
 earth in Arizona as well as a large proportion of the gold, silver and lead. 
 Again assuring you of our desire to meet you here and of a cordial 
 welcome when you arrive, we remain, 
 Yours very truly, 
 
 J. J. BOWEN, 
 
 M. NEWMAN, 
 
 M. J. CUNNINGHAM, 
 
 E. C. CAMPBELL, 
 
 E W. BEDDOW, 
 
 GEO. L. DAVIDSON, 
 
 L. J. OVERLOCK, 
 
 JESSE YOAKUM, 
 
 H. B. HUNTER, 
 
 JOSEPH H. GRAY, Secretary, 
 
 Directors. 
 
 MR. GERALD SHERMAN: Mr. President, I have the honor of be- 
 ing a delegate from the Bisbee Board of Trade, and I wish to confirm 
 their invitation and assure any of the members who might be able to 
 come that they will be taken care of and that every possible effort will 
 be made to show them what is there and to make their visit a pleasant 
 one. 
 
 SECRETARY CALLBREATH: I have a communication from Mr. 
 I. C. Thoreson, United States Surveyor General of Utah. 
 
 CHAIRMAN PHILLIPS: Is it the desire of the convention to hear 
 the paper read? 
 
 (Reading called for.) 
 
 Mr. Thoreson's paper will be found at page 190 of this report. 
 
 MR. UTTER: Mr. President, I move that paper be filed and that 
 the Committee on Resolutions may be asked to formulate a resolution 
 or recommendation to be presented to this Congress and passed and 
 possibly forwarded to our lawmakers or the authorities in Washington. 
 This is in the interest of the poor miner. 
 
 (Motion seconded and carried unanimously.) 
 
 CHAIRMAN PHILLIPS: Gentlemen, I am sure that such of you as 
 are able to make the trip to Bisbee will find it both profitable and pleas- 
 ant, and it is to be hoped that some of you will be able to accept the 
 very kind invitation issued by the people there. I wish my plans were 
 such that I could accept it, because I remember some very pleasant 
 days spent at Bisbee some years ago. Is there any further business to 
 come before the convention this afternoon? We have reached the end 
 of our program. If not, the Congress will now stand adjourned until 
 7 : 30 o'clock this evening. 
 
 WEDNESDAY, DECEMBER 9, 1914. 
 Morning Session, 9:30 O'clock A. M. 
 (President Scholz in the chair.) 
 
 THE PRESIDENT: Gentlemen, you will please come to order. The 
 first thing on the program this morning will be the introduction of reso- 
 lutions. Has the Committee on Resolutions anything to bring forward? 
 
62 OFFICIAL PROCEEDINGS 
 
 MR. REES H. BEDDOW: Mr. President and Gentlemen: On behalt 
 of the Resolution Committee I beg to report Resolution No. 1, introduced 
 by Mr. George Dern of Utah, with the recommendation of the committee 
 that same be adopted. 
 
 I move that the same be adopted by the Congress. 
 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT: Are there any further resolutions to be in- 
 troduced this morning? 
 
 MR. BEDDOW: Mr. President, I have a copy of a bill in my pocket 
 that is pending before Congress, and it has been sent down here from 
 New Mexico with a request that this Congress take some action upon it. 
 I am not familiar with the matter referred to in this bill and don't want 
 to assume any responsibility for its introduction before the Congress, 
 but if it is thought proper I can bring it forward and it can be read 
 and you may take such action as you deem proper. 
 
 THE PRESIDENT: Has the Resolutions Committee passed upon 
 that bill? 
 
 MR. BEDDOW: The bill was presented to the committee yester- 
 day, but they thought it would be the proper thing to bring it before the 
 Congress. 
 
 THE PRESIDENT: If it meets with the approval of the delegates, 
 I would suggest that the bill be read and be submitted to a vote of the 
 Congress after it has been read. 
 
 The bill was read by the Secretary, and is as follows : 
 
 In the House of Representatives. H. R. 18519. 
 
 August 25, 1914, Mr. Fergusson introduced the following bill, which 
 was referred to the Committee on Public Lands and ordered to be 
 printed : 
 
 A BILL to amend section 2324 of the Revised Statutes of the United 
 States, relating to mining claims. 
 
 Be it enacted by the Senate and House of Representatives of the 
 United States of America in Congress assembled: That the provisions 
 of Section 2324 of the Revised Statutes of the United States, which re- 
 quire that on each claim located after the 10th day of May, 1872, and 
 until patent has been issued therefor, not less than $100 worth of labor 
 shall be performed or improvements made during each year, be suspended 
 for the year 1914, so that no mining claim which has been regularly 
 located and recorded as required by the local laws and mining regula- 
 tions shall be subject to forfeiture for nonperformance of the annual as- 
 sessment for the year 1914; provided, that the claimant or claimants 
 of any mining location, in order to secure the benefits of this act, shall 
 cause to be recorded in the office where the location notice or certificate 
 is filed on or before December 31, 1914, a notice that he or they in 
 good faith intend to hold and work said claim; provided, however, that 
 the provisions of this act shall not apply to the state of South Dakota. 
 
 Section 2. That this act shall take effect from and after its pas- 
 sage. 
 
 THE PRESIDENT: Gentlemen, you have heard the bill read; is 
 there any discussion on the subject? 
 
 MR. BEDDOW: Mr. President, the only information I have got in 
 regard to this bill is this that the matter was first brought up before 
 the State Republican Convention of New Mexico in August. Resolu- 
 tions were passed at that convention requesting Congressman Fergusson 
 
AMERICAN MINING CONGRESS 63 
 
 to introduce this bill in Congress, and as I said before, I know nothing 
 about the merits of the bill, because I am not familiar with the condi- 
 tions down there in New Mexico where it is supposed to benefit quite 
 a number of claim holders. The statement made before the Democratic 
 State Convention, to which it was also presented, was that there were 
 a large number of claim holders in Grant and Sierra Counties, New Mex- 
 ico, that had been working their claims for a number of years and that 
 when they were not working their own claims they were working in other 
 mines there for wages, and on account of the war, the men had been 
 thrown out of work, and that they had no money to do their assess- 
 ment work with. Now, that is the extent of my information in regard to 
 this bill. You gentlemen probably know more about it than I do. 
 
 MR. BERN: I move that the matter be referred to the Committee 
 on Resolutions. 
 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT: Are there any other resolutions to be pre- 
 sented to the Congress? If there are no more resolutions, we will pro- 
 ceed with the regular program; but before going ahead with the busi- 
 ness session I would like to say to those delegates who came in after 
 our first session that we are very cordially welcomed by the people of 
 Phoenix; we had the former governor, the present governor, the mayor 
 of the city and others to welcome us and to extend to us the hospitality 
 of this town and state. The only reason we didn't have a king here is 
 because under our constitution we haven't any, but even the policeman 
 on the corner welcomed me this morning when I took my early walk. 
 I don't think you appreciate how considerate these people are of us. 
 You will notice the footlights on the stage are red so that you can not 
 see the blush of the chairman when! occasions arise to make him blush. 
 I sat in the front row yesterday when Mr. Phillips occupied the chair, 
 and a gentleman in the back asked him what he knew about mining, and 
 Dr. Phillips admitted to himself that he didn't know much about it. I 
 wondered why he didn't blush, but I now know the clause the reflec- 
 tion from the footlights prevent your seeing the exact condition of the 
 chairman behind this table. 
 
 When the local committee discovered that the chairman had cold 
 feet they provided gas stoves, and many similar things, for which we 
 are duly thankful. One of the things I have observed is that every 
 time I leave this room (I am generally the last one out the door, be- 
 cause the distance is greatest) some resident who owns an automobile 
 lingers and takes me to the hotel. I don't know what the purpose is, 
 but I think he* is afraid someone might sell me a slice of desert as a 
 farm or fake mining claim. At any rate, I have been very well taken 
 care of, and I am sure the delegates have all had the same experience. 
 We are very grateful for the hospitalities extended to us. 
 
 Next on the program is the report of the Committee on Prevention 
 of Mine Accidents, by Dr. W. R. Ingalls. 
 
 SECRETARY CALL.BREATH: This is not in the form of a report, 
 but in the form of a personal letter in response to my request for a 
 report: 
 
 Report of Committee on Mine Accidents. 
 
 Hill Bldg., 10th Ave. at 36th St., New York, N. Y. 
 James F. Callbreath, Esq., Munsey Bldg., Washington, D. C.: 
 
 My Dear Mr. Callbreath In response to your request for a state- 
 ment respecting the work of the Committee on the Prevention of Mine 
 Accidents, whereof I am chairman, which committee was originally ap- 
 pointed by the American Mining Congress, and later became a committee 
 
64 OFFICIAL PROCEEDINGS 
 
 of the United States Bureau of Mines, I have the permission of the 
 Director of the Bureau to inform you as follows: 
 
 The committee, having made several preliminary reports, has al- 
 ways eoitertained the idea of preparing a final draft for a model law, 
 profiting by the comments made upon its earlier work. As things pro- 
 gressed, however, it developed that the studies that were involved were 
 beyond the means of the members of the committee unassisted. Conse- 
 quently Dr. Joseph A. Holmes, Director U. S. Bureau of Mines, invited 
 the committee to serve as a committee of the bureau. His invitation 
 was welcomed and accepted. It was fully appreciated, moreover, that 
 the United States Bureau of Mines was in the best position to see that 
 whatever report might finally be made by the committee should be 
 properly distributed among miners and mine operators. 
 
 Since April, 1911, up to this date a great deal of work has been done 
 involving the co-operation of a great many persons. It was decided to 
 extend the scope of the projected report beyond any previous ideas, 
 and instead of submitting a mere draft for a mining law, to submit 
 such a draft with copious annotations, giving the reasons for all opinions 
 and decisions upon important matters and several chapters in explana- 
 tion of important features of mine inspection and mining practice. The 
 report will constitute a volume of about 300 pages. It is now in type, 
 and as soon as possible after the revision of the proofs by the committee 
 will be issued by the United States Bureau of Mines. It is hoped that 
 this publication will occur about the end of this year. 
 
 Yours very truly, W. R. INGALLS. 
 
 SECRETARY CALLBREATH: I might say, in this connection, that 
 this committee is composed of some of the ablest engineers of the 
 country. The committee was first appointed at the Denver convention 
 in 1906. After about two years service in getting together the data 
 necessary in doing its work the committee found, as Mr. Ingalls states 
 in his communication, that the Mining Congress was not able to finance 
 its work and the members of the committee did not feel like performing 
 the work and paying the bills for such a work as they have since ac- 
 complished. At that time the Bureau of Mines came to the rescue and 
 reappointed the committee as a committee of the Bureau of Mines, and 
 the work has been carried on under that head since. This accounts 
 for the fact that the chairman of the committee felt that he could not 
 make a regular report except with the consent of the director of the 
 Bureau of Mines. I am sure that when this report is made it will be 
 found to be one of very great value, and I trust that those of you who 
 are interested will make early application to the Bureau of Mines for a 
 copy. 
 
 In this connection I may say something that I hope will be said 
 more forcibly and completely hereafter, and that is that one of the most 
 difficult things we have in our Washington work is to get enough money 
 appropriated so that publications of this kind can be generously dis- 
 tributed. The Bureau of Mines is limited in its appropriation. Unfortu- 
 nately, as Dr. Phillips' story illustrated yesterday, it looks like a case 
 of "All for the white man and none for the nigger," in the division of 
 appropriations. We ought to have a direct appropriation to the Bureau 
 of Mines to cover its work, but instead of that we are forced to take our 
 share of the appropriation made to the Interior Department, divided 
 up as that department may decide, so that in the growing work of the 
 Bureau of Mines we only get the same division as we would if the work 
 had been thoroughly established. In other words, the older bureaus 
 get in proportion to previous appropriations, holding the Bureau of 
 Mines to its present status. I feel that in this connection it is proper 
 for me to say that the Bureau of Mines has been engaged in the prepara- 
 tion of a codification of the mining laws of the United States. That 
 
AMERICAN MINING CONGRESS * 
 
 work is practically completed and in the hands of the printer. One 
 of the things I have tried to do in Washington was to secure an appro- 
 priation by which that book might be published in sufficient quantities 
 so that every mining man who needs that work might get it from the gov- 
 ernment. We have not succeeded in getting such an appropriation. We 
 have succeeded in providing for its publication, its distribution to the 
 libraries and the public institutions which are entitled to have it, and 
 the book will be on sale at a very low price. The cost for printing the 
 first 1,500 copies being about $4,500, while the cost of 3,500 additional 
 copies would be about $1,500, but we were unable to get the order for 
 the 5,000 copies for free distribution, and because we couldn't get that 
 $1,500 you gentlemen who need this work will have to buy it. It may 
 be all right in some senses that you should buy it, because it will come 
 to you at a very low cost from the public printer. The only point I make 
 it that we need sufficient force back of us so that we can demand for 
 the mining industry a special appropriation which will cover the actual 
 need for the publication of such works as this. The Agricultural De- 
 partment during the last 18 years has distributed free nine million 
 copies of its Year Book to the farmers, but when it comes to publishing 
 this codification of the mining laws for free distribution to miners, we 
 cannot get $1,500 to print 3,500 copies. The Agricultural Department 
 can distribute 500,000 copies of a similar publication every year and the 
 Bureau of Mines cannot distribute 3,500 copies one time only. This 
 indicates very clearly the necessity for a better organization of mining 
 men so that we do not have to say please, but we can say, "Gentlemen, 
 we want this and we have got to have it." (Applause.) 
 
 THE PRESIDENT: Gentlemen, you have heard the report sub- 
 mitted by Dr. Ingalls. What is your pleasure about it? 
 
 MR. SWART: Do I understand this committee is still a committee 
 f the American Mining Congress? 
 
 THE PRESIDENT: Yes. 
 
 MR. SWART: Then I move that this report be considered as a 
 progress report and spread on the minutes. 
 
 SECRETARY CALLBREATH: May I suggest a vote of thanks t 
 that committee for their efficient work? 
 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT: The next on the program is the report of th 
 committee on revision of general land laws, by Mr. E. B. Kirby of St. 
 Louis. 
 
 MR. CLARK: Mr. President and Gentlemen: As one of the mem- 
 bers of the committee, I have a letter from Mr. Kirby addressed to me at 
 the Chamber of Commerce in which he expresses regrets that he is 
 unable to present the report and requesting me to do so. I will rea* 
 the report: 
 
 Report of the Committee on Revision of the Mineral Land Laws to the 
 American Mining Congress, December 9, 1914. 
 
 Since the last annual convention, the American Mining Congress 
 has taken every opportunity to press for the creation by the Congress 
 of the United States of a commission which shall revise and codify the 
 mineral land laws of the United States. 
 
 Your committee takes pleasure in reporting that encouraging prog- 
 ress towards the desired end has been made at Washington. A bill 
 (No. 4373), providing for the appointment of the commission desired, 
 was introduced in the Senate by Senator Smoot and was approved by the 
 Secretary o f the Interior, as follows: 
 
66 OFFICIAL PROCEEDINGS 
 
 "Hon. T. J. Walsh, Chairman Committee on Mines and Mining, United 
 
 States Senate: 
 
 "My Dear Senator I am in receipt of your letter of February 9, 
 1914, transmitting for report a copy of S. 4373, a bill designed to provide 
 for a commission to codify and suggest amendments to the general 
 mining laws. The bill provides that the proposed code shall not deal 
 with lands containing deposits of coal, oil, gas, phosphates or soluble 
 potassium salts. Various recommendations and amendments to the gen- 
 eral mining laws have been suggested by this department from time to 
 time, and there seems to be more or less desire on the part of those 
 connected with prospecting or mining for certain amendments to the 
 law. The codification of all laws relating to the location, development 
 and disposition of such mineral lands would also, in my opinion, be 
 desirable. I believe that the investigations and findings by such a 
 commission as is provided for in this bill would be of material value to 
 Congress, and have therefore to recommend that the measure be enacted. 
 "Very truly yours, FRANKLIN K. LANE." 
 
 The bill, after receiving some alterations, was favorably reported by 
 the Committee on Mines and Mining, and was passed by the Senate on 
 May 7th. Meanwhile, on April 1, 1914, Mr. Taylor of Colorado intro- 
 duced) a similar measure (Bill 15288) in the House of Representatives, 
 which was likewise approved by the Secretary of the Interior and favor- 
 ably reported back to the House by its Committee on Mines and Mining. 
 
 At that stage, Congress decided to restrict its legislative program 
 for the remainder of the prolonged session to the trust bills, and your 
 representatives were informed that no further progress with the revision 
 bills would be possible until the next session. Later on, the adminis- 
 tration measures relating to coal, oil, etc., were added to the legislative 
 program and it was understood that the revision bill would be included 
 with these. This expectation was not fulfilled and the House adjourned 
 without action in the matter, so that nothing further can be done until 
 the winter session. 
 
 Both the Senate and the House bills vary somewhat from the meas- 
 ure recommended by the American Mining Congress, which provided for 
 a commission of five members who should be selected by the President 
 for their recognized knowledge and experience in the mining industry 
 (see copy attached). In the Senate bill, this was amended to create a 
 commission of three members, two of whom should be lawyers and one 
 a mining engineer. The House bill, on the other hand, permitted the 
 commission to consist of five members, but provided that they should 
 serve without compensation. 
 
 While these alterations were unsatisfactory, it is believed that the 
 best opportunity to make further efforts for their correction will be pre- 
 sented after the passage of the House bill and when it meets the Senate 
 bill in conference. 
 
 Your committee believes that the most important qualification of 
 the commission should be its ability to command the confidence of the 
 mining communities and that this end can be best attained by having 
 at least five members and leaving the President free in making the se- 
 lections. Moreover, the members should be properly paid so that the 
 appointments may not be restricted to men of wealth and in order that 
 the business may be undertaken in a serious way, befitting its import- 
 ance. The House bill will shut out from any possibility of selection 
 the vast majority of mining men as it restricts the personnel of the 
 commission to those who have the rare combination of a knowledge 
 of the subject, a desire to work for it, and who, at the same time, possess 
 such incomes and freedom from business duties that they can leave 
 their own affairs for six months of arduous labor, and bear the serious 
 expenditures which cannot be included in government accounts. 
 
AMERICAN MINING CONGRESS 67 
 
 At the proper time, further efforts will be made to have these 
 difficulties considered by those who are in charge of the bills, but in 
 any case, it is probable that a revision bill will be passed at the next 
 session. 
 
 In the meantime, public interest is growing and the forces massing 
 back of the revision movement are steadily increasing. In the American 
 Institute of Mining Engineers and the Mining and Metallurgical Society 
 of America, no other matter of public policy has been commanding such 
 interest as this. In both organizations, the sentiment in favor of a 
 general revision is overwhelming and each one has gone as far as it 
 could in approving and aiding the movement. The American Institute 
 of Mining Engineers has been specially restricted in its support by 
 provisions in its constitution which bar it from taking up public ques- 
 tions and an effort is now being made to have its sphere of activity 
 enlarged. 
 
 In the meantime, the American Mining Congress remains as the only 
 general organization of the great mining industry which is in a position 
 to freely voice its wishes and act for its interests in any direction. 
 There has certainly never been a time when these interests have needed 
 co-operation and intelligent direction so much as they do now, and min- 
 ing men cannot afford to have the activities of the Congress weakened 
 through any lack of financial support. 
 
 Practical experience has shown that to be effective, the recommen- 
 dation of the Congress upon any matter must be properly presented at 
 Washington, and this requires steady, persistent work by some one who 
 can stay there. At present, there is no way of securing this until the 
 Secretary of the American Mining Congress is given the means with 
 which to carry on his work in the proper way. This is absolutely 
 necessary to supplement the efforts of your various committees who can 
 only act through correspondence and the occasional visits of their mem- 
 bers. 
 
 The mining industry cannot hope that any of the afflictions from 
 which it is suffering will disappear by chance. The only help in sight 
 is self help, the labor and money contributed by mining men to the work 
 of the American Mining Congress. 
 
 (Signed) EDMUND B. KIRBY, Chairman. 
 
 Committee: 
 
 E. B. Kirby, St. Louis, Mo., Chairman. 
 Alaska L. V. Ray, Seward. 
 Arizona Will L. Clark, Jerome. 
 California E. H. Benjamin, San Francisco. 
 Colorado Victor C. Alderson, Denver. 
 District of Columbia Hennen Jennings, Washington. 
 Idaho J. R. Richards, Boise. 
 Montana William Scallon, Helena. 
 Minnesota Horace V. Winchell, Minneapolis. 
 Missouri E. B. Kirby, St. Louis. 
 Nevada D. C. McDonald, Ely. 
 New Mexico C. T. Brown, Socorro. 
 Oregon H. H. Schwartz, Portland. 
 Texas Isadore Broman, Austin. 
 Utah W. H. King, Salt Lake. 
 Washington L. K. Armstrong, Spokane. 
 Wyoming Edwin Hall, Lusk. 
 
S OFFICIAL PROCEEDINGS 
 
 Appendix. 
 
 Preliminary Draft Suggested for a Joint Resolution of the Senate and 
 
 House. 
 
 That Congress shall undertake a general revision of the laws relating 
 to mineral bearing lands and mineral rights within the United States 
 and Alaska, and such revision shall cover mineral deposits of every 
 kind except those of coal, oil, phosphates and salines, which are set 
 aside as the subjects of other and special legislation. 
 
 In view of the technical nature of the problems presented by the 
 work it is desired to secure first the results of the knowledge and ex- 
 perience which exists among those who are engaged in the mining in- 
 dustry. 
 
 To this end- the President shall, within 60 days hereafter, appoint 
 a commission of five members who shall be selected for their recognized 
 knowledge and experience in the mining industry. 
 
 The commission shall consider the mining laws of this and other 
 countries and shall hold public hearings in the principal mining centers 
 of the Western States and Alaska, giving full opportunity for the expres- 
 sion of public opinion concerning the problems before it. Its recom- 
 mendations shall be presented in the form of a fully drafted mining code. 
 
 Within six months after the appointment of the commission its re- 
 port shall be delivered to the President, who shall within 30 days there- 
 after transmit it to Congress with his further recommendation if there 
 be any. 
 
 Members of the commission shall receive per diem with expenses 
 and shall engage such clerical assistance as may be necessary for the 
 work. 
 
 (Clause providing for the necessary appropriation.) 
 
 Resolution above introduced by Will L. Clark. 
 
 (Applause.) 
 
 THE PRESIDENT: Gentlemen, you have heard the report of tk 
 Committee on Revision of General Land Laws. What is your pleasure 
 about the report? Is there any discussion? 
 
 MR. CLARK: Mr. Chairman, in connection with the report we hav 
 prepared a resolution which I will also read: 
 
 RESOLUTION NO. 2. 
 (Introduced by the Committee on Revision of Mineral Land Laws.) 
 
 Be It Resolved, By the American Mining Congress, in regular con- 
 vention assembled at Phoenix, Arizona, 
 
 That Congress shall be urged to provide for a general revision of 
 the laws relating to mineral bearing lands and mineral rights within the 
 United States and Alaska, and such revision shall cover mineral deposits 
 of every kind except those of coal, oil, phosphates and salines, which are 
 set aside as the subjects of other and special legislation. 
 
 In view of the technical nature of the problems presented by the 
 work it is desired to secure first the results of the knowledge and ex- 
 perience which exist among those who are engaged in the mining in- 
 dustry. 
 
 To this end it is urged that the President shall, within 60 days 
 hereafter, appoint a commission of five members who shall be selected 
 for their recognized knowledge and experience in the mining industry. 
 
 The commission shall consider the mining laws of this and other 
 countries, and shall hold public hearings in the principal mining centers 
 
AMERICAN MINING CONGRESS It 
 
 of the Western States and Alaska, giving full opportunity for the ex- 
 pression of public opinion concerning the problems before it. Its recom- 
 mendation shall be presented in the form of a fully drafted mining code. 
 
 Within six months after the appointment of the commission its re- 
 port shall be delivered to the President, who shall within 30 days there- 
 after transmit it to Congress with his further recommendations if there 
 be any. 
 
 Members of the commission shall receive per diem with expenses 
 and shall engage such clerical assistance as may be necessary for tfae 
 work. 
 
 (Clause providing for the necessary appropriation.) 
 
 MR. CLARK: I have left blank the clause to be provided for the 
 necessary appropriation. 
 
 Regarding this resolution, as set forth by the report, a good deal of 
 progress has been made, and the bills now before Congress should be 
 amended in conference, so the committee thinks, to include, as stated, 
 five members instead of three as provided by the Senate bill, and that 
 these members should be paid a per diem and expenses in order that 
 selection may be freely made from those who should appear to be best 
 fitted for the work without involving personal labor and expenses to 
 appointees. Now, I will not go into the subject of the great need of 
 revision of the mineral land laws at any length, because that has been 
 discussed, and I believe every Western mining man and nearly every 
 one engaged in the industry, understand the very pressing need of this 
 work. It is one of those things which have been talked about so fre- 
 quently that revision should have been granted by the Congress of the 
 United States immediately that this was presented to them in proper 
 form, yet men have worked on this proposition for over twenty years. 
 Some of the most eminent men in the mining industry in the United 
 States have devoted much time and labor to it. Dr. Raymond, for in- 
 stance, told me he had repeatedly formulated resolutions on the subject; 
 and following that along, I talked, myself, once with five United States 
 senators, happening to catch them together, about the matter, and they 
 said, "Oh, it is a monumental work." I told them I thoroughly disagreed 
 with that view, and they could select a commission that could easily do 
 the work and do it well. I said a year, and they seemed to be amazed; 
 yet this provides for six months, and it can easily be done, I believe, in 
 six months. For a while there was a difficulty about it, during the acute 
 stage of the discussion, concerning extra-lateral rights, but now there 
 is a general agreement that they can be done away with. Now, just one 
 phase of the subject, the question of the discovery of oil, or even of 
 mineral as an absolute necessary requirement under the present laws. 
 There is no reason why you should have to discover it. The policy of 
 this government has always been to invite the taking up of the public 
 lands and to sell them at very reasonable prices, and when you hare 
 gone through all this rigmarole of making a discovery if you have a 
 claim that is any good at all you may have a few lawsuits during the 
 intricacies of patenting and things of that kind, and the government 
 finally sells you that land at $5 an acre. Now I don't think there would 
 be any difficulty if they classified it as worth more than that, the same 
 as the coal lands, say $20 an acre, within reasonable transportation 
 or water haul, and with less amounts to those prospectors who are far 
 in the mountains and who would necessarily have to wait a long time. 
 But in any event it is so simple that if the Congress of the United 
 States would be properly approached by this great industry we should 
 have first the classification of these lands, and following that it is very 
 easy to provide simple methods of having these lands appropriated by 
 those who want to develop them. As has been well said here before, it 
 should be just the same as taking up any other land, but it has beea 
 
70 OFFICIAL PROCEEDINGS 
 
 hedged about by all these troubles, some of which the miners are re- 
 sponsible for themselves, but at the same time it is now at a point 
 where this revision should be pushed. The other striking reason why 
 this has become a very great necessity to the West is the question we 
 have talked of of how should the mining industry of the West be pro- 
 moted, how should it be aided? One of the greatest aids you could 
 possibly give it is this revision of the general land laws. Why? It is 
 well known that if a mining proposition is presented to investors one 
 of the very first and strongest objections that they will make to going 
 into such an investment is the probability of litigation. That old subject 
 comes right up. Everyone has heard, "Well, if you find anything you 
 will get into litigation." That condition of affairs could be ended, and 
 it could easily be ended by this Congress if there is just a little more 
 work done. We have got far enough along now where it is practically, 
 I should say, only a question of a little further effort; and I want to 
 say a word for Mr. Kirby, our chairman, who has personally gone to 
 Washington a number of times and worked on this matter and has de- 
 voted his time and money to this very freely, and other members have 
 done so. Professor Winchell, also of the committee, has performed a 
 deal of work in various ways and by discussion in the technical papers. 
 I think now if every one of the delegates, in addition to the formal 
 resolution a resolution may get pigeonholed, but if every one of the 
 delegates to this Congress, whether they have personal acquaintance 
 or not with their representatives in Congress, will write a letter once a 
 month asking what has been done in regard to this revision of the 
 general land laws, I am sure you will secure the appointment of a com- 
 mittee to revise them at this session of the Congress of the United 
 States. (Applause.) 
 
 THE PRESIDENT: Gentlemen, you have heard the most instructive 
 report of the Commitee on the Revision of the General Land Laws, and 
 the resolution. What is your pleasure with the report, in the first place? 
 I suggest we consider them separately. 
 
 MR. F. L. SIZER: I move the adoption of the report as presented 
 by Mr. Clark and thanks to the committee for their work; that the re- 
 report of the Committee on the Revision of the General Land Laws, and 
 gentlemen who framed it, and that the committee be continued. 
 
 THE PRESIDENT: Is there any further discussion of the matter? 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT: I would suggest that the resolution be referred 
 to the Resolutions Committee. 
 
 We will be obliged to deviate from our program, because Dr. Tal- 
 mage is going away, and I will call on him to present his address on 
 the proper advertising of mining opportunities. I may say that adver- 
 tising is one of the great American games, and I have learned some les- 
 sons in these arid countries. On one of my early trips, in approaching a 
 town after a long cross-country drive, I saw a big sign, "First Chance," 
 and upon getting near I found there was a saloon. As I left the town 
 I noticed a sign on the other side of the building reading "Last Chance." 
 They have us both coming and going. Mr. Talmage's subject is one of 
 more serious character, and I am sure we have much to learn from him. 
 
 Dr. Talmage's paper will be found at page 172 of this report. 
 
 THE PRESIDENT: Gentlemen, we have certainly enjoyed Dr. Tal- 
 mage's able address, and will now proceed to another address, which 
 promises to be equally instructive and interesting, by Mr. W. G. Swart, 
 on "The First Move." 
 
 Mr. Swart's paper will be found at page 144 of this report. 
 
AMERICAN MINING CONGRESS 71 
 
 MR. SIZER: Mr. Chairman, I would like to ask Mr. Swart to supple- 
 ment his very interesting paper by a private statement of how the Colo- 
 rado system of assisting prospectors has worked out. 
 
 MR. SWART: I am fortunate enough, or unfortunate enough, as 
 you may look at it, to be the chairman of the Mining Committee of the 
 Denver Chamber of Commerce. You probably know more or less of the 
 movement which was started up there two years ago. One of our news- 
 papers started something out of a clear sky. They sent around to a 
 number of prominent mining operators and found out they were of the 
 opinion that something was wrong with mining, and that it was the lack 
 of prospecting which was at the base of the trouble, so the newspaper 
 asked if they would not contribute to a fund to help prospecting. In 
 two days this newspaper raised $11,000 among a few of the mining men 
 of Colorado. They were all glad to contribute, and the newspaper 
 turned the fund over to the Denver Chamber of Commerce to handle, 
 which body appointed a special committee for that one purpose and the 
 committee labored all through the summer and into the late fall. That 
 fund put 84 prospectors in the field. As a rule, they were put out in 
 pairs. When the movement was started it hadn't been fully considered 
 from a legal standpoint. The fact was the Denver Chamber of Com- 
 merce was not organized for profit, and therefore it could not partici- 
 pate. Nevertheless the prospectors were sent out under a written agree- 
 ment that they should have half of whatever they found and the Denver 
 Chamber of Commerce the other half through trustees who acted for the 
 Denver Chamber of Commerce. Those prospectors went out in the field 
 and spent the summer. There were, I think, eight finds about 10%. 
 Several engineers went out to see them, reporting that out of the eight 
 there were two which showed some promise of becoming mines. Then 
 came up this important point, that there is a marked distinction between 
 prospecting and developing. No provision whatever had been made for 
 the development of these prospects. Now, what was the use of sending 
 the prospectors out to simply uncover something unless you wen 
 going on and turn the thing into a mine? We found ourselves facing a 
 situation that simply could not be handled by our organization, because 
 any time you start a game of that sort on the sole basis of benefitting 
 the state of Colorado or the state of Arizona, and doing something for 
 the public good, you are going to fail. There is just one thing on which 
 to base mining, and that is the making of money. So we were forced to 
 abandon this method, which, had it been organized for purely business 
 purposes, would have worked out all right, and I say that it would have 
 worked out all right because since that time some of us have taken 
 the idea over and it is this little organization I have mentioned where 
 ten engineers joined hands and efforts which really is the successor of 
 that prospecting enterprise. The thing as originally planned was 
 dropped; it failed; there was no development money raised and nothing 
 real was accomplished. The prospects which had been found were 
 turned over to the prospectors with the compliments of the Denver 
 Chamber of Commerce. What they have done with them since I do not 
 know. But as the successor to that movement, the men who really 
 believed, the men who knew, the engineers, the mining men themselves, 
 organized this little company which I have just mentioned. The ten of 
 them got together and their undertaking has been a success. I am sorry 
 I can't give you all the details of it. I will be glad to do so privately, 
 but it is a close corporation and has its own affairs and secrets, of 
 which I do not feel at liberty to speak freely. But I am willing to stand 
 here and say that the enterprise has been an unqualified success, and 
 can be made a success in any community when taken up in a similar way. 
 If the trained mining men will get together, will keep their heads and 
 will organize the sentiment of their community behind them, and will 
 then direct it, you won't need to worry about the mining industry; it will 
 take care of itself. 
 
72 OFFICIAL PROCEEDINGS 
 
 THE PRESIDENT: Gentlemen, I am sure I voice the sentiment 
 of this meeting when I express the thanks of the Congress to Mr. Swart 
 for his able paper, which so clearly emphasizes to my mind the analogy 
 between mining and farming. As I came up the Salt River valley day 
 before yesterday I was impressed with the greatness of the desert, and 
 one of my companions who had never been West. asked me, "What is 
 this land good for?" I told him to withhold his opinion which was 
 not very favorable until we came nearer this town, having heard of 
 the great water project which you have here, and he was very willing to 
 agree with me that nothing more was wanted than a little water to con- 
 vert a desert into a wonderful oasis. I think the prospector and his 
 field are very similar. He has the desert before him, and if he can only 
 get a little water he will soon develop wonderful mines. 
 
 The next number on the program is an address to be delivered by 
 Mr. Walter Douglas. I may say that on my first trip West some fifteen 
 years ago, after I crossed the Missouri river, and as we approached El 
 Paso, in the smoking car of the Pullman I overheard two or three men 
 talking something about a copper queen, and having only recently come 
 to this country, being one of those poor Germans who left his home 
 country to look for greater opportunities, I had my ear to the windward 
 looking for an heiress, and the words "copper queen" appealed to me, 
 and I wondered where she lived. (Laughter.) I didn't have much hope 
 of meeting her, because I hadn't been mixing with royalty; I had been 
 a miner all my life, and the chances were pretty slim. But much to my 
 disappointment I found that the copper queen was not a dusky lady but 
 a copper mine. It was my pleasure afterwards to meet a gentleman 
 connected with this mine and who is well known to you, and I feel that 
 it. would not be improper for me to bestow upon him the name of the 
 Copper Prince. I have the pleasure of introducing to you Mr. Walter 
 Douglas, who is going to read a paper on "Legislation and the Mining 
 Industry in Arizona." I may say that we have invited the legislators of 
 this state to attend this meeting, and I hope they are here and will 
 profit by what Mr. Douglas has to say. (Applause.) 
 
 MR. WALTER DOUGLAS: Mr. President and Members of the 
 American Mining Congress: It is very embarrassing for me to get up 
 and speak after an introduction of that kind. In connection with the 
 Copper Queen in the gossip of a smoking room, I think the most amusing 
 thing was the member of our company who was coming out on the 
 Rock Island line and he heard some tourists who were going out to 
 Arizona discussing matters pertaining to the West. At that time the 
 El Paso & Southwestern had for its trademark the head of an Indian 
 surrounded by a circle, and on it the words "Copper Route," and one of 
 the tourists was explaining how this Indian had discovered the Copper 
 Queen mine and had developed it and that his name was Dr. Douglas. 
 (Laughter.) 
 
 Before reading this very brief paper which I have prepared on re- 
 cent legislation affecting the Arizona mining industry, it might be proper 
 for me to state that no reference whatever has been made to the initiative 
 and referendum measures which were passed at the last election, and 
 their effect and constitutionality can only be predicated at this time. 
 
 Mr. Douglas' paper will be found at page 140 of this report. 
 
 THE PRESIDENT: I am sure we have learned much from Mr. 
 Douglas' valuable paper, and thank him for the able presentation thereof. 
 
 Several years ago when I attended a meeting of the Congress, I was 
 late one day, just as most of you gentlemen were this morning, but the 
 chairman was not as considerate as I have been. He had started the pro- 
 ceedings, and a tall Westerner had the floor, and in a very vigorous way 
 delivered an address which come home pretty close to all those present. 
 
AMERICAN MINING CONGRESS 73 
 
 I have reference to the senator of your neighboring state, Hon. John F. 
 Shafroth. He is unable to be here today because another Congress, the 
 one at Washington, has called on his time, but he has given us a paper 
 which I am going to ask the Secretary to read, on "The Administration'* 
 Public Lands Policy." 
 
 SECRETARY CALLBREATH: I would suggest, in view of the fact 
 that that paper has been printed and distributed among the members, 
 that we dispense with the reading of both that and the following paper 
 and that they be printed in the proceedings. 
 
 (Motion seconded and carried unanimously.) 
 
 Senator Shafroth's address will be found at page 207 of the report. 
 
 The next and last item on the program this morning is "Conserva- 
 tion, State or National?" by Dr. William B. Phillips of Austin, Texas. 
 Dr. Phillips doesn't need any further introduction. 
 
 DR. PHILLIPS: Have you that paper, Mr. Secretary? 
 SECRETARY CALLBREATH: It doesn't seem to be here. 
 DR. PHILLIPS: Gentlemen, that is a very important paper. 
 THE PRESIDENT: How do we know? 
 
 DR. PHILLIPS: Because I wrote it. I have no copy of it here; I 
 have it at the hotel; and the Secretary has no copy of it. I am going 
 to ask you to allow me to read that paper this afternoon, and will add 
 that it is going to be a very good paper. 
 
 (Cries of "Go on.") 
 
 DR. PHILLIPS: It was on the subject of conservation, whether 
 there should be state or national control of this important matter, and in 
 that paper I have endeavored to point out some of the fundamental prin- 
 ciples governing the so-called conservation movement in this country. 
 I do not see, myself, how we can have any considerable conservation of 
 our resources without a very considerable degree of development. I do 
 not see how we can conserve a mining industry that has not already 
 been developed; nor do I see how we can conserve anything without 
 sufficiently regulated authority. Whether that authority is to be state 
 or national will largely depend on circumstances over which I think we 
 have very little control. It would appear that we for many years in this 
 country have drifted into a condition which the early founders of this 
 republic neither contemplated nor provided for. We have seen in recent 
 years an attempt on the part of one of the states to regulate the minimum 
 price at which oil shall be sold within that state. If the state has a 
 right to do that it has a right to fix the minimum price at which any 
 product can be sold within that state. The power to regulate one re- 
 source is the power to regulate all. If I am forbidden to sell my oil at 
 a minimum price I can also be forbidden to sell my lead or copper or 
 zinc or tin or gypsum or salt or cement or anything that I may produce. 
 The same principle applies to all as applies to one. A sister state, and 
 the one to which I refer, attempted, two or three years ago to prevent 
 the exportation of natural gas from without its borders, claiming that 
 its natural resources were to that extent being depleted and that there- 
 fore it had a right to protect itself. It endeavored to prevent the transfer 
 of its natural gas supplies to a neighboring state under the plea that 
 such transfer would deplete its own resources and it would thereby be 
 to some extent impoverished. It didn't take long for the United States 
 
74 OFFICIAL PROCEEDINGS 
 
 Supreme Court to dispose of this case when it came up. It held that 
 no state had a right to pass laws forbidding the exportation of its mineral 
 products to a neighboring state. It would appear ridiculous to most of 
 us that such a case could ever have gone as far as the United States 
 Supreme Court. It has happened within very recent time and is happen- 
 ing today that an important oil producing state in the Union is seeking, 
 through a commission, to regulate the oil business, not only to fix the 
 maximum and minimum price but to some extent also to limit produc- 
 tion. We have seen that same principle cropping out in some of the 
 large cotton producing states by which it was sought, under the guise 
 of law, to limit the cotton acreage and to make it an offense punishable 
 by fine and imprisonment for any man to plant beyond a certain number 
 of acres of cotton during the year 1915. Such legislation is highly 
 socialistic in its tendency and can be charged neither to the old line 
 Democratic party nor to the old line Republican party. If we are ready 
 in this country, gentlemen, ^ for the government to take control of the 
 conservation of our resources we must at the same time be ready for it 
 to control the means by which those resources are brought into use. If 
 we would conserve our supplies of oil or natural gas or coal or copper or 
 whatever it may be, it can only be through the administration of law 
 either of state or of national origin. If we are to say that our coal 
 resources in some parts of this country are being depleted too rapidly 
 we can only remedy that defect by taking charge of that production 
 either through the state or national administration. If we say that our 
 oil supplies in Oklahoma or Texas or California or wherever it may be 
 are being depleted too rapidly, if there is too swift an exhaustion of 
 our supplies of natural gas, we can only control that matter through 
 governmental agency. In our own state we have passed a law regulating 
 the waste of gas wells. If you will bear with me for one moment I 
 will relate a circumstance which has taken place in that state within 
 the last three weeks seven miles from the city of Corpus Christi, which 
 is on the Gulf, and just across an arm of the bay. Three weeks ago an 
 enormous gas well was brought in. The pressure was sufficient to send 
 a column of mud and water and gas one hundred and fifty feet high, and 
 it was visible during the day time for a distance of nearly ten miles. 
 It was absolutely impossible to control that well. The estimated flow 
 was fifty million feet a day. That well inside of ten days choked itself 
 at the bottom and it is now a mud volcano. The derrick, machinery, and 
 so forth, fell into the hole, and it is spouting mud and water and all the 
 other devilment it can collect for a depth of a thousand feet. (Laughter.) 
 Its owners are liable under the law for wastage of gas. They would be 
 glad to pay any man $50,000 this minute to go there and stop that flow 
 of gas. Three old wells in the immediate vicinity that haven't yielded 
 oil or gas have begun to spout. The bottom of the sea nearby the 
 well is immediately on the coast is bubbling and heaving every day 
 with the amount of pressure of that gas seeking to relieve itself from 
 underneath. We had the same experience in the great gas fields of 
 Caddo in Louisiana, where gas not only ran for several years uncontrolled 
 but finally caught fire, and I have myself seen that fire twenty-five miles 
 away at night, so tremendous was it. The state of Louisiana finally 
 served notice on the owners of the well that that flow of gas had to be 
 stopped, and the question arose how to do it. The state, in effect, served 
 notice upon them that if it was not stopped, by virtue of the right of 
 eminent domain it would itself take charge of that property and stop 
 the flow of gas and charge the expense against the property; whereupon 
 the owners of the well got busy, as the saying is, and finally controlled 
 it, at a very high expense, and that gas is now being piped as far north 
 as Hot Springs and Little Rock in Arkansas, and is finally, I believe, 
 destined to reach St. Louis, a distance of about six hundred and fifty 
 miles. 
 
 We are facing, I believe, gentlemen, a very important turn of the 
 
AMERICAN MINING CONGRESS 75 
 
 road in industrial development in this country. It has come so insidiously 
 as to escape the notice even of very observing men, and that is the 
 tendency to apply to the government every time anything goes wrong 
 with business. If things are wrong in the oil business we go to the 
 legislature for relief. If anything is wrong in the gas business we run 
 to the legislature or to the national government for relief. You are all 
 more or less familiar with the operations of the Interstate Commerce 
 Commission, by which, through a central agency, we are now controlling 
 inland freight rates. There are forty-seven or forty-eight states in this 
 Union enacting laws bearing more or less upon the mining industry, and 
 in our own state, which is not remarkable for the value of its mineral 
 products we get only about thirty million a year there we make up in 
 legislation what we lack in production. (Laughter.) If you will 
 pardon me a few moments: The state of Texas has had its 
 own land office and this matter bears directly upon the subject 
 which I am attempting to discuss in a brief way for seventy-five years. 
 It was opened in 1838 and they had at that time some seventy-nine 
 million acres of land to dispose of. You know Texas ran as far north 
 as Cheyenne, Wyoming, and took in a large portion of Colorado and New 
 Mexico. The New Mexico portion was sold to the national government 
 in 1851 for $10,000,000. We were not very prudent in that day in our 
 country, because the area sold has since proved itself to be worth a good 
 deal more than $10,000,000. Since 1838, therefore, the state of Texas 
 has controlled its own land. It has an enormous domain which was 
 set aside for the benefit of the public school fund, which now reaches 
 very nearly to the value of $70,000,000. Nearly all of that land has been 
 sold. I think there now remains only about one million six hundred 
 thousand acres of unsold public land in Texas. When I went there 
 fourteen years ago there were twenty-two million acres unsold, but all 
 of that domain now has been disposed of with the exception, we will 
 say, of a million and a half acres. Not a foot of that land has been 
 sold without a reservation of mineral right. You cannot acquire any 
 of the public domain in that state, nor has it been possible for many 
 years to do so, without a reservation of the minerals that may be found 
 on or within that land. The last legislature marked a radical departure 
 from the preceding methods, and it declared it to be no longer the policy 
 of the state to part with the mineral rights in its public lands. You 
 cannot now buy in that state any mineral right from the state; it is all 
 on a royalty basis of 5% of the gross value of the output of minerals 
 from such land. It is not an ad valorem tax, hardly, nor a net profit tax, 
 it is a gross value tax by which the operator pays ^nto the state 5% 
 of the gross value of such minerals as he may remove from the public 
 land. That has been in effect about two years and has not been pro- 
 ductive of much revenue except in case of some isolated oil and gas 
 lands which the state found it owned on the Gulf of Mexico and within 
 the tidewater limits. We have had another interesting thing down there 
 in respect to the conservation of mineral resources, and that has been 
 to take a pair of boots and grease them well and put them away in a 
 closet and say, "We will conserve those boots for the benefit of pos- 
 terity." (Laughter.) There are some states, gentlemen, which do not 
 consider anything but the "reservation" of rights and do not know what 
 conservation means. I would be among the last in this country to de- 
 plete any of the natural resources or any portion of them, but I think 
 we are putting the cart before the horse, and as the horse has been 
 sufficiently discouraged by the introduction of automobiles, I think we 
 ought to regard his feelings a little more. It is development that this 
 country needs, not conservation. (Applause.) We need less of the 
 spirit of saving and more of the spirit of giving of our time, our money, 
 and our intelligence to upbuilding a far-sighted, prudent and economic 
 nation. We do not make a nation by conservation, gentlemen, we make 
 a nation by development; and that, I believe, is the trouble over the 
 
7 OFFICIAL PROCEEDINGS 
 
 whole of this beautiful land of ours, the lack of systematic and economic 
 development. When that comes about we shall hear less of conservation, 
 because, as I regard it, conservation is perhaps a shorter term for what 
 should be named a wise development. We have obscured many of the 
 important considerations that confront us as a nation by coining that 
 word "conservation," and it has deceived some of the elect. (Applause.) 
 We need a greater confidence in the mining industry as an investment. 
 We ned a wiser system of development which shall look not only to 
 our own benefit but to the benefit of those who are so soon to come 
 after us. I have never had any sympathy for the man who is inclined 
 not to consider benefits to posterity on the plea that posterity had never 
 done anything for him. (Laughter.) How to bring about development 
 without depleting the \resources of the country is a matter demanding 
 the utmost statesmanship and the most acute observation and consider- 
 ation. Some years ago the commissioner of agriculture in the state of 
 Texas was president of the State Conservation Association and asked 
 me to speak beforei a convention of lumbermen in San Antonio on the 
 question of conservation of the lumber supply of that state. I did so, 
 and thought I made a pretty good talk, and a lumberman got up and 
 said: "I would like to ask you one question. We have bonded our 
 lands for so much; we have to meet a certain rate of interest or this 
 property goes into the hands of the bondholders. We have got to cut 
 a certain amount of timber every month. Now, how are we going to 
 conserve the timber supply of this state and at the same time meet our 
 fixed charges and bonded interest?" I sat down. It is beyond me how 
 to conserve a supply and at the same time use it how to eat your cake 
 and have it. I do not believe that any set of laws would press equally 
 upon all of the business of this country; each thing has to be considered 
 in and for itself. The laws that apply to the conservation of the anthra- 
 cite supplies of Eastern Pennsylvania do not apply to the conservation 
 of oil in Oklahoma or natural gas in West Virginia. If we are to have 
 any system of state or national conservation that system will have to 
 be based upon local needs. I do not know that General Hancock was 
 so far wrong, though he was much derided for it, when he said the 
 tariff was a local issue. Events since his day have shown that the old 
 general, a better soldier than politician, knew what he was talking 
 about when he said that it was a local issue. Conservation laws that 
 press upon coal and oil supplies cannot be the same as those which 
 press upon copper supplies or lead or zinc or tin or whatever it may be. 
 I was brought up in the old school of belief that the creation and preser- 
 vation of a body of self-respecting, prudent and intelligent people in this 
 country depended upon as little governmental interference with private 
 affairs as possible. (Applause.) It is, in my opinion, the fundamental 
 principle on which we have built this country up to what it is today. 
 There are some things in which the government interest must be shown 
 and the government money be expended, but, looking at things by and 
 large, the less we have of governmental control in this country the 
 greater is our progress in all the elements of good citizenship. (Ap- 
 plause.) There are some things, however, gentlemen, that the govern- 
 ment must do for us because we cannot do them for ourselves. Now, 
 where that line lies is for our individual judgment to determine. In 
 some cases it may lip in one direction, in some cases in another direc- 
 tion. It is impossible to say where it shall lie in all directions. In the 
 matter of looking into the supplies of material within this country as a 
 whole, the government must do for us what we cannot do for ourselves. 
 Now, I will take occasion, if you will allow me, to point out one thing 
 especially to you people in the state of Arizona, continuing a few re- 
 marks I had the honor to address to you last night. It is the fact that 
 the entire hope of this part of Arizona is based on the possibilities of 
 continuous and successful irrigation of farm land from the great Roose- 
 
AMERICAN MINING CONGRESS 77 
 
 velt dam. Is it not so? The great agricultural hope of this part of 
 Arizona is based upon the possibility of irrigating this beautiful valley. 
 The same is true of many other valleys in Arizona. You must have 
 water in this Western country as we must have water in the western 
 part of my own state. Do you know that the surveys, estimates and 
 calculations upon which the construction of these great irrigation schemes 
 is based was made by the United States Geological Survey and not by 
 the United States Department of Agriculture? Is it not true? The 
 United States Department of Agriculture had very little to do with the 
 surveys on which you people expect to build an agricultural community 
 here at Phoenix; that is work that must be done by the general gov- 
 ernment for the benefit of the entire citizenship, and it is in this respect 
 a very notable one that we must apply to the government for aid. 
 
 In the adjoining state of New Mexico we see another striking illus- 
 tration in the great Elephant Butte dam. All those surveys, all those 
 estimates, everything of the sort, was made by the United States Geo- 
 logical Survey, although not one acre of that land will ever come into 
 use for geological purposes. It is all agricultural. It shows all the dif- 
 ferent departments of the government are intertwined and interknit so 
 that the work of the Geological Survey inures to the benefit of the De- 
 partment of Agriculture and to the benefit of all of the citizens who 
 expect to use that land for farming purposes. There will not be a foot 
 of land put under use by the Elephant Butte dam that can be used for 
 mining purposes; not one foot. It is all agricultural. And yet, as I 
 endeavored to point out last night, this Survey and the Bureau of Mines 
 is actually starving to death for lack of a little money from the general 
 government. It is not to our credit as a nation, gentlemen, that we are 
 starving these two great agencies for the benefit of the entire population 
 of this country; it is not to our credit; it is, rather, more to our shame. 
 
 I thank you very much for the attention you have kindly given to 
 these remarks. I had a paper prepared. I haven't said much about 
 what is in the paper; in fact it it a very good scheme to write a paper 
 and read it to your wife before you leave home. We all do that. (Laugh- 
 ter.) Poor, suffering creature, she has my sympathy. (Laughter.) But 
 she always says, "That is the best thing you ever wrote;" and you get 
 all puffed up about it, and come out and measure yourself among men 
 of your own size and dwindle down like a balloon with a hole in it. So 
 my paper is with the Secretary, and these remarks are with you, with 
 my sincere gratitude for your kind patience and attention. (Great ap- 
 plause.) 
 
 Dr. Phillips' address will be found at page 160 of this report. 
 
 THE PRESIDENT: Ladies and gentlemen, Dr. Phillips' address 
 concludes the program for this morning, and I think we are very much 
 interested in it. Being on the inside, I am going to confess to you that 
 Dr. Phillips' paper has not been written. His fumbling around among the 
 documents on the table here, ostensibly endeavoring to find it, was a 
 fake. But we are going to have the speech to which you listened written 
 up and printed in the minutes of the proceedings and you will see it 
 later. He told us about a gas well spouting some fifty million feet a 
 day. I think some very solid facts have come out of that gas well, and 
 we are going to profit by it. (Laughter.) 
 
 The session this morning was called for 9:30, and at 11 we got 
 away. I would ask you to cut your lunch hour short and get back here 
 at 2, because we have some very interesting papers to listen to. Unless 
 there is something further to come before the meeting this morning we* 
 will now stand adjourned until 2 o'clock. 
 
 Meeting adjourned. 
 
78 OFFICIAL PROCEEDINGS 
 
 WEDNESDAY, DECEMBER 9, 1914. 
 Afternoon Session. 
 
 2 O'clock P. M. 
 (Vice President Day in the chair.) 
 
 THE VICE PRESIDENT: The Congress will please come to order. 
 The first business for the afternoon session is the introduction of resolu- 
 tions. Has any delegate an additional resolution to introduce? If so, 
 he will please convey it to the Secretary's desk where it will be read 
 and referred to the Committe on Resolutions. Don't be bashful, gentle- 
 men; now is the time to introduce those pet resolutions which you have 
 been carrying around in your vest pockets for some time. 
 
 (Secretary reads Resolution No. 4.) 
 
 RESOLUTION NO. 3 
 
 (Introduced by L. S. Judd, Vicksburgh, Ariz.) 
 Mineral Land Within an Indian Reservation. 
 
 Whereas, A recent resurvey of the Colorado Indian Reservation has 
 t&ken in mineral land upon which entries have been made and work 
 prosecuted for years without protest on the part of the agent of the 
 reservation, or the Department of the Interior. 
 
 Now, therefore, Be it Resolved that the Bureau of Mines be requested 
 to investigate the rights of the interested property claimants, to the end 
 that intelligent assistance may be rendered them in such legislation 
 as may be brought by their representatives in Congress, for their relief. 
 
 CHAIRMAN DAY: This will be referred without debate to the 
 Committee on Resolutions. 
 
 (Secretary reads Resolution No. 4.) 
 
 RESOLUTION NO. 4 
 (Introduced by Charles H. Clapp, C. T. Willis and S. H. Worrell.) 
 
 Whereas, The Congress of the United States of America has appro- 
 priated at various times the Morrill Fund of $50,000, the Adams Fund of 
 $20,000, the Hatch Fund of $15,000 and the Lever Fund of $10,000 yearly 
 to each state agricultural college, making a total of $95,000 yearly; and 
 
 Whereas, This money has been spent to such great advantage to the 
 farmers and the farming industry that they are continuing to call for 
 more money, that it behooves us as representatives of the mining in- 
 dustry; and 
 
 Whereas, No money has been appropriated at any time to foster 
 and stimulate instruction in mining subjects although approximately 50% 
 of the above amounts are directly for instruction in agricultural sub- 
 jects; and 
 
 Whereas, The total aggregate value of agricultural products is 
 $10,000,000,000 and the total value of mineral products is $4,600,000,000 
 or 46%; and 
 
 Whereas, The importance of the industry is further reflected by the 
 fact that approximately 60% of the freight hauled by the railroads is 
 for the mining industry; 
 
 Therefore be it Resolved, That we, as representatives of the mining 
 industry, ask the Congress of the United States to pass favorably a bill 
 similar to the Austin bill which provides that an appropriation of $25,000 
 per annum be made to each mining school in the United States. 
 
AMERICAN MINING CONGRESS 79 
 
 CHAIRMAN DAY: No objection appearing, it will be referred to the 
 Committee on Resolutions. 
 
 MR. BASS: I would like to ask if there have been any resolutions 
 in relation to the leasing of the public lands or any discussion on that 
 subject. 
 
 CHAIRMAN DAY: Yes, there is a paper here somewhere entitled, 
 "The Administration's Public Land Policy," by John F. Shafroth, sena- 
 tor from Colorado. As I understand it, that is one of the orders of busi- 
 ness this afternoon. 
 
 (Secretary reads Resolution No. 5.) 
 
 RESOLUTION NO. 5 
 (Introduced by Dr. William B. Phillips and Mr. R. C. Allen.) 
 
 Resolved, That the American Mining Congress respectfully urges 
 the Congress of the United States to pass during its present session in 
 Washington the bills now pending before both the Senate and the House 
 which provide for the establishment of mining experiment stations and 
 mine safety stations looking to a reduction of the hazards and the wastes 
 of resources in the mining, metallurgical and other mineral industries; 
 
 That the American Mining Congress also respectfully petitions that 
 in the enactment of this legislation the number of mining experiment 
 stations be increased from ten, as provided for in the pending bills, to 
 fifteen, which larger number is still less than one-third the number of 
 agricultural experiment stations already established and maintained from 
 the national treasury. 
 
 Resolved, That the President of the American Mining Congress ap- 
 point a committee of three persons in each of the states to co-operate 
 with the Secretary of the American Mining Congress and a special rep- 
 resentative, also to be appointed by him, in Washington, in securing the 
 enactment during the present session of Congress of the bills now pend- 
 ing before the Senate and the House of Representatives, which provide 
 for the establishment of mining experiment stations and mine safety 
 stations in the more important mining regions of the country. 
 
 CHAIRMAN DAY: No objection appearing, the resolution will be 
 referred to the Resolutions Committee. 
 
 MR. SWART: I would like to submit two resolutions. 
 
 RESOLUTION NO. 6 
 (Introduced by W. G. Swart of Colorado.) 
 
 Resolved, That the American Mining Congress, recognizing the ne- 
 cessity of carrying forward the movement for greater safety in mining, 
 places itself hereby on record as in favor of the earliest possible adoption 
 of a uniform national system of bell and danger signals. 
 
 RESOLUTION ON. 7 
 (Introduced by W. G. Swart of Colorado.) 
 
 In view of the humanitarian, as well as the metallurgical interest and 
 importance attached to radium investigations, the American Mining 
 Congress urges the Congress of the United States, now assembled in 
 Washington, to provide the necessary appropriation and authority to 
 enable the Department of the Interior to purchase a supply of radium 
 ores and to carry forward its metallurgical investigations at least to 
 such extent as may be necessary to demonstrate the lower cost of pro- 
 ducing radium and other rare metals found in the public land states 
 and to supply a sufficient quantity of radium to meet the needs of the 
 government hospitals. 
 
SI OFFICIAL PROCEEDINGS 
 
 MR, CLARK: I will ask that these resolutions be referred to the 
 Resolutions Committee. 
 
 CHAIRMAN DAY: No objection appearing, it is so ordered. 
 The next on the program is an address by the chairman of the Com- 
 mittee on Alaskan Legislation, Mr. Falcon Joslin, Fairbanks, Alaska. 
 
 SECRETARY CALLBREATH: Mr. Chairman, I have Mr. Joslin's 
 communication. It is rather long, somewhat in the nature of an ad- 
 dress, outlining the present conditions in Alaska, describing the legis- 
 lation with reference to the construction of railroads and the leasing 
 of coal in Alaska and so on. It is so long that I would suggest that we 
 read it by title, and all of our members will have an opportunity a little 
 later to read it in the proceedings of the Congress. 
 
 CHAIRMAN DAY: No objection appearing, it will be so ordered. 
 The Secretary will please read the address by title. (See page 153.) 
 
 If Mr. Clapp is now ready to deliver his address we will be very glad 
 to hear from him. 
 
 Mr. Clapp's address will be found at page 177 of this report. 
 
 CHAIRMAN DAY: The next paper on the program is one entitled 
 "The Federal Control of the Water Power of the West," by Hon. E. A. 
 Wedgewood of Salt Lake City, Utah. As Mr. Wedgewood is not witk 
 us, the paper will be read by title by the Secretary and passed. 
 
 SECRETARY CALLBREATH: The paper has been printed and 
 passed around. (See page 181.) 
 
 CHAIRMAN DAY: The next on the program is the report of the 
 Committee on "Workmen's Compensation," by Mr. Samuel A. Taylor of 
 Pittsburgh, Pennsylvania. 
 
 Report of Committee on Workmen's Compensation. 
 
 To the American Mining Congress: 
 
 Gentlemen Your Committee on Workmen's Compensation has not 
 had a meeting. The reason for this is as follows: There were a num- 
 ber of states that had under consideration the compilation of workmen's 
 compensation bills to be presented to the next session of their legislature. 
 The chairman having this in mind tried to secure some information on 
 these proposed bills, and also tried to secure copies of all compensation 
 laws now in force in the various states, which number 24, as well also 
 any suggestions for changes thereto resulting from the experience 
 gained in the operation of said laws. The purpose of these inquiries 
 were so that we could examine these various laws, tabulate the essential 
 points of the laws which were in common and also to note the points 
 in which they differed. This information was not secured from all the 
 states and those which were received were not received in time to per- 
 mit the chairman to tabulate the points he had in mind so that the 
 time of the committee would be saved, and get the committee together 
 for action thereon. The result therefore is that this brief report is the 
 report of the chairman rather than the committee as a whole, and is only 
 a brief report of progress. 
 
 In response to a question asked from each state as to the operation 
 of their compensation laws, almost the universal reply was that it is 
 working very well, although in some cases they have certain changes 
 which they propose to their present law in order to render it more 
 effective. This is no doubt due to the fact that most any law where a 
 fixed amount and an exact method of providing such compensation is 
 a great improvement over the old method of collection by suit at law, 
 in which case the party entitled to and receiving compensation was often 
 deprived of a large amount of what was paid by the employer. 
 
AMERICAN MINING CONGRESS 81 
 
 In several states specific changes are under consideration which 
 will make the law more simple, fairer and surer in its operation, and in 
 several other states that have had their compensation acts in force long 
 enough to show their shortcomings and to have the acts amended by the 
 legislatures of the states, have already amended them to a good ad- 
 vantage. 
 
 I wish to say that so far as I have examined into these acts, there 
 is very little in the amended acts that is much of an improvement over 
 the proposed act recommended by a former committee of the Mining 
 Congress. 
 
 Two features of all the laws passed are well worth while to con- 
 sider, by all those states contemplating the passage of a compensation 
 law. First, that so nearly as possible in all states uniform tables of 
 compensation be secured, or in other words, if a uniform percentage of 
 wages for a uniform period of time could be secured then a much better 
 and fairer comparison of the different acts can be compiled. 
 
 The State of Wisconsin has made a comparison of the laws of some 
 ten states in the bulletin of the Industrial Commission, Vol. 1, No. 3, 
 dated July 20, 1912, and by reference thereto will be seen at once how 
 much a uniform amount of compensation is needed. 
 
 The other question is the method of collecting the compensation. 
 The question of the compensation being compulsory or elective, and 
 also the question of a prompt and economical method of administering 
 the fund. 
 
 In connection with this second question, it seems very apparent 
 that it is desirable for all companies, large and small, engaged in the 
 same business to be obliged to come under the compensation act on 
 exactly the same terms, for otherwise an unbalanced condition will exist 
 which may work out to the detriment of the small or independent com- 
 pany as against the large company or combination of companies, both 
 in the way of securing employes and as to the cost of said compensation. 
 For example, suppose a large coal company operating many mines had 
 an explosion in one of their mines, where a number of men were killed. 
 This large company carrying its own risk might be able to pay all of the 
 claims under a compensation law, while if the same accident would 
 happen to a company owning only the one mine where the explosion 
 took place, would not have sufficient capital to pay the amount of com- 
 pensation stipulated in the law, for all the deaths which occurred in said 
 explosion. The result of such an accident would probably mean the 
 bankrupting of the small company and in addition to this the men en- 
 gaged in this industry would thereafter seek employment in the larger 
 or stronger companies and would only work for the smaller company 
 when they could not obtain work with the larger companies, and thus 
 work to the detriment of the small companies. A uniform and compul- 
 sory compensation law would overcome this by all paying the same 
 proportional amount, and would also place all companies, regardless 
 of size, on a parity in the matter of operation. Furthermore, the cost of 
 said compensation being uniform would be easily estimated as part of 
 the cost of production and added thereto, and thus the consumer would 
 pay for it in the end, which I believe is only fair. 
 
 If such a uniform basis can be formulated for all the states, I am 
 sure compensation laws will become more popular and desirable. 
 
 Finally, examination of these reports, so far as I have been able 
 to study them, seems to bear out the fact that where all employers are 
 classified into groups according to the hazard of the employment, a 
 uniform assessment made and all employers and employes obliged to 
 come under the law, a much better feeling exists between the employers 
 and employes. A great improvement is also experiencd over the old 
 
82 OFFICIAL PROCEEDINGS 
 
 method of settling the claims for accidents and the common weal is ad- 
 vanced by having fewer paupers or persons dependent on charity. 
 
 The work of the Mining Congress along this line now seems to 
 have reached a point where it should advocate nation-wide compensation 
 laws, uniform in the percentage of the wages paid to employes or 
 their dependents and also as to the method of collection and adminis- 
 tration. And if \it were possible to have a national law applying to 
 all states alike this would be very desirable, but inasmuch as a national 
 law oannot under the present status of governmental affairs be appli- 
 cable, it is very desirable to work to the end of securing a uniform basis 
 for compensation laws in all states. 
 
 This seems to me to be the special work of the Mining Congress at 
 the present time. 
 
 Respectfully submitted S. A. TAYLOR, 
 
 Chairman Compensation Committee. 
 
 CHAIRMAN DAY: Gentlemen, what is your pleasure with regard 
 to the report of the Compensation Committee? Discussion is now in 
 order. If no remarks are forthcoming the paper will be accepted and 
 placed on file. 
 
 The next on the program is "The Law and Compulsory Arbitration," 
 by Hon. James A. Emery of Washington, D. C. 
 
 Mr. Emery's paper will be found at page 227 of this report. 
 
 SECRETARY CALLBREATH: I would like to say that we made 
 our very best effort to provide a complete discussion of this subject. 
 It would seem that the enormous waste occasioned and the bad feeling 
 engendered by labor strikes, to say nothing of the loss of life, which 
 amounts to crime in many instances, call for the action of an organiza- 
 tion which has as one of its primary, basic purposes, the bringing about 
 of the highest efficiency. I have corresponded with leaders on the various 
 sides who might be expected to have decided opinions on the question 
 of compulsory arbitration, asking them to present papers or to appear 
 here and discuss this subject. I have not been able to find anyone, 
 either upon the side of the laborer or of the employer, who is willing to 
 unqualifiedly say that he favors any system of compulsory arbitration. 
 From |the standpoint of the operator it is urged that the award could 
 not be enforced against the worker because of the fact that, while it 
 might prohibit a combined going out of the help, it could not possibly 
 prohibit the ceasing of work by any individual. On the other hand, the 
 laboring people insist that compulsory arbitration would be absolutely 
 destructive of the independence of the American working man. At the 
 time the Chicago, railway strike was impending and the efforts by the 
 President of the United States were being made to have the dispute 
 adjusted and referred to arbitrators, it was stated to me by a very high 
 public official, who was also a representative of labor, that in case there 
 should be a tie-up of the traffic of the United States for a period of 
 ten days nothing under the sun could prevent the enactment of laws 
 requiring arbitration of labor disputes in such cases. It would seem 
 that in cases of concerted action to stop the passage of traffic, which 
 would practically put the larger cities of our country on a starvation 
 basis, that the public has rights which should be recognized. It would 
 seem that there should be some method by which disputes could be 
 settled in those lines of business which directly affect the public. It 
 seemed to those of us who prepared the program for this meeting that 
 even though we might not at this meeting accomplish anything, we 
 might at least bring to the front a question which is bound to be a vital 
 question in the future. I do not believe that under the conditions in this 
 country as they now are we can afford the enormous waste which is 
 consequent upon industrial strikes, and other countries have shown us a 
 
AMERICAN MINING CONGRESS 83 
 
 way by which a greater part of these losses can be avoided. The papers 
 which are presented are intensely interesting, and I do not know 
 whether this audience would care to have them presented or not, but 
 I have made this preliminary statement with this thought only, that we 
 ought to start a movement looking to the elimination of that enormous 
 waste and bitterness and crime which often follows a bitter dispute 
 between employer and employe. We are all alike in one respect when 
 we get into a contest we do not stop to ask whether the club at hand has 
 a blaqk end or not, we take it and strike. When labor disputes come 
 things are generally done which those guilty of the infractions of the laws 
 do not attempt even to justify. I am wondering whether this convention 
 is large enough to undertake the beginning of a movement looking to 
 a betterment of these conditions. 
 
 CHAIRMAN DAY: The next paper on the program is entitled 
 "Compulsory Arbitration," by Mr. Samuel O. Dunn of Chicago. 
 Mr. Dunn's paper will be found at page 230 of this report. 
 
 SECRETARY CALLBREATH: I would like to have a suggestion 
 from somebody in the convention or from a number of those in the 
 convention as to whether it would not be wise for the American Mining 
 Congress to appoint a committee to investigate this general subject with 
 a view of reporting at a later convention or back to the Mining Congress 
 as to whether or not any remedy for the existing conditions can be 
 brought about. 
 
 CHAIRMAN DAY: Gentlemen, you have heard the suggestion of 
 Secretary Callbreath. What is your pleasure in regard to it? It seems 
 to be a matter well within the province of this Mining Congress. The 
 question of the relations between capital and labor is an acute one in the 
 various parts of the country. No discussion apparently being forth- 
 coming, 
 
 MR. DOUGLAS: Mr. Chairman, with reference to this matter of 
 compulsory arbitration, it seems it should be confined at the present 
 time to industries which furnish the necessaries of life. Possibly these 
 would include only transportation, and so far as the mining industry is 
 concerned, the production of fuels. These two commodities the public 
 cannot get along without. The question as to the successful working of 
 compulsory arbitration, I think, is very doubtful, when it is applied to 
 what either the employer or the employe might consider his "honor." 
 We run up against the same stone wall that the international arbitration 
 treaties have encountered. The question of "honor" in the mining in- 
 dustry as between the employer of labor and the workman resolves 
 itself generally into a question of the recognition or the non-recognition 
 of the union. Now, whether a matter of that kind, whether a question 
 of recognition can be left to arbitration, is the most important one. I 
 think there are very few cases in which we have had any serious labor 
 difficulties in this country where the union question was not the principal 
 one in dispute; and therefore I do not believe that it is well to dismiss 
 this subject without full consideration, and in accordance with the recom- 
 mendation of the Secretary I move that a committee be appointed by the 
 Chair to consider this matter and to report at the next general meeting 
 of the Congress. 
 
 (Motion seconded.) 
 
 MR. HULL: Mr. Chairman, two years ago I had the pleasure of 
 being at the meeting of the National Civic Federation. Twenty-five of 
 us were on that committee. We took up this same proposition, which 
 we supposed would do the work which you are attempting to do now. 
 In all the resolutions I took an active part, and when we went into the 
 convention they were accepted, and they were as good a set of resolutions 
 
S4 OFFICIAL PROCEEDINGS 
 
 as were ever gotten up any place in the United States. There may be 
 some gentlemen here that were there on that occasion. I was asked 
 to go if I could, and I went there, and we agreed upon some propositions, 
 but those propositions have not been entirely worked out. 
 
 Now, in regard to arbitration, of course that comes under our own 
 constitutions. In adopting these resolutions you could not go to work 
 and adopt arbitration measures without they should be prescribed by 
 the laws of your state, and I hope that they can be. I hope something 
 could be done that would bring us all together, the workman as well 
 as the mining man. I think if we did appoint some men we might, 
 through the efforts of this Congress, do many things that would be for the 
 benefit of the mining men, the laborer and the companies that employ 
 them. 
 
 CHAIRMAN DAY: We 1 would like to hear from another gentleman 
 whq has views to submit on this question. The motion is before the 
 house. Are you ready for the question. (Question called for.) 
 
 SECRETARY CALLBREATH: Mr. Chairman, would it not be wise 
 to extend the authority of this proposed committee to cover not only 
 compulsory arbitration but mediation and conciliation, so that if it were 
 found that compulsory arbitration is impracticable at this time, it could 
 recommend means through which mediation and conciliation can be 
 made more effective. Much has been done already in that direction, but 
 there is much more to do. I would suggest that the resolution be so 
 framed that the committee would have full authority to go into any 
 means through which industrial disputes might be settled in some other 
 way than by strikes. 
 
 MR. DOUGLAS: I accept the Secretary's modification. 
 
 CHAIRMAN DAY: The widening of the scope of the motion has 
 been accepted by the author. Is it agreeable to the second? 
 
 MR. DELEGATE: It is. 
 
 CHAIRMAN DAY: A motion has been made and seconded that a 
 committee be appointed to consider the question of compulsory arbitra- 
 tion, mediation and conciliation, and to report, as I understand it, at the 
 next meeting of the Mining Congress. Is that your idea, Mr. Douglas? 
 
 MR. DOUGLAS: Yes. 
 (Motion carried unanimously.) 
 
 CHAIRMAN DAY: The chair will take the appointment under ad- 
 visement in the absence of the president, Mr. Scholz, and the appoint- 
 ments on the committee will be announced later. 
 
 Has any delegate anything further to submit? 
 
 SECRETARY CALLBREATH: Mr. Chairman, there seems to be 
 nothing further upon the program this afternoon except the consider- 
 ation of the report of the Resolutions Committee. I would suggest that 
 if the people here are anxious to see the Arizona mineral exhibit, as I 
 have no doubt many of them are, after calling upon the Resolutions 
 Committee to report what business they have agreed upon, and its 
 consideration, we might adjourn in order to give the delegates present 
 an opportunity to see that exhibit. 
 
 MR. CARMICHAEL: The Resolutions Committee would prefer to 
 wait until tomorrow morning to make its report. We have no resolutions 
 ready to report at this moment. 
 
 CHAIRMAN DAY: No further business appearing, an adjournment 
 will be taken until tomorrow morning, and the meeting at that time is 
 supposed to be taken up largely by discussion of the resolutions. I 
 
AMERICAN MINING CONGRESS 85 
 
 wonder if it would not be well for us at this time to take up a discussion 
 which was scheduled for tomorrow morning on the subject of "What Is 
 the Matter With Mining?" which was to be led by Mr. Knight of Utah. 
 I think it rests with the convention which they would prefer to do. 
 
 MR. SWART: Mr. Chairman, I move that we take up that discus- 
 sion and let us have it out. 
 
 CHAIRMAN DAY: We are fortunate in having Mr. Jesse Knight of 
 Utah with us, who will lead this discussion. 
 
 Mr. Knight's address will be found at page 150 of this report. 
 
 CHAIRMAN DAY: I am sure we have all been very much edified 
 by the remarks of Mr. Knight. I know of no one in the mining business 
 better qualified, by reason of wide experience and good judgment, to 
 express the sentiments of the miners of the West. We would like to 
 hear from others. (After a pause.) If we don't get more muck we will 
 have to put in the shot and shake up this hard formation. Mr. Secre- 
 tary, I would suggest that you call the roll of the states, and we will 
 ask the delegates to respond by states. 
 
 SECRETARY CALLBREATH: The first on the list is Arizona. 
 
 CHAIRMAN DAY: Who will tell us what is the matter with min- 
 ing in Arizona? 
 
 MR. JOSIAH BOND of Arizona: Mr. President! I am a prospector 
 residing in Arizona. I think I can tell you one of the things that is the 
 trouble with mining. My general view has been well expressed by the 
 gentleman from Texas, Dr. Phillips. He remarked that they didn't have 
 such an awful lot of mineral production in Texas, but what they lacked 
 in production they made up in legislation. Now, we can beat Texas a 
 hundred to one in mineral production, I suppose, but we can beat them 
 a thousand to one on legislation. That is, to my mind, one of the most 
 serious troubles of the present day, not only with mining but every 
 other form of business, what I might call, tinkering with legislation. 
 Unfortunately in the last six or seven years we have had dull times, 
 and a lot of people have been let loose to think up something to worry 
 the rest of us with, and they have succeeded in doing it pretty well. 
 These laws are probably well meant; at least they are not proposed by 
 vicious people. I know many people in my own voting precinct (where 
 almost every one of these laws carried), and they are all good people, 
 and lots of them are my friends. They vote against their own interests 
 many times, because I believe they do what the ordinary man does 
 under some kind of atavistic law they follow the leader, and when the 
 bell-sheep runs off they run off with him, and when somebody proposes 
 a law they don't want to be disagreeable about it, and having, they 
 think, nothing at stake, they say, "All right." 
 
 Now I have a few claims and I have been trying to sell them, or 
 some of them for a long time, but I can't do it; but whenever I can I 
 lease them. I have one or two claims now leased to a man who is a 
 great union labor man. I can tell you a little incident about him that 
 I think will illustrate the present condition pretty well. He is not only 
 a great union labor man, but he is also a Socialist of the most advanced 
 German type, and he was boasting to me I might even say he was 
 bragging to me that at the present time in the State of Arizona the 
 condition of the laboring man in the eyes of the law was the best that 
 ever was in the world (and I was inclined to agree with him), but 
 shortly afterwards in the same conversation he admitted to me that it 
 was the hardest he had ever known in his own history, the hardest time 
 for a man to get a job. Now, don't you see that the two go together? 
 When people try to produce legislation for their benefit only, and at the 
 expense of the rest of the community they get the rest of the com- 
 
86 OFFICIAL PROCEEDINGS 
 
 munity a little frightened. Sooner or later they will get them thoroughly 
 frightened and then they back off and they refuse to go into anything. 
 Well, that is the result in mining right here in Arizona. We cannot 
 raise money for perfectly legitimate and good schemes in mining or in 
 any other way simply because the people are afraid of what is going 
 to come next. 
 
 Now, of course, most of this legislation has been poorly thought out. 
 We adopted at the last election in this state what was known as an 
 anti-blacklist law, which provides that you must not ask any questions 
 of a man when you hire him. This was initiated by the labor men, I 
 suppose. At the last minute the labor men in Tucson concluded that 
 they would vote against it, because they discovered that it might knock 
 out the union shop altogether. If you could not ask a man any questions, 
 or whether he belonged to a union, how in the world could you have a 
 union shop? This is what I mean by saying the legislation is not well 
 thought out, and does not help the ones in whose supposed interest it 
 is passed. They have not had good advisers in suggesting the legisla- 
 tion and it is what we might call half-baked, and this is troubling not only 
 the mining industry, but every other business in the United States. 
 
 The people have gotten into that state of mind where they are 
 willing to try all sorts of experiments, and I think this Congress ought 
 to go on record against that sort of experimentation. We do not need 
 it. For example, we have proposed a resolution, which will be presented 
 here tomorrow for us to vote upon, urging a change in the law in regard 
 to mining locations. As a prospector I do know something about that 
 question, and I am willing to admit right now that probably the man 
 who proposed that law in the first place Senator Stewart, wasn't it? 
 if he had known how our deposits were going to be found in later years, 
 couldn't have proposed any law that would have been worse. But the 
 Supreme Court of the United States and all the other courts in all the 
 mining states of the Union have threshed away at the law until they 
 have reduced it to some kind of intelligible terms, so that the ordinary 
 man understands it. Now, when I propose to men to go into prospects 
 with me they want to know under what kind of a title I hold them and 
 what kind of security I can give them that the law will be the same in 
 the course of a year or two from now as it is today. Of course I cannot 
 give such assurance, nor can anybody else for that matter, but I want 
 to go on record here as opposed to all changes in the law which are not 
 demonstrated to be absolutely necessary. 
 
 I was a strong silver man in 1896. I can prove to every man in this 
 house that the free and unlimited coinage of silver at the ratio of six- 
 teen to one is entirely correct. Yes, sir. But the inexorable logic of 
 events has been against the proposal. Lots of bills that are perfectly 
 right theoretically, when you come to put them into practice are all 
 wrong. There has been some talk about the causes of the war in 
 Europe. I believe that the microbe of experimentation has gone around 
 the world, and the great German people, who pride themselves upon the 
 great improvements they have made in everything, upon their superior 
 kultur, and above all upon their efficiency, with this microbe working, 
 had to do something to change the situation, and they thought they 
 would change it completely while they were at it. (Laughter.) 
 
 This is the idea I want to impress upon you: I think this Congress 
 ought to go upon record it is an important body of men, gathered from 
 all over the United States and I say it ought to go upon record in 
 warning the people against this tinkering with the laws when it is not 
 necessary, and when there is no good to be derived, even from what 
 looks on the face of it like a theoretically good thing. Now, I don't 
 know whether I have made myself plain to you or not, but I hope I 
 have, because I feel very strongly about it, and I feel that I am right 
 about it, too. I thank you for your attention. (Applause.) 
 
AMERICAN MINING CONGRESS 87 
 
 CHAIRMAN DAY: I am sure we are all glad to hear from Mr. Bond 
 on the subject near to his heart. It strikes a responsive chord with 
 lots of us, I am sure, and we appreciate his suggestion looking toward 
 a resolution of some suitable protest against this mania or hysteria for 
 some new legislation to which he so feelingly refers. 
 
 MR. McALPINE of Oklahoma: Mr. Chairman, I am a little out of 
 order on account of having to leave in a few minutes to attend a com- 
 mittee meeting. I want to say that I have enjoyed every minute of my 
 stay in the state and also in the City of Phoenix. I have also enjoyed 
 and profited by what has been said in this convention; but inasmuch 
 as I come from a coal mining state and there has been little said along 
 coal lines here, I am somewhat disappointed. 
 
 I regret that those who were on the program to speak on the sub- 
 jects of "Compulsory Arbitration" and "Workmen's Compensation" are 
 unable to be here and discusss them. I have remained perhaps a day 
 longer than I would have done had I know they would not be here. We 
 are meeting these problems in Oklahoma, and you are going to meet 
 them, and whether we like it or not they must be confronted. At the 
 coming legislature in Oklahoma it is almost certain that a workmen's 
 compensation bill will be brought before that body for passage. There 
 have been workmen's compensation bills proposed at different times 
 and I am sure that at the coming session of the legislature an attempt 
 will be made to pass such a law. 
 
 I am interested in this subject and, having a large number of men 
 in my employ, I realize the need of having a law of this kind. I am a 
 believer in a compensation law and I hope one can be passed that will 
 be just and fair to all concerned. I had hoped that this subject would 
 be discussed from all viewpoints and that I would be able when I re- 
 turned home to offer suggestions that would be for the good of the cause 
 all along the line. 
 
 In a state where you have laws such as were mentioned this morn- 
 ing by Mr. Douglas, and which are on the statute books of my own 
 state, mining men know that it is an every-day occurrence to have men 
 come to you, demanding that you shall recompense them for injuries, 
 many of which are imaginary and many for which the company is in no 
 way liable. I have such to contend with daily and often we are com- 
 pelled to go into court to defend ourselves against people who are suing 
 us ofttimes when they have no just claims against us. And you will 
 always find, where these laws exist, there is a certain class of lawyers 
 who make it their business to be near when an accident occurs and 
 who ofttimes induce those injurpd to sue for recovery of damages on a 
 percentage basis; and, if you have not this type of lawyer here now, 
 you will have them, since you have passed the laws referred to. You 
 will also find that when some men receive slight injuries injuries for 
 which they don't lose more than one or two weeks' time you will be 
 sued for amounts of from $2,000 to $10,000. Although they do not always 
 recover damages, they nevertheless cause you a great deal of trouble, 
 and I am sure, in the main, that if we had a compensation law that would 
 be administered by a commission of fair and just men we would be 
 much better off than we are at present, being dragged, as we are, into 
 court on account of every little accident that occurs to our workmen. 
 
 In regard to compulsory arbitration, I desire to say that from my 
 own views and dealings with labor I am opposed to it. in Oklahoma, 
 the coal operators have a joint agreement with their workmen. For 
 the past four years we have had a system of compulsory arbitration for 
 adjusting our disputes, but at the time of making a new contract last 
 summer in Kansas City the miners took a positive stand against our 
 system of compulsory arbitration and positively refused to again sign 
 a contract in which all cases not decided otherwise were finally to be 
 
SS OFFICIAL PROCEEDINGS 
 
 arbitrated. The operators favored compulsory arbitration on the ground 
 that it was better to have a final means of settlement of disputes (al- 
 though the system did not meet with their entire approval), rather than 
 have tneir men, in case of failure of settlement of any question, take 
 independent action and strike. The president of the Mine Workers' 
 Union took a very decided stand in opposition to compulsory arbitration 
 and quoted a prominent American statesman in saying the world was 
 not ready for compulsory arbitration. The obvious reasons of the miners 
 in their opposition were: 
 
 First That believing their position taken on a disputed subject was 
 right, they did not propose to have it subjected to the element of chance 
 that always enters into arbitration, with the possibility of losing their 
 case; 
 
 Second The fact that a case not settled otherwise has a tendency 
 to cause those interested, and especially those who have doubts as to 
 the justice of their claims, to throw the responsibility on an arbitrator. 
 
 Their reasons are, in my opinion, good and logical. I have found 
 that when every argument is beaten down and a position can no longer 
 be maintained, the loser in the dispute is always ready to declare in 
 favor of arbitration. This is the case with both employer and employe. 
 I am in favor of a workmen's compensation law, but opposed to com- 
 pulsory arbitration. 
 
 CHAIRMAN DAY: Who will speak for California? 
 
 MR. MUDD: Mr. Chairman, the last speaker referred to one of 
 the workmen's compensation laws. We have a new compensation law 
 in California; the terms of it are drastic, perhaps as much so as those 
 of any state that has enacted a compensation law. The premium rate 
 agreed upon by representatives of a number of accident insurance com- 
 panies was 7.86% of the pay roll for underground employes. The Cali- 
 fornia Industrial Accident Commission named the same rate, but de- 
 clined to accept any mining risks. I think a number of the stronger 
 mining companies carry their own compensation risks, but quite an 
 amount of insurance was written at a premium rate of 7.86% of the 
 pay roll, although some of the accident companies made concessions 
 under certain conditions. 
 
 The rates charged by the California Industrial Commission for em- 
 ployes of other industries were so high that the state is now returning 
 to the insured about 15% of the premium paid. Both the state and the 
 accident insurance companies were very uncertain what the proper 
 premium should be under the new law, and in the beginning made the 
 rate too high. It is assured that in the near future both the state and 
 the accident insurance companies will name lower premium rates. 
 
 The California Metal Producers' Association is now being organized 
 by the actual operators of the state and the first subject they have taken 
 up seriously has been this one of compensation insurance. Their in- 
 vestigation indicated that little if any more than one-third of the pre- 
 miums charged ordinarily for accident insurance reached the injured 
 employes. This does not mean that the other two-thirds became a 
 profit to the accident insurance companies, for the cost of securing new 
 'business and handling it afterwards is great, but it does mean that the 
 insured have to pay a very high rate for accident insurance ordinarily. 
 
 It was at first thought it would be necessary for the members of the 
 California Metal Producers' Association to adopt a co-operative or inter- 
 insurance plan. After this plan was advanced one of the accident insur- 
 ance companies named a sufficiently low rate to be attractive and insur- 
 ance will be taken out by many of the members of the California Metal 
 Producers' Association with this particular accident insurance company. 
 The rate charged is very much less than the rates asked a year ago. 
 
AMERICAN MINING CONGRESS 89 
 
 A gentleman from Arizona referred to the conditions in Germany, 
 where compensation insurance has been in force for many years, and 
 said that the number of accidents was great and that the injuries were 
 glow in healing. 
 
 Twenty-five years or more ago I was connected with a property that 
 was doing very well indeed. The stockholders were happy and generous 
 and they wanted to do everything they could for the miners. They 
 adopted a rule that whenever a man was sick or injured he should re- 
 ceive full pay until he returned to work. Accidents were numerous and 
 it seemed that the men were very slow in recovering. Sprained backs 
 and mashed fingers were out of all proportion just before a baseball 
 game or any other attractive event. The amount of money paid to em- 
 ployes for time when they were not at work became so great that finally 
 the rule referred to was abandoned altogether and the men were forced 
 to make a very clear case before any compensation for injuries was 
 allowed. Thereafter the number of injuries was reduced materially. 
 
 I believe no compensation laws will in the end be satisfactory to 
 both parties until the employe becomes a contributor to the compensation 
 fund. 
 
 No matter how well a law may be framed there will be more or 
 less injustice to both employer and employe. I think the question of 
 unjust claims has been the one that has worried the accident insurance 
 companies in California more than any other. The proper premium 
 under a specific state law can only be determined accurately by the 
 experience of a number of years. This proper premium will be effected 
 by the precautions taken and rules adopted by the employers, but, more 
 largely, by the earnest efforts of the employes to prevent accidents to 
 themselves and to co-employes and the monetary interest in seeing that 
 no unjust claims shall be made by any of the employes. The aid of the 
 employes in eliminating unfair compensation will become a very im- 
 portant matter and I fear such aid will not be freely and systematically 
 given until the employes themselves are financially interested in reduc- 
 ing the premium rate through the fact that they themselves are con- 
 tributors of a certain percentage of the premium. 
 
 While the employer will probably always contribute the greater 
 portion of the money for compensation insurance, I believe the contri- 
 bution of the employes will aventually be welcomed by the employes 
 and will result in a more self-respecting, independent set of workmen. 
 All of us have probably noted the reluctance of employes to use facilities 
 around mines and smelters which are furnished free and to which they 
 contribute little in the way of money or control. 
 
 I believe ultimately we must come to an arrangement whereby part 
 at least of the compensation comes out of the fund deducted from the 
 employes' wages before the compensation laws reach their final and 
 ?iaost satisfactory form. (Applause.) 
 
 CHAIRMAN DAY: We are getting a large amount of valuable in- 
 tormation as we go along, gentlemen, and we would like to hear from 
 others. 
 
 Before Colorado volunteers and I know there will be a dozen of 
 them I would like to ask Mr. Carl Scholz, the President, to come for- 
 ward and take his job. I belong to the Resolutions Committee, and I 
 see a chance to get away now that that committee is going out to resume 
 its labors. 
 
 THE PRESIDENT: I will call on the Secretary to speak for Colo- 
 rado. 
 
 THE SECRETARY: Mr. President, I would like to refer to one 
 recent instance in Colorado as an example of one of the things that 
 stand in the way of a better mining development and which I fear in the 
 
90 OFFICIAL PROCEEDINGS 
 
 future is going to be a greater obstacle than it has been in the past. 
 I will first state the facts as nearly as I have them. Some years ago 
 Mr. Bolthoff, whom you will recognize as the junior member of the firm 
 of Hendrie Bolthoff, the machinery manufacturing firm in Denver, 
 filed on a number of mining claims and a mill site in the Clear Creek 
 valley. As time went on he proceeded to develop those claims, spending, 
 I am told, something like $60,000. Something like a year ago he con- 
 cluded that the development had proceeded far enough to justify the 
 construction of a mill. He proceeded to the construction of a mill upon 
 the mill site, and at the same time applied to the government for patents 
 upon his mill site and upon his mining claims. While his patent appli- 
 cation was pending he expended something like $25,000 in permanent 
 construction work upon a mill and had machinery of approximately equal 
 value purchased for it, ready to complete the mill, when, to his great 
 surprise, he was met by the determination of the Land Department that 
 the mill site connected with his mining claims could not go to patent 
 because of the fact that the valley had been withdrawn from entry as a 
 water power site and in consequence his mill site could not be patented. 
 An appeal has been made to the Secretary of the Interior. Mr. Bolthoff 
 was forced to employ a firm of attorneys, sending them to Washington, 
 and after considerable effort on the part of the senators from Colorado 
 a hearing was finally arranged before a subordinate of the Interior De- 
 partment, The attorney presented his case very ably and is now await- 
 ing a decision. I am not certain, of course, as to what the decision will 
 be. One thing is certain, however, the only ground upon which he can 
 hope for the cancellation of the withdrawal and the granting of his 
 patent is the fact that his mill site was filed on before the withdrawal 
 was made. Had it been after the withdrawal there would be no hope 
 for his getting patent to that ground until the federal administration 
 shall entirely reverse its theory of handling of our Western lands. There 
 is a possibility that he may receive his patent. But, gentlemen, had he 
 known that he was going to get into this trouble do you suppose he 
 would have spent $60,000 in the development of those claims? Would 
 he have undertaken to build a mill for the treatment of ore which he had 
 developed? There is but one answer to that question, and the fear that 
 we may get into some triuble of that sort is, to my mind, preventing 
 the development of many mining claims in the West. 
 
 Had Mr. Bolthoff found it necessary to raise money for this enter- 
 prise by the sale of stock he could not have raised the money, but if 
 he had and the investors had lost their money the gentlemen who sup- 
 port and approve this federal interference would have raised their hands 
 in holy horror at the iniquity of the dishonest promoter. 
 
 The present session of Congress is considering a bill for the leasing 
 of mineral lands of the West. The Mining Congress has been on record 
 in opposition to a federal leasing system within the states. It has done 
 everything it could to prevent but it has not been strong enough to 
 prevent the progress of these bills. The Alaska leasing bill has been 
 passed, the leasing bill for the states is on the calendar and has been 
 passed by one body and is now before the other, and there is but one 
 hope that it may be defeated, and that is that through dilatory tactics 
 Western senators may be able to prevent its final adoption. That is 
 one of the things which, it seems to me, stands in the way of mining 
 development. In line with what our good friend from Utah has said, 
 the effort to administer public lands at this great distance by a machine 
 which requires years to get into action, in my judgment will be found 
 entirely inadequate. Mining men of the West take quick action when 
 they go into business operations, and when they have to do business 
 with a machine which cannot by its very nature, be moved inside of 
 two or three years, it will necessarily delay mining operations in the 
 West. Another proposition, which seems to me to be iniquitous, and on 
 
AMERICAN MINING CONGRESS 91 
 
 which we ought to take strong ground, is the method required in securing 
 a right of way over the public domain for a public utility. If a public 
 utility needs a right of way over privately owned land, and the owner 
 refuses to sell at a fair price, the utility company proceeds under the 
 eminent domain acts to take possession of the land and in condemnation 
 proceedings forces the private owner to surrender the right of way for 
 what the court shall determine to be a fair price. You are absolutely 
 prevented from bringing a similar suit against the federal government, 
 because you cannot sue the government. Unless the government allows 
 you by permission to have a right of way for a public utility you cannot 
 get it. This condition was long since recognized by Congress, as it was 
 provided in the original law years ago that "a right of way is hereby 
 granted across the public domain" and described the utilities which 
 could take advantage of that law. In other words, the government didn't 
 stand back at that time, under the old theory of the administration of 
 the public lands, and say you must even condemn. All you needed to 
 do was to satisfy the Secretary of the Interior that a public purpose is 
 to be served and your right of way was granted without litigation. This 
 supervisory power was given the Secretary of the Interior simply that 
 he might see to it that your right of way and mine did not conflict; in 
 other words, require you to file your plat in such a way that if after- 
 wards I sought a right of way I would not conflict with yours, or in case 
 the government should sell that land to some one else for other pur- 
 poses it would be sold with the reservation of your right of way, and 
 your description was required to be so definite that the reservation could 
 be properly made. But in these days a different construction has been 
 given, a,nd now if a right of way across the public land is required for a 
 utility it is not a matter of right. It seems to me that we should stand 
 for the right of condemnation for a right of way across the public domain, 
 and that the public domain ought not to be more sacred than the private 
 holding of an individual. In my judgment this is one of the things which 
 in future years is going to interfere very seriously with the progress and 
 development of mining operations. I thank you, gentlemen. 
 
 MR. BASS: Mr. President, on those lines I would like to say a few 
 words because it hits my case thoroughly. I at one time located a mill 
 site down in Grand Canyon for the working of asbestos mines. I located 
 it before it had been declared a national reserve. But shortly after that 
 the superintendent of forestry on the north side notified me to meet 
 him there. Of course I neglected my business and went down there to 
 see him, but he didn't show up. But some days afterwards he did, and 
 when I went down there afterwards I found that he had put up a notice 
 prohibiting me from going on this particular mill site, because it was on 
 a forest reserve, mind you, a forest reserve down in Grand Canyon 
 where there is not enough timber for firewood and also a national game 
 park. I paid no attention to it at all. I wrote back and told him that 
 my filings were all recorded and I considered I had a right there. He put 
 me to a great deal of trouble and expense. The gentleman from Utah 
 has hit the nail on the head and on the top of it and all over it, for the 
 simple reason that when you come to leasing water power, the govern- 
 ment plan of leasing it, means not conservation but confiscation. That is 
 what it means. Now, we have heard a great deal about damming the 
 Colorado. When you come to build a reservoir to irrigate all of Arizona, 
 well, I do not believe you could place the stock of a company of that 
 kind today among multi-millionaires, provided they knew anything about 
 it. I know something about it. I know that when that river gets right 
 mad and runs twenty miles an hour and brings down thousands of tons 
 of all kinds of stuff, it would fill up any dam and preclude the mainte- 
 nance of any power plant. But I do know that after a while if people 
 understand the situation there you can cut a tunnel there that will con- 
 fine that river at the west end of the Granite Gorge and make a water 
 
2 OFFICIAL PROCEEDINGS 
 
 power that I believe would turn half the world over, because you cam 
 get 120 feet fall by building a tunnel something like two miles, just cut- 
 ting a tunnel through. Some years ago I took Mr. A. J. Chandler down 
 there to investigate the water power. Now, this gentleman from Utah 
 will bear me out in the statement that there is an immense body of 
 timber over the Utah side of the Grand Canyon. That is the part of 
 Arizona of which the gentleman spoke when he said if we were like 
 those people who were in the habit of giving away their horses and 
 watches and everything else we would give them. Well, of course, I am 
 always fighting that, because I happen to know about it, and I think that 
 unless Utah would be willing to give us their part on the other side of 
 the river we will not give them what is on our side. I oppose it because 
 there is a whole lot of good stuff on the east side of the river, as this 
 gentleman will admit. There are two billion feet of merchantable tim- 
 ber on that side of the Grand Canyon that can be put on the market. 
 Now, how long does it take to cut a billion feet of lumber? It would 
 take quite a good while, wouldn't it? And yet I made that statement once 
 before, and I believe somebody said there was nothing like that. I be- 
 lieve it was our senator from Flagstaff who made some such statement 
 as that. You can develop all the horsepower you want from the water 
 from those creeks up there; you can turn it over and over and over and 
 use it as many times as you like. To tie up that land in the hands of 
 the government as it has been tied up, looks too ridiculous, and when 
 you go to get your permits they put a man over you to tell you what 
 you must do, and that man doesn't know anything about the conditions. 
 
 Now, as to the tying up or the leasing of the public domain over 
 there anywhere along the Grand Canyon in the granite section, I don't 
 care where you go in the mineral region you will find the secondary forms 
 of mineral. To tie it up, to lease it, would stop the development of it. 
 There are thousands of acres of good land up there, too. I think ther** 
 is a man here from Arizona, from the northern part, who knows that 
 only a few years ago it was pretty hard to get a sack of potatoes up 
 there, and I understand they have shipped down here to you people thia 
 season about 23 carloads. I am opposed to the leasing of the public 
 domain because I am interested in the betterment of the small farmer. 
 (Applause.) 
 
 MR. SIZER: Mr. President, I rise to ask whether the gentlemam 
 from Texas, who spoke this morning, has succeeded in finding his paper. 
 If he has, I for one would very much like to hear it. 
 
 THE PRESIDENT: Dr. Phillips, give an account of yourself. One 
 of us is going to be made out a liar, you or myself. 
 
 DR. PHILLIPS: I have been a more or less successful liar all my 
 life. But three weeks ago I had a receipt from your Secretary, Mr. Prea 
 ident, for the paper that I sent him on that subject. 
 
 THE PRESIDENT: You refer to the assistant secretary, I presume 
 who is not here? 
 
 MR. PHILLIPS: I think it was Mr. Wolcott who sent it to me; S 
 don't think it was Mr. Callbreath. 
 
 SECRETARY CALLBREATH: Is Mr. Wolcott in the room? 
 
 DR. PHILLIPS: No; I wouldn't make the assertion if I thought 
 he was here. 
 
 THE PRESIDENT: I knew it. This paper is going to be published 
 in the proceedings, and the proceedings will be published very promptly, 
 and we will ask your indulgence to wait until you see it there. Is there 
 anything else to come before the session this afternoon? If not, I will 
 declare the Congress adjourned until 9:30 tomorrow morning. 
 
 Meeting adjourned. 
 
AMERICAN MINING CONGRESS 8 
 
 THURSDAY, DECEMBER 10, 1914. 
 
 Morning Session. 
 9:30 O'clock A. M. 
 (President Scholz in the chair.) 
 
 THE PRESIDENT: The meeting will please come to order. Gen- 
 tlemen, there are several committees to report. There was a committee 
 appointed to audit the accounts. Is that committee ready to report? 
 
 SECRETARY CALLBREATH: I have the report here, Mr. Preg- 
 ident. 
 
 (Auditing Committee's report read by President.) 
 
 Report of Auditing Committee. 
 
 Phoenix, Arizona, December 10, 1914. 
 
 We, the undersigned committee, appointed to audit the books of the 
 Secretary of the American Mining Congress, have gone over the accounts 
 mud find the same to be correct. 
 
 (Signed) F. K. BRUNTON, 
 GEO. H. UTTER, 
 Auditing Committee. 
 
 A DELEGATE: Mr. President, I move that the report be approved. 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT: The next item on the program is a report front 
 the Committee on Resolutions. Are there any other reports to be pre- 
 sented this morning, Mr. Secretary? 
 
 SECRETARY CALLBREATH: No, there are no others, I think, 
 except that of the Resolutions Committee. 
 
 MR. CARMICHAEL: Mr. President, your Committee on Resolutions 
 having had under consideration Resolution No. 2, introduced by the Com- 
 mittee on Revision of Mineral Land Laws, do hereby recommend that the 
 tame be amended by substituting therefor the following: 
 
 Resolution No. 2, as Amended. 
 
 "Be It Resolved, By the American Mining Congress at its Seventeentk 
 Annual Convention assembled at Phoenix, Arizona, that Congress be 
 urged to pass legislation now before it providing for the revision of the 
 mineral land laws of the United States." 
 
 THE PRESIDENT: That is a substitute for the original as sub- 
 mitted? 
 
 MR. CARMICHAEL: Yes, and I move that the resolution as 
 amended by the committee be adopted. 
 
 MR. CLARK: I accept the amendment. 
 
 SECRETARY CALLBREATH: Mr. President, in view of the fact 
 that the maker of the resolution accepts the amendment, it may be wise 
 to assume that this amendment was introduced in this shape instead of 
 as it originally stood. 
 
 MR. CLARK: The provision was recommended by the committee, 
 and just merely to expedite the business was the reason I accepted it. 
 I do not think the amendment really covers the ground we want to cover, 
 but I thought I could get at that in some other way. But the point is, 
 we have recommended there a certain kind of a committee, and we want 
 an appropriation. 
 
 (Motion seconded and carried unanimously.) 
 
94 OFFICIAL PROCEEDINGS 
 
 MR. CARMICHAEL: Your Committee on Resolutions has had under 
 consideration Resolution No. 4, and recommend that same be amended 
 to read as follows: 
 
 Resolution No. 4, Introduced by C. H. Clapp, C. T. Willis and S. H. Wor- 
 rell, as Amended. 
 
 Whereas, The Congress of the United States of America has appro- 
 priated at various times the Merrill Fund of $50,000, the Adams Fund 
 of $20,000, the Hatch Fund of $15,000 and the Lever Fund of $10,000 
 yearly to each state agricultural college, making a total of $95,000 
 yearly; and 
 
 Whereas, The expenditures of the above sums of money have been 
 productive of great advantage to the agricultural interests of the coun- 
 try ; and 
 
 Whereas, No money has been appropriated at any time to foster and 
 stimulate instruction in mining schools although approximately 50% of 
 the above amounts are directly for instruction in agricultural subjects; 
 and 
 
 Whereas, The total aggregate value of agricultural products is $10,- 
 000,000,000, and the total value of mineral products is $4,600,000,000, or 
 46%; and 
 
 Whereas, The importance of the industry is further reflected by the 
 fact that approximately 60% of the freight hauled by the railroads is 
 for the mining industry; 
 
 Therefore, Be It Resolved, That we, as representatives of the min- 
 ing industry, ask the Congress of the United States to pass favorably a 
 bill similar to the Austin bill, which provides that an appropriation of 
 $25,000 per* annum be made to each mining school in the United States. 
 
 MR. CARMICHAEL: We recommend that the resolution be passed, 
 and move its adoption. 
 (Motion seconded.) 
 
 SECRETARY CALLBREATH: May I say only one word on the 
 resolution, Mr. President? Only to question the figures as to agricultural 
 production. I have hoped for the opportunity to analyze the agricultural 
 production statistics in such a way as to show the real truth. In the 
 agricultural reports showing this enormous production we will find that 
 hay is counted, and later on that hay is fed to cattle and the beef is 
 counted and later the hides are counted. In many other lines you will 
 find the report of the agricultural production of the country is enhanced 
 by a duplication of the product, while in mining we are held right down 
 to the actual production of the mine. When an actual comparison be- 
 tween the total products in the two industries is made the mining in- 
 dustry will come very much nearer equaling in production that which is 
 reported for agriculture. 
 
 THE PRESIDENT: I live in Illinois, and I was much surprised in 
 reading the reports of the Geological Survey of the enormous iron pro- 
 duction of the state, and I began to look for an iron mine. I found that 
 the iron referred to was that which came to Chicago by boat from 
 Northern Michigan. So I guess the same condition applies to both in- 
 dustries. But I think it would be well to make an investigation anyway. 
 
 (Motion carried unanimously.) 
 
 MR. CARMICHAEL: Mr. President, your Committee on Resolutions 
 having had under consideration Resolution No. 5, introduced by Mr. 
 William B. Phillips and Mr. R. C. Allen, do hereby recommend that same 
 be passed, and I move the adoption of the resolution. 
 
AMERICAN MINING CONGRESS 95 
 
 SECRETARY CALLBREATH: This is a very important resolution, 
 and in the appointment of a committee of three in each state the President 
 will find a very difficult proposition unless the people from the several 
 states who are interested in this matter shall volunteer to do their part 
 of the work. 
 
 (Motion seconded and carried unanimously.) 
 
 MR. CARMICHAEL: Mr. President, your Committee on Resolutions 
 having had under consideration Resolution No. 7, do hereby recommend 
 that the same be amended as follows, and I move the adoption of the 
 resolution: 
 
 Resolution No. 7, as Amended, Introduced by W. G. Swart of Colorado. 
 
 That the American Mining Congress, recognizing the necessity of 
 carrying forward the movement for greater safety in mining, places 
 itself hereby on record as in favor of the earliest possible adoption of a 
 uniform national system of bell and danger signals, and urges the Bureau 
 of Mines to take such action as will insure the accomplishment of this 
 object. 
 
 (Motion seconded and carried unanimously.) 
 
 MR. CARMICHAEL: Your Committee on Resolutions recommend 
 the adoption of Resolution No. 6, introduced by Mr. W. G. Swart of 
 Colorado, and I move its adoption. 
 
 (Motion seconded and carried unanimously.) 
 
 MR. CARMICHAEL: That is all just now, Mr. President. We will 
 have a few more resolutions later on. 
 
 THE PRESIDENT: While the Resolutions Committee are com- 
 pleting their work I am going to take the liberty of asking Dr. Holmes 
 to come on the stage not under the five-minute rule but under the 
 three-minute rule. Not that we do not want him all day, but I would 
 like to have the Doctor come forward and address the audience for just 
 a few minutes, and I will appoint a committee to escort him to the 
 platform. I will ask Mr. Dern and Mr. Brunton to serve upon that 
 committee. 
 
 (Dr. Holmes was enthusiastically applauded as he ascended the 
 platform.) 
 
 DR. HOLMES: Mr. President and Fellow Members of the American 
 Mining Congress: It is certainly one of the pleasures of the year to 
 meet with the mining men on occasions of this kind. The Bureau of 
 Mines and its work is something quite young, having been established 
 only in 1910, and therefore you might say that during the few years 
 since that time it has been little more than well inaugurated. But there 
 are always two conditions necessary in the accomplishment of a work 
 of its kind. The first condition is to have money enough for the per- 
 sonnel, the proper men, experts, and for the equipment with which to 
 do their work. The Bureau of Mines has today not a much larger ap- 
 propriation than had the old technological branch under the Geological 
 Survey several years ago. Since the Bureau of Mines was organized in 
 1910 there has been comparatively little increase in the moneys appropri- 
 ated for the actual investigations of mining, consequently we have not 
 been able to do the amount of work which we would like to have done. 
 Our plans for the present year are in no way enlarged upon those of 
 the past year. Now, that is a condition which is going to continue as 
 it is now until the mining people of this country make up their minds 
 to the fact that they are not being treated on the square. You realize 
 this very interesting information brought out by the President in his 
 address the other evening, that whereas every miner in this country 
 
96 OFFICIAL PROCEEDINGS 
 
 contributes something like $1,800 a year to the national wealth, as com- 
 pared to ,$800 or $900 contributed by every farmer of the country to 
 the national wealth, at the same time the people of the United States 
 contribute 28 to 30 cents per capita for the advancement of agriculture 
 and less than 2 cents per capita to the advancement of mining; that 
 in spite of the fact that mining is the most hazardous of our great 
 industries and agriculture is the safest; that in mining we have one 
 lot of mineral resources and that when they are gone the nation must 
 depend upon something else or some other country, whereas agriculture 
 is a self-perpetuating industry. Why is it that it is so difficult to get 
 anything done out of the federal or state treasury on behalf of mining? 
 And the first reason which I found in talking with members of Congress 
 is the fact that when you talk to them about helping mining what they 
 see is the Homestake and the Treadwell and the United Verde and half 
 a dozen great, big mines in the country, and they say, "Why, those 
 fellows are rich enough to take care of themselves." They don't see 
 the small mines of the country; they don't see the struggling miners 
 who are trying to build up a great industry, and the reason they don't 
 see these things is because they are not presented to them; and in that 
 connection I want to emphasize one of the most important lessons for 
 this session of the Mining Congress to learn thoroughly, and that is that 
 until the mining people of this country do what the railroad companies 
 of the country are doing, educating public sentiment as to what this 
 great industry is and what it means to this nation, the people of the 
 United States will never understand it. You know for many years the 
 railroads followed the policy of doing what they called quiet work. They 
 endeavored to control legislation by interviewing on the side important 
 politicians. Now they have found that that is a sort of thing that the 
 American public is rebelling against. That is the sort of thing which at 
 the present time won't go, and they have found it to be the case. No 
 class of people in this country became so much and so thoroughly 
 suspicioned as were the railroad men. Now, what they have done was 
 to decide on another policy. They have come squarely out into th 
 open. They have organized, as was told you here the other evening, 
 a bureau of railroad economics, a bureau of information which they 
 support in Washington. That bureau has done so much good to the 
 railroads that it has brought about recently a rehearing before the 
 Interstate Commerce Commission on the rate question, and in many ways 
 it is securing fair treatment for the railroads, and just as soon as the 
 mining interests of this country all pull together and the American 
 Mining Congress is the best organization through which they can pull 
 together in my judgment they will educate public opinion in this 
 country so that unjust taxation and unfair legislation which will en- 
 danger the industry will become an impossibility. One of the most 
 encouraging evidences of this fact is that within the state of Missouri, 
 within the past few months, we have seen the recall of the obnoxious 
 legislation which was popular in its day with both politician and voter, 
 but when attention was called to the real situation, how it was injuring 
 the public and injuring the private property and the great railway lines, 
 the people of the state of Missouri recalled that legislation, and they 
 will be fair to the mining industry and they will support the mining 
 industry and will treat it justly and fairly for all time if the mining 
 people of this country will get together and pull together, educate them 
 as they ought to be educated and give them information in which they 
 have real confidence. 
 
 I thank you very much for this opportunity to speak to you, and 
 I am very glad to be here with you, and have enjoyed my association 
 with you since you have been in Phoenix. (Great applause.) 
 
 THE PRESIDENT: Gentlemen, it is a rare pleasure indeed to have 
 Dr. Holmes with us and to hear his remarks. He has done a great deal 
 
AMERICAN MINING CONGRESS 97 
 
 for our business, as we all know, and we owe him a great deal; more, I 
 think, than we will ever be able to tell him. 
 
 SECRETARY CALLBREATH: Mr. President, I desire to announce 
 the election of officers by the Board of Directors at their meeting last 
 night, as follows: 
 
 For President, Carl Scholz. 
 
 For First Vice President, Harry L. Day. 
 
 For Second Vice President, M. S. Kemmerer. 
 
 For Third Vice President, George H. Dem. 
 
 For Secretary, J. F. Callbreath. 
 
 The Executive Committee elected is Messrs. Carl Scholz, Charles S. 
 Keith and Walter Douglas. 
 
 In additon to that, the Board of Directors exercised the privilege 
 given under the by-laws to create an honorary life membership. The 
 directors are limited by the by-laws to one each year, and I might say 
 this is the fourth time this privilege has been exercised in the seventeen 
 years of the life of the Mining Congress. The Board of Directors yester- 
 day conferred that honor upon Dr. James Douglas of New York. 
 
 PRESIDENT SCHOLZ: Gentlemen, I would be very remiss if I 
 did not express my gratification over my re-election as President of the 
 Congress. Frankly, when I entered the committee room last night I 
 had hoped that the directors would say, "Well done, thou good and 
 faithful servant," but, on the other hand, they said, ''If at first you don't 
 succeed, try, try again. Don't be discouraged," and they have handed 
 you another lemon. I saw one down the street last night that weighed 
 2% pounds, I tip the scales at 157. You can figure out the ratio. A 
 year ago I was elected president because I had "put it over" on the coal 
 men. I then had in mind the adage which emanated from our great 
 statesman, Mr. Lincoln, who wisely said, "You can fool some of the 
 people part of the time, part of the people all of the time, but you can't 
 fool all of the people all of the time." I think I have beat him to it. 
 (Laughter.) 
 
 Since this is the last session of the Congress I feel that I should 
 voice the sentiments of the delegates and the visitors who have been 
 here by thanking the Committee on Arrangements and the citizens of 
 Arizona, and, more particularly, of Phoenix, for the very cordial welcome 
 they have given us and the very courteous and delicate way in which 
 they have carried it out. I travel more or less and have been in any 
 number of civilized and a great many uncivilized sections, but never 
 have I found a place which I liked so well as I like Phoenix. I was im- 
 pressed when I came with the magnitude of the desert, with the miracles 
 wrought by the waters, with the wonderful buildings and streets; but 
 most of all I have been impressed with the people, and those of us who 
 have to return to the frigid climes frigid in more ways than one will 
 miss Phoenix very much, and I want to convey to the Reception Com- 
 mittee, to the governor who received us, and the various officials, the 
 mining kings, the consort of the "Copper Queen" and others who have 
 made our stay so pleasant here, the very heartfelt thanks of the Con- 
 gress, and I am sure that every delegate will join me in this. (Applause.) 
 
 What is the next thing you have on your desk, Mr. Secretary? 
 
 SECRETARY CALLBREATH: I presume, Mr. President, the Secre- 
 tary also ought to acknowledge his gratification at his re-election, and 
 I think the comparison between the 2^-pound lemon and the 157-pound 
 lemon, while entirely inapplicable in the case of the President, might 
 well be applied in the case of the Secretary. At any rate, gentlemen, 
 I intend to perform the duties of the office as best I may during the 
 coming year, but I want to impress upon you that work of this kind is 
 
98 OFFICIAL PROCEEDINGS 
 
 work that cannot be done by one man or two or three or a dozen men. 
 The work must ^ be a unanimous uprising and demand on the part of all 
 of the mining men of the country. Unless there is that hearty co- 
 operation, unless each of you feels that the work of the Secretary, the 
 work of the President, the work of all of the officers, is work in which 
 you are directly interested, we will not achieve complete success, and 
 when you see that we are making errors we want you to call our at- 
 tention to it, because remember always that to the earnest official 
 honest criticism is always the highest compliment and the best aid. 
 Whenever your officials are not doing what they ought to do it is your 
 province to call their attention to it. You may be mistaken, and when 
 you have made your criticism it may be explained to you why you are 
 wrong and why the work as it has been done is best, under the best 
 conditions. You cannot help but understand that in dealing with other 
 people we have sometimes to accept compromises. It is not within the 
 province of any one or all of us to attempt to dictate to Congress. We 
 cannot even attempt to dictate to one single congressman and do it 
 successfully, because we may not know exactly the surroundings under 
 which he is forced to act, and we have to do the best we can. I want 
 to say that I deprecate the feeling which seems to prevail in many 
 sections that members of Congress and senators and public officials are 
 corrupt or subject to improper influences. As a matter of fact, the men 
 who go to Congress are, generally speaking, the very best men that 
 can be selected. Some mistakes are made but usually the best men are 
 elected. On the whole the average of the integrity and honesty of the 
 members of Congress and the Senate is of the highest order, and there- 
 fore, if we can only convince them that our cause is just we are able 
 to get their support. We must remember, further, that to convince 
 every member of Congress that a certain thing is important and should 
 be done does not pass a bill through Congress. It is only in some great 
 emergency in which the public rise up en masse and demand legislation 
 that it is possible to pass a bill within several months in Congress, and 
 every congressman is yielding to the force of public sentiment which is 
 behind him to get the best thing he can for his constituents. Unless 
 you as mining men present your cause in convincing way you cannot 
 expect members of Congress to leave matters on which they are being 
 crowded to take up questions for which there seems to be no public 
 demand. If we expect Congress to yield to our wishes we must not 
 only convince them that we are right, but we must convince them that 
 the great public back of them, their constituency, demand the things 
 that we seek. It would probably take six months even though there 
 was no objection on the part of anybody to get Congress to indorse the 
 Lord's Prayer or any other thing which they thoroughly believed in. 
 It requires a little pressure all the time to keep them up to the rack, 
 to see that they do not forget, because they must necessarily do the 
 things which come to them with the greatest demand. This shows the 
 great necessity of organization through which every section of the coun- 
 try may push and urge upon its member of Congress and its senator 
 the necessity of the particular legislation which we recognize to be so 
 important. 
 
 I want to say a word concerning the Kern-Foster bill. This is the 
 bill which is provided for in one of the resolutions which you have ap- 
 proved providing for the creation of metallurgical research stations in 
 the West and providing for greater means of safety, with particular 
 reference to coal mines. I presume it is true that the average loss of 
 life in precious metal mines is as great as in coal mines. This is not 
 generally recognized, because of the fact that in metal mining there are 
 usually but one or two men injured at a time. In coal mining the 
 horrible disasters command the attention of the public. The rescue 
 car is for the protection of the lives of miners in all kinds of mining. 
 The metallurgical research stations are especially for the benefit of the 
 
AMERICAN MINING CONGRESS 99- 
 
 Western precious metal mining, and when we are able to induce the 
 leader of the Democratic Senate from an Eastern state, who knows 
 nothing about and has no interest in precious metal mining, to father 
 the bill for your benefit and urge its adoption in the United States 
 Senate, and when we are able to secure an Eastern member of Congress 
 who has nothing to do with metal mining and no personal interest in 
 it to introduce that bill in the House and get back of it with his com- 
 mittee, you can see that we have gone a long way towards getting that 
 support which is necessary to secure legislation. But we need more 
 than that; we need to show that there is a real demand for this. And, 
 gentlemen, we must not ask upon the theory that the mining industry, 
 because of its importance, is entitled to it. It is all right to say that, 
 but we must ask for it because the mining industry needs it, and unless 
 the mining industry can show its need then it is not entitled to ask for 
 this legislation. Congress is not there to pay tribute to people who have 
 been successful. It is there to help the development of those industries 
 which are basic in the business life of the country. We must show to 
 Congress that the mining industry needs the investigations which will 
 enable the small miner to prosecute his work successfully. If we can 
 show them that the development of a certain ore body is important to 
 the public and we must never lose sight of the fact that the question 
 is not how it affects you as individuals but how it affects the country 
 as a whole if you as an individual cannot make your mine successful, 
 and if there is no demand on the part of the public that you shall be 
 successful, then it is a proper suggestion that you go into some other 
 line of business; but if the production of your mine furnishes the basis 
 of the industry and prosperity of the country, then every man in the 
 United States is interested in that development. We must show that 
 you as a miner need this scientific investigation to enable you to carry 
 on your work effectively, efficiently, with the greatest safety to the men 
 employed in the underground work, with the cheapest production which 
 is possible, and at the same time the best conservation of those natural 
 resources which you did not create and which were placed there for the 
 benefit of the world. Safety, Efficiency, Conservation are the three 
 watchwords of the American Mining Congress, and it is hoped that by 
 co-operative effort on the part of the mining men of the United States 
 these things may be accomplished. As has been said this morning, vie 
 must not expect that we can go around and buttonhole a member of 
 Congress and pull him aside and by some improper or secret method 
 induce him to be with us. We must lay our case before him with the 
 utmost publicity, and we must do that not only in the nation but in 
 the state. We must take our legislators into our confidence and show 
 them that the public is interested in the business as well as we are. 
 We are interested in making a profit; you are interested in this de- 
 velopment and in the men we employ, and the men themselves are inter- 
 ested in receiving the highest wages consistent with the conditions of 
 the business. So we must work together, and I hope the day may come 
 when this conflict between employer and employe will cease, because 
 the highest development of the mining industry can never be secured 
 until the mine worker and the mine operator work squarely together 
 for the best safety, the best working conditions, the best living con- 
 ditions and the highest wages that are possible to be paid taking other 
 interests into consideration. The mine operator is entitled to his profit 
 and he is entitled to a profit in proportion to the risk which he assumes 
 in the carrying out of his business. That profit must be enough not 
 only to pay current expenses and to cover this risk, but to cover the 
 value of his mine, which sooner or later will be depleted. During the 
 time of its operation the mine and plant must be paid for from the 
 proceeds. Having met those two conditions, the third thing is that the 
 consumer is entitled to the product of the mine at the lowest price 
 which it is possible to furnish it to him for, having cared first for the 
 
100 OFFICIAL PROCEEDINGS 
 
 miner and the operator. When we have reached the condition where 
 there is a most perfect co-operation between miner and operator and 
 where the great public outside, which are the consumers of the products 
 of our mines, are willing to say, "We will pay an increased price for 
 this product because we know that unless the mining industry is profit- 
 able we cannot be prosperous; we are willing to pay a price which meets 
 all these other conditions and makes the mining industry profitable," we 
 can say that we have succeeded in our work. 
 
 The Kern-Foster bill provides for the creation of metallurgical re- 
 search stations in the West. It is the first long step toward an effort 
 to apply to mining the highest scientific knowledge which the world 
 possesses. It may be and probably is true that you know today more 
 than anybody else does about your own mining operations. But some 
 man and there are today a number of men who have been dubbed "bug 
 hunters," who can go into a plant of any kind, not necessarily a mine, 
 in which the best methods are not in use and point out different plans 
 of operation through which better efficiency can be secured. We want 
 the Bureau of Mines to pursue such investigations, and we want to have 
 them show us the better and more efficient methods of operation. I 
 remember some years ago when we were in the Bureau of Mines fight in 
 Washington, in the early days, Mr. Thomas F. Walsh, who was known 
 to many of you, invited a number of senators and representatives to his 
 house to a dinner. There were about forty members of Congress, and 
 probably about twenty senators, and the others, excepting the speaker, 
 were more or less distinguished men. At that meeting Mr. Walsh had 
 upon his table a large specimen of what looked like a silver-lead ore. 
 Mr. Walsh said: "Gentlemen, you will excuse me for talking shop in 
 my own home and to my guests, but I can't resist the temptation to 
 present to you just one illustration. This piece of ore is from a mine 
 that has been in operation for fifty years. During that time it has been 
 utilized for its lead and silver contents only. It has recently been dis- 
 covered that its greatest value is in wolframite, which is worth more 
 than the lead and silver combined, and during the last fifty years that 
 ore has been treated only with reference to the two other minerals." 
 Some one might say, "Well, who cares for this man if he didn't know 
 enough to get his values?" But the other feature of it is that the use 
 of that wolframite would greatly extend the life of the rails which are 
 used by our railroads. The railroads must charge a freight or passenger 
 rate which would keep up their road, and do you not see where you 
 become interested. It is a proposition that concerns everybody, and it 
 concerns the individual miner who is operating in the mine. Now, it 
 was only by accident that the presence of wolframite in that ore was 
 discovered. We believe the federal government ought to undertake on 
 a broad scale the solution of every problem of that kind to the end 
 that the highest efficiency may result in the operation of the mining 
 industry, and to that end we want your support to pass the Kern- 
 Foster bill. It provides for a beginning of that work, and I hope that 
 we may have from those assembled here and from their friends as 
 they go back home and from the country at large a demand that this 
 bill shall be made a law during the present session c-f Congress. 
 
 I thank you, gentlemen, very much for your kind attention. (Ap- 
 plause.) 
 
 THE PRESIDENT: To fill out the time while we are waiting for 
 the Resolutions Committee, I would like to make one brief remark on 
 the duties of the delegates, which I brought out in my address that the 
 duties of delegates are not ended by coming to Phoenix and attending 
 the sessions and participating in the entertainment, of which we had a, 
 very good example last night. Those are merely the stage settings. 
 Your work is upon your return to your homes when you should report 
 to those who sent you here the work of this Congress and commend it 
 
AMERICAN MINING CONGRESS 101 
 
 to them so that they may be interested and know that they sent you 
 with good results. I urge upon you that upon your return you write 
 a strong letter to the governor or the respectiy^ 'iumojtities ;whcTsent 
 you here and tell them what you found arid/ (ioinnie'ad to them the 
 work of this Congress. (Applause.) , , . >t .,^ ,, v 
 
 MR. CARMICHAEL: Mr. President, your -Committee cm- jftostlufcidas 
 having had under consideration Resolution No. 3, introduced by L. S. 
 Judd of Vicksburg, Arizona, respectfully recommend its adoption as 
 amended. 
 
 Resolution No. 3, as Amended, Introduced by Mr. L. S. Judd, Vicksburg, 
 
 Arizona. 
 
 Whereas, It has come to the attention of the American Mining 
 Congress that sundry mining claims on Indian reservations in the states 
 of Arizona and New Mexico are unable to obtain title to their property 
 by reason of conflicting surveys made many years since covering the 
 boundaries of the above mentioned Indian reservations; now, therefore 
 
 Be It Resolved, That this Congress respectfully request all Western 
 congressmen and senators to support and expedite the measure now 
 under consideration for the relief of those suffering by reason of the 
 existing conditions. 
 
 MR. CARMICHAEL: I move the adoption of the resolution as 
 amended. 
 
 (Motion seconded and carried unanimously.) 
 
 MR. CARMICHAEL: Mr. President, your Committee on Resolutions 
 submits the following resolution for consideration and I move its adop- 
 tion: 
 
 Resolution A, Introduced by the Committee on Resolutions. 
 
 Whereas, The American Mining Congress was originally created for 
 the specific purpose of securing the active co-operation of the federal 
 government in the development of the mining industry; and 
 
 Whereas, The first step looking to such co-operation was made 
 effective by the creation of the federal Bureau of Mines; and 
 
 Whereas, The results accomplished by that bureau have been such 
 as to commend themselves not only to the mining men of the country, 
 but to all those who realize that safety and efficiency in operations and 
 conservation of the nation's resources are matters of vital importance 
 to the nation as a whole; and 
 
 Whereas, The means at its disposal are inadequate for the proper 
 conduct of its affairs and for the execution of well considered plans; 
 
 Therefore Be Is Resolved, By the seventeenth annual meeting of the 
 American Mining Congress, assembled at Phoenix, Arizona, December 
 7th to llth, 1914: That the Congress of the United States be urged in 
 the most earnest manner to provide immediate and more adequate sup- 
 port for the said bureau. 
 
 And Be It Further Resolved, That we urge on the Congress of the 
 United States the enactment of a law providing for the creation of a 
 department of mines and mining with its head a member of the Presi- 
 dent's Cabinet. 
 
 That a copy of this resolution be transmitted to Congress by the 
 President and Secretary of the American Mining Congress through the 
 proper channels at once. 
 
 (Motion seconded and carried unanimously.) 
 
102 OFFICIAL PROCEEDINGS 
 
 THE PRESIDENT: While the Committee on Resolutions is per- 
 forming the rest of its work I would like to amend the statement I made 
 a while /ago regarcfii^the' reports of the delegates, that the delegates 
 who have' been appointed' by the President of the United States will 
 prepare a report to be sent 'to him, and I am going to ask Dr. Phillips, 
 thfT . gefQtJeirsaii'who q"ac\ted the Bible so freely last night, to act as 
 ch'aifman 6f that committee. Incidentally, I feel it proper to inform you 
 that he made a mistake, I think, when he referred to books, chapters and 
 verses last night, because I have looked it up in the book which the 
 Gideons have left in my room, and I have concluded that he must have 
 referred to the mining code which is yet unpublished and not to the 
 Bible (Laughter), which caused me more or less loss of sleep. 
 
 DR. PHILLIPS: I feel particularly grateful, Mr. President, that 
 through any effort of mine, even though they were not intended, you 
 have been induced to read a portion of the Holy Scriptures. (Laughter.) 
 
 MR. BASS: Mr. President, I would like to take this opportunity to 
 express my personal appreciation of the able manner in which the offi- 
 cers of the Mining Congress have conducted the business of the Con- 
 gress, and I think we ought to be proud to think that we have such 
 officers; and not expressing the feeling of the people of Phoenix par- 
 ticularly, but of the whole state of Arizona, I believe that every citizen 
 will feel proud that we have had the honor of this Congress. 
 
 Now, our worthy doctor here, I think, is entitled to consideration 
 for that address we had last night, because he probably has not had a 
 chance lately to look into the Scriptures, and I don't think you ought to 
 call him down on that, Mr. President, at all. I enjoyed it very much 
 myself. 
 
 I heard a statement here the other day by one of the members that 
 he thought that Arizona mountain land wasn't worth anything only for 
 mining; that if it wasn't good for mining it wasn't good for anything 
 else. I felt like getting up and making the statement then that I 
 believe we can build sanitariums on every acre of it, and when our 
 Eastern friends need the benefit of a health-giving climate we can keep 
 them out here for six months and they never will want to go back. When 
 I first came here I was an invalid. I came out here to die, and have 
 been here thirty-one years. I wrote a little advertisement of our climate 
 and for the benefit of our members I will give it to you: 
 
 If your health should fail and your pulse grow weak, 
 And your doctor advises you some clime to seek, 
 
 Do not be discouraged nor sit down and cry, 
 
 Arizona will save you, with her climate so dry. 
 
 Our pure air will revive you, sunshine give new life 
 And strength to prepare you for all future strife; 
 
 But then we are mortals and surely must die, 
 
 And in our blissful climate you can hang up and dry. 
 (Laughter.) 
 
 MR. SIZER: Mr. President, I believe the delegates here this morn- 
 ing would like to hear from Mr. Frank Murphy. 
 
 MR. MURPHY: I think it is hardly fair to ask me to stand up in 
 the presence of many able gentlemen who have talked to you here at this 
 convention. It has not been my privilege to be with you all through, 
 so I am not thoroughly advised. I have, however, formed some impres- 
 sions from the little that I have heard that lead me to feel greatly en- 
 couraged so far as the mining interests of Arizona are concerned and 
 the general business interests in our state. Arizona has suffered ma- 
 terially and all the United States has suffered from a lack of serious 
 
AMERICAN MINING CONGRESS 103 
 
 interest on the part of business men in the politics of our country. 
 Arizona is not altogether a mining country, though manifestly rich in 
 that particular; but we have great agricultural possibilities, and there 
 is a conflict of political interest and ambitions running through this state 
 that have brought about us a very unpleasant condition of things, very 
 injuriously affecting the interests of our state. I believe from what I 
 have heard here in the day or two that I have been with you, and the 
 talks that have been made, and from conversation with different parties, 
 that a movement is on foot by which the big and little interests of our 
 state are going to take hold of these important matters, and that great 
 good will result. I am particularly anxious to see something of the 
 kind take place, and if the disposition in evidence is properly directed, 
 I would expect to see Arizona move ahead with leaps and bounds gratify- 
 ing to all people interested in the state, and neighboring states as well. 
 The justification and importance of prompt action towards the bettering 
 of conditions in this state, has been thoroughly brought to your attention. 
 I do not know of anything in particular that I can say at this time. The 
 subject under consideration has been gone into very carefully and ap- 
 preciatively, by those fully qualified to determine the line of procedure 
 necessary. I have lived here for thirty-eight years, and been somewhat 
 identified with development of the resources of the state, and naturally 
 feel a great interest in its future. 
 
 I am sorry to have to say that during the past few years the radical 
 political epidemic that has been so hurtful throughout the entire United 
 States, fastened itself on Arizona in the most destructive way imagin- 
 able. Scheming politicians, never constructive, living off of what has 
 been created, taxing everything now existing and prospective to the 
 limit, and mischievously working hardships on those who have been 
 conspicuous in the development of the resources of the state, have been 
 able to deceive the wage-earner and thoughtless business man generally, 
 to an alarming extent, but I am pleased to be able to feel that a change 
 for the better confronts us. I think the time has arrived for the poli- 
 ticians of the country to get busy and use such brains and intelligence 
 as they possess, in at least trying to create something to tax, instead of 
 throwing all kinds of obstacles and objections around the people who are 
 doing business, and producing the wealth of the country, maintaining 
 pay rolls and trying to create a healthy and prosperous condition through- 
 out the country. (Applause.) 
 
 THE PRESIDENT: We will be glad to hear further from the 
 Resolutions Committee. 
 
 MR. CARMICHAEL: Mr. President, right in line with the remarks 
 of the last speaker, the committee submits the following resolution for 
 consideration by the Congress: 
 
 Resolution No. B, Introduced by the Committee on Resolutions. 
 
 Whereas, The mining industry can only reach its highest develop- 
 ment through more complete co-operation between the miner, the oper- 
 ator and the various interests through w r hich mines are developed and 
 the products thereof are prepared for and transmitted to market; and 
 
 Whereas, The present condition of the mining industry is such that 
 all unnecessary restrictions should be removed and every aid and en- 
 couragement be given through just and farseeing legislation; and 
 
 Whereas, The development of the mining industry has at times been 
 greatly hampered by unwise and illy considered laws, placing thereon 
 unfair restrictions and undue burdens which have seriously hampered 
 the industry as a whole. 
 
 Whereas, Many of these unfortunate laws have been passed without 
 a comprehensive knowledge of conditions; now, therefore, 
 
104 OFFICIAL, PROCEEDINGS 
 
 Be It Resolved, By the American Mining Congress in its Seventeenth 
 Annual Convention assembled at Phoenix, Arizona, that all connected 
 with the mining industry be urged to take a more active interest in 
 proposed legislation, and through proper organizations or otherwise, see 
 that all legislators and the people generally are given full information 
 as to the experience of other states with legislation similar to that which 
 may be proposed, and be given all available information which may 
 lead to an accurate forecast of the effects of such proposed measures. 
 
 MR. CARMICHAEL: I move the adoption of the resolution. 
 (Motion seconded and carried unanimously.) 
 
 DR. PHILLIPS: I do not wish to impose on my Arizona friends, 
 because I am an old Arizona pioneer myself. I was in Arizona many 
 years ago with a diamond drill outfit which I carried in on a pack mule 
 across the range. It was about the time that the great discoveries of 
 oil in California and Beaumont induced us to discontinue our work, be- 
 cause coal could not at that time compete with oil. 
 
 Gentlemen, with the permission of the President and in your inter- 
 est, I would ask to speak a few words concerning the director of the 
 Bureau of Mines. I suppose I am his oldest friend here, because I have 
 known him intimately for about thirty-two years. I do not know of any 
 man who has led a life of greater usefulness, nor one whose devotion 
 to the public interests of this country can for a moment be compared 
 with that of Dr. Holmes. I betray no secrets when I say that his health 
 has failed under the tremendous burdens imposed upon him by the duties 
 of this position. Last spring, contrary to the advice of his physician, 
 he went to Alaska at a time of the year when the waters were still cold. 
 He ate and slept very little. He worked twenty-four hours a day part 
 of the time, and spent many nights sleeping in wet blankets or as he 
 could. This has brought upon him a serious attack of illness from which 
 his recovery will, I think, be somewhat slow. When I visited him a 
 month ago at Fort Bayard I was distressed by his condition, but I am 
 pleased to remark that now he appears to be on the upgrade. Gentlemen, 
 I can recommend this man to you from a knowledge stretching over a 
 third of a century. There are but few men in the United States like 
 Dr. Holmes, the director of the Bureau of Mines (great applause), and 
 I know what I am talking about, because I have known him intimately 
 since he came to the University of California fresh from Cornell Uni- 
 versity as a recent graduate. There is not a man of my acquaintance 
 who has shown half of the devotion to the public service or brought 
 to the solution of the problems which he has faced for years so much 
 intelligence, perseverance and insistence. He is one man among a thous- 
 and. Modest, kind-hearted, with a heart as big as all outdoors, he knows 
 nothing but the public good. If he borrowed $10 from you today he 
 would spend it for the Bureau of Mines. He not only spends his own 
 money but everything else he can get hold of. He is the most intemperate 
 man I ever saw in my life; he has no regard for his health, his comfort 
 or anything else but the work to which he has devoted his life; and I 
 move you, Sir, that as an appreciation of his services this Congress go 
 on record as expressing the utmost sympathy for him in his present 
 indisposition, with the most heartfelt wish that he will soon be restored 
 to complete health. (Applause.) 
 
 (Motion seconded and carried unanimously by a rising vote.) 
 
 THE PRESIDENT: Mr. Day is called upon to address the Congress 
 on the general subject of the interests of mining. 
 
 MR. DAY: Mr. President, I must respectfully ask to be excused. 
 I do not feel that I can say anything at this time that would be of in- 
 terest to you gentlemen. 
 
 THE PRESIDENT: We will excuse you reluctantly. 
 
AMERICAN MINING CONGRESS 105 
 
 MR. DERN: Mr. President, it has just occurred to me, after listen- 
 ing to the remarks of the gentlemen who have spoken this morning, 
 remarks which conform to much of the sentiment expressed throughout 
 this session, that there is one thought that we might take home with us, 
 and that is that we seem to be getting into the habit of ascribing all of 
 our ills to hostile legislation. In my judgment there is, if anything, too 
 much stress laid upon that particular point. Our discussions have 
 tended to convey the idea that the only thing that is the matter with the 
 mining industry is that there have been a lot of bad laws passed. I do 
 not mean to defend the legislation that has been complained of. I do 
 not say that the laws have not been bad; but I do say that personally 
 I do not believe that these laws are the sole cause of our troubles. And 
 in my opinion we are laying ourselves open to the charge of being short- 
 sighted and narrow-minded if we permit ourselves to become obsessed 
 with this notion. The people of Arizona, the mining men particularly, 
 seem to be finding a good deal of fault with some of the recent legis- 
 lation in this state, and they have given us the impression, in some 
 degree, that if they were rid of this obnoxious legislation, everything 
 would be well with them. I never heard of this legislation until I came 
 to this Congress, and I am far from denying that our Arizona friends 
 have a grievance, but I should like to call attention to one point. Arizona 
 (s generally considered an extremely radical state, whilst Utah is char- 
 acterized as an extremely conservative state. In Utah we have not had 
 any of the radical legislation that we find so bitterly denounced here. 
 And yet I venture to say that, on the whole, mining conditions in Utah 
 are very much the same as they are in Arizona. Hence I say that if 
 we look at the matter in a broad way we must conclude that there must 
 be something the matter with mining besides these laws that have been 
 
 One of the chief things that is the matter with mining just now, as 
 we all know, is the low metal market, and that, of course, is a matter 
 over which the states have no control, and consequently this is one of 
 our ills for which legislation is in no wise responsible. 
 
 But I do not intend to take the time to attempt to say what is the 
 matter with mining. Many valuable suggestions have been made on 
 this subject during the present session. My general opinion is that "the 
 old order changeth," that mining is getting upon a different basis than 
 it used to be. The easy picking is all gone. The old method of going 
 out on the hills and finding a mine, and developing it with small capital, 
 is past. The country has been pretty well prospected over, and mining 
 is entering upon a different stage. The scale of operations, the methods, 
 the treatment of ores, and so forth, have got to be changed; and until 
 the country adapts itself to these changed conditions there probably 
 will be some hesitancy in mining development. For this reason I think 
 we ought to remember that our chief function is not so much to criticize 
 what we might term hostile legislation although such criticism, of 
 course, is perfectly legitimate but we should be constructive in our 
 views. We should endeavor to evolve measures that will meet the new 
 conditions, and that, of course, is one of the very reasons why we want 
 the Bureau of Mines more adequately supported and its scope of oper- 
 ations enlarged. That is the reason the Mining Congress has been so 
 much interested in the Bureau of Mines; and I think we can do more 
 for the mining industry by enlarging the scope of that bureau, and by 
 helping to frame constructive legislation, than we can by adopting a 
 dog-in-the-manger policy and simply kicking about everything else that 
 is done. 
 
 I suppose it is true that there is a good deal of legislation that is ill- 
 considered. I suppose some of the men sent to the legislature simply 
 come back and say they have voted something like the story I heard 
 not very long ago of the old German who belonged to the Knights of 
 
106 OFFICIAL PROCEEDINGS 
 
 Columbus. He went back to his home town after a considerable absence 
 and decided he would visit the lodge. Meanwhile they had built a new 
 building with two or three lodge rooms in it. The building was pointed 
 out ito him, and he went upstairs, and got into the wrong room. The 
 lodge was in session, but there was nobody at the door, so he walked 
 right in. Just as he got in the door he saw a man at the head of the 
 room, sitting at a table, rapping on the table with a gavel, and saying, 
 "Brothers, step up and vote! Don't keep us waiting; we are in a 
 hurry!" He walked up to a little table in the middle of the room and 
 saw a box with a lot of black and white balls. He dropped in a white 
 ball, and just then somebody hollered, "Who are you?" "What are you 
 doing here?" and he said, "Who am I? Didn't I be a Knight of Columbus 
 for fourteen years? Vy shouldn't I wote?" And they hollered, "Raus 
 mit him!" When he told it afterwards he said: "Dey trew me oud, unt 
 put a man py der door so I couldn't get back in again anymore. But 
 anyhow I woted; but vat I woted for I don't know." (Laughter.) 
 
 I suppose that is the way some legislators work, and when they 
 go home they can say, "Anyhow, I voted." But if they do not know 
 what they voted for, is it not often our own fault? Do we always do 
 our share to inform them? Perhaps not; and perhaps also, we do not 
 always look at our own questions from a broad enough public viewpoint. 
 Perhaps the legislator thinks a good deal the same way about us, that 
 we come together in a Mining Congress, and in the course of three or 
 four days dispose of a lot of big questions that specialists spend their 
 lives upon; and we pass a lot of resolutions that we never heard of 
 before and that we have only considered a few minutes; and then we 
 go home, thinking that, anyway, we voted, though when we examine 
 ourselves closely we must admit that what we voted for we know very 
 little about. One of the chief benefits that we might derive from the 
 American Mining Congress, especially now that a monthly journal is 
 to be sent to all its members, is to educate us on these questions, so 
 that we will be better equipped to consider them in a broad, fair spirit. 
 
 I think there are two sides to this question of cussing the legislator, 
 and we ought to be broad-minded and charitable enough at least to give 
 the other fellow credit for good intentions, even if we will not concede 
 that he had good judgment. We should bear in mind that one's opinion 
 of a question always depends upon his point of view. I believe the 
 average legislator tries to do his duty, and I am very much impressed 
 with the temperate tone of the resolution passed a little while ago, in 
 which mining men were urged to interest themselves more in legis- 
 lation. I think if we mining men would do that, instead of holding our- 
 selves aloof from men in government positions, or from legislators, and 
 would get into close contact with them, so as to give them the fullest 
 information, and present our side of the case frankly, thoroughly and 
 fully, we would find that the average legislator is willing to be convinced. 
 (Applause.) 
 
 THE PRESIDENT: Gentlemen, it is with great reluctance that I 
 am going to call for the introduction of the last resolution, which Mr. 
 Carmichael has been withholding, and I want to thank the members for 
 their patience and the kind consideration they have extended to me as 
 presiding officer of this meeting. I know my own shortcomings much 
 better than you can tell me, and therefore I greatly appreciate the help 
 with which you have supported me in this work. It has been coming 
 almost too easy to be true, and I expected much more opposition than 
 we have had, and I thank you most cordially for the kind consideration 
 which you have extended to me. We will now hear from Mr. Carmichael 
 once more. 
 
 MR. CARMICHAEL: Mr. President, your committee presents the 
 following resolution: 
 
AMERICAN MINING CONGRESS 107 
 
 Resolution C, Introduced by the Committee on Resolutions. 
 
 Whereas, The success attending the Seventeenth Annual Session of 
 the American Mining Congress, held at Phoenix, Arizona, December 
 7-llth, 1914, has been due in a great measure to the excellent arrange- 
 ments made for the meetings and to the hospitality extended to the 
 members of the Congress by the citizens of Phoenix. 
 
 Now, Therefore Be It Resolved, That the Congress hereby expresses 
 its deep appreciation of the help and entertainment extended to it, and 
 its hearty thanks to all concerned, especially the Phoenix Board of 
 Trade and local committees, through whose untiring efforts is due 
 largely the success of the meeting; also to the citizens of Phoenix gen- 
 erally, for the many courtesies extended to the members during their 
 stay. 
 
 MR. CARMICHAEL: I move the adoption of the resolution. 
 (Motion seconded.) 
 
 SECRETARY CALLBREATH: May I suggest to the committee that 
 much assistance was rendered in this work by some of the companies 
 and cities outside of Phoenix, and I think they ought to be included in 
 this resolution. If the chairman will consent that the resolution be 
 amended so that it will read to the citizens of Arizona and 
 
 MR. CARMICHAEL: This places me in a slightly embarrassing 
 position, Mr. Secretary. Speaking more as an Arizona delegate, I am 
 sure that the rest of the delegates and those in Arizona who have 
 assisted towards making the meeting of the Congress a success, appre- 
 ciate the sentiment which the Secretary has so gracefully expressed, and 
 if the Congress sees fit to amend the resolution in such a way I am sure 
 the( rest of my committee will acquiesce. 
 
 SECRETARY CALLBREATH: I only make this suggestion because 
 I happen to know that a good deal of the money which was subscribed 
 to make this convention possible, was subscribed by outside people 
 whose support was very important in making a success of the movement, 
 and I feel that they ought to be recognized. 
 
 THE PRESIDENT: We all appreciate the delicate position of the 
 chairman of the Committee on Resolutions. All those in favor of the 
 adoption of the resolution as read will signify by saying aye. Contrary. 
 
 (Carried unanimously.) 
 
 THE PRESIDENT: The next order is the photograph to be taken 
 outside, the visit to the mineral exhibit and the automobile ride, also 
 the safety demonstration here this evening at 8 o'clock, and the business 
 of the Seventeenth Annual Session of the American Mining Congress 
 is now declared to be adjourned. 
 
 Convention adjourned sine die at 12 o'clock. 
 
MEETING OF MEMBERS 
 
 TUESDAY, DECEMBER 8, 1914. 
 Evening Session, 7:30 O'clock P. M. 
 
 THE PRESIDENT: Gentlemen, you will please come to order. This 
 is the annual meeting of the members. The first order of business Is 
 the reading of his report by the Secretary. 
 
 SECRETARY CALLBREATH: The report is as follows: 
 
 AMERICAN MINING CONGRESS 
 
 Secretary's Financial Report, October 1, 1913, to November 30, 1914. 
 Cash on hand October 1, 1913 ' $ 130.06 
 
 RECEIPTS. 
 
 Membership dues $ 3,493.90 
 
 Membership fees 600.00 
 
 Life memberships ' 1,500.00 
 
 Special contributions 4,600.00 
 
 Deficiency contribution 500.00 
 
 Phoenix Convention contribution 5,000.00 
 
 Reimbursement by Philadelphia Convention fund.. 682.56 
 
 Balance Chicago advertising fund 33.85 
 
 Rebate on railroad ticket 4.30 
 
 Miscellaneous 5.00 
 
 Total receipts 16,419.61 
 
 Total to be accounted for $16,549.67 
 
 EXPENDITURES. 
 
 Secretary's salary, March, 1911-July, 1912 $ 5,100.00 
 
 Rent Washington office 510.00 
 
 Stenographer 972.00 
 
 Postage 1,025.10 
 
 Printing 550.60 
 
 Multigraph and letter service 251.63 
 
 Office equipment 222.26 
 
 Secretary's traveling expense and incidentals Wash- 
 ington office, including telephone and telegraph, 
 stationery, District of Columbia taxes and extra 
 
 stenographic service 1,385.88 
 
 Audit Philadelphia accounts 50.00 
 
 Rent Denver office 337.50 
 
 Exchange on deposits in Denver bank 28.45 
 
 Assistant Secretary's salary 800.00 
 
 Traveling expenses Assistant Secretary (including 
 advances) account organization State Chapters 
 
 and Phoenix Convention 1,042.15 
 
 Taxes, Denver 2.40 
 
 Commission and expense advertising 1914 Booklet.. 810.37 
 
 Securing memberships 95.00 
 
 Refund of dues paid twice 10.00 
 
AMERICAN MINING CONGRESS 109 
 
 Expense of previous year: 
 
 Secretary's expense account, April and 
 
 May, 1913 $302.15 
 
 Expense account Booklet, Philadelphia 
 
 Convention 55.00 
 
 Total 357.15 
 
 Total expenditures $13,550.49 
 
 Less advances by Secretary included in above for 
 
 which he has not been reimbursed 88.61 
 
 Total payments $13,461.88 
 
 Covered by National Metropolitan vouchers 1 to 59.$ 4,082.01 
 Covered by First National, Denver, 1,299 to 1,353. . . 9,379.87 
 
 $13,461J 
 
 Cash on hand November 30, 1914 $ 3,087.79 
 
 On deposit as follows : 
 
 In National Metropolitan Bank, Washington $ 1,017.99 
 
 In First National Bank, Denver, Colo 2,049.80 
 
 In office 20.00 
 
 $ 3,087.79 
 
 ADDITIONAL RESOURCES. 
 
 Accounts Receivable: 
 
 Advertisements in Phoenix Convention Booklet $ 2,470.50 
 
 American Tempering Co. (Philadelphia Exposition) 15.00 
 
 LIABILITIES. 
 
 Half-tones and cuts, 1914 Booklet $ 41.10 
 
 Printing 1914 Booklet 522.61 
 
 R. L. Humphrey, director Philadelphia Exposition: 
 
 Balance claimed due for service $571.40 
 
 Less paid by Secretary 25.00 
 
 Less charge for photographs 15.00 
 
 531.41 
 
 Due Secretary: 
 
 Balance on expense vouchers to Nov. 1, 1914 88.61 
 
 November expense voucher 182.17 
 
 Salary August, 1912 to November, 1912 % year at $3,600. . 1,200.00 
 Salary December, 1912, to November, 1914 2 years at $6,000 12,000.00 
 Respectfully submitted, 
 
 J. F. CALLBREATH, Secretary. 
 
 We hereby certify that we have examined the cash book, vouchers 
 and bank accounts of the American Mining Congress as kept by J. F. 
 Callbreath, Secretary, and that the foregoing financial statement of re- 
 ceipts and expenditures is correct as set forth in said records. 
 
 The statement for November of the account in the First National 
 Bank, Denver, Colorado, is not yet at hand, but the statement showing 
 balance November 1, 1914, was found to be correct. 
 Respectfully, 
 
 HARVEY S. CHASE & COMPANY, 
 By HOWARD C. BECK, C. P. A., Local Manager. 
 Washington, D. C., December 1, 1914. 
 
110 OFFICIAL PROCEEDINGS 
 
 SECRETARY CALL-BREATH: I might say that the item of $88.63 
 which appears as a liability was a mistake in the footing of my personal 
 expenditures, my footing being that much less than the actual amount, 
 which was discovered by the auditor in his examination of the accounts. 
 I must confess that the auditor has convicted me of being a very poor 
 bookkeeper. The receipted vouchers are accompanied by the cancelled 
 checks with which the payment was made during the time covered by 
 the report. I think that everything is available here for an examination 
 of the accounts. Up to this year, we have always had an Auditing Com- 
 mittee which has gone over the accounts monthy and audited the bills. 
 For the past year this has been practically impossible because the only 
 members we have in Washington are in official life who could not under- 
 take to audit the bills, and as most of the business has been done in 
 that office during the past year, or practically all of it, it has been im- 
 possible to have anybody there who could audit those accounts. It has 
 been necessary for the Secretary to go ahead and transact the business. 
 I turn over the vouchers and books, and I ask, Mr. President, that a 
 committee be appointed to audit these accounts. For several years here- 
 tofore I have asked for the appointment of an Auditing Committee, and 
 the convention has never granted the request, upon the theory that an 
 Auditing Committee, having already gone over and approved each of 
 the bills, further accounting was not necessary other than the examina- 
 tion by an accountant. I feel now that, in view of the fact that no one 
 has approved any of these bills during the year, there ought to be an 
 Auditing Committee appointed to go over the account. 
 
 THE PRESIDENT: I will ask Mr. George H. Utter and Mr. F. K. 
 Brunton to act as Auditing Committee and take these accounts and go 
 over them and report back to us what they find. 
 
 MR. GERALD SHERMAN: Mr. President, I move that the report 
 be accepted as read. 
 
 MR. F. H. O'BRIEN: I second the motion. 
 THE PRESIDENT: Without the auditing? 
 
 MR. SHERMAN: Yes. 
 
 (Motion seconded and carried unanimously.) 
 
 THE PRESIDENT : The next item of business comes under Section 
 3 of Article 5, consisting of the selection of a Nominating Committee. 
 'That section reads as follows: 
 
 For the purpose of facilitating the selection of Directors, there shall 
 be elected at the annual meeting of the members, a committee of five 
 members to be known as a Nominating Committee, whose duty it shall 
 be to present to the members for their consideration the names of such 
 persons as such committee may deem advisable to act as Directors for 
 the ensuing year. 
 
 MR. IMER PETT: Mr. President, I take pleasure in nominating 
 Mr. Arthur Thomas of Utah. 
 
 THE PRESIDENT: Are there any other nominations? There 
 should be five names. 
 
 MR. DAY: I would like to place in nomination the name of Mr. 
 Seeley W. Mudd of California. 
 
 MR. DERN: I would like to nominate Mr. W. G. Swart of Colorado. 
 
 MR. O'BRIEN: I would like to put in nomination Mr. Gerald Sher- 
 man of Arizona. 
 
 MR. TALMAGE: I nominate Mr. George H. Utter of New Mexico. 
 
AMERICAN MINING CONGRESS 111 
 
 THE PRESIDENT: Are there any further nominations, gentlemen? 
 (No response.) Since no further names are forthcoming the nomina- 
 tions will be considered closed. 
 
 (The candidates placed in nomination were unanimously elected.) 
 
 SECRETARY CALLBREATH: Mr. President, it has been suggested 
 by quite a number of the delegates that we may be able to finish our 
 business and adjourn on Thursday night, finishing up the work of the 
 Resolutions Committee, instead of having them report again on Friday 
 morning. I think it would be wise to take the sense of the members as 
 to whether they would like to have the business so arranged as to finish 
 Thursday night or to go over until the Friday morning session. 
 
 THE PRESIDENT: The chair will be glad to entertain discussion 
 on that subject. The prorgam for Friday morning is short, and as a 
 good many prefer to leave on Thursday night rather than Friday morn- 
 ing, I would be glad to have the sense of the meeting on that point. Are 
 there any suggestions 
 
 MR. JESSE KNIGHT: I move that we finish up on Thursday if 
 possible. 
 
 (Motion seconded and carried unanimously.) 
 
 SECRETARY CALLBREATH: I would like to make one suggestion 
 to the Nominating Committee, and that is, that in making their nom- 
 inations they so arrange that there will be two directors at the same 
 place or so near each other that it will be convenient for them to get 
 together as the Executive Committee in order to transact the business 
 of the committee. As you understand, in an organization of this kind, 
 with its directors scattered from one end of the country to the other, 
 must have its executive power lodged somewhere, and it is necessary 
 that the Executive Committee, under our by-laws, can meet, because our 
 directors can very seldom get together except at the annual meetings 
 in sufficient numbers to constitute a quorum. The Executive Committee 
 under our by-laws is authorized to act on behalf of the Board of Directors, 
 and our custom has been that when a new matter needing the approval 
 of the directors comes up it is submitted to them by letter, and their 
 letter-vote upon that subject is turned over to the Executive Committee, 
 which has the legal power, under the by-laws, to make effective the sug- 
 gestion or recommendation of the members of the board. It is necessary 
 to have two men who can conveniently get together to make effective 
 the recommendations of the Board of Directors. 
 
 MR. SHERMAN: I would like to know if there are any particular 
 rules for the nominations. Are the nominations of the Nominating Com- 
 mittee to be final, or are the members at liberty to add other members 
 to the nominations? 
 
 THE PRESIDENT: Other nominations will be put to the house and 
 voted upon in the event any nominations made by the Nominating Com- 
 mittee are not acceptable. 
 
 I believe the next business in order is the amendment of the by- 
 laws. I will ask the Secretary to read the proposed amendment to the 
 by-laws. 
 
 SECRETARY CALLBREATH: Our by-laws are amended by thirty 
 days' notice to each of the members and then by vote of the members 
 thereon. The following amendment has been proposed: 
 
 That Section 1 of Article 3 be amended by striking out the whole 
 of said section and substituting in lieu thereof the following: 
 
 Section 1. There shall be three classes of members, to be known 
 respectively as Active Members, Subscribing Members, and Associate 
 
112 OFFICIAL PROCEEDINGS 
 
 Members. Active Members alone shall be eligible to hold office and 
 Active and Honorary Members alone shall be entitled to vote. 
 
 Active Members. Any person associated with mining, whose appli- 
 cation for membership has been approved by the Committee on Mem- 
 bership, and who shall pay an initiation fee of $15 shall become an 
 Active Member of this Congress and thereafter shall pay in advance an 
 annual fee of $10; and during the term for which said dues have been 
 paid, such member shall be entitled to all the rights and privileges of 
 membership. 
 
 Subscribing Members. Any corporation or organization or co- 
 partnership actively engaged in or interested in mining may, with and 
 by the approval of the Committee on Membership, be admitted as a 
 Subscribing Member upon such terms and conditions as the Board of 
 Directors may determine. Such Subscribing Members shall not be en- 
 titled to vote, but shall be entitled to receive all of the publications of 
 the Congress and to receive abstracts of all data, statistics and legal or 
 technical information which may be in the files of the Congress, and to 
 have such special reports covering inquiries as may be made from time 
 to time and which the Secretary or his assistants may be able to furnish 
 concerning any matter upon which the Congress may have special in- 
 formation. The membership of Subscribing Members shall continue 
 only during the term for which the dues of such member as fixed by 
 the Board of Directors, has been paid. 
 
 Notice of this proposed amendment was mailed from the Washing- 
 ton office November 7, 1914, to all of the members. 
 
 THE PRESIDENT: You have heard the reading of the proposed 
 amendment to the by-laws. What is your pleasure? Is there any dis- 
 cussion on the subject? 
 
 SECRETARY CALLBREATH: I might say, Mr. President, that of 
 the members who have voted by letter-vote there are 372 votes; two 
 have been cast against the proposed amendment and 370 in favor of it. 
 These votes in nearly every instance are in favor of the proposed amend- 
 ment, with any amendments germane thereto, so that in case it is 
 thought wise to amend this proposed amendment by any slight change 
 it would be in order to have it done and these 370 votes still count in 
 favor of its adoption. 
 
 THE PRESIDENT: What is your pleasure, gentlemen, with re- 
 gard to this amendment? We would like to have some discussion or 
 motion on the subject for or against. 
 
 MR. E. L. WOLCOTT (Assistant Secretary): Mr. President, while 
 the amendment, to those of us who have studied this question, is very 
 plain, I have talked with some members who do not understand the gist 
 of it. I would like to ask that the Secretary go a little more into detail 
 and analyze it, as it were, so that the delegates present will understand 
 just why we are endeavoring to bring about this kind of an amendment. 
 
 MR. PRESIDENT: We will hear from the Secretary. 
 
 SECRETARY CALLBREATH: Mr. President and Members: I am 
 afraid I will be obliged to anticipate something I had expected to say 
 later in the evening under the general discussion. The plan proposed 
 is for the purpose of having a larger membership. There are many 
 people who feel like contributing to and supporting the work in the 
 localities but who do not feel like paying the amount of dues which is 
 necessary to be an active member of the Congress. It is proposed to 
 increase largely the membership, both for the purpose of keeping in 
 touch with the Washington work, through the local members, who can 
 be called upon to assist when there is something which needs outside 
 support, and again, that they may have strong working chapters within 
 
AMERICAN MINING CONGRESS 113 
 
 the various states. It has been desired for a number of years that we 
 should create state organizations, because while it has been important 
 that the legislative matters at Washington should be looked after, it is 
 equally important that legislative matters within the states should be 
 looked after on behalf of the mining industry. I think the mining con- 
 dition, as you who are in Arizona know, points clearly to the necessity 
 in all of the states of a strong working mining men's organization which 
 shall see to it that legislators, when they undertake to legislate on 
 behalf of the mining industry, shall understand the conditions and shall 
 understand what certain legislation means. In this state I am told you 
 bave a law which will practically close down some of the mines because 
 it prohibits the employment of men who are not citizens. As your 
 President said to you last night, legislation of this character is sort of 
 catching; one state passes a law which appeals to a vicious or selfish 
 minority, and people of that same caliber in the adjoining states, selfish 
 or vicious as the case may be, undertake to pass similar legislation, pos- 
 sibly not for the benefit of the state but in order that they may appeal 
 to the populace as being heroes in their behalf; so that in all of the 
 states we have bad legislation, and the fact has been pointed out today 
 in the discussion of mine taxation is quite generally true, that no two 
 states have the same theory of legislation. In one state you assess your 
 property upon one basis and in another state upon an entirely different 
 basis. In Colorado our tax law provides that assessments upon mining 
 property shall be at its full cash value plus all of the net output and 
 one-half of the gross output. In Arizona you have a similar law, except 
 the ratios are different. Now, the ratio which is right in one state is 
 right in another state, and one of them is certainly wrong as applied 
 to the same character of mining. Proposals are being put forward in 
 the several states by people who do not understand the business and do 
 not realize how much hardship it will entail, do not realize how much 
 of a burden is going to be put upon the industry and how much of that 
 burden will fall directly upon the people whom the legislation is supposed 
 to benefit. So that it is necessary in each of the states that we have 
 strong working organizations. The proposed plan is that the national 
 organization shall ask from each of those who join $2 a year, and for that 
 it is proposed to publish a monthly journal which will go to them for 
 the $2. It is following largely the plan of the National Geographical 
 Society of Washington, which, with its $2, sends the National Geographic 
 Magazine, and their membership has grown to enormous proportions. 
 We do not hope for a membership anything like as great as that of the 
 National Geographical Society, because that appeals to all classes. We 
 do hope to bring together in the American Mining Congress all of 
 those people within the different states who are interested in the 
 progress and development of the mining industry, giving to them a jour- 
 nal which possibly not at first but in a very short time will be fully 
 worth the $2 which is paid, granting to those associate members the 
 right to become members of the state chapter by an additional fee to 
 be imposed by the state chapter. My suggestion is that they should 
 pay 25 cents a month or $3 a year, making the total $5 a year, and giving 
 the state chapter $3 with which they can employ a secretary who will 
 be continually looking out for the interests of the mining men of the 
 state. I do not think it is ever possible to have a strong organization 
 unless there is provision made for some one who is able to give his 
 entire time to the work. We have hoped through this plan that we 
 could cement together all of the people who are interested in the mining 
 industry, that we could keep them posted as to what is going on, and 
 through their being advised as to the different classes of legislation 
 which are proposed in the various states they will be able to meet the 
 situation better than they could acting independently as we are now 
 doing. The American Mining Congress is the first great effort to create 
 :a national organization of mining men along these lines, and the work 
 
114 OFFICIAL PROCEEDINGS 
 
 which has been done thus far has met the approval of at least those 
 who are nearest to where the work has been done and know most about 
 it. The Monthly Bulletin which we published for a time we were 
 obliged to discontinue because of the lack of funds. The result is that 
 we have no method of communicating with our membership except by 
 personal letter, and that is too expensive. Consequently members have 
 wondered what we were doing. If I could explain to you all the things 
 we have been doing, I know that in the main you would approve what 
 has been done and would feel that at least some good had been ac- 
 complished. But this new plan is to create a great, strong membership, 
 and we are hoping that a campaign may be organized at this meeting 
 by which, in each of the mining states of the West, a strong working 
 mining organization may be created capable of presenting to the legis- 
 lative bodies the real truth respecting mining and in that way preventing 
 the legislation which is of a character detrimental to the mining business 
 as a whole. It is proposed now that this journal shall receive adver- 
 tising, and through the advertising it is hoped to make a profit for con- 
 tinuing the work of the national organization. It is hoped that the 
 members of the organization will stand by the journal to the extent that 
 they will be a little more friendly to the mining machinery manufacturers 
 and supply dealers who patronize its advertising columns. If the mining 
 men of the country would stand loyally by a plan of that sort, the 
 journal would furnish a good deal of profit through which the national 
 work could be financed. Now, it is proposed in this journal not to get 
 into competition with the trade journals now published for the benefit 
 of the mining industry. For years it has been proposed that we publish 
 a magazine of this kind, and I have always been opposed to it because 
 of the fact that we could not afford to lose the support of the mining 
 trade journals, and I felt that they might possibly feel that our receiving 
 advertisements, to some extent possibly in competition, was not fair and 
 would feel that they could not afford to support our work. I have taken 
 this matter up with a number of them, and there seems to be no objec- 
 tion of that kind, particularly in view of the fact that we do not propose 
 to enter their field in the editorial line. The purpose is to keep our 
 members advised as to proposed legislation affecting their interests in 
 Washington and in the various states. We shall attempt to keep a record 
 of the decisions of the courts which affect the mining industry; we 
 shall also try to keep up to date on the administration rulings with 
 reference to the mining industry in the departments at Washington, and 
 in that way furnish the information along legislative lines which our 
 members ought to have and which they cannot get in any other way. 
 We hope, in addition to that, to make the journal an advocate of the 
 Safety First movement, through which we may hope to bring about 
 better service in the prevention of loss of life and injury to limb in the 
 mining industry. Those are the proposed purposes of the new journal, 
 and in view of the fact that we hope it will be worth the $2 to our mem- 
 bers we believe we ought to receive a very large membership, and if 
 these men are all in one organization we are in very much better position 
 to secure legislative support and indorsement than by being scattered 
 in our efforts. I think that explains the purpose of this amendment. 
 It is a little doubtful in my mind whether this amendment is clear 
 enough, that the associate member will not be permitted to vote in the 
 national organization. The members of the national organization who 
 do have a right to vote pay $10 a year dues, and in consequence of that 
 they are a part of our corporation and they have a right to vote upon 
 the election of all the directors and all of the business of the organiza- 
 tion. It is not intended that the associate member shall have the right 
 to vote in the national organization. He is eligible to vote in the state 
 organization. The state organization itself shall be the sole judge of the 
 qualifications of its members, and if somebody happens to pay $2 and 
 becomes a member of the national organization he does not become a 
 
AMERICAN MINING CONGRESS 115 
 
 member of the state chapter unless the state chapter is willing to 
 admit him. 
 
 MR. PETT: Mr. President, I now move that the amendment as read 
 be adopted. 
 
 (Motion seconded and carried unanimously.) 
 
 SECRETARY CALLBREATH: Wait a minute. I desire, as proxy, 
 to cast 130 votes for the amendment, and 203 of the proxies have desig- 
 nated either Mr. Scholz or myself, both names being upon the proxies, 
 so that Mr. Scholz and myself, with his permission, will cast 203 votes. 
 Mr. Scholz has 30 votes to cast if he sees fit to cast them in that 
 behalf. 
 
 THE PRESIDENT: They are all cast. 
 
 Our program calls for a discussion of the needs of the western min- 
 ing industry and plans through which its higher development may be 
 fostered. This discussion was to be led by Dr. Holmes, and I am informed 
 that Dr. Holmes is unable to come out at this time, and he has asked 
 that he be excused from leading the discussion and has asked Mr. Call- 
 breath to open the discussion in his place. I am very sorry it is not my 
 pleasure to introduce Dr. Holmes tonight; he is recuperating from a 
 very serious attack of bronchial trouble brought on by exposure and 
 overwork, and we have endeavored to keep him indoors as much as pos- 
 sible and to guard against further exposure. I am now going to call 
 upon Mr. Callbreath to open the discussion. 
 
 SECRETARY CALLBREATH: Mr. President, if I may be permitted 
 before touching upon the other subject or, rather, in the middle of it, 
 because I have partially completed what I have to say along that line 
 in reference to the amendment I desire to say, concerning Dr.Holmes, 
 that his illness is entirely the result of too intense loyalty to your 
 interests. I have known many hard-working men, and I have known 
 Dr. Holmes very intimately. I have never known a man who put in 
 half the hours in the cause which he had at heart, the development of 
 the mining industry, that Dr. Holmes has devoted to the service. I am 
 sure that we all hope for his final recovery, because I should regard 
 that if he were incapacitated for work the nation would lose its most 
 faithful and most efficient servant. (Applause.) 
 
 I have outlined to you one of the plans through which we hope to 
 expand the influence of the Congress, and through which we hope to 
 help out the finances, through the proceeds from the journal. 
 
 Another plan which is proposed a plan which has been followed by 
 other organizations is to create a bureau of mining economics, which 
 will gather information about every possible phase of practical mining, 
 which will keep in touch with markets, which will get all of the infor- 
 mation that is necessary to be furnished either to the prospector who 
 begins his work, to the operator, or to the engineer who wants special 
 information along a certain line which is outside of his professional 
 specialty, which will keep the legal phases and decisions classified so 
 that they will always be available, which will collect information as to 
 production and cost of production in every branch of the mining industry 
 and be able to furnish data to all who wish it about any phase of mining. 
 This has been a dream of my own for a long time. I did not know 
 until recently that the railroads of this country maintained exactly such 
 a bureau in the same building in which our Washington office is lo- 
 cated. They are spending in the neighborhood of $100,000 annually in 
 the collection and preparation of the information which is there avail- 
 able. They are prepared to furnish any inquirer the information bear- 
 ing upon any particular transportation question. The value of this 
 .service has recently been demonstrated. The railroads of the United 
 
116 OFFICIAL PROCEEDINGS 
 
 States, because of the increased wages and the increased cost of ma- 
 terial, asked for an advance in freight rates, while on the other hand 
 the Interstate Commerce Commission was requiring reductions, so that 
 the railroad companies found themselves between the upper and nether 
 millstones. After a lengthy hearing the Interstate Commerce Commis- 
 sion admitted their statement but seemed to be of the opinion that the 
 railroads had better practice economy, but suggested that the passenger 
 rates might be advanced, that they believed that the railroads from this 
 source, from the economy practiced on the one side and the increased 
 amount received from passenger traffic, could make up the deficiency 
 which seemed to face them. The Bureau of Railroad Economics fur- 
 nished information. It was sent broadcast, and the people began to- 
 talize that, in this country, we desire and demand the very best service 
 that can be given, were expecting that perfect service from corporations 
 which were hampered by increased expenses on one side and reduced 
 returns upon the other; that condition prevailing at a time when the 
 business of the country as a whole began to contract and lessen; the 
 railroads were in a position where it seemed they could not make the 
 improvements necessary and keep up their rolling stock and roadbeds. 
 The result has been a reopening of that case and the railroads will have 
 another chance to be heard and another chance to get what they believe 
 they ought to have. Now, what I have said does not mean that I believe 
 they ought to have the advanced rates or that they ought not to have 
 them, but I do say that they ought to have enough of a rate to enable 
 them to pay the costs which are necessary to be paid, to furnish those 
 appliances which will protect the lives of their patrons and reduce the 
 loss of life among their employes to a minimum, and enable them to 
 give to you and to me and to the people of this country that efficient 
 service which we demand. It was because they had this bureau in oper- 
 ation for a number of years that they were able to present this informa- 
 tion in such a way as to secure what they desired. Now, it has been 
 proposed to establish a bureau of mining economics along the same line, 
 not upon so broad or comprehensive a scale, but it was estimated by the 
 Committee on Ways and Means appointed at the Philadelphia conven- 
 tion last year, after a careful examination of the matter, that such a 
 bureau would cost about $25,000 a year, and it was proposed at that time, 
 and our by-laws were amended to meet that situation, to provide for 
 another class of memberships to be known as corporate memberships. 
 It was proposed that the larger mining corporations should pay into 
 a fund on the basis of their production an amount which would make up 
 enough money to pay for the cost of this bureau of mining economics. 
 The Mining Congress for a number of years, as you have seen by the 
 financial report, has gone along creating a deficit. This report shows 
 that during the last year, while our expenses have been greater than 
 ever before, we have paid all of our expenses and reduced the deficit 
 by several hundred dollars. I might say that a good deal of the credit 
 for that is due to our President, Mr. Scholz. We hope to extend the 
 general system of membership as far as possible; we hope to create 
 the special memberships to such an extent as will enable us to maintain 
 the organization and at the same time to create organizations within the 
 several states willing and able to meet all state questions. We hope 
 through the corporate memberships to establish a bureau of mining 
 economics through which any member of Congress or senator or anyone 
 else who desires information along any mining line can secure it 
 promptly and accurately. With all these different plans which are now 
 before us, with the record of one year of more than meeting our expenses, 
 although greater than usual, the officers of the American Mining Con- 
 gress feel encouraged to go forward. There have been times when it 
 has seemed that we ought to stop, and some of our good friends have 
 thought we might better stop; but we haven't stopped; we have con- 
 tinued; and we hope that the future, with the earnest support of the- 
 
AMERICAN MINING CONGRESS 117 
 
 mining men of the West, will put us upon the basis that we will not 
 only deserve respect but will be able to command it. I thank you, gentle- 
 men, for listening so patiently. (Applause.) 
 (Mr. Phillips in the chair.) 
 
 CHAIRMAN PHILLIPS: Mr. President and Fellow Members: You 
 have heard the very happy reference which has been made by our Secre- 
 tary, Mr. Callbreath, to the good work that has been done by our Presi- 
 dent, Mr. Carl Scholz of Chicago. A large part of the financial efficiency 
 of the last fourteen months is due to hii efforts, and I think it very 
 timely that Mr. Scholz should favor us with his views as to what should 
 be done for the good and welfare of the Mining Congress. (Applause.) 
 
 THE PRESIDENT: Mr. Chairman, Ladies and Gentlemen: I greatly 
 appreciate the remarks made by the Secretary as to my efficiency, but I 
 assure you he has greatly overestimated my work; and if I have done 
 anything it has been one for the Mining Congress and two for myself. 
 Like everybody else, I am selfish in my motives, and my interests and 
 work were not entirely for your benefit but for my own and for the 
 companies I represent. I referred last night to the fact that the coal 
 people out here are in the minority. I think there are very few, perhaps 
 less than a dozen, representatives of the coal industry here. At Phila- 
 delphia last year we had quite the opposite; there were few metal men 
 and many coal men; and I think it proper that I again refer to the fact 
 as to why the coal people have taken such an interest in this work. 
 My first appointment as a delegate to the American Mining Congress 
 dates back to 1900. At that time I was located in West Virginia, and 
 the conditions at that time did not quite permit my trip to Milwaukee, 
 although I was quite anxious to visit that famous town; but later on I 
 was again appointed a delegate to the Congress at Pittsburgh, which I 
 attended and became greatly interested in the work, I saw a certain 
 analogy between the efforts of the Mining Congress and those which 
 the coal people had been exerting along the same lines, but I am sorry 
 to say without success. Later on I was called upon to assist in the work 
 of establishing the Bureau of Mines, and that was my first active con- 
 nection with the work. I was greatly surprised at the opposition to that 
 work, which we now generally recognize as one of the best undertakings 
 we have fostered, manifested by senators and congressmen not all of 
 them, but a certain faction which was very much opposed to any gov- 
 ernment aid in fostering the mining industry, which they thought was 
 entirely for gain, and I shall never forget the chilly reception we received 
 at the hands of some of our foremost senators. I didn't blame them 
 very much, because they didn't know the needs of the industry, and I 
 was surprised how little effort it took to fully convince them that they 
 had been wrong and make converts of them for our cause. While my 
 work was very limited, I am very glad that we finally succeeded in 
 establishing the Bureau of Mines, because you all appreciate what has 
 been, done by it. Likewise it was my pleasure to assist in the estab- 
 lishment of a School of Mines in the state of Illinois. Unfortunately, I 
 offered a short resolution at a meeting of a fuel committee that we 
 should have a mining school. Had I been better posted I think I should 
 have kept my seat. But once I got my foot into it I made up my mind 
 the school would have to be established, and while it took some effort, 
 I think in less than two months the legislature of Illinois appropriated 
 the amount and the school has been in operation for four or five years 
 and has done a great deal of good. It is one of the very satisfactory 
 schools that we now have in Illinois. 
 
 The coal people had made several efforts to bring about co-operative 
 work, but we didn't have very much success. Several of my friends 
 appreciated that the Mining Congress had an established machinery 
 which could be made good use of and we participated in the delibera- 
 
118 OFFICIAL PROCEEDINGS 
 
 tions of the Congress and allied ourselves with it. I am glad to say that 
 out of the $10,000 which we collected last year the coal mining industry 
 contributed the larger proportion, being something like $6,000, against 
 $4,100 coming from the metal mining industry. So you can see that 
 we endeavored to pay you back for the money which you invested in 
 establishing this machinery, and I feel sure in saying that the coal 
 people in the future are going to be just as anxious, and more so I believe, 
 to contribute their part of the expense. I want to assure you that we 
 didn't want to take away something you had established; we wanted to 
 help you to make it more effective and more useful, and we Very much 
 hope that we will be able to show you our appreciation not by promises 
 but by cold cash. 
 
 I think that covers the most essential point I wanted to bring out, 
 excepting that I again want to urge the necessity of attending to legis- 
 lative affairs. I myself am not a politician, excepting by force, but I 
 have found that if we do not interest ourselves in politics somebody else 
 who doesn't care as much for the effect as we do will do the work for 
 us and will not do it as well as we think it ought to be done, and in 
 talking to some of you people here today I was surprised that a gentle- 
 man who was a delegate and also a member did not know that we were 
 doing much work in Washington. Candidly, the main part of the work 
 has been done by the Secretary. I made three or four trips, and I became 
 convinced that we have a very excellent standing among the congressmen 
 and senators in Washington now. We go before them and tell them 
 our troubles and they listen in a very patient way and always give us 
 a very cordial reception. I think they are much warmer toward us and 
 our cause now than they were, because they realize that we do not ask 
 for things we are not entitled to, but that we are simply asking for 
 things we must have and need, and by presenting our cause clearly and 
 strongly, and with the backing of such a large number of members as 
 we ought to have I feel quite sure that we can make our cause felt much 
 better in the future than we have in the past. There are some of you 
 gentlemen to follow, and I am not going to tire your patience any longer, 
 and I thank you very much for the hearing you have given me. (Great 
 applause.) 
 
 CHAIRMAN PHILLIPS: Ladies and gentlemen, we have with us 
 one of the prominent members from the state of Colorado, Mr. W. G. 
 Swart, and will be glad to hear from him with a statement of his views 
 on the promotion of the usefulness of the American Mining Congress. 
 
 (The President in the chair.) 
 
 MR. SWART, of Colorado: Mr. Chairman and Fellow Members: I 
 have been asked to say just a few words further with regard to the atti- 
 tude of the American Mining Congress toward legislative affairs. Like 
 the Secretary, and, I presume, also the President, I have had some little 
 experience with that matter in the state of Colorado in the last few 
 years. We all seem to have our troubles in various states with our tax- 
 ation laws and our compensation laws and various other measures 
 which need not be gone into in detail here. We are all apparently fight- 
 ing the same fight. It differs a little in the various states, but it is the 
 same fight. Now, no one is going to fight this battle for us; we have 
 to do it ourselves. None of us is able to make this fight single-handed, 
 no state is able to make it single-handed. We must organize and stand 
 shoulder to shoulder, and as I understand the American Mining Congress, 
 that is its fundamental idea. That is one reason, and a good, strong 
 reason, a real reason, why the American Mining Congress ought to have 
 the support of every man in any way interested in the mining business. 
 
 A little while ago the Secretary said that in a good many of the states 
 legislation had been originated by irresponsible or vicious people. It 
 seems to me there is still another class, the ignorant people people who 
 
AMERICAN MINING CONGRESS 119 
 
 do not really know what they are doing; and if you will go into the 
 state legislatures and study the men we have sent there, you will discover 
 that a very, very large portion of the trouble is not viciousness but 
 ignorance. Now, it is up to us to produce the education. If anyone 
 knows anything about this mining business we do. We are miners. Who 
 is going to educate these men and who is going to provide this informa- 
 tion unless we do, and if we do not, who is to blame? Ourselves alone! 
 
 I am going to tell you a little thing that happened in Colorado two 
 or three years ago. The governor appointed a certain man trustee of 
 the State School of Mines. This man was not at all fitted for the po- 
 sition, and when the appointment was duly announced three prominent 
 mining men of the state of Colorado took it upon themselves to go up 
 and protest to the governor. They walked in and said, "Why, Governor, 
 we are simply astounded that you should make such an appointment as 
 this, and we are right here to protest against it." The governor whirled 
 around in his chair and said, "Gentlemen, that is far enough. Every 
 man of you knew that this appointment was to be made, and every man 
 of you knew that I had to make it, and that this was the time it was to 
 be made. There were three candidates for this office; no one spoke a 
 single word for two of them, and I have here only two letters advocating 
 the appointment of this other man. If this meant anything to you, why 
 didn't you come and tell me what you wanted and what I ought to do? 
 With proper advice from you gentlemen in advance I would have been 
 glad to appoint any man had you shown me he was the proper one." 
 Now, that is the idea. How do you expect we are going to get what we 
 are entitled to? How do you expect the men at the head of the gov- 
 ernment will know what we want unless we tell them? And as I con- 
 ceive the American Mining Congress, its duties, its opportunities are 
 right along this line, and the responsibility for action is ours. 
 
 And there is one thing more. I can't say that I know exactly how 
 to present it, but it is a general proposition. It is not confined to mining 
 men. You look back over political history in this country and you will 
 find a large part of the criticism made of our methods of legislation has 
 had to do with the lobbying system. What was done was often done 
 under cover and in an under-handed way. But the railroad people have 
 had to come out into the open. It was forced upon them. The railroad 
 lobby is practically a thing of the past. It may still exist, and I presume 
 it does exist, in spots, but taken by and large, the railroad lobby is a 
 thing of the past; and in the future you are going to see the railroads 
 coming squarely out in front of the public with whatever they have to 
 offer with their complaints, with their troubles, with their requests and 
 with their demands, and they have got to play in the open. And so, 
 gentlemen, have we got to play in the open. I think it is beyond any 
 question that the time has come when the mining men with a just cause 
 must stand up firmly and in public view and tell the people plainly what 
 the truth is, back it up with the reasons and demand their rights; and 
 I believe, gentlemen, that the American Mining Congress has a place, 
 it has a position, it has a niche to fill, and that it can better do this 
 work than any organization that is in existence today. For one, I am 
 prepared to support it so far as I can, myself, and for the people I 
 represent, and I hope you all feel the same. If you don't, get posted. I 
 thank you. (Applause.) 
 
 THE PRESIDENT: Ladies and Gentlemen: There is a delegate 
 present this evening who made such an entertaining address this after- 
 noon that I feel sure we will want to hear another one from him. I now 
 call upon Dr. William B. Phillips of Austin, Texas. 
 
 MR. PHILLIPS: A good many years ago Mr. Knott represented a 
 district in Congress from the state of Kentucky. He made a famous 
 speech about certain improvements which the government was to under- 
 
120 OFFICIAL PROCEEDINGS 
 
 take at Duluth and spoke of Duluth as the queen city of the unsalted 
 sea, and went along in a very humorous and effective vein. It is re- 
 ported that he said he would have given a thousand dollars if he had 
 never made a humorous speech in Congress, as nobody afterwards be- 
 lieved that he could be in earnest. 
 
 The moral of this story lies in the application of it. It has become 
 my unfortunate duty to speak of the financial end of the undertakings 
 that lie before this American Mining Congress. Many years ago, when 
 I was some years younger than I am now, I was a deacon in the Presby- 
 terian Church. (Laughter.) No one need believe that unless he wants 
 to. I had to collect money for the sustenance of the church and the pay- 
 ment of the pastor's salary, all of which I did with signal success. We 
 want about four million dollars out of the United States government for 
 the advancement of the American mining industry, and I propose that 
 we get it. (Laughter and applause.) I want to read to you, or rather, 
 recite to you, some very pertinent statistics on this subject prepared 
 lay the director of the Bureau of Mines and published in his last annual 
 report. Those figures were adopted by Mr. Kern in his speech before 
 the United States Senate in furtherance of some of the plans submitted 
 for the support and maintenance of mining experiment stations through- 
 out the country; so they have a double value, having first been prepared 
 by the director of the Bureau and then used by Mr. Kern. 
 
 The total value of the agricultural products of this country is about 
 ten billion dollars. 
 
 The total value of the mining products may be taken as about four 
 billion six hundred million. 
 
 The appropriations for agriculture by the United States Congress 
 amount to about twenty-eight million dollars. 
 
 The appropriations for the support of the mining industry, including 
 all of the work of the Geological Survey and Bureau of Mines, all of the 
 work that is undertaken for topographical surveys, surveys for water 
 and irrigation which fall under that department of the government how 
 much do you suppose? About two million dollars. Twenty-eight million 
 dollars for agriculture; two million dollars for mining! Whose fault is it? 
 I think it is the fault of the mining men. The farmers can stand to- 
 gether, and they do. They present a united front, whether they call 
 them Populists or Grangers of Democrats. (Laughter.) There is very 
 little wavering in their ranks, and what they want they generally get. 
 You know a farmer is a man who makes his money in the country and 
 spends it in town, and an agriculturist is a man who makes his money 
 in the town and spends it in the country. (Laughter.) I am an agri- 
 culturist. I once owned a farm in North Carolina and it broke me every 
 year trying to keep it up, but I can distinctly recall that the members 
 of the legislature were very much more inclined to regard me with 
 respect as long as I owned a farm. When I became a mining man they 
 passed me by on the other side of the street. It is, I think, our fault 
 and I speak of the mining men collectively that the United States gov- 
 ernment regards with so little favor any requests coming from the 
 mining industry of the country. If we had from the general government 
 the same proportional support that is given to agriculture we would have 
 about eleven million, dollars a year spent for the benefit of the mining 
 industry. We would have about eleven million dollars expended for the 
 benefit of the mining industry, as against twenty-eight million for agri- 
 culture, because that is the relative proportion of the value of those 
 two products, agricultural and mineral, instead of which, for all pur- 
 poses, we have less than two million. 
 
 If you will pardon me for a minute, I am going to read a little item 
 here taken from Senator Kern's speech, and I want you to remember it. 
 
AMERICAN MINING CONGRESS 121 
 
 The yearly appropriation by the general government for agriculture. 
 Three separate items. From direct appropriation, $2,500,000; from land 
 grants, $1,000,000; from the Smith-Lever bill, which I believe is now 
 pending, $480,000 in 1915, and then it increases automatically, so much 
 each year, until it becomes a very respectable sum; for fifty-two agri- 
 cultural experiment stations, one in each state, $1,500,000; for general 
 research and other work in agriculture and mining I am glad they put 
 in those words "and mining" .$22,000,000. 
 
 That "and mining" reminds me of the way they used to manage in 
 North Carolina, when a colored man and a white man went into partner- 
 ship in the farming business. The old nigger said that at about harvest 
 time the white man would take out a little old pencil and figure on the 
 back of an envelope and he would say: 
 
 Naught is a naught, and a figger is a figger, 
 
 All for the white man and none for the nigger. (Laughter.) 
 
 I think that is the way our appropriations were figured out; they 
 get twenty-eight million dollars a year and we get two. Where do we 
 get off? Now, how are we going to get that money? I do not doubt 
 for a minute that we shall get it. You never get anything that you 
 don't expect to get. I think there is a bill now pending in Congress 
 for the establishment of fifteen mine experiment stations throughout the 
 United States and an appropriation of twenty-five thousand dollars to 
 each one. It is barely possible, I think, that at this session of the 
 Congress more than three of those stations shall be established, if so 
 many. One, I suppose, would be established in Arizona, in connection 
 with the University; the others established throughout the country 
 where the needs seem to be most pressing. It is up to the mining men 
 of the country to secure the passage of that bill. If we do not pass it 
 nobody else will give it the least attention. If you people believe that 
 Arizona ought to have one of those mine experiment stations, go and 
 get it. If in Texas we believe we ought to have one, why, we will go 
 and get it. If there is to be one farther north of here, or farther east 
 you cannot go much farther south those people will simply have to go 
 and get it. 
 
 Now, furthermore, I want to say that I fully indose what Mr. Swart 
 has said. I always agree with what Mr. Swart has said, no matter if 
 he didn't say it. (Laughter.) All this work must be done perfectly 
 above board. It must be perfectly understood that this is an open game 
 from one end to the other. We have nothing to conceal; we have every- 
 thing to lay bare; we must make our demands perfectly open and plain 
 so that we can appeal to that great sense of fair play which is the dis- 
 tinguishing characteristic of nearly every American I have ever known 
 
 I think one reason why there is getting to be somewhat of a rever- 
 sion of popular sentiment in regard to the railroads is the fact that the 
 American people have become aroused to the idea that the railroads 
 haven't had a square deal, and when they come to understand that the 
 mining inlustry in this country has not had a square deal the American 
 people, if I understand them aright, will see that we do get it. We are 
 asking for no more than our just proportion of government help. I 
 wouldn't take one cent away from the farmers; I wouldn't take one cent 
 away from the twenty-eight million dollars that is devoted to agriculture. 
 It needs it and more. But we need it, too. We need it in proportion as 
 they need it, and if we do not go and get it I think they will get it. 
 (Laughter.) 
 
 Now, to bring the matter a little bit nearer home: How much do 
 you good people in Arizona give to the support and maintenance of the 
 mining business in your state? You talk about the great mineral prod- 
 ucts of Arizona, and they are very large. How much money do you 
 
122 OFFICIAL PROCEEDINGS 
 
 contribute to the promotion of the interests of the mining industry in 
 your state? Why, back East and I do not live so very far back East 
 we do not regard Arizona as an agricultural state; we think of it as a 
 mining state; and yet I am told you give four times as much to the 
 support of agriculture as to the support of mining. Now, how can you 
 expect the general government and those interested in the development 
 of the mining industry of the country, to do any better than you are 
 doing yourselves? We do not regard Arizona back in our country 
 and I have lived much farther east than I do now as anything but a 
 great mining state, and yet I am told that you do not do very much for 
 the maintenance of the mining schools and in aid of scientific research 
 here in your own state. If I am wrong I will be glad to be corrected, 
 just as glad as the old Dutchman was who took dinner with us. He was 
 bragging about his memory. He said, "Mr. Phillips, I have an awful 
 good memory. You have no idea how good a memory I have. I can't 
 remember a single thing that I have ever forgotten." (Laughter.) If 
 I have forgotten anything I will be glad to have you call it to my at- 
 tention. 
 
 Now, I will not speak any longer or tax your patience. We must 
 have this support from the general government, and we must have it 
 now, and if we do not get it ourselves nobody will hand it to us on a 
 silver platter. Are we prepared to go open-handed and open-hearted into 
 this struggle? If the American Mining Congress is to stand for anything 
 in this part of the country it is for government aid in undertakings that 
 we cannot undertake for ourselves. 
 
 I thank you very much. (Applause.) 
 
 THE PRESIDENT: We will be very glad to hear from any one 
 else who has anything to say on the subject of the betterment of the 
 mining interests of the country. We do not want to close now because 
 Dr. Phillips has warmed up the audience, and let us keep the iron going 
 while it is hot. Mr. O'Brien, you are a Western man and a coal man. 
 Tell us what you have done and what you are going to do. 
 
 MR. O'BRIEN: I don't know that I have anything to say. I am 
 perfectly willing to accept Professor Phillips' apologies. (Laughter.) 
 
 MR. WOLCOTT: Mr. President and Members: The question, as I 
 understand it, tonight is what can we do to better the condition of min- 
 ing, and judging by the enthusiastic manner in which the delegates here 
 rise to their feet to offer suggestions at the present time, I am inclined, 
 or would be inclined, to believe that mining was getting all that was 
 coming to it if I didn't know better. I do not think there is a man within 
 the hearing of my voice who believes that mining is receiving the atten- 
 tion that it should receive, that it is receiving the consideration that it 
 should have. I do not believe there is a man here that believes that in 
 any of the Western states where mining is being done that enough min- 
 ing is being done or that the proper kind of mining is being done, or, 
 what is more to the point, that the mining fraternity is getting anything 
 like a square deal in its mining operations. I do not think anybody 
 believes that we can get what we are after single-handed. We have 
 been trying individually for years as miners and as mining corporations 
 to get that square deal from the federal government, from the state gov- 
 ernments, from those who have anything to do with the mining industry, 
 and we have failed. Up to four years ago the mining industry was hardly 
 represented except through the Geological Survey, which certainly was 
 not a mining bureau, and yet for twenty-five years or more miners were 
 trying to have a bureau or department of mines established. They were 
 trying individually. They went before congress and before the com- 
 mittees and asked that such a bureau be established, and they got turned 
 down and got nothing for it. Then it was taken up by the only organ- 
 
AMERICAN MINING CONGRESS 123 
 
 ization which had mining at heart and was doing anything for mining, 
 the American Mining Congress, and within four years from that time 
 the Bureau of Mines was established. We cannot do anything individ- 
 ually; we can accomplish things only as an organization. Here in Ari- 
 zona you have had some laws enacted which have been mentioned be- 
 fore in this convention, which, if applied, will probably close the greater 
 part of the mines of this state. There are two such laws in particular, 
 one that forbids a mining company to employ more than twenty per cent 
 of any class of people that are not qualified electors; another law that 
 forbids the mining men to ask the applicant for a position or for a job 
 if he an American citizen. Now, that is practically the way the anti- 
 blacklist and the eighty per cent law work together. And what are you 
 going to do? Are you going to close your mines or are you going to 
 commit a felony? And yet mining men allowed those laws to pass. 
 Why? Because they were not organized. If they had been organized 
 these laws would not have passed. 
 
 Now, I want to tell you some things that can be done by a state or- 
 ganization. I want to cite the case of Colorado and its tax commission, 
 or the Colorado tax law. Two years ago there was introduced before 
 the legislature of Colorado a law which, in many ways, was arbitrary, 
 which allowed the assessor a latitude that no assessor should be al- 
 lowed, and which in many ways was unfair to the mining industry. As 
 secretary at that time of the Colorado Chapter I wrote a letter analyzing, 
 so far as I could, the effect this bill would have on the mining industry, 
 and I sent it to the various mining men of the state. I got a few an- 
 swers. Most of them didn't pay any attention to it at all. The answers 
 that I got said, "It is so ridiculous it cannot pass." "No legislature that 
 has the sense of a gray cat would ever pass such a law." However, I 
 could do nothing individually. I wasn't authorized by the Chapter to do 
 anything further than I had done, and the consequence was that law 
 passed. Now, that was bad enough as it stood, but the assessment which 
 v;as levied in one district was contested in the courts by the mine 
 owners and the Supreme Court handed down a decision something like 
 this that the assessment should be levied on the entire value of the 
 metal contents of the ore, at New York quotations, irrespective of 
 whether it was paid for at the smelter or whether it was penalized or 
 thrown out as waste matter. (Laughter.) 
 
 Well, a good many of the mining companies and some individuals 
 and one or two of the smaller organizations took it up before the 
 Supreme Court and asked for a re-hearing. They were not granted a 
 re-hearing at that time. Then the Colorado Chapter of the American 
 Mining Congress met, took up the same question, went before the Su- 
 preme Court, asked for a re-hearing, and was granted a re-hearing, and 
 we had, I think, ten days in which to prepare our brief and appear be- 
 fore the court, which we did, and within ninety days we had secured a 
 reversal of that decision; we secured more than we had asked for, be- 
 cause the Supreme Court decided that the charge for extraction and 
 transporation should also be deducted from the ore as well as the metals 
 not paid for. Now, that was only one effort. We have done many other 
 things in that state, and yet our organization is not nearly so strong as 
 it should be. Now, miners of Arizona, is it not about time that you get 
 together in an organization that can handle these questions, or are you 
 going to stand back and try individaully to do what you cannot do' as 
 an individual and have the legislature, the tax assessors or any power 
 that be I am not throwing it at my friends the tax commissioners or 
 assessors in the back part of the hall, but the tax commission has to 
 raise the money to run this state. You who own the mines look, to them, 
 like ready money. They can tax you, and make themselves believe they 
 are doing the right thing. Just so long as you are working as individ- 
 uals, just so long as you are not organized, you are going to get this kind 
 
124 OFFICIAL PROCEEDINGS 
 
 of treatment. Now, isn't it about time to get together and organize to 
 look after your own interests? 
 I thank you. (Applause.) 
 
 MR. CHALMERS: Mr. President, I would like to say a word regard- 
 ing raising capital for mining. Some years ago I went up into Alaska in 
 1898. I spent three or four years there, and while there I was inter- 
 ested in mining. I found companies there which had flooded some of 
 the states with what they called mining certificates. Some of these 
 companies spent very little of the money for mining purposes. Of course, 
 not having spent any money, or very little, those that bought stock didn't 
 receive any dividends. In 1912, I believe, they passed in this state, what 
 is called the blue-sky law, and we have a commission, and it has taken 
 some of us promoters out of that class of people who take people's 
 money and put it in their pockets and don't put it into mines. A few 
 years ago, and more recently, nearly every magazine I would pick up 
 was advising people, bankers especially, people with money, farmers, 
 everyone, not to put a cent in mining; that they did not consider mining 
 a safe investment. Suppose we want to raise capital to help the mining 
 industry I have been trying to raise a little myself, and that is how 
 I come to know a little about it. Nearly every friend I approached 
 seemed to think I was a thief or something about as bad. I have had 
 a good many temptations to be dishonest, and I try to be honest. I pay 
 my bills, and I am willing to go in debt if people will trust me. It 
 would seem to me the best way for us to raise money for mining would 
 be for those who are in a position to do so to try to educate people who 
 have been led to think that all promoters are thieves. Since these blue- 
 sky laws have been passed, these commissions look into these things, 
 and unless a prospect is sufficiently good it is impossible for any one 
 to sell stock. These commissions, if I undestand it right, are going to 
 look into the matter from now on and see that a fair amount of that 
 money is invested in the mines, and invested right, giving the people a 
 chance to get their money as they never have before. I think if the 
 people could be educated to the fact that mining is becoming more hon- 
 orable than it has been in the past the majority of the people, or a great 
 many of them, would be only too glad to invest with those who are try- 
 ing to open up the mines. 
 
 I. thank you. (Applause.) 
 
 A DELEGATE: Mr. President, I am a miner, and I have some min- 
 ing claims loqated ten miles from Wilcox, Arizona, in the foothills of 
 the Graham mountains. I got through doing some assessment work out 
 on the claims, came to Bisbee, Arizona, looking for work, and I was 
 referred to the two laws put through in the state of Arizona, that you 
 men say are no good the eighty per cent law and the anti-blacklist 
 law. I went to the Copper Queen employment office to get a job. I 
 received the job. I went before the doctor, and the only thing he could 
 find wrong with me was that I had a little fever. I couldn't get any 
 work. I don't believe in competing with the foreign element in this 
 country. I can't go into the Bisbee camp and live on 50 cents a day as 
 those people can. That is my opinion in regard to two of the finest laws 
 ever passed in the state of Arizona. Thank you. The only thing, Mr. 
 Chairman, that you educated men you men are educated and know 
 better, but you simply blindfold the working class of people because you 
 haven't got the backbone to stay by what is right. 
 
 MR. SHERMAN: Mr. President, I think the last speaker is mis- 
 taken in the object of the physical examination. A physical examination 
 was suggested for a very just purpose, and I believe it is serving that 
 purpose. There are certain men who ask for employment in the mines 
 who are not fitted to work underground. They are not fitted to work 
 
AMERICAN MINING CONGRESS 125 
 
 underground not only for their own sake but for the sake of the men 
 they are working with. There are two or three things which would 
 bar a man from such work. One of them is tuberculosis; another is 
 heart disease. There are other things in less degree. One of the indi- 
 cations of tuberculosis is the temperature. I think every doctor will 
 bear me out in that. I think the last speaker, if he had returned a few 
 days later with no temperature would have had no difficulty in being 
 passed and getting work. I think no one can object to the barring out 
 of a man with tuberculosis from work underground. It can do him no 
 good. He has no business underground, for himself, and he is injuring 
 every man that he is associated with. 
 
 A DELEGATE: Mr. Chairman, in regard to the question the gentle- 
 man brought up there, I don't see why they don't pass a law that they 
 would examine a man when he gets through working in one of those hot 
 boxes, as I call them. That is the time to examine a man that gets all 
 your diseases this man claims. That is the time to examine them 
 when they come out of these hot places. 
 
 THE PRESIDENT: I would like to correct an impression of the 
 last speaker in connection with his reference to the educated man. For 
 my part, I am a mining man from the pick. I worked in the mines 
 myself in Germany, and we were compelled to undergo a physical 
 examination, because we had the workmen's compensation acts, which 
 carried with them pensions, and our employers felt that they wanted 
 to be very careful in the employment of their men, therefore we had to 
 undergo a much more rigid examination than those required by life 
 insurance companies in this country, and, it had a very beneficial effect. 
 It gave us a better class of miners all the way through and kept many 
 men from wasting their lives had they been permitted to go underground. 
 So I have had experience as a practical miner, and I will say that our 
 wages were nothing like yours are here, and the work was much harder 
 and more trying, and we found that a physical examination was of the 
 utmost importance, and it was conducted with every man that was ad- 
 mitted to a mine before he would be allowed to go inside. 
 
 MR. WOLCOTT : Mr. President, I would, like to correct the gentle- 
 man in regard to his understanding of my remarks pertaining to these 
 two laws. I did not question whether the laws were good or bad. What 
 I said was that there had been two freak laws passed which conflict with 
 each other, one nullifying the other, if you try to live up to them as they 
 appear upon the statute books. That was my sole contention. 
 
 THE PRESIDENT : I would like to make just one more remark, and 
 that is, that all great movements usually come from the east to the west. 
 Women's fashions that originate in Paris find their way to Chicago and 
 land in Phoenix as I discovered last night. (Laughter.) I think the 
 legislative movements work very much in the same manner, and I have 
 had experience in the last fifteen years in one of the highly organized 
 states, the state of Illinois. It has been our experience that we have 
 great lessons to learn from our employes who, by organized efforts, 
 obtain concessions that we would not be able to get, and finally we 
 agreed in our wage agreements that our employes would not introduce 
 any bills in any legislative house that had not been discussed with us. 
 That forms a part of our wage agreements now, and we found it abso- 
 lutely necessary. You people out here haven't had to deal so long as 
 we have with labor unions, but I can tell you that we have learned some 
 valuable lessons from the acts of our employes. It has been the tendency 
 of coal operators to content themselves with the defense of their inter- 
 ests against measures introduced rather than to form and introduce 
 aggressive legislation. We simply rested on our oars and endeavored to 
 defend ourselves against such bills as were proposed; but our aim and 
 
126 OFFICIAL PROCEEDINGS 
 
 effort now is to do the very opposite to introduce legislative measures 
 and thereby stop the other side from being too aggressive, and that, in 
 my opinion, should be the first effort of the American Mining Congress, 
 to draft bills which will meet your needs, and introduce them, and not 
 wait to simply fight the other fellow off, but to attack him, to pursue 
 very much the tactics that the great German Emperor has pursued of 
 late, and I very much hope that before we leave here we will adopt 
 ways and means to bring that about. 
 
 We will be glad to hear from others. We still have a few minutes 
 before adjournment. 
 
 SECRETARY CALLBREATH: Mr. President, this being a meeting 
 of members, and a little different from our regular convention sessions, 
 I move that the members meeting do now adjourn to meet at 2 o'clock 
 tomorrow afternoon. This will give the Nominating Committee time to 
 report, the Convention, as such, reconvening at 9:30 in the morning. 
 
 (Motion seconded and carried.) 
 
 Meeting adjourned. 
 
 ADJOURNED MEETING OF MEMBERS. 
 
 December 9, 1914. 
 
 2:30 P. M. 
 
 CHAIRMAN DAY: Gentlemen, we will be obliged to pass the pro- 
 gram for a few 1 moments and go into session as a meeting of the mem- 
 bers of the American Mining Congress. Visitors will please remain in 
 their seats. It is only a formal matter and the report of the Committee 
 on Nominations is now in order. Is the chairman of that committee 
 ready to report? 
 
 MR. W. G. SWART: Mr. Chairman, your Nominating Committee 
 beg to report the following nominations for directors of the American 
 Mining Congress for a term of three years: Messrs. Samuel A. Taylor, 
 Carl Scholz, Charles S. Keith, L. A. Friedman and Walter Douglas; for 
 director to serve for term of one year, Falcon Joslin. 
 
 I move the adoption of the report. 
 
 Motion seconded. 
 
 THE CHAIRMAN: It is regularly moved and seconded that Messrs. 
 Samuel A. Taylor, Carl Scholz, Charles S. Keith, L. A. Friedman and 
 Walter Douglas be elected to serve for a term of three years, and that 
 Falcon Joslin be elected to serve as director for one year. Are you ready 
 for the question? 
 
 SECRETARY CALLBREATH: The by-laws provide that the elec- 
 tion be by ballot, so that if there is no objection an instruction to the 
 Secretary to cast the unanimous vote by ballot would be in order. 
 
 CHAIRMAN DAY: Gentlemen, you have heard the statement of the 
 Secretary. What is your pleasure? If there is no objection to the names 
 proposed by the Nominating Committee, a resolution as suggested by the 
 Secretary will be in order. 
 
 MR. SCHOLZ: There is an objection, Mr. Chairman. I have been 
 a director for four or five years, and I feel that I have done my duty 
 by this movement, and I would be very glad to have some other man 
 selected to take my place. There are men who are better able to work 
 for this cause than I, and I candidly believe it would be for the best 
 interests of the Mining Congress to put somebody else in my place. 
 
AMERICAN MINING CONGRESS 127 
 
 CHAIRMAN DAY: I think, Mr. Scholz, the Congress appreciates 
 your position, but at the same time good men are scarce. The showing 
 you have made in the administration of the affairs of the American 
 Mining Congress is such that we cannot afford to lose you. That is 
 my judgment, and I am sure the other members agree with me. As a 
 representative of the great coal mining industry we certainly need a man 
 of your caliber on the board. I am glad there is no move to accept your 
 declination, and the chair declines to entertain it. (Great applause.) 
 
 A motion to authorize the Secretary to cast the unanimous ballot 
 of the members present in favor of these nominations is now in order. 
 
 MR. CLARK: Mr. President, I move that the Secretary be in- 
 structed to cast the unanimous vote of the members present for the 
 nominations as submitted by the committee. 
 
 (Motion seconded and carried unanimously.) 
 
 CHAIRMAN DAY: The Secretary will cast the ballot accordingly. 
 
 SECRETARY CALLBREATH: Mr. President, in accordance with 
 your instructions I hereby cast the unanimous vote of the members of 
 the American Mining Congress for the election of Mr. Falcon Joslin to 
 serve on the Board of Directors of the American Mining Congress for 
 one year and until his successor is elected and qualified, and for Messrs. 
 Samuel A. Taylor, Carl Scholz, Charles S. Keith, Walter Douglas and 
 L. A. Friedman to serve as directors for the term of three years and 
 until their successors are duly elected and qualified. 
 
 CHAIRMAN DAY: The votes have been cast by the Secretary ac- 
 cording to the direction of the Congress, and I now declare the gentle- 
 men named have been duly and regularly elected directors of the 
 American Mining Congress. 
 
 Members meeting adjourned. 
 
The President's Annual Address 
 
 BY CARL SCHOLZ, 
 CHICAGO, ILL. 
 
 The aim and purpose of The American Mining Congress have 
 been placed before the membership and mining interests so often 
 in recent years that it becomes unnecessary to reiterate them now. 
 There is no doubt that the need for this organization has become 
 greater, that its efforts are more appreciated, and that it occupies 
 a stronger position now than at any previous time. That its good 
 work is valued by others than the metal miners of the West is evi- 
 denced by the active interest taken in its work by the coal mine 
 operators, more particularly since the Chicago meeting of 1911. It 
 may be appropriate at this time to state that the coal operators 
 joined The American Mining Congress because they felt it was 
 the best organization in existence to carry out the work in hand, 
 having an established standing and working machinery. Efforts 
 to start co-operative work among the coal operators had failed and 
 The American Mining Congress was considered the best organiza- 
 tion which could be helpful to the coal mine operators, as it had 
 been in the metal mining business. It has been hinted that' some 
 of the metal miners felt the coal people were trying to monopolize 
 the Mining Congress, but let me assure you now that such is not 
 the case. Mining is mining, whether the product be coal or gold. 
 Our interests are identical whether the mines are located in Arizona 
 or Pennsylvania. The chief topic of this address, therefore, is to 
 urge co-operation and combined efforts toward improvement in the 
 mining industry, irrespective of the location of the mines or the 
 character of their product. 
 
 I will not burden you with the detailed statements of what 
 has been done in the last year. The reports of the various com- 
 mittees and of the Secretary will c6ver these subjects fully. There 
 is one point I will touch upon briefly in reference to our financial 
 situation. As you will see, our income for the year has exceeded 
 our expenses and our outstanding debts have been diminished 
 this notwithstanding the increased expenses due to the maintenance 
 
130 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 of the Washington office during the entire year on account of the 
 prolonged session of Congress ; also that arrangements have been 
 completed on begin on January 1st next the publication of a month- 
 ly bulletin, which will serve to establish closer relations between 
 our widely scattered membership and keep the more inactive mem- 
 bers thoroughly posted on the work in hand. 
 
 The methods of modern business within the short time of our 
 experience have undergone great changes. The advance from the 
 tallow dip to the tungsten lamp in the lighting of our homes may 
 be considered a fair comparison. In the first half of the past 
 century the perplexing question of big business had not made its 
 appearance. When owners were co-workers there was little need 
 for legislative regulation or supervision. Man had not specialized 
 upon a single occupation or depended solely upon it for his liveli- 
 hood. Trade Unions had not restricted the working hours or out- 
 put of individuals. The relations between employers and employes 
 w'ere closer, and personal equations were more pronounced. There 
 was little need for contracts and intricate agreements a man's 
 word was his bond. I do not intend to convey the impression that 
 modern business is altogether bad, but it certainly is different, and 
 to some it may seem better. The question we must naturally ask 
 ourselves is, have we contributed our share toward the solution of 
 the great problems which necessarily follow in the w'ake of tre- 
 mendous development such as this country has undergone. We 
 have a different people to deal with and a different Government to 
 regulate our affairs ; therefore cannot look to other countries for 
 precedence to follow. We have business varying from the smallest 
 unit of the single prospector to the largest mining corporations, 
 with many grades betw'een these two. To properly protect these 
 great varieties of investors and workers, to give each his due 
 share, is an undertaking of the greatest importance. 
 
 Mining in a measure is the administration of a public property 
 insofar as it is an estate not created by man and which cannot be 
 replaced once it is removed or used. Geographical lines, so sharp- 
 ly drawn for political purposes, must be lost sight of in mining, 
 because the different States not containing any mineral resources 
 are dependent upon their supply from the more favored sections. 
 Unlike the manufacturing or farming industries, the sources for 
 mining cannot be shifted, and yet its products are needed every- 
 where. The enormous coal deposits of the far Northwest are of 
 
PRESIDENT'S ANNUAL ADDRESS 131 
 
 little interest to the State of New York as long as there is an avail- 
 able coal supply in Pennsylvania, but New York is concerned in 
 the situation of its present coal supply because if it is exhausted 
 sooner by waste, that section of the country will have to depend 
 upon a supply located elsewhere, w'hich will be more costly to 
 obtain. The sections with small or no mining interests are usually 
 large consumers of mining products, and the metal manufacturing 
 sections with their established population and industries depend 
 upon the fuel and ores of the mining States for their very exist- 
 ence. Mining, therefore, is distinctly an interstate business and 
 of interstate value. Some regulation has been considered in this 
 respect; for instance, in the State of Oklahoma, by fixing the 
 minimum price at which gas or oil from its wells may be sold. 
 
 I am not competent to speak authoritatively on the great 
 amount of mineral resources available, but I have often endeavored 
 to reconcile the statements published by the United States Geologi- 
 cal Survey on the vast amount of coal available in certain fields 
 with which I am quite familiar. These statements refer to all the 
 coal in existence without distinguishing as to the cost of extrac- 
 tion; in fact, all Government reports are silent on this point, and 
 the ordinary reader naturally believes that the billions of tons of 
 coal available can be produced at no greater cost than the present 
 supply. This cannot be true, and in less time than the average 
 man believes we will be forced to recognize the fact that even the 
 largest coal fields are being exhausted very rapidly and that the 
 remaining coal while available will cost many times over the present 
 cost of production. Even within the limit of my personal experi- 
 ence many important mining centers have been abandoned or gone 
 back in their production. This may not indicate extraction of all 
 the available coal, but certainly no more coal will be produced in 
 these sections at the present prices, and undoubtedly large propor- 
 tions of the abandoned territories are lost forever, or can only be 
 recovered at a greatly increased, or perhaps prohibitive cost. The 
 average life of a coal mine in this country is rarely in excess of 
 twenty-five years. In the major portion of our coal fields, particu- 
 larly the interior sections, rarely more than two or three w'orkable 
 veins exist in the same territory, frequently only one. I may men- 
 tion a few of the sections more generally known where the produc- 
 tion has diminished, such as the northern coal field of Illinois and 
 the Hocking Valley field of Ohio. In the Great Kanawha district 
 
132 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 of West Virginia all of the coal along the river has been worked 
 out or abandoned and the newer mines have been located along 
 creeks and tributaries to the river. If these mines are worked out 
 in as short a period as those along the river front, it will not take 
 very many generations to exhaust the field. In Germany, France 
 and South Wales where from ten to fifty workable veins exist in 
 the same section overlying each other, it is merely a question of 
 increasing the depth of the shaft to obtain additional areas. Mines 
 have been hoisting coal from the same shaft for three hundred 
 years in the vicinity of Liege. If similar situations exist in the 
 metal mining industry, then we betray a trust placed upon us by 
 further delay in exercising the obligation which we assume as 
 managers of a destructive industry, because aside from the proper 
 treatment of our workmen and consumers the chief duty of the 
 operator is to avoid waste, which is an irreparable damage. 
 
 We can only speak with words of the highest praise of the 
 work accomplished by the Bureau of Mines during its short exist- 
 ence, and at the same time decry the limited support which this 
 Bureau receives from the National Government. The appropria- 
 tions are too small to even investigate the physical features of 
 mining, and the Bureau is not in a position to be of any assist- 
 ance or even investigate the economic sides of the industry. The 
 only statistics collected now deal with the mine accidents, and the 
 only information on economics is collected by the Census Bureau 
 every ten years and the information when furnished two or three 
 years later is of practically no value on account of the great delay. 
 
 The people of the United States now' contribute yearly out of 
 the Federal treasury twenty-eight cents per capita to the Depart- 
 ment of Agriculture against a contribution of two cents per capita 
 for the advancement of mining and this discrepancy exists in spite 
 of the following facts which should appeal to the American people : 
 
 "That in mining we have the most hazardous of our great in- 
 dustries and in agriculture the safest. 
 
 "That our mineral resources, once exhausted, cannot be re- 
 placed and we therefore should use this supply with the highest 
 degree of intelligence and under such safeguards as keep in view 
 the w'elfare of our future generations. 
 
 "That in point of production every miner contributes annually 
 two thousand dollars to our national wealth compared to a con- 
 tribution of eight hundred dollars from every farmer/' 
 
PRESIDENT'S ANNUAL ADDRESS 133 
 
 The appropriation for the Bureau of Mines is less than one- 
 half that for the Geological Survey and much less than that for 
 many other less important branches of our public service; it is 
 entirey insufficient to enable this Bureau to meet even the humani- 
 tarian demands being pressed upon it in behalf of safeguarding 
 the lives of the more than two million men associated with mining, 
 metallurgical, and other mineral industries of the country; and the 
 Federal Government is failing in its duty towards this great in- 
 dustry. 
 
 I am sure that every member of the American Mining Con- 
 gress will agree with me that we must somehow' impress the Con- 
 gress of the United States with the imperative need of enlarging 
 the appropriations and the scope of the work of the Bureau of 
 Mines ; I am also sure that every member of the American Mining 
 Congress will agree with me as to the imperative need of estab- 
 lishing a Federal Department of Mines which will have within its 
 organization several bureaus, each investigating different phases of 
 the mining industry, and at the head of this organization a Secre- 
 tary of Mining who will be a member of the President's cabinet 
 and who will see that all the interests and the needs of the mining 
 industry are properly presented to the President, to the Congress 
 of the United States, and to the people of the United States. 
 
 Other branches of the Government do a great deal for their 
 constituents. I have in mind the crop reports which are collected 
 by the Agricultural Department largely by telegraph and which are 
 furnished very frequently to the farmers and dealers in farm 
 products, to the great advantage of both. Undoubtedly the mine 
 owners are partly responsible for not having insisted upon more 
 co-operation from the Government, and, perhaps, w'e have a lesson 
 to learn from the mine employes in obtaining their desires from the 
 Government. Through the various ramifications of labor organi- 
 zations the mine workers have obtained great political prestige and 
 have made good use of it from their viewpoint. They may not 
 have always acted wisely, but they have obtained much they have 
 asked for. There have been extended strikes in the metal mining 
 industry and some are in existence at this time. The great coal 
 strike of Colorado, which has extended over a period of five years, 
 is being waged solely to obtain recognition of the Miners' Union 
 by the operators of that State. The anti-trust laws passed by the 
 last Congress are generally considered a great victory won by the 
 
134 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 laboring classes. For years we have heard much of the labor op- 
 pressing capitalist, and perhaps there were isolated cases where 
 the acts of greedy corporations had to be curbed, but there is 
 danger of going too far in this direction, and sooner or later it will 
 be much more difficult to settle the labor problem than has been 
 the regulation of moneyed trusts. Labor organizations are not im- 
 poverished and do not ask for sympathy. They have ample funds, 
 which are freely spent if deemed advisable or necessary to carry 
 a point. Practically two per cent of the wages of the organized 
 coal miners is contributed to the maintenance of their various 
 organizations. The chief difficulties experienced in dealing with 
 these organizations are not so much with their leaders as with 
 some over-zealous members or sub-officials. Undoubtedly these 
 conditions are not known to their fullest extent by our people or 
 the Government. The repeal of the Full Crew Bill under the ref- 
 erendum law of Missouri at the last November election is an indi- 
 cation that the people are interested in matters of avoiding unneces- 
 sary waste. The politicians of that State under the pressure of 
 railway employes' organizations had forced the passage of a bill 
 which increased the operating cost of the railways without any 
 benefit to their employes or the public. It was a question of a 
 greater number of people having pressed their case before their 
 legislative representatives successfully, but when the attention of 
 the people was called to the defect of the Bill and to the damage 
 it did, it was promptly recalled and set aside by a great majority 
 of the popular vote. The coal operators of Arkansas and Okla- 
 homa were not so fortunate in having the Mine Run Bills of these 
 two States recalled, and, strange as it may seem, in the latter State 
 the greatest support w'hich the Bill received came from the mem- 
 bers of the Farmers' Union, whose constituents have to pay the 
 bulk of the cost because they are the buyers of that grade of coal 
 which is mainly affected by this damaging legislation. Perhaps 
 the Farmers' Union wished to help the Miners' Union because 
 both were Unions and therefore the natural enemy of capital. Were 
 it not a most serious matter, we might enjoy the ridiculous view 
 of this attitude. 
 
 Congress convenes at Washington today, and there is neces- 
 sity for aggressive and constructive legislation. Mine operators 
 have been contenting themselves more or less with defensive meas- 
 ures, but I wish to urge not only for the best and strongest repre- 
 
PRESIDENT'S ANNUAL ADDRESS 135 
 
 sentation at Washington and at the various State Capitols but also 
 for the introduction of measures deemed necessary to the best 
 interests of mining. At this occasion I want to make clear the 
 oft-misunderstood purpose of the maintenance of the Washington 
 office by The American Mining Congress, some members having 
 expressed themselves as not being in favor of maintaining a lobby, 
 feeling that it was degrading to the Congress and not worthy of 
 the industry. This attitude and misconception must be corrected. 
 Our representation at Washington is not for the purpose of unduly 
 influencing Congress in our favor or obtaining concessions by un- 
 fair meains. It is there for the purpose of aiding our law makers 
 in the protection of the industry and advising them of our needs. 
 With all due deference to the make-up of our State and National 
 legislative bodies, it is not reasonable to expect of them a thorough 
 knowledge of all affairs of this great country and the needs of the 
 great multiplicity of interests and industries therein. It is not only 
 a necessity but a duty of each industry to have at convenient reach 
 representatives who may inform and consult with Congressmen on 
 matters pertaining to their respective lines of business. Every day 
 new problems arise, regarding which the Congressman removed 
 from his home conditions cannot be kept posted unless he is con- 
 stantly informed by a reliable source. It is not reasonable that we 
 should expect other interests to champion our cause, and I would 
 recommend that each mine owner, even if he is not a member of 
 this organization, advise his Senator and Congressman that The 
 American Mining Congress is the representative of his respective 
 company in matters pertaining to the mining industry and will 
 gladly furnish correctly and concisely such information as may be 
 called for. 
 
 Before the year closes the Federal Trades Commission will be 
 appointed by the President, and the mining industry deserves the 
 fullest consideration in the selection of the personnel of this board. 
 You have been erquested to use your influence in this direction and 
 it will soon be too late to do so, therefore prompt action is desired. 
 
 Many of us are, perhaps, in doubt as to what constitutes unfair 
 competition. On one hand, railroads must charge the same rates, 
 otherwise their competition is unfair ; yet if mine operators pre- 
 pared a price list they would be promptly attacked as a combina- 
 tion in restraint of trade or in violation of the State and National 
 anti-trust acts. The shipping trust was declared legal because it 
 
136 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 agreed upon rates and apportioned the transportation of steerage 
 passengers from Europe to this country, and even some advantages 
 were seen by our higher court in this combination. The Harvester 
 trust was declared illegal because it manufactured forty per cent 
 of a certain farm implement. If there ever was need for co-opera- 
 tive work in any of the great industries, the bituminous coal indus- 
 try deserves the most immediate and fullest attention of the Trades 
 Commission, and it will, I am sure, be accorded every facility and 
 assistance at the hands of the mine operators of this country to 
 clarify the drastic conditions. 
 
 The recent war has brought to our attention conditions which 
 we had not been obliged to consider in the rush and bustle of our 
 rapidly growing country. Some of us have had to change our 
 views that a foreign war would mean a great boom to our indus- 
 tries, that our coal mines would be operated to their fullest capac- 
 ity to supply the demand oT the xavies and industries of the for- 
 eign countries, but with some minor exceptions, the very opposite 
 has been true. We have been obliged to admit to ourselves that 
 we are not as independent of the world's trade as we have been 
 led to believe in Fourth of July orations and after-dinner speeches. 
 These sudden conditions are problems of the greatest mag- 
 nitude, and while we may never be able to solve them in their 
 entirety, great relief can be afforded. They are not matters which 
 can be settled by individuals, and while there may be leaders doing 
 more than their share, they must have the support and co-operation 
 of a large following to bring about the most good to the greatest 
 number. 
 
 Let me suggest also at this time that the delegates to this 
 Convention report to the authorities who have sent them here the 
 proceedings and the work of this Congress. Do not believe that your 
 duties as delegates end by attending these meetings the real pur- 
 pose of your coming here is to report at home what you have 
 found and what you think should be done by yourself and your 
 principals. Do not wait for the distribution of the printed pro- 
 ceedings of this Convention. The desk of the busy man today is 
 burdened daily with publications of this kind which are often not 
 read for weeks and months, and frequently consigned to the book- 
 cases without having been opened. I am sure a concise letter, with 
 a personal opinion expressed, will do much more good than hun- 
 dreds of pages of closely printed matter which remains unread. 
 
PRESIDENT'S ANNUAL ADDRESS 137 
 
 Another thought has suggested itself to me which I think it 
 proper to bring to your attention at this time, and that is, the elec- 
 tion of your officers and directors. Many of us have had experi- 
 ence with organizations of a commercial or social nature where 
 much dissatisfaction existed over the management of affairs. I 
 may not fully appreciate the advantage of the present method of 
 electing your officers and directors, which is left largely to the dele- 
 gates at the annual conventions, but I believe that a direct election 
 by the members would insure greater interest. I have no fixed 
 plan to suggest, and may be entirely out of order to even com- 
 ment on the by-law's, which were undoubtedly carefully framed by 
 the founders of this organization, but I recommend the considera- 
 tion of a plan whereby each member is given the opportunity to 
 select his choice for office by a ballot submitted through the mail. 
 It would, perhaps, require three votes to make the final choice. 
 On the first ballot each member will be asked to recommend his 
 personal choice of candidate for the office to be voted for ; all but 
 the names of the eight or ten parties receiving the greatest num- 
 ber of votes will be dropped and submitted as a second ballot, upon 
 the receipt of which the third ballot containing the names of two 
 or three candidates receiving the greatest number of votes will be 
 submitted for a final selection. I am sure the increased interest 
 by the members will w'ell warrant the expense and trouble of such 
 procedure, each member having an equal chance a privilege so 
 greatly valued by the American voter and there can be no feeling 
 that certain interests or individuals take undue advantage of oppor- 
 tunities. With the widely scattered membership it is impossible 
 to obtain a full attendance at these annual meetings, and votes by 
 proxy do not appeal to me and may be very objectionable to many 
 others. 
 
 The most successful organizations are usually managed by 
 well paid men, who give their entire time to the business in hand. 
 I do not believe I look too far ahead when I hope that this plan 
 may be adopted by this organization in the future. While it is a 
 distinct honor to serve as President of this Congress, most of your 
 Presidents have been men who could only give you a part of their 
 time, having to look after their own business, and whatever work 
 they have done for you has been at a sacrifice of their personal 
 interests. This work is of sufficient importance to require the 
 undivided attention of the best talent, and that of several men. 
 
138 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 I know your Secretary has often hesitated to ask for time of your 
 officers, knowing the many calls made upon them. 
 
 I wish to invite your special attention to two subjects which 
 are going to be discussed at this session and which I regard of the 
 greatest importance ; namely, the arbitration of industrial disputes 
 and the progress of the Workmen's Compensation Committee. The 
 former is a subject little discussed up to this time. Under our 
 Constitution no compulsory measure can be enforced. It must re- 
 main a matter of honor between the two interests, to avoid indus- 
 trial conflicts. It is not fair to ask employers to yield to unreason- 
 able demands of employes because of any special or unusual busi- 
 ness conditions existing, or by this denial, bring about business 
 interruptions or even bloodshed. Likewise, is it not proper that 
 employers should take undue advantage of their men under stress. 
 Such actions encourage discrimination or other unreasonable atti- 
 tudes at opportune occasions. Interruptions to mining do not end 
 by affecting the employers and mine owners ; the damage to the 
 consumer and user of mining products may be much greater, i 
 need only call attention to the expense which our coal consumers 
 are put to every tw'o years by storing vast quantities of coal in the 
 face of uncertainty regarding the renewal of expiring wage agree- 
 ments. Appeal to the patriotic spirit is not a cure, and it is proper 
 that we duly consider the best solution of the subject by discussing- 
 it from every viewpoint and form some basic opinions. 
 
 State Legislation is more or less contagious if one State con- 
 siders a certain measure, and particularly one which meets popular 
 favor, other States will endeavor to adopt it. The Workmen's 
 Compensation Bills have furnished their share of opportunity to 
 the spectacular politicians by supporting this popular legislation, 
 frequently under the disguise of desiring to appear more progress- 
 ive and liberal than neighboring States. Many bills have been pro- 
 posed which are unworthy of the cause they represent, and modi- 
 fications will be proposed at the coming sessions. There is no 
 question but that each industry should bear the cost of its toll of 
 life and injuries. The injured workmen or their families should 
 not be dependent upon charity. There may be no difference be- 
 tween the services of a soldier who draws a pension for giving his 
 services to his country to defend it, perhaps, only for a short time 
 and the workman who gives his entire lifetime to build it up. The 
 employer, to meet these expenses, must be placed in a position to 
 
PRESIDENT'S ANNUAL ADDRESS 139 
 
 earn the cost of this protection. The schedules of compensation 
 must be fair to both sides, else the employers will not place them- 
 selves under the Acts, which are optional and under our Consti- 
 tution cannot be made compulsory. The present method of liti- 
 gation is wasteful, deprives the needy at the time when assistance 
 is of the greatest value, often giving the greater sums to those least 
 entitled, at the expense of those really deserving. This condition 
 should not be permitted to continue. My own opinions differ some- 
 what from the expressed view of our Committee, insofar as I 
 believe the workmen should contribute a part of the cost of this 
 insurance. It will make the plan more valuable to them. Their 
 self interest will prevent unfair payments, because increases would 
 have to be borne in part by themselves. Their ability to contribute 
 can only be measured by the readiness with which the organized 
 men pay dues and assessments, about two per cent of their gross 
 earnings being given to the Union fund of the organized coal fields. 
 Should they contribute an equal amount to the Compensation fund 
 in addition to the equivalent added by the employers, we would 
 have a fund of 3 cents to 3^ cents per ton of coal, which is con- 
 sidered adequate at this time. Such contributions would entitle 
 them to representation in the administration of the fund, which 
 should be kept out of the reach of political influence. 
 
 The unusually depressed condition of the mining industry pre- 
 vailing during the past year has required more than the ordinary 
 attention and time of the operators and mining officers, and has 
 prevented many from more active co-operation with our w'ork. 
 Your directors and officers have not been able to give as much 
 time to the work as was hoped, nevertheless, we have advanced, 
 and I take this opportunity to thank the directors and members 
 for their cordial and generous support. Many promises have been 
 made, which will be handed as a heritage to my successor in office, 
 who I am sure will be able to convert them into cash as soon as the 
 financial situation improves, and I feel that the outlook for The 
 Mining Congress is more encouraging now' than at any time since 
 its organization. As to your Secretary, I can only reiterate what 
 I stated at Philadelphia, that he has been the main-spring of your 
 machinery and to him is due the credit for any accomplishments. 
 
Recent Legislation Affecting the Arizona Mining Industry 
 
 BY WALTER DOUGLAS, 
 BISBEE, ARIZONA. 
 
 When the Territory of Arizona achieved its ambition and 
 was admitted into the sisterhood of states, its legislators sitting 
 as members of its constitutional convention felt it incumbent upon 
 them to evolve a constitution which would be in nowise secondary 
 in progressive principles to that adapted by its predecessor, Okla- 
 homa. 
 
 To this end the XVIIIth,, article concerning labor deals with 
 certain features of social legislation which are ordinarily left to 
 legislatures to enact. 
 
 Sec. I. of Article XXVIII directs the legislature to enact a 
 law providing that eight (8) hours and no more shall constitute 
 a day's work in all employment of the state or any subdivision 
 thereof. 
 
 Sec. II. That no child under the age of fourteen (14) shall 
 be employed in any gainful occupation, nor shall any child under 
 sixteen (16) be employed in mines or other hazardous occupation. 
 
 Sec. III. Declares it unlawful for an employer to contract 
 with an employee whereby he shall be released from responsibility 
 for any injuries sustained. 
 
 Sec. IV. Abrogates the common law doctrine of fellow ser- 
 vant, while 
 
 Sec. V. Leaves the defense of contributory negligence, or 
 of assumption of risk to the jury as a question of fact. 
 
 Sec. VI. Provides that the right of action to recover damages 
 shall never be abrogated and the amount recovered shall never be 
 subject to any statutory limitation. 
 
 Sec. VII. Directs the legislature to enact an Employer's Lia- 
 bility law by which the employer shall be liable for death, or injury, 
 to an employee due to the hazard of the employment. 
 
 Sec. VIII. Provides that the legislature shall enact a Work- 
 man's Compulsory Compensation law but specifically states that it 
 
RECENT LEGISLATION AFFECTING ARIZONA MINING 141 
 
 shall be optional with the employee to accept compensation or re- 
 tain the right to sue. 
 
 Sec. IX. Prohibits the exchange, solicitation or giving out 
 of a "Black-List", and 
 
 Sec. X. That none but a citizen of the United States shall 
 be employed upon public works. 
 
 Article XIX. Establishes the office of mine inspector and 
 directs the first legislature to enact law's regulating the operation 
 and equipment of the mines of the state. 
 
 The first legislature of the state of Arizona convened on the 
 i8th day of March, 1912, and proceeded to carry out the instruc- 
 tions embodied in the constitution and to enact of their own voli- 
 tion other measures effecting the mining industry. 
 
 Considering the different laws that have been enacted in their 
 relative importance and after over two year's experience of their 
 operation it would be proper to ascribe the first place to the mine 
 inspection bill. 
 
 It has been singularly fortunate for the state of Arizona that 
 some time prior to the convening of its first legislature the Ameri- 
 can Mining Congress had appointed a committee of distinguished 
 members to compile a code applicable to the conditions obtaining 
 in metal mines and that the rough draft of its reports was avail- 
 able for the legislature when confronted with the necessity of 
 framing a law as directed by the constitution. 
 
 With a few minor and one major exception the code drafted 
 by your committee w'as adopted and became the present law under 
 which mines are operated in this state. It is a pleasure to be able 
 to say that state inspection instead of being a detriment, or an 
 embarrassment, in operating, has become a positive benefit in that 
 it has kept the management in close touch with underground con- 
 ditions through the state inspector and has assisted those in direct 
 charge by association with an outside point of view. Perhaps 
 part of the success has been largely due to the ability, tact and 
 helpfulness of the mine inspector who has converted prejudice and 
 suspicion into hearty co-operation. 
 
 Next in importance to the mine inspection is the Compulsory 
 Compensation Act. The first legislature found itself in the ex- 
 extremely embarrassing position of having to frame a measure of 
 Compulsory Compensation which under the wording of the con- 
 
142 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 stitution could only be optional. They doubtless did the best they 
 could under the very difficult circumstances but the result has 
 been eminently unsatisfactory to all parties concerned. Any law 
 which leaves the question of compensation for death, or injury, to 
 the financial soundness of the individual employer is bound to be 
 a hardship on the employee, as only responsible corporations are 
 in a position to meet a heavy loss through an accident. The miner 
 who goes out to do assessment work on one of the thousands of 
 prospects, owned by parties of small means, meeting with an injury 
 can obtain no relief. It is estimated that not more than forty per 
 cent (40%) of the labor employed in the state would under this 
 defective law be able to collect damages for injuries, or death. 
 
 I think it is a fair assumption that the great majority of the 
 employers of labor today recognize the justness of the axiom that 
 the industry should bear the burden of its hazards ; but it is only 
 fair that the financial degree of responsibility should be defined 
 and understood by both parties. A law which binds one party and 
 not the other is in its very essence unfair and intolerable and 
 can only be a fertile source of misunderstanding and distrust. 
 
 Until the constitution of the state has been amended making 
 it possible to introduce a system of state insurance, such as that 
 so successfully operating in the state of Washington, or a com- 
 pulsory compensation bill like those of New York or Massachu- 
 setts the moneys which in the ordinary course of events would 
 go to alleviating the suffering of the injured will serve to render 
 the ambulance chaser prosperous and contented. 
 
 Perhaps the most pernicious law passed by the last legisla- 
 ture and especially aimed at the mining industry was the so-called 
 eight hour law, which provides that an employee shall not remain 
 underground for a longer period than eight (8) hours in any 
 twenty-four hours. This, in the experience of the large mines 
 of the state, means that deducting the necessary time to get to 
 and return from the working place and half an hour for lunch 
 the miner only averages seven (7) hours work. It is inconceivable 
 that the framers of this measure could have believed that it would 
 inure to the benefit of the best interests of labor. It is of that 
 class of legislation w'hich endeavors to throttle ambition and ef- 
 ficiency, to make all men of the same degree of mediocrity and 
 to prevent ability and industry asserting itself. In the past, and 
 
RECENT LEGISLATION AFFECTING ARIZONA MINING 143 
 
 before the passage of this law, the miner or mechanic of ambition 
 was glad to get a few hours extra work as overtime each week 
 not only for the additional money there was in it, but in order 
 to acquire experience in a class of labor which was impossible 
 during hours of regular operation. The result of the passage of 
 this law has been that the average wage of the employee has been 
 curtailed and, what is more important, his opportunity for advance- 
 ment has been materially reduced. As a commentary on legisla- 
 tion of this class directed at a single important industry it might 
 be proper to mention that of the 54 members of the first legis- 
 lature but 7 of them could be by the most liberal construction 
 classed as representatives of mining or had any practical knowl- 
 edge of the industry. 
 
 It would be improper in this brief review of recent legisla- 
 tion as applying to the mining industry to dwell at length on the 
 law enacted by the first state legislature for the taxation of mines, 
 as this subject will be fully discussed at the meetings of the Con- 
 gress. 
 
 In conclusion, therefore, it is a fair assumption, which is 
 borne out by actual experience, that ill-digested legislation such 
 as that above cited has not been of financial or moral benefit to 
 the wage earner but has served to embarrass an industry on the 
 material prosperity of which this state to a large extent depends. 
 A prolonged period of great depression faces the copper producers 
 and only mutual co-operation and wisely considered measures can 
 succeed in preventing great suffering in the mining communities 
 through further restriction in the copper output. 
 
The First Move 
 
 BY W. G. SWART, 
 DENVER, COLORADO. 
 
 We have recently been hearing that something is wrong with 
 the mining industry ; that the mineral output does not keep pace 
 with the demand; that the good mines are rapidly being worked 
 out ; that prospecting is a "lost art" ; that engineers will not recom- 
 mend prospects ; that money for development is not to be had, and 
 that only developed properties can be marketed. 
 
 I am not going to say these assertions are wholly false, because 
 the statement which opens this discussion is true there does seem 
 to be something wrong with the mining industry but I do not 
 believe the other statements will bear the light of careful investi- 
 gation. The mineral output does keep pace with the demand. 
 Metal prices and statistics prove it directly, beyond question, except 
 in the case of gold, and since the price of gold must be measured 
 indirectly we can only say that it seems also to be true of gold. 
 It certainly is not true that all the good mines are worked out, 
 neither is it true that prospecting is a "lost art," that engineers 
 will not recommend prospects, that development money cannot be 
 had, nor that only developed properties can be marketed. Any 
 or all of these things may be true in individual cases, but in the 
 aggregate the situation seems better than ever before. We are 
 simply facing changed conditions and the old order is passing. 
 
 Mining must undoubtedly depend ultimately on prospecting, 
 and like every other activity prospecting has had to change its 
 methods. The man Arizona knows as the "desert rat," with his 
 little grugstake and his burro, was in his day the efficient pros- 
 pector, but his burro cannot now compete with the automobile nor 
 can he himself compete with the younger and more energetic men 
 who drive the machines. They are the real modern prospectors, 
 and if you will stop a moment and consider you will be forced to 
 admit both the increasing number of such men, and their influence 
 on result. Some of these men are trained engineers, but many are 
 not, and the statement that engineers will not recommend prospects 
 
THE FIRST MOVE 145 
 
 almost answers itself it makes little difference, so long as a body 
 of active and intelligent young men is constantly discovering pros- 
 pects and turning prospects into mines. It is also plain enough 
 that some one is furnishing the money for this work. This leaves 
 partially open only the statement that none but developed proper- 
 ties can be sold. Arizona again furnishes an answer. It is not 
 necessary to go beyond her borders to show that some of the 
 largest and best properties in the world have been bought, de- 
 veloped, equipped and put into operation within the past ten years. 
 Does anyone question the willingness of the men who did this to 
 repeat their successes, or the willingness of others to emulate 
 them ? 
 
 The real point to be noted and emphasized here is that these 
 are the large things, the spectacular things, the unusual things, the 
 things requiring enormous capital. 
 
 They are .not the things requiring discussion here. We may 
 take it as a firmly established fact that the really big things will 
 continue to be handled by the really big men with their big re- 
 sources. But the prosperity and stability of the mining industry 
 depends, in the last analysis, just as much on the smaller enter- 
 prises, and it is with these that most of the complaints seem to 
 originate. Is there then a chance for the smaller mining operation ? 
 Can it be made attractive, secure and profitable? 
 
 Let us consider for a moment the distinction between pros- 
 pecting and developing. There seems to be a very general impres- 
 sion that the lucky prospector finds a mine ready made. What he 
 usually finds is a "pro s P ect >" which is simply the surface indication 
 of possible ore beneath. It generally takes both time and money 
 in liberal amount to ascertain even its chance of possible value, 
 and this is called developing. Developing is the department of 
 mining where the greatest risks must be taken, and where, inci- 
 dentally, the greatest rewards may be expected. It is distinct from 
 prospecting, and is even more important, but the distinction is not 
 well understood by the public at large. Mining is much more apt 
 to suffer from lack of development than from lack of prospecting. 
 Development funds come from a variety of sources, not necessary 
 to enumerate here. They may, however, be separated into two 
 general kinds pure speculation and distributed risk. Unquestion- 
 ably the larger part of development money has gone into the 
 ground as pure speculation whether its owners knew it or not, and 
 
146 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 like most other speculations, the proportion of losses have been 
 exceedingly high. The distributed risk money has done far better 
 but has not been so widely applied to smaller operations. Dis- 
 tributed risk is merely an application of the old adage "Don't put 
 all your eggs in one basket." Mark Twain criticized this policy, 
 saying through the lips of one of his best known characters that 
 it seemed better to "put all your eggs in one basket and watch that 
 basket." From the published list of mining stocks included in his 
 estate it is evident he found it difficult to properly watch his basket. 
 In reality his difficulty lay not so much in w'atching the basket 
 as in selecting both the basket and its contents, and it seems to 
 me it is the proper selection and handling of mining enterprises 
 that most needs our consideration. 
 
 We all know that mining is made a solid, substantial and 
 profitable business by the larger organizations. The very best 
 talent is employed and the utmost care used in the selection and 
 management of property. As many selected risks are assumed 
 as can be obtained on suitable terms up to the financial limit of 
 the organization. This is the distributed risk plan at its best, and 
 few such concerns have ever failed from legitimate causes. 
 
 For a number of years the feeling has been growing among 
 men qualified to judge that similar methods might be applied to 
 smaller operations. The idea of local mining or exploration syndi- 
 cates is not new they have operated for years with a fair percent- 
 age of successes. A syndicate of Colorado lawyers, under good 
 technical advice, took several million dollars out of Creede and 
 Cripple Creek. A syndicate of school teachers in another state, 
 paying into a working fund from $5 to $20 a month each, made 
 over $200,000 in five years. It is easy to multiply such illustrations 
 but we should also not forget that there have been many failures 
 far too many arising both from general and local causes. It will 
 occur to your minds immediately that the success of one such 
 organization in a community ought to cause others to spring up 
 with similar aims and hopes. It does. But the possibilities are 
 usually seen and grasped first by the irresponsible promoter, and 
 in the excitement of the public mind the real merit of the plan 
 and the real reasons for its success are lost sight of with much 
 unnecessary loss. This has happened and will continue to happen, 
 but there is an obvious and adequate remedy, and it is the appli- 
 
THE FIRST MOVE 147 
 
 cation of this remedy which I have had in mind in entitling this 
 paper "The First Move." 
 
 I believe the first move is a very definite move which must 
 be systematically made in each community by those best qualified 
 to make it, and they are the trained mining engineers and oper- 
 ators. I do not mean necessarily the graduates of mining schools, 
 but just what is said the trained mining men. They must do 
 what they have consistently done in the past take the initiative 
 and assume the leadership that is properly theirs. They must di- 
 rect mining investment, instead of only advise concerning it. 
 
 In spite of all unfriendly criticism of pretensions to see under- 
 ground, use of yellow leggings or partiality toward offices in the 
 high buildings, the fact remains that nearly every successful mining 
 operation of consequence, old or new, is today in the hands of 
 experienced, technically trained men. These are the men w'ho 
 select, who reject, who discriminate, who decide on the place, time, 
 direction and amount of expenditure, and who plan and execute 
 the work. No man does these things for any considerable time 
 successfully without becoming a business man of a high order. 
 Leadership is his by every right, but unfortunately he has not 
 always chosen to accept it and turn it to best account, even when 
 possible. Let me illustrate what is possible. In one of the classes 
 recently graduated from a certain mining school Were four young 
 men who resolved to pool their efforts and go to mining directly 
 instead of accepting salaried positions as assayers, surveyors, etc. 
 At the end of five years they are in far better financial condition 
 than the average of their classmates, they have had more real ex- 
 perience, and they understand what accepting responsibility means, 
 but above all, they stand absolutely at the head of mining affairs 
 in their community and are reaching out steadily for larger things. 
 They have made good, and in making good they have secured 
 an unhesitating local following in every mining enterprise they will 
 take over. This is the kind of leadership I have in mind. No 
 irresponsible promoter can capture that community. 
 
 The one necessary thing is to guide and systematize local 
 activity, and it can be done properly only by the trained men. They 
 must first show confidence in themselves, then build up the con- 
 fidence of the community in their ability, integrity and unselfish- 
 ness, and the rest is easy. 
 
 Another illustration of results actually achieved: A company 
 
148 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 of ten engineers was recently organized in Colorado, with modest 
 capital, and this company is already successfully operating selected 
 property along these very lines. When these men began sys- 
 tematically to put faith behind their works and money behind their 
 judgment, they took the first necessary step. They have already 
 secured the confidence and following of the communities in which 
 they operate. No one believes either that ten experienced men 
 can be seriously misled or that they will ever adopt anything but 
 a policy of absolute fairness and integrity. Every one believed 
 they would win, and they have. 
 
 While this is not the place for details, it may be well to point 
 out briefly several interesting features of this first move. 
 
 1. The proposal is not that the movement be restricted to 
 mining engineers and operators simply that it must be organized 
 and directed by them. 
 
 2. The movement probably cannot succeed without the con- 
 fidence and co-operation of the business and professional men of 
 the respective ocmmunities. Mining has usually been only a side 
 issue, an incidental, a speculation, if you like, with most such 
 men. Investing without proper guidance, their activity has been 
 spasmodic and unsatisfactory. 
 
 3. The movement must not only be started but be made 
 systematic and continuous, otherwise it has no real future. 
 
 4. The organizers must be prepared to make sacrifices of 
 time and energy, to say nothing of money, and to sink any petty 
 professional jealousies ; but at the same time the idea must not be 
 allowed to creep in for one moment that it is in any sense a philan- 
 thropic move. There can be just one underlying aim, and that is 
 to make mining pay. 
 
 5. No such organization can hope to succeed permanently 
 which does not propose to be fair and more than fair to its non- 
 technical associates and stockholders. The plan rests solely on 
 confidence in the ability and fairness of technical men. It is use- 
 less to start on any other basis. 
 
 6. It is not expected nor necessary that every engineer and 
 operator take an active part in such an organization. Some are 
 overburdened now ; some are honorably bound to organizations al- 
 ready existing ; some are more efficient working alone, but there is 
 
THE FIRST MOVE 149 
 
 plenty of available material in every mining district, in every west- 
 ern city. 
 
 7. It is a "get together" plan with indirect as well as direct 
 benefits. 
 
 8. It requires no large amount of capital. It is better to start 
 modestly and well within the means of the primary associates. It 
 is particularly necessary to assume no financial responsibilities be- 
 yond the actual capital in sight. Success in even the smallest way 
 brings possibilities of growth far faster than they can be properly 
 cared for. A good set of brakes is much more essential than the 
 high gear. 
 
 9. The mining men will have to start this themselves. No 
 one is going to do it for them. No one ought to do it for them. 
 
 You will realize that this paper is not an inquiry into what is 
 wrong with mining. It suggests that if something is wrong with 
 mining here is one constructive remedy. It is a workable plan, 
 whose details will of course vary with location and conditions, and 
 it is already in successful operation, but it is possible only to a 
 body of trained men. Undoubtedly there are other good methods, 
 but as I see the situation, the underlying idea must be the same in 
 all. The qualified mining men ought to be in better control of the 
 industry than they are, and they can be, but the first move is 
 theirs. 
 
The Leasing System and Conservation 
 
 BY JESSE KNIGHT, 
 PROVO, UTAH. 
 
 Mr. Chairman, I appreciate very much the honor but at the 
 same time I do not feel competent to lead this discussion. That 
 man from Texas (Dr. Phillips) spoke my mind so much better 
 than I can myself that I feel very incompetent to say anything. But 
 I have a few ideas, gained through experience, in regard to the 
 leasing question especially. I do not believe in it at all, from any 
 point, either for the state or the government, especially the govern- 
 ment. I think if they are going to lease, each state ought to do its 
 ow'n leasing. I think they know better how to handle it than the 
 government does. They are closer home. 
 
 I suppose this was intended for a general discussion on every- 
 thing that is bad. The leasing of power sites in these little moun- 
 tain streams here in the West, to me, always looks like the most 
 ridiculous thing I could think of in the way of conservation. The 
 streams are going to waste, and so long as we do not interfere with 
 irrigation, and we do not need to in most cases, w'e should be per- 
 mitted to drop the water above the farms and harness up little 
 mountain streams and thus do a great good with them and develop 
 the country. Those streams are going to waste, and perhaps will 
 go to waste forever, but when they lease them it hinders the pro- 
 gress of the country. It seems to me it might be just as well to 
 conserve the air w'e breathe and call it conservation as to conserve 
 these mountain streams. I have been in the power business in a 
 small way. In the first place we harnessed a little stream in San- 
 taquin, Utah, to take power over to the Tintic mines for our own 
 use. We found quite a good deal of difficulty in getting a right of 
 way. It took about six months after we were ready to start work 
 to get the right of way red tape in dealing with the government 
 officers for our pipe line and to set our poles, etc., which makes 
 it rather exasperating. Then when we got one little plant over 
 there w'e found that we needed more for safety and protection, as 
 we found by experience that one little plant didn't do us much 
 
THE LEASING SYSTEM AND CONSERVATION 151 
 
 good, as the electric storms would put us out of business. So we 
 continued until we built five little power plants, and then we found 
 that we were leasing in competition with people that didn't have to 
 lease. The Telluride Power Company, for instance, in Utah, had 
 its rights beforehand and had titles to its holdings, and it was not 
 a lessee, and of course, being suspicious, as I am, I was fully con- 
 vinced that the men who got up that bill to make lessees of every- 
 body else did it to head off competition for themselves. I think 
 that men sometimes do things as bad as that. If you compete with 
 them they don't like it. They might have done it for that reason 
 or they might have made people believe it was conservation, but I 
 fail to see where it comes in. I never could see any sense in calling 
 it conservation of water power sites. I cannot conceive of such a 
 thing as conservation under that guise. I suppose others can, but 
 I have never heard any of them explain how it would conserve any- 
 thing. The more it would be used, of necessity it would save coal, 
 but to leave it go to waste forever, how could it conserve anything? 
 As I have said before, I haven't heard anybody explain how' it con- 
 serves natural resources, but that is the pretext they do it under, 
 to prevent monopolies from having too big an interest in a certain 
 thing, I suppose, and they fool the people right along. Most of 
 these leases and conservation ideas hold projects back from the 
 common people until the big fellows get ready to use them, in my 
 judgment. Now, I will tell a little story that will apply, maybe, to 
 what I want to say. When we built our first little power plant there 
 was an old Englishman who had an irrigated farm below, and he 
 protested against our use of the water. We told him that we would 
 drop it above all the farms and they could use it just the same, and 
 we would save water for them. It was running three or four miles 
 through loose gravel beds and sand before it got down to their 
 headgates. The farmers protested quite vigorously, but of course 
 they couldn't prevent us, and when we got permission from the 
 government we went ahead and built our pipe line along the side 
 of the hill, and we furnished them at the headgates just twice the 
 water they formerly had in low' water season. The old Englishman 
 still was not satisfied, and he said, "Well, what good is it when you 
 take the electricity all out of it?" (Laughter) From my view- 
 point there is about as much common sense in the conservation idea 
 as relating to power sites, as there is in the old man's valuation 
 placed upon the water after it has run over the wheel. The law's 
 
152 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 regulate how we can hold them ; we cannot hold them without us- 
 ing them, and to take them off the market in some instances and 
 lease them in other instances seems to me to be the clearest fraud 
 ever heard of in the name of conservation. 
 
 Now, in regard to the taxation of mining property, on which 
 we pay a fuller tax than is paid by almost any other business in 
 the country : In the State of Utah, where I live, in the first place, 
 we pay the taxes on the price of the land that we pay the govern- 
 ment, and we pay the government a larger price for the land than 
 most people who get lands from the government for other pur- 
 poses, and until we find ore, how can it be worth any more than 
 what we gave for it? I fail to see why they should want to tax it 
 any more than the government charged for it until it is shown that 
 it is worth more. The net proceeds tax seems to me to be the very 
 best law that could be got at to make the miners pay their equal 
 proportion of the taxes ; then we cannot get around it. We pay 
 our full quota of taxes in every sense so far as I am able to see. 
 
 I am not used to expressing my ideas, only in my own way, 
 and I am not competent at all to make a talk on the floor any place ; 
 but I admire that man from Texas, and he expresses my sentiments 
 better than I do. 
 
 I thank you. (Applause.) 
 
Federal Legislation for Alaska 
 
 BY FALCON JOSLIN, 
 CHAIRMAN OF THE ALASKA COMMITTEE OF THE AMERICAN MINING 
 
 CONGRESS, 
 FAIRBANKS, ALASKA. 
 
 The year 1914 marks a new era in the history of Alaska. Three 
 Acts of Congress of the highest importance to the territory were 
 passed and approved. These were : First, the Act authorizing the 
 President of the United States to construct approximately one 
 thousand miles of railroad at a cost not to exceed $35,0x30,000; 
 second, the Act repealing the existing laws for the sale of coal lands 
 in Alaska and providing for the leasing of such lands in the future, 
 and third, the bill reducing taxation on privately-owned railroads. 
 
 The policy disclosed in these bills shows a very wide departure 
 from all former plans of the government. The scheme and policy 
 for the development of the public domain since the very beginning 
 of the nation has been to grant to citizens a fee simple title in the 
 soil with complete and independent ownership. In railroad develop- 
 ment from the very first, the policy has been the encouragement of 
 private enterprise and private ownership of the railroad lines with 
 governmental aid for pioneer lines in their inception and during 
 their infancy. There was indeed in the earlier years of manage- 
 ment of the public domain some attempt at establishing a leasing 
 system, particularly with reference to lead mines, but after some 
 years of experiment and failure, the leasing system was abandoned. 
 In the beginnings of railroad development there were also some 
 experiments in state ownership as well as some experiments in 
 national construction of highways, but these experiments w'ere all 
 abandoned. About ten years ago during the first "reign" of Roose- 
 velt the idea was started that these old and well-tried policies of 
 the government toward the disposal of the public lands were all 
 wrong. Private ownership and control of the great railway high- 
 ways of the nation was also subjected to criticism and hostility. 
 
 It happened that just at this time the great domain of Alaska 
 was beginning to attract attention and immigration. This vast 
 
154 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 territory of nearly 600,000 square miles had been supposed an 
 arctic, ice-covered waste, and useless except for furs and whaling. 
 The discovery of enormously rich bonanza gold fields in different 
 localities attracted many thousands to Alaska and its development 
 began with a rush. 
 
 In the decade between 1890 and 1900, the population gained 
 more than 100 per cent. It was discovered that the territory was 
 not only valuable for furs, but contained amazing stores of gold, 
 copper and coal and its w'aters contained a most abundant supply 
 of fish. Railroad building began in 1898. Dozens of railroad lines 
 were projected and surveyed and in the succeeding ten years nearly 
 500 miles were constructed. The law relating to the disposal of 
 coal lands which prevailed in the western states was extended to 
 Alaska, modified somewhat, but still in principle the same. This 
 law was in effect that the government offered its coal lands for 
 sale to any citizen in tracts of 160 acres at the price of $10 an 
 acre, the applicant himself to pay for the cost of surveying the 
 land, all of which was unsurveyed. Under the provisions of this 
 law approximately 40,000 acres of coal land in various localities 
 were applied for by several hundred different citizens, surveyed by 
 them at their own expense and purchased from the government and 
 paid for. Nearly $400,000 in cash have been paid into the treasury 
 of the United States as purchase price of these coal lands. Per- 
 haps another $200,000 were spent in surveys. Probably more than 
 a million dollars additional were spent in the exploring, buildings, 
 roads and other development. 
 
 There w'as every indication that the development of Alaska 
 was going forward in the same manner and along the same lines 
 that the great western frontier of the United States proceeded. 
 But the new policies which have been mentioned were also gaining 
 headway and in the year 1906 resulted in the issuance of executive 
 orders which very promptly brought this development and progress 
 to a standstill. Railroad building ceased. The proposed opening 
 of coal mines immediately stopped and some mines w'hich were 
 already opened closed down. There is not a coal mine operating in 
 all Alaska. The development of the oil fields also came to an abrupt 
 end, except one claim, fee simple title to which had been obtained 
 before the executive orders were issued. The executive orders re- 
 ferred to were those issued in November, 1906, supplemented by 
 various orders during the next few months withdrawing all land in 
 
FEDERAL LEGISLATION FOR ALASKA 155 
 
 Alaska containing coal from sale or entry. These orders were 
 ratified by later orders in 1910. The fact that these orders were 
 wholly without authority made them none the less effective. For 
 in matters relating to the administration of the public lands, full 
 authority rests with the Executive Department of the government. 
 The courts have no jurisdiction either original or appellate. The 
 citizen seeking to acquire public land has no right of access to the 
 courts. 
 
 The policy and purpose of these orders was quite clearly ex- 
 pressed, although not in the orders themselves. Their policy was 
 to change the system of disposal of public coal lands from the 
 freehold to the leasehold system. Such a change constitutionally 
 and regularly could only have been brought about by the action of 
 Congress through legislation. At that time, however. Congress had 
 not awakened to the enormous advantages of the leasehold over 
 the freehold system, while the Executive Department had. One of 
 the executive orders, the one indeed which has been in effect until 
 the moment of the approval of the present leasing bill, naively de- 
 clares that the orders were issued "in aid of legislation." Thus 
 in addition to the executive and judicial po\vers the executive now 
 assumed also the legislative power. We now have the Act, approved 
 October 2Oth, 1914, to provide for the leasing of the coal lands in 
 the Territory of Alaska and for other purposes, as the ripened 
 fruit of this new policy. 
 
 The Act to authorize the President of the United States to 
 locate, construct and operate railroads in the Territory of Alaska, 
 approved March I2th, 1914, is the result of this new policy with 
 reference to railroads. 
 
 More than three years ago it became quite clear to your 
 Alaskan Committee that no progress could be made toward the 
 opening of Alaska except by yielding to the demand for the change 
 of policy above indicated. The growth and development of the 
 territory had practically ceased. During the decade between 1900 
 and 1910 the population had gained less than 2 per cent. The rail- 
 road mileage which had been built, comprised in seven or eight 
 separate lines, was without exception unprofitable. Upwards of 
 thirty millions dollars had been invested in these railroad enter- 
 prises. The two or three hundred men who had bought and paid 
 for coal lands were unable to get any title thereto. Indeed the 
 policy of the Executive Department was not to decide the cases one 
 
156 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 way or the other. Nearly two hundred of them had been subjected 
 to criminal indictments, most of which are still pending. A few 
 were brought to trial and promptly acquitted. The case of the 
 Alaska coal claimants is probably unparalleled in the history of the 
 nation. They surveyed and bought the land at the price at which 
 it was offered and paid for it. But though the government took 
 their money and gave receipts for it, it refused to give them title, 
 at the same time retaining their money. On top of this they 
 criminally indicted the greater portion of them for attempting to 
 buy land at the price at which it was offered for sale. 
 
 The infant and struggling railroading enterprises which in the 
 western states, under similar circumstances had been subsidized by 
 government loans and land grants, in Alaska were subjected to ex- 
 cessive taxation and even the control of their management was 
 brought under the Interstate Commerce Commission, which in a 
 large measure takes the control away from the ow'ners. 
 
 Under these circumstances, it is not to be wondered at that any 
 further capital could not be induced to go into Alaska. It became 
 evident that if the territory was to have railroads at all, the govern- 
 ment itself must build them. Your committee, therefore, in 1912 
 drafted a bill containing a plan for the construction by the govern- 
 ment of not to exceed one thousand miles of railroad in Alaska. 
 Hearings were secured before the Territories Committees of Both 
 House and Senate and the plan and draft bill was presented. It met 
 with favor and the Senate Committee introduced the bill as a com- 
 mittee bill. Though the bill was not passed, a Commission of 
 Engineers was authorized by Congress and appointed by the PresU 
 dent to go into Alaska and report upon routes and other matters 
 relating to railroad development of the territory. This commission 
 duly reported in January, 1913, and new' bills were introduced in 
 substance and effect the same as the former bill which had been pre- 
 pared by your committee. 
 
 Very fortunately when the Democratic administration came 
 into office. Secretary Lane and President Wilson took up the sub- 
 ject of railroad legislation for Alaska and made the bill an adminis- 
 tration measure. The bill met severe opposition in both House and 
 Senate, but finally overcame all opposition and became a law. The 
 greatest praise for its success belongs to President Wilson and 
 Secretary of the Interior Lane, without whose powerful influence 
 the measure could never have been passed. Your committee, ably 
 
FEDERAL LEGISLATION FOR ALASKA 157 
 
 advised and assisted by Secretary Callbreath, worked unceasingly 
 for the measure through three sessions of Congress. 
 
 Theoretically, government ownership of railroads is an ideal 
 system. Capital supplied by the government is obtainable at about 
 3 per cent interest, whereas supplied by bankers or private indi- 
 viduals it would cost at least 6 per cent. The saving in this item 
 alone on $35,000,000 of capital amounts to over $1,000,000 per year. 
 The power to make and sustain low rates in the beginning and 
 thereby to encourage the rapid development of the territory served, 
 is another very great advantage of government ownership. Against 
 these advantages must be set off the fact that in government owner- 
 ship, construction and operation will probably be more expensive 
 than in private ownership. The bill, however, provides that the line, 
 or lines, when constructed may be leased, in fact, shall be leased 
 in case a satisfactory lease can be procured. Under the system of 
 government ownership with operation carried on under lease, there 
 is no reason why as high degree of economy cannot be obtained as 
 may be had under private ownership. 
 
 The bill also authorizes the President to either construct the 
 lines on force account, or let the construction by contract. If the 
 construction work is taken under contract, there should be as high 
 a degree of efficiency and economy as if the roads were built by 
 private owners. The bill very wisely, as it seems to your com- 
 mittee, has given the President the widest and most complete power. 
 There is practically no limitation upon his pow'er except that he 
 shall not contract for more than $35,000,000 worth of construction, 
 the appropriations for which must be made annually by Congress. 
 
 The selection of routes, always the most troublesome point in 
 the building of new railroads, is left entirely with the President. 
 This indeed was the great point which brought success to the bill. 
 Unless the discussion of the various routes could be avoided, no 
 measure could hope to pass Congress, except after years of debate 
 and struggle. 
 
 It should be said that some votes were cast for the bill in 
 Congress by those who were hostile to the principle of government 
 ownership. They thought that Alaska would be the most difficult 
 field for the experiment and that it would therefore show that 
 government ownership will be a failure. Whether it is a failure 
 or not depends upon the administration of the law. 
 
158 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 Your committee feels that the American Mining Congress, 
 having taken such an active interest in the origin and passage of 
 the bill, is now bound to do all in its pow'er to assist in its work- 
 ing out. 
 
 Undoubtedly there are many disadvantages in government 
 ownership. For example, the encouraging of emigration by adver- 
 tising and other means usually employed to increase population will 
 be difficult for the government. The exploiting of mineral and 
 other resources for the building up of traffic and the extension of 
 spurs and branches cannot be well done by the government. But 
 none of these disadvantages are such that they may not be over- 
 come by careful and earnest effort. 
 
 The political aspects of government ownership is probably the 
 most risky and dangerous of all features of government owner- 
 ship. Whether the selection of routes and of personnel, the grant- 
 ing of contracts, the making of rates and the operation of the 
 property, can be carried forward under government ownership free 
 from political influences of fear or favor, is a highly important 
 question in the w'orking out of the law. 
 
 The work has already begun ; a Commission of Engineers has 
 been appointed by the President who have spent the past season 
 in Alaska in making surveys and who will shortly make their re- 
 port and recommendations. It is to be hoped that construction 
 will begin during the summer of 1915 and that prosperity for 
 Alaska will follow immediately. 
 
 THE COAL BILL. 
 
 Three years ago the Alaskan Committee of the American Min- 
 ing Congress, though all without exception opposed to the principle 
 of leasing coal lands, nevertheless drafted and supported before 
 Congress a bill for leasing coal lands in Alaska not that it be- 
 lieved in the principle, but that it was the only way to get action. 
 
 When the bill which has now become a law was first intro- 
 duced in the Congress which has just expired, your committee con- 
 sidered it a reasonably fair leasing law. Members of your com- 
 mittee being called upon appeared before the House Committee on 
 Public Lands and supported the measure, providing certain amend- 
 ments were incorporated in it. When the bill was reported from 
 the Public Lands Committee of the House, it was in such condition 
 that your committee felt its passage would be an outrage and made 
 
FEDERAL LEGISLATION FOR ALASKA 159 
 
 every effort to secure its amendment. Many of the amendments 
 proposed by your committee were adopted and incorporated in the 
 Act; others were rejected. 
 
 One of the most vicious things in the measure is the provision 
 that deprives any of the existing coal claimants of the right of 
 access to the courts. The bill proposes to lease the identical lands 
 which the government has heretofore sold. It is the law that a 
 citizen may not sue the government, but it also is the law that if 
 the government sells a tract of land to a citizen and afterwards 
 attempts to transfer the same tract to another citizen, the first pur- 
 chaser may bring suit against the second when he enters into pos- 
 session and thereby get judicial consideration of his right in the 
 courts. If the first purchaser's right is decided to be superior, then 
 the second claimant will be declared by the courts to hold the land 
 as trustee for the first purchaser and be required to yield up pos- 
 session and title to him. Congress, with the cunning device con- 
 tained in Section 13 of the bill, proposes to legislate the Alaska 
 coal claimants out of this right of access to the courts. It will 
 probably prove futile, but the malignant purpose is no less dis- 
 couraging. It should not be forgotten that murderers and the most 
 abandoned criminals are entitled to their day in court. It is prob- 
 ably the first time in the history of the nation that Congress has 
 attempted, with conscious purpose and design, to deprive its citizens 
 of this right. Always before the spirit has been to give every citi- 
 zen the right of fair hearing in the courts and full right of appeal. 
 It will not inspire confidence in those who are invited by the bill 
 to take leases in the future. If their predecessors who bought and 
 paid for the coal lands are to lose their improvements, and suffer 
 the ignominy of criminal indictment and finally be deliberately 
 legislated out of their right of trial by, or appeal to the courts of 
 the land, it may well make prospective leasers pause before they 
 venture to invest large capital where such things can be done and 
 go unrebuked. However daring the men who go to Alaska, the 
 capital that hereafter is invited there must be timid with such a 
 record before it. 
 
 However, no new and novel propaganda to change the laws 
 is at present afoot. The building of the railroads and the arctic 
 climate will be powerful arguments in favor of opening coal mines 
 and your committee earnestly hopes that the leasing law 1 will work 
 as well as its most vigorous supporters have hoped. 
 
Conservation of Mineral Resources; State or National? 
 
 BY DR. WILLIAM B. PHILLIPS, 
 AUSTIN, TEXAS. 
 
 During the last years a great deal has been said and written 
 concerning the conservation of our mineral resources. There has 
 been a widespread awakening of the public interest and, one may 
 add, of the public conscience on this subject. 
 
 It has been treated from practically every standpoint, so that 
 it would not appear to be an easy task to discuss it further. 
 
 In spite of this, however, and largely because of it I venture 
 to tax your patience in an effort to set forth what, to me, are 
 the fundamental principles of this matter. 
 
 There are three things to which your earnest attention is re- 
 quested; these are as follow's: 
 
 First There can be no conservation without systematic de- 
 velopment. 
 
 Second There can be no real conservation without recog- 
 nized and regulated authority. 
 
 Third There should be no conservation that does not press 
 equally upon all concerned. 
 
 Conservation has three things to deal with, development, regu- 
 lated authority and equality. 
 
 We do not conserve our mineral resources by the enactment 
 of laws which, in effect, are prohibitory, nor do we properly 
 develop them by loosely drawn and insufficient laws. Development 
 that does not develop is worse than conservation that does not 
 conserve, for it closes the only door through which we may enter 
 upon a wise conservation. 
 
 Our mineral wealth must be developed for our own use and 
 benefit, with due regard to the needs of those who are to follow us. 
 
 The conservation of undeveloped resources is a contradic- 
 tion in terms. It is worse than this, for it distracts attention 
 from the main issue and substitutes for it an idea which has no 
 sure foundation. The real value of an undeveloped resource is 
 
CONSERVATION OF MINERAL RESOURCES 161 
 
 a thing which no one has yet been able to elucidate except in the 
 light of a similar resource which has been developed under fairly 
 comparable conditions. 
 
 There are communities and even entire states that are today 
 hoarding their undeveloped resources without knowledge what 
 they are. This is one of the commonest experiences of the capi- 
 talist, the mining geologist and the mining engineer. 
 
 "Why, sir, the resources of this state (county or district, as 
 the case may be) are perfectly enormous. There is enough iron 
 ore in our hills to supply a thousand furnaces a thousand years. 
 Enough gold and silver to pay off the national debt. Enough cop- 
 per to copper-plate the sun, moon, stars and other flag stations 
 of the universe. Enough oil to grease the wheels of Time and lubri- 
 cate the mills of the Gods that grind so slowly. Enough natural 
 gas to consume the earth and leave of it only a pile of sinter, sur- 
 mounted by a salamander." 
 
 Who of us has not heard such eloquent descriptions of unde- 
 veloped resources? And who of us has not found, to his cost, 
 that the gas was the only thing that had been developed? 
 
 We are sometimes disposed to think of conservation as a thing 
 separate from development, as a thing that can be considered on 
 its own merits. We say that such and such resources should 
 be conserved, but how can they be conserved if they are not devel- 
 oped? How' can one conserve a resource whose development is 
 not yet within the sphere of commercial activity? We do not con- 
 serve a pair of boots by greasing them and putting them away 
 in the closet, nor do we conserve a mineral resource by refusing 
 or neglecting to develop it. If there were a more systematic 
 and a wiser development we should hear less of conservation and 
 of the intricate and delicate questions that lie on the borderland 
 between present emergencies and future probabilities. 
 
 What we need, the country over, is not less conservation but 
 more development, not less of the spirit of saving but more of 
 the spirit of giving, the giving of our time, our means, ourselves 
 to the task of building a prosperous, far-seeing and economical 
 nation. 
 
 It is not to be denied that in some cases improper develop- 
 ment has caused conservation to assume the guise of necessity, 
 but, taking the country as a whole, we are today in far more ur- 
 
162 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 gent need of development than of conservation. Furthermore, the 
 insistence upon conservation has, in some instances, retarded the 
 development upon which our prosperity must be based. We have 
 put the cart before the horse, much to the discouragement of that 
 worthy animal. 
 
 The threatened depletion or exhaustion of the mineral re- 
 sources of the country upon which our rank as a nation must de- 
 pend is much less serious than some of our friends would have us 
 think. 
 
 Take, for instance, the coal resources of the country. Accord- 
 ing to the best information available the total coal area in the 
 United States is 373,000 square miles. The original supply of coal 
 is thought to have been about 2,750,000,000,000 tons, of which 
 11,000,000,000 tons, or 0.4 per cent have been removed. 
 
 If we allow that that original supply was one-half of such 
 estimates as have been made and that the exhaustion has been 
 twice as great as we have reason to believe we still find that we 
 have no appreciable demand upon our coal supplies. 
 
 Perhaps more has been said as to the conserving of our coal 
 supplies than almost anything else. In the very nature of our 
 circumstances we make a greater demand upon such supplies than 
 upon any other mineral resource and this demand increases year 
 by year. But we do not find that we have exhausted the supply 
 to an appreciable extent. In parts of the country and with spe- 
 cial kind of coal it may be that the principles of a sound conserva- 
 tion do now apply, but that they apply to the country as a whole 
 may well be doubted. 
 
 If there are portions of the country that are suffering from 
 lack of conservation there are far greater portions that are suf- 
 fering from lack of development. If there are cases of deplora- 
 ble waste in some of our mining operations there are multiplied 
 instances of a far greater waste through undeveloped resources 
 that w'ould contribute to our prosperity. 
 
 We must preach the doctrine of a wise development, for, in 
 that case conservation will take care of itself. I do not decry con- 
 servation that really conserves. I merely point out that develop- 
 ment is for us now the far more important consideration. 
 
 We come to our second heading; there can be no real con- 
 servation without recognized and regulated authority. 
 
CONSERVATION OF MINERAL RESOURCES 16a 
 
 We enter at once upon some of the most important questions 
 of state and national administration. 
 
 If we allow that self interest does not and will not impel us 
 towards a wise conservation we can hope for it only through gov- 
 ernmental control. There is no use in blinking at this for it con- 
 fronts us inexorably. If the natural laws of profit and loss are 
 not sufficient to cause us to protect ourselves and our children 
 we come surely to the more or less artificial laws of human enact- 
 ment and execution. 
 
 Before we face this emergency and have to deal with it we 
 must decide whether it w'ould not be better for the growth of a 
 self-reliant citizenship to work out our own salvation with as little 
 help from the government as possible. 
 
 The wisdom of government is the wisdom of the people who 
 compose it. We do not enlarge the intelligence or add to the wisdom 
 of a man by electing him to office, or making him the Chairman 
 of a Commission, or the head of a Bureau. We may increase his 
 sense of responsibility, but this does not necessarily imply that he 
 knows more or can use his knowledge to better advantage. It 
 is not so much what he knows as what he should know, not so 
 much what he does as what he should do. There is many a man 
 who is busy all day and half the night, but whose activities are 
 those of a child writing his name in water. Activity is not to 
 be confused with usefulness. If, as State or Nation, we are to 
 enter upon a real conservation we must do so with our eyes open 
 and with a full realization of what it will mean. I do not approve 
 or condemn such a course, I merely say that we must know whether 
 what we propose to do is worth doing and, if so, how to do it. 
 
 If w'e are to set a minimum price for a barrel of oil, by law, 
 it is but one step and that an inevitable one to controlling, by law, 
 all of the agencies concerned in the production and distribution 
 of that oil. If we are to disregard the time-honored law' of supply 
 and demand and substitute for it some human contrivance that 
 seems to appeal to our present needs we must accept the conse- 
 quences of our action. It is oil today, copper tomorrow and lead 
 next week. Also, if the owners of that oil refuse to sell it at 
 the price named there is no way of disposing of it save through 
 the agency that fixed the price, viz., the government. 
 
 It is quite beside the mark to say that a combination of in- 
 
164 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 terests may, by wholly artificial means, increase the price w'hich 
 the statute seeks to lower, for the price, in the long run, is fixed 
 by conditions over which no special interest or combination of 
 interests have any control whatsoever. 
 
 If the government, under the guise of law, can fix a minimum 
 price for a mineral product it can also, under the guise of law, 
 increase the price. But no government of the kind we have in 
 this country has yet been able to force producers to take less for 
 their product than it is worth or to force consumers to pay more 
 than it is worth. It might as w'ell undertake to pass laws regu- 
 lating the obliquity of the ecliptic, which would be a shameful 
 thing to do, even in times of profound peace. 
 
 There are some who say that we have already departed from 
 the old conceptions of the powers of a republican form of govern- 
 ment and that we are now doing things that the founders of this 
 Nation did not contemplate or provide for. Be that as it may. 
 But so long as we hold to a government of the people, by the peo- 
 ple and for the people w'e need not exercise ourselves over purely 
 academic questions. It is a case of allowing the dead to bury 
 their own dead. 
 
 If there is to be recognized and regulated authority for the 
 conservation of our mineral resources it will be because you and 
 I ask for it. 
 
 If there is to be compulsory arbitration of industrial dis- 
 putes a matter closely connected with both development and con- 
 servation it will be because you and I ask for it. If there is to 
 be state or national supervision of our resources it will be because 
 you and I ask for it. 
 
 No one is to force these things on us. We take them or 
 reject them according to our best judgment. If we are willing 
 that the government should do things for us that we have not 
 done for ourselves it will do them, but we must bear the cost. 
 We must remember that conservation which looks towards the 
 future cannot be separated from the development of the present. 
 If we are to turn over to the government the conservation of our 
 mineral resources we turn over to the government the develop- 
 ment of our mineral resources. Private and corporate money 
 may still be expended, but the determination of the necessity for 
 the expenditure will be in the hands of the government our own 
 government, if you will, established and maintained by ourselves 
 but still the government. 
 
CONSERVATION OF MINERAL RESOURCES 165 
 
 There seems to be no escape from the logic of the situation. 
 
 In so far as concerns certain phases of the matter it will 
 make no great difference whether the regulating pow'er is state or 
 national, but it may be submitted that the conservation of resources 
 which affect our standing among other nations is for our con- 
 sideration as a Nation, not as a Union of States. It is when we 
 speak as a nation that we receive attention. It is the Spirit of 
 the Nation that thinks, decides and executes. We are comparable 
 to a hive of bees among whom, as Maeterlinck has so beautifully 
 shown, it is the Spirit of the Hive that determines the course of 
 action. 
 
 Here, however, we trench upon matters that do not particu- 
 larly concern us at this time. One may refer to them merely to 
 point out that national conservation is a thing apart from conserva- 
 tion among or by the several states. 
 
 It has been held by the supreme court that the pow'er to pre- 
 vent the transferal of mineral products from one state into an- 
 other state does not reside in any state. There may be a deple- 
 tion of the resources of a state by such procedure, but it cannot 
 be prevented by state legislation. This is a far-reaching decision, 
 especially when we reflect that the exportation of mineral products 
 is a national not a state matter. We export as a nation, not as 
 separate states or an assemblage of states. 
 
 Finally, there should be no conservation that does not press 
 equally upon all concerned. 
 
 If our coal resources are to be conserved so must our re- 
 sources in iron, copper, silver, lead, zinc, oil, natural gas, etc. 
 
 We may not single out a particular industry and begin to con- 
 serve it without, at the same time, taking into our view the con- 
 servation of other industries, similar or dissimilar. 
 
 If, as a state or nation, we decide that such and such re- 
 sources are being depleted too rapidly now there will come a time 
 when the same decision will be made with respect to other re- 
 sources. 
 
 The power to conserve one is the power to conserve all. The 
 power to fix the price for one mineral product is the power to fix 
 the price for all mineral products. Furthermore, in this general 
 power there are included minor powers, such, for instance, as the 
 compulsory arbitration of industrial disputes which, in effect, is 
 
166 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 the pow'er to regulate wages, the determination of inland freight 
 rates, with which we are already familiar, etc. 
 
 It is just possible that we have not sufficiently considered 
 what conservation really means. It means governmental control 
 over agencies of production which we have not been able to con- 
 trol ourselves to the best advantage. This control, to be thoroughly 
 effective, must be exercised either by the state or by the nation, 
 the one or the other, not both, separately not conjointly. Partner- 
 ship of authority, in matters of this kind, is not likely to work 
 out to the satisfaction of either party. 
 
 There may be co-operation in work but there cannot be co- 
 operation in authority, if we are to attain the best results. There 
 may be advice and suggestion, more or less pertinent, but the final 
 decision must be with some man or set of men representing one 
 source of authority. 
 
 Whether or no we are ready to do these things remains to 
 be seen but I take the liberty of pointing out the direction in which 
 we shall probably travel if we make a start. 
 
 Industrial matters today represent so complicated a system of 
 production, distribution and sale that we can hardly touch one 
 part without affecting other parts. This is true not only of our 
 own country but of all the trading world. We are knit together 
 in bonds so intimate that it is difficult to select a single natural 
 resource that is free from this universal law of interdependence. 
 The development of any great material resource is felt over the 
 entire world. It is for this reason, among others, that the exten- 
 sion of the power of government, whether state or national, should 
 be scrutinized with the utmost care. 
 
 Let us not be hasty in this matter. 
 
 If it is best that we do this thing let it be done only after 
 every factor has been weighed and every condition given its true 
 value. 
 
 The American Mining Congress is composed of men who rep- 
 resent the development of our resources as a nation. It concerns 
 itself with matters of national importance rather than with those 
 of a more restricted character. Its discussions take a wider view 
 and its decisions are based on broader foundations. 
 
 We do not meet as citizens of a slate but as citizens of a 
 nation whose sole purpose should be to consider, in fairness, pa- 
 tience, intelligence and hopefulness matters affecting the welfare 
 of the entire country. 
 
What Must Be Done to Stimulate the Mining Industry 
 
 With Special Reference to Western Mining and the 
 Protection of Mining Investors 
 
 BY E. P. SPALDING, 
 SPOKANE, WASHINGTON. 
 
 The mining industry is one of the great legitimate basic indus- 
 tries of the country, as well as one of the most profitable. To 
 maintain it as such, prospects and undeveloped mining properties 
 of merit must be developed and means for financing the develop- 
 ment work devised. 
 
 Some one has said that mining is the greatest basic industry 
 of the world, as well as the oldest, next to the industry of raising 
 babies. Not being an expert in this latter industry I shall confine 
 my remarks to the next oldest, the mining industry. 
 
 The demand for developed mines and mining properties, at 
 prices affording good profits on the development investment, is 
 large and constantly increasing, whereas, there is a constantly 
 increasing shortage of such developed mining properties. On the 
 other hand there are numerous prospects and partly developed 
 mining properties which merit development to a greater or less 
 extent under intelligent, skillful and conservative management. 
 
 The owners of these prospects and partly developed mining 
 properties are usually men of limited mining experience, and lack- 
 ing the necessary means for the development of their properties 
 to a point where they can be sold to the large mining concerns, 
 or operated as going profitable mines. These large mining con- 
 cerns will rarely undertake the development of prospects into mines, 
 preferring to await the full and complete blocking out of the ore 
 bodies and paying a much larger price for the same than they 
 would have to pay upon a development basis plus the cost of 
 development. 
 
 With these conditions prevailing, namely, a large demand for 
 developed mines on the one hand, and on the other hand an al- 
 most absolute lack of developed properties with which to fill this 
 demand, the question naturally arises, "what are the underlying 
 causes, and why is money for development hard to get?" 
 
168 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 To my mind there are a variety of causes for these condi- 
 tions. They involve the prospector, the wildcatter, the mining 
 engineer and the mining capitalist. 
 
 The Prospector : We have all listened to his story many times 
 and have patiently inspected his glittering specimens and high 
 grade assays, and frequently have gone with him to inspect the 
 "lo-foot vein of ore which the specimens and assays represent 
 an average, and if anything a little poorer than the average", 
 only to find once more that the imagination was greater than the 
 facts. If, perchance, he has really discovered an ore body of merit 
 and has done sufficient work on it to warrant development on 
 a more extensive scale, he usually demands the price of a fully 
 developed mine and shows his faith (?) by demanding terms that 
 not only are not warranted, but are foolish from a business point 
 of view. Hence he is unable to do business with serious respon- 
 sible people, nor does he get his prospect developed. On the con- 
 trary he is frequently fooled by glittering promises into tying his 
 property up to unscrupulous imposters or wildcatters and often 
 to his serious damage, and always to the detriment of the mining 
 industry. 
 
 The Wildcatter: He is the unprincipled highwayman of the 
 mining industry who robs both the prospector and the public, and 
 who has done more to bring legitimate mining into bad repute 
 with the small investor than many producing mines can overcome. 
 The desire to invest and speculate in mining is inherent in most 
 red-blooded people, but, with the history of the devastation of the 
 wildcatter fresh in memory, the cause of the difficulty of getting 
 money from small investors for co-operative mining development 
 is quite apparent. Thanks to an aroused public opinion acting 
 through official channels, the race of the wildcatter is about run. 
 
 The Mining Engineer: He is at fault, in individual cases, 
 largely through a desire to make a record for conservatism at 
 the expense of his employer and frequently to his pecuniary loss. 
 I know of instances where meritorious mining properties have 
 been turned down by engineers for no other apparent cause. 
 Sometimes he is at fault through ignorance or lack of mining ex- 
 perience and without the latter his opinion on the merits of a 
 prospect or partly developed mining property should have but 
 little weight. Much theory and little practical experience some- 
 times is not only dangerous but expensive. In other individual 
 
WHAT MUST BE DONE TO STIMULATE MINING 169 
 
 cases, I am sorry to say, he is at fault from reasons of wrongful 
 personal gain. Generally speaking, however, the trained and ex- 
 perienced engineer is worthy of our full confidence, respect and 
 admiration. He should be, and usually is, a many sided man, able 
 and competent under trying and difficult circumstances and fear- 
 lessly honest in his profession. 
 
 The Mining Capitalist: He is at fault nearly always in the 
 eyes of the prospector, because he demands some value and reason- 
 able business terms for his money. In other words, to use a 
 homely phrase, he demands a "run for his glass alley". Those 
 of us who were once boys will understand that term and appre- 
 ciate its full meaning. But, altogether too frequently, the capi- 
 talist is too drastic in his demands, and not infrequently is unre- 
 sponsive to the rights of the little fellow', be he prospector, pro- 
 moter or minority stockholder. I remember recently hearing 
 through a New York correspondent of a mining proposition of 
 merit presented there, wherein the capitalist demanded eighty per 
 cent of the proposition for equipping the property without any 
 cash payment to the owners, leaving them but twenty per cent 
 out of which they had to pay the brokers commission. To a 
 Western miner with a proposition of merit, that looks like plain rob- 
 bery. It is hardly necessary to state that business did not result 
 and in consequence the property lies idle and of no benefit to the 
 mining industry. 
 
 What, then, is the remedy? We must have mines and these 
 mines must be developed from prospects in the original case. 
 How, then, are w'e to bring prospector and investor together on 
 a basis where the investor will be fully protected in his investment 
 in the co-operative development of the prospect into the productive 
 mine, and, how are we then to bring seller and buyer together for 
 mutual profit and with mutual respect? 
 
 My answer is, through an organization that will occupy the 
 middle ground between the prospector on the one hand and the 
 large mining concerns on the other and with the small investors 
 co-operating with that organization, who, under proper safeguards, 
 may, through such an organization, safely make their investments 
 in the co-operation of developing for profit, meritorious mining 
 properties for sale or operation. These investments can be so 
 made and so protected that sooner or later the investment will 
 be returned with a substantial profit. 
 
170 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 This must all be done under the skillful management of 
 trained and experienced engineers, business men and miners. 
 The prospector must be taught to reasonably value his holdings 
 and to permit the development of his property under reasonable 
 and business like terms. The wildcatter, if any there be at large, 
 must be absolutely put out of business. The small investor must 
 be encouraged and taught that mining is not only legitimate, but 
 that conducted under proper management, properly financed and 
 with proper safeguards, is both profitable and as safe as any mer- 
 cantile or manufacturing business, or so-called industrial. When 
 so taught and encouraged by actual experience, then will it be 
 possible to stimulate the mining industry to a productiveness never 
 before reached. 
 
 Such an organization as is mentioned herein is now in process 
 of formation, the objects and purposes of which are, primarily, 
 the stimulating of the mining industry in the West by the develop- 
 ment for sale or operation of meritorious prospects and partly 
 developed mining properties and especially gold properties, under 
 favorable long-time bond and lease, and to bring seller and buyer 
 together for mutual profit. Its scheme of financing is such and 
 is so surrounded with proper safeguards as to commend it to small 
 investors who are assured, under this plan, ,of safety and a rea- 
 sonably large profit. All money invested under this plan will be, 
 in fact must be, spent in or upon the property or properties under 
 development, reasonable charges for engineering and management 
 being considered a legitimate and necessary part of the develop- 
 ment expense. 
 
 Under this plan also, the small investor, while secured in his 
 investment, has the assurance of the major part of all profits 
 derived from development, promotion and sale, or operation of 
 the property, and his interests are recognized as paramount to 
 all else. The plan has been pronounced sound, feasible and equit- 
 able by bankers, lawyers, business men and engineers to whom 
 it has been submitted and by whom it has been criticised and 
 perfected. It offers a new freedom to the small investor for co- 
 operative and profitable investment in the mining industry, a free- 
 dom from the unscrupulous and the wildcatter, and a basis upon 
 which he may share in the legitimate profits of mining. 
 
 We are at the dawn of a new day in mining; the day of 
 practical, systematic and scientific prospecting and accomplishment 
 
WHAT MUST BE DONE TO STIMULATE MINING 171 
 
 along commercial lines. The day of the mining boom and the 
 mining rush with all its glittering folly is past. The day of legiti- 
 mate commercial mining is here. The highly speculative or gam- 
 bling feature of mining is passing. The day of the picturesque 
 has passed. No longer will the honored mule while straying from 
 camp be the discoverer of future Bunker Hill & Sullivans. No 
 longer will the storied "Red Eye", the red light and the gam- 
 bling resorts represent the beginnings of civilization, nor the de- 
 bauchers of the prospector in the future mining camp. The pros- 
 pector of the future will be a trained man, properly equipped and 
 financed and sent out by an organization of the character described. 
 His work will be done systematically and along practical lines in 
 conformity with modern experience and conditions backed by sci- 
 ence and knowledge. 
 
 The results of this modern system can be but stimulating and 
 beneficial to the mining industry and I believe that industry, when so 
 conducted, will merit and have the support of the small investors 
 who, in the past, have largely been the prey of wrong conditions 
 and of the unscrupulous and dishonest wildcatter. Honesty and 
 fair dealing in mining will reap the same rewards as in commer- 
 cial or industrial pursuits. Let us have more of it. 
 
The Proper Advertising of Mining Opportunities 
 
 BY DR. JAMES E. TALMAGE, 
 SALT LAKE CITY, UTAH. 
 
 We live in an advertising age, and mining like every other 
 systematized activity is concerned in the modern art and practice 
 of public exploitation. It is of record that the earliest printed per- 
 iodical, devoted to the dissemination of news, issued in the year 
 1622 ; but not until another quarter of a century had sped its way, 
 that is to say in 1647, did the first newspaper advertisement ap- 
 pear. That pioneer in a new field was a simple announcement of 
 a book consisting of a compilation of religious and theological 
 essays. Publishers in the early days possessed some of the now 
 rare element, modesty, as a constituent part of their being, and 
 they regarded with some sense of propriety if not of sanctity, their 
 precious columns. However, books both good and bad, and par- 
 ticularly medicines guaranteed to cure any and every disease 
 known and unknown, soon became subjects of regular advertise- 
 ments, though all announcements of such were printed in small 
 type with simple and unobtrusive head-lines. The earliest news- 
 paper advertisement of a trade commodity dates back to 1658, 
 when there appeared in a London weekly an announcement as to 
 where could be bought material for the then new beverage, Tea. 
 
 From such small beginnings do great things come. Today 
 advertising is cultivated and practiced as a combined art and sci- 
 ence, and as the expert in the profession knows, success therein 
 depends largely upon on understanding of philosophy and psychol- 
 ogy. Now, advertisements exceed news in the columns of many 
 newspapers, and the advertising pages in some of the magazines 
 double the otherwise needful weight and bulk of each copy. 
 
 We recognize today three principal methods of advertising in 
 print : 
 
 (i) By signboards, posters, and display-signs, of innumer- 
 able varieties. 
 
PROPER ADVERTISING OP MINING OPPORTUNITIES 173 
 
 (2) Through the pages of periodicals, both newspapers and 
 magazines. 
 
 (3) By distributing circulars in great numbers through the 
 mails. 
 
 The last named is practically the only one of the three with 
 which the mining world is particularly concerned ; and it moreover, 
 is the one selective method, for the promoters endeavor to send 
 their printed matter to the people who are thought to be directly 
 interested in the kind of enterprise which the circulars are in- 
 tended to exploit. 
 
 Well developed, productive, and paying mines are not adver- 
 tised as a rule, by any of the methods specified. There is a very 
 natural tendency to keep a really good thing in mining properties 
 among the few who are fortunate enough to acquire holdings while 
 the stock was cheap ; and who have had the ability and good sense 
 to retain the same. Prospects of undemonstrated and uncertain 
 value, are made subjects for widespread advertisements, usually, 
 as stated, by the circularizing method, and many are they who are 
 caught thereby, more frequently to their sorrow than joy. 
 
 The real prospector, he of the pick, shovel and pack-mule, is 
 no party to the advertising scheme ; when the mails begin to be 
 burdened with printed matter respecting his find, it is a sure in- 
 dication that the property has ceased to be his, and has passed into 
 the possession of an entirely different species of prospector, who 
 probably could with difficulty distinguish the pick from the shovel 
 or the burro from its pack; and whose place of work is not the 
 hole in the ground but the well-furnished office ; whose chief as- 
 sistant is no hardy miner but a pretty stenographer ; and whose 
 pay-streak is the inherent weakness of human nature. 
 
 The element of chance, which enters so largely into all mining 
 operations, the ever alluring possibility of a "get-rich-quick" op- 
 portunity, lead many to seize the glittering bait offered through 
 the circular advertisement, though they have not experience, 
 knowledge, or judgment enough to see whether the bait is flesh, 
 fish, or fowl, or only a glittering spoon-bait with the hooks in plain 
 sight. 
 
 The safe and reasonable w'ay is to regard every circularized 
 mining proposition with caution if not with suspicion. The stand- 
 ing of reliable companies is or should be set forth in the official 
 
174 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 reports of the president and directors ; and the would-be investor, 
 if prudent, may ascertain from such reports and by personal in- 
 quiry the merits of the mine. 
 
 If mining properties are to be advertised at all, public senti- 
 ment and if necessary legislation should be invoked to denounce 
 and punish dishonest promoters who seek to entrap the unwary 
 and unwise, by presenting possibilities as certainties. No one knows 
 better than the really practical miner, the competent mining en- 
 gineer, and the experienced mining geologist, how much there is 
 about mining that we do not know; nor do any realize better than 
 these that we have learned some things about mineral occurrences, 
 and that we can speak with relative certainty on many matters re- 
 lating to ore deposits and the reliable indications thereof. In any 
 advertising of mining property the promoter ought to be com- 
 pelled to state only the facts such as a skilled and trustworthy ex- 
 aminer would attest, and to make clear the risk involved in the en- 
 terprise. 
 
 It is true that many of the promised advantages associated 
 with circularized mining properties are so plainly exaggerations 
 and misrepresentations that the duped victims thereof are deserv- 
 ing of little sympathy. Admitting this without question we are 
 still confronted by the facts that such glaring misrepresentations 
 are essentially criminal, and that the mining profession and indus- 
 try is the ultimate sufferer therefrom. The spirit of American 
 law' is unquestionably set against wilful deception and fraud, how- 
 ever great the ignorance and guilelessness of the thoughtless vic- 
 tims. 
 
 It is a practical certainty that much of the misrepresentation 
 embodied in promoters' advertisements is chargeable, in part at 
 least, to the optimistic reports made by incompetent or dishonest 
 examiners, many of whom profess a standing among "mining ex- 
 perts" though lacking practical experience as miners and technical 
 training as mining engineers or geologists. If advertisers be re- 
 quired, either through stress of public opinion or by legislative pro- 
 vision, to support their promises and claims by the authority of 
 competent men who have examined and reported on the properties 
 offered to the public, there should be a strong and effective pro- 
 scription against untrained and unreliable men posing under the 
 objectionable but nevertheless current designation "mining ex- 
 perts." One of the great drawbacks to real progress in intelligent 
 
PROPER ADVERTISING OP MINING OPPORTUNITIES 175 
 
 prospecting, and in the legitimate inducement of capital to fur- 
 ther the enterprise, is the unreliability of the professional exam- 
 iners of mining properties whose reports are made the basis of un- 
 warranted and exaggerated claims. We all know that the honor- 
 able, high, and useful profession of the mining engineer and the 
 mining geologist is infested by many parasites who stand to the 
 competent mining men as the proverbial quack stands to the worthy 
 physician. 
 
 It is needless to affirm that every proper advertisement of an 
 opportunity in mining should be fair and honest, which is but an- 
 other way of saying truthful. If the mining property to be ad- 
 vertised offers a real opportunity for advantageous development 
 and subsequent productiveness, this truth should be so set forth 
 with the supporting evidence afforded by the report of competent 
 examiners ; but to proclaim a certainty where only a possibility ex- 
 ists is not only to speak but to commit a pernicious falsehood. 
 
 The most effective safeguard against the continuation of dis- 
 honest methods in advertising mining opportunities is that of pro- 
 fessional and public opposition thereto. I consider it strictly within 
 the legitimate activities of this Congress to set its seal of disap- 
 proval on the pretentions of untrained and unqualified men in all 
 departments of the mining business, and to demand in no uncertain 
 tones integrity and uprightness on the part of all who seek to pro- 
 mote and to advertise properties and opportunities offering gain 
 in mining. Public opinion, encouraged and supported by the in- 
 fluence of this great organization, will be stronger than legislative 
 enactment however radical or drastic. I do not recommend as es- 
 sential to reformation in the matter of mine promotion the creation 
 of new laws, either state or national, but the strict enforcement of 
 existing statutes, and the spirit of the common law, w'hich may 
 perhaps with allowable variation be called the "common sense law," 
 of right doing. It is impossible to advertise extensively except 
 through the use of the United States mail; and existing laws di- 
 rected against the illegal use of the mails are sufficiently compre- 
 hensive if only enforced. In the process of extensively circulariz- 
 ing any mining property, good or bad, some intelligent mining men 
 would be reached through the mails. If they find in the literature 
 sent to them the element of fraud, misrepresentation, and deceit, it 
 should be considered by each of them a duty to report the matter 
 to the postal authorities and place in official hands the evidence of 
 
176 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 the offense. We have already on record a few cases of conviction 
 and punishment for criminal misrepresentation of facts in connec- 
 tion with mining properties in which the charge of illegal use of 
 the mails w'as proved. These examples have had a wholesome ef- 
 fect and a persistent following up of this aggressive course cannot 
 fail in time to reduce the criminal practice to a minimum. In the 
 intersts of legitimate mining let us be united in determined and 
 aggressive opposition against all species of untruthful advertising. 
 
The Mining Industry of Arizona 
 
 BY CHARLES B. CLAPP, 
 TUCSON, ARIZONA. 
 
 It is rarely customary for those travelers who visit different 
 countries for a fe\v days or weeks to apologize for writing and talk- 
 ing about the people and industries that they have hardly more 
 than seen. However, I am going to break from the custom and 
 apologize for talking about the mining industry of Arizona, since 
 I have been in Arizona only somewhat more than a year, and since, 
 strictly speaking, I am not a mining engineer, but a geologist ; 
 and perhaps some of you may remember what Professor Haultain 1 
 of Toronto said at the Ottawa (1913) meeting of the Canadian 
 Mining Institute, when he compared a geologist to a mining en- 
 gineer. Neither do I wish to attempt to review' the mining geology 
 of Arizona ; that has already been done admirably in a few pages by 
 Mr. Lindgren 2 ; and in addition, the Director of the U. S. Geolog- 
 ical Survey states that Mr. Ransome is preparing a summary of 
 the geology and ore deposits of Arizona, to be published shortly 3 . 
 
 I came down to Arizona, as far as my own personal ambitions 
 were concerned, to get acquainted with the mining industry. Not 
 having been here very long, I can give you only those things which 
 have impressed me most during my year's residence. In Arizona, 
 as elsewhere, the big things and the very small things impress one 
 most. The biggest thing in Arizona is its climate. If it could be 
 exported, I believe we could make the Arctic region comfortable, 
 we could make the moon a summer resort, or we might make even 
 the "effete East" into "A Man's Country." 
 
 But aside from the climate, the mining industry is the biggest 
 feature of Arizona. Of this industry, as you all know, approxi- 
 mately 90 per cent is copper. Further, of this 90 per cent, approxi- 
 mately 99 per cent conies from four districts, comparatively small, 
 geographically speaking. These are the Clifton-Metcalf district, 
 
 Canadian Mining Jour., Vol. 34, 1913, pp. 182-185. 
 3 The Mining Districts of the Western United States. Bull. 507, U. S. 
 Geol. Survey, 1912, pp. 14-17. 
 
 3 Thirty-fourth Ann. Kept. Director U. S. Geol. Survey, 1913, p. 42. 
 
178 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 the Bisbee-Warren district, the Globe-Ray-Miami district, and the 
 Jerome district. But the mines of these districts are big mines. 
 and the companies operating them are big companies. It would 
 take scarcely more fingers than I have on my two hands to count 
 the companies responsible for 99 per cent of the production from 
 these four districts, and it would not take the fingers on one hand 
 to count the big corporations behind these big mining companies. 
 
 Whether this is a good thing or not, it is a fact. Personally, 
 I think it is a good thing, but very probably not for the same rea- 
 son that some of you may think it is a good thing. I believe it 
 is a good thing because these big companies can employ geologists, 
 and all do. Some of the companies call them geologists and some 
 call them by other names. But just as Shakespeare says, "a rose 
 by any other name would smell as sweet," so a geologist by any 
 other name may know' as much. 
 
 Mr. T. A. Rickard, among many others, has said that the de- 
 velopment of our natural resources presents three main problems 
 first, the amount of stuff ; second, the average value of the stuff ; 
 and third, the turning of the stuff into cash. You may employ a 
 mining engineer to estimate the amount of stuff, or a prospector 
 may be the man, but in so far as he is dealing with the amount and 
 occurrence of that stuff, he is dealing with geology. It is the work 
 of the mining engineer and the business man to turn the stuff into 
 cash. I think that, as a rule, the mining engineer can determine the 
 value of it much better than can a geologist, for he has more 
 patience ; but in order to work these tremendous geological bodies 
 and convert them into money producers, the engineer and the busi- 
 ness man must have geoloical knowledge. They need it to initiate 
 some definite working plan. Without it they cannot approach the 
 ideal of every modern undertaking in the exploitation of resources. 
 Mr. Hayes, formerly chief geologist of the Survey, has defined this 
 ideal in national terms, as utilization with a maximum efficiency 
 and a minimum waste. In other words, conservation at its best is 
 merely good business. Courage in business is not recklessness. It 
 is the daring that comes from knowledge. Whether these big com- 
 panies are the best and the wisest conservationists is still an open 
 question, but it is in their favor that when they desire greater effi- 
 ciency, they employ better educated men. By better educated men, 
 I do not necessarily mean men with more school training. But I 
 mean, as was said this morning, men with more brains and better 
 
THE MINING INDUSTRY OF ARIZONA 179 
 
 developed brains. It matters not where the training w'as received, 
 through school training or through experience. 
 
 The smallest things in Arizona are three : The small mine op- 
 erators, the School of Mines, and the amount of money which the 
 state of Arizona, through its legislature, gives to the upbuilding of 
 its main industry. It is practically nil. I say "practically nil" 
 because it is not quite so. It used to be so, but for some reason my 
 salary was this year transferred onto the University fund. This is 
 practically nil. 
 
 Dr. Phillips said last night that the ratio of expenditures by 
 the legislature for agriculture and mining is four-to-one, but the 
 ratio is much greater than that. This, it seems to me, is the fault 
 not of the legislature but of the mining men. It is chiefly due to 
 the fact that they have no definite organization, which we hope will 
 not be the case after this meeting; and it is partly due to the fact 
 that they have not educated the legislators and the small operators 
 to an appreciation of the situation. The agriculturists, on the other 
 hand, are educating themselves and the public. They demand a 
 new building and get it. They make more demands naturally and 
 rightly. But it has come to a point where granting those demands 
 must be at the expense of the mining industry. 
 
 A farming man of the state said last w'eek in Tucson perhaps 
 not really believing what he said that Arizona would eventually 
 be a farming state, that everything would be a farming state, that 
 farming would go on when mining was dead and buried and for- 
 gotten. He did not say how he planned to dig his potatoes with 
 a piece of w'ood or what not. 
 
 This is a wrong attitude. It is imperative that it should be 
 corrected, and it is only the mining men who can correct it. We 
 want to make the mining school an exponent of conservation. We 
 want to make it efficient. But we cannot make it efficient unless 
 we have the means with which to do it. I am not one w'ho believes 
 that school training is a panacea for all the ills of the mining in- 
 dustry. But with most of you, I do believe that education is a 
 near remedy for some of our present troubles. If our farmer friend 
 had been broadly or even sensibly educated, could he have spoken 
 as he did ? Who, but the mining men, can educate the people of the 
 state to an appreciation of what the proper development of Ari- 
 zona's greatest industry can do for Arizona? 
 
180 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 Education, like mercy, is twice blessed, and blesses him that 
 gives and him that takes. It is the theory of democracy that when 
 the state gives to its youth, the youth grown to man's estate shall 
 return manifold to the state. One shall interpret or enforce its 
 law's ; another shall gather and loan its monies ; another shall stimu- 
 late and direct its commerce ; another shall till its fields ; shall none 
 be taught to find and exploit the treasures of its mountains? 
 
Conservation of Western "Water Power Resources 
 
 BY E. A. WEDGWOOD, 
 SALT LAKE CITY, UTAH. 
 
 The incapacity of the human mind, and the complexity of 
 human affairs, is such that no man, however capable, can give all 
 current affairs the thought and investigation necessary to marshall 
 the facts, sense their effect, and work out a judicial opinion in 
 relation thereto. Therefore popular ideas on many subjects are 
 but mere impressions. 
 
 Probably no jingle of words, used as a "catch" phrase to in- 
 dicate a policy, or course of action, has created more impressions 
 upon the minds of citizens, unfounded in fact and judicial con- 
 clusion, than the words "Conservation of Natural Resources". 
 
 To conserve natural resources is not to waste. Not to waste 
 demands opposite acts and conduct as to different resources. If 
 the resource be active it must not be left unused and unproductive. 
 If dormant, it must not be expended unnecessarily, carelessly or 
 without valuable results. 
 
 This brings to the fore the character of natural resources to 
 be conserved. We will consider falling water, the metals and 
 coal. 
 
 Falling water is an active resource. Power is inherent therein. 
 If not captured, it is unused, unproductive and wasted. 
 
 The metals in common use naturally lie captive in the heart 
 of the mountains. When mined and converted into form for com- 
 mercial use they are made into articles useful for the time, in 
 due course becoming obsolete and finding their way to the junk 
 heap from which they emerge in different form time and again 
 with but a percentage of loss. 
 
 Coal measures present a different question. In so far as coal 
 is devoted to beneficial uses this resource is consumed, even as to 
 by-products. A portion of the mined supply is necessarily con- 
 sumed for the production of heat, but that portion used for the 
 development of dynamic energy is unnecessarily used wherever 
 water power may be practically substituted therefor. 
 
182 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 Where coal is so consumed for power three losses necessarily 
 occur the loss of the coal itself, which might be conserved for 
 use of future generations the loss of the inherent power of idle 
 water, which flows on wastefully to the sea the loss of the cost 
 of transportation from the mine to place of use, which is simply 
 wasted energy. 
 
 The transformation of the inherent power of falling water 
 into revolving wheels, located miles distant, consumes nothing but 
 the final toll demand by the junk heap. 
 
 From the foregoing, it seems obvious that conservation of 
 natural resources demands immediate development of available 
 water powers, and that such factors as stand in the way are 
 antagonistic to actual conservation. 
 
 Three factors control the development of Western water power 
 resources : The right to the perpetual use of flowing waters. The 
 right to occupy the necessary public lands for dams, power houses, 
 water conduits and pole lines. Money sufficient to construct dams, 
 water conduits, power houses and transmission lines. 
 
 These factors are controlled by different interests. 
 
 In the states of the arid West, where the law of riparian 
 rights has been practically abandoned, and within which large and 
 valuable mining interests, developed and undeveloped and depend- 
 ent upon power, are situate, the flowing waters of the natural 
 streams, not heretofore appropriated, are the property of the state, 
 and w'here not navigable, wholly under the control of the state. 
 
 The lands upon which dams and power plants must be con- 
 structed and over which water conduits and transmission lines 
 must be built, are, in general, the property of the United States, 
 tinder the control of the interior department, subject to congres- 
 sional enactment. 
 
 Funds for the development of water powers, in the immediate 
 future at least, must be furnished by private capital. 
 
 It is therefore evident that these diverse interests must unite 
 upon common ground if progress is to be and conservation accom- 
 plished. 
 
 The greater portion of the area of the Western arid states 
 is unoccupied, public domain, mountainous and desert in character. 
 In one, but 30 per cent of its lands in, or in process of transfer to, 
 private ownership and this 30 per cent carries the burdens of the 
 
CONSERVATION OF WESTERN POWER RESOURCES 183 
 
 state. These states are anxious for the advancement of their re- 
 sources. To that end their laws permit a corporation or individual, 
 upon proper application and the payment of a reasonable fee, to 
 become the ow'ner of a perpetual right to the use of the flowing 
 waters of the natural streams. 
 
 The principal resources of these states are mining, agricul- 
 ture and stock raising. 
 
 Stock raising is dependent upon agriculture, agriculture upon 
 irrigation, and mining and irrigation upon flowing water and 
 power. The development of water resources develops all. 
 
 Under such laws and conditions, private capital and the state 
 readily join hands for development. The only question to be set- 
 tled being, will development be profitable? 
 
 The third factor is the right to the use of a few acres of 
 desert land for power site and rights of way, which, in themselves, 
 are valueless for other useful purposes. By reason of ownership 
 of these lands, the Federal government, through congress and the 
 departments, apparently assumes to control water power develop- 
 ment and therefore the progress and material welfare of those 
 states. 
 
 Ought the mere ownership of a few acres of desert lands 
 give this power? All lands in private ow'nership are subject to the 
 law of eminent domain. If Federal ownership does carry such 
 power and the law of eminent domain does not apply to such lands, 
 ought Federal power over these lands to be used to retard the pro- 
 gress of a state and prevent the conservation of its natural re- 
 sources ? 
 
 The Interior Department holds that where power developed 
 from falling water is to be used for a purpose other than irrigation, 
 permits for rights of w'ay and power sites can issue only under the 
 law of Congress of February 15, 1901, (31 Stat. L. 790) the clos- 
 ing words of which act are : 
 
 ''And provided further that any permission given by the Sec- 
 retary of the Interior under this act may be revoked by him or his 
 successor, in his discretion, and shall not be held to confer any right 
 or easement or interest in, to, or over any public land, reservation 
 or park." 
 
 This ruling has been in force for aproximately four years and 
 water power development in the West has been substantially at a 
 
184 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 standstill. This must necessarily be under such conditions. The 
 construction of a hydro-electric power plant involves the expendi- 
 ture of hundreds of thousands and oft-times millions. It is, in its 
 nature, a permanent investment for the water continues to flow 
 forever and only the hand of decay touches the dams, diversion 
 works and water and electrical conduits. The investor's owner- 
 ship of money is transferred to representations of indebtedness. 
 Under the law above quoted from the right to use this plant, and 
 each element thereof, except the water, "may be revoked by him 
 (the Secretary of the Interior) or his successor in his discretion." 
 
 Will the prudent investor put money into an enterprise the 
 very life of which, so far as he is concerned, depends wholly upon 
 the will of a Secretary of the Interior? The answer must be, No! 
 The lack of water power development during the last four years 
 so demonstrates and also that the law of 1901, born of federal 
 control of a few acres of land, has blocked the progress of states 
 and prevented the conservation of their resources. 
 
 The impotence and viciousness of this law being realized, a 
 bill "To provide for the development of water power and the use 
 of lands in relation thereto and other purposes" (H. R. 16,673) 
 was introduced in the house of representatives, May 19, 1914, 
 there passed, and is now before the senate and has been twice 
 read and referred to the committee on public lands. 
 
 The question of interest is: If this bill be enacted into law, 
 will the development of Western water powers be practical under 
 its terms ? In other words : Ought prudent investors to invest 
 in securities issued under its terms? Will such investors invest? 
 If these questions must be answered in the negative, then the 
 passage of the bill would accomplish no useful purpose. 
 
 Stripped of verbiage, the important provisions of the bill are: 
 
 "That the public domain may be leased for the purpose of the 
 construction and operation of hydro-electric plants for not longer 
 than fifty years, but such lease shall not be assignable or trans- 
 ferable without the written consent of the Secretary of the Inte- 
 rior. 
 
 "That such plants shall be continuously operated subject to 
 market conditions, and an excess of fifty per cent of its output 
 shall not be contracted to any one consumer. 
 
 "That the regulation and control of service and charges and 
 
CONSERVATION OF WESTERN POWER RESOURCES 185 
 
 the issuance of stock and bonds is conferred upon the Secretary 
 of the Interior. 
 
 'That the physical combination of plants may be permitted 
 in the discretion of the Secretary of the Interior, but arrangements 
 limiting the output are prohibited. 
 
 "That without the consent of the Secretary of the Interior 
 no sale and delivery of power shall be made to distributing com- 
 panies, except in cases of emergency and then only for a period 
 not exceeding thirty days. 
 
 "That the constructor shall create no lien upon the plant by 
 mortgage or trust deed, except such as is approved by the Secre- 
 tary of the Interior. 
 
 "That after forty-seven years, upon three year's notice, the 
 United States shall have the right to take over the plant upon 
 paying the actual cost of rights of way, water rights, and the 
 interests in lands of which the lessee is the actual owner and 
 the reasonable value of the property erected upon the leased lands, 
 such reasonable value to be determined by agreement betw'een the 
 Secretary of the Interior and the lessee or by judgment of the 
 United States court. 
 
 "That if, upon the expiration of the lease, the United States 
 does not take over the plant, or does not renew' the lease, the 
 Secretary of the Interior may sell the entire property, the pur- 
 chaser to pay the lessee upon the same basis the United States 
 would pay if it took over the property. 
 
 "Contracts for the sale of power extending beyond the life of 
 the lease, must be made with the approval of the Secretary of the 
 Interior and when so made, the successor in interest of the lessee 
 assumes the obligation thereof. 
 
 "The Secretary of the Interior may specify charges and col- 
 lect charges or rentals for all power sold and used and not neces- 
 sary for the operation of the plant, said charges to go into the 
 reclamation fund heretofore created by Act of Congress, one-half 
 thereof to come back to the state when certain conditions are ful- 
 filled. 
 
 "In states where the regulation of rates of service and the 
 issuance of stock or bonds is not controlled by a public service 
 commission or other authority, such power is vested in the Sec- 
 retary of the Interior or other body authorized by congress. 
 
186 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 "The power to examine all books and accounts and require 
 the submission of statements and reports relating to the business 
 matters of the lessee, is vested in the Secretary of the Interior. 
 
 "That rules for carrying into effect the provisions of the Act 
 shall be made by the Secretary of the Interior. 
 
 "That nothing in the Act shall be construed as affecting or 
 intending to affect, or in any way to interfere with the laws of 
 any state relating to the control, appropriation, use or distribution 
 of water." 
 
 Will the investing public looking at the matter from the 
 standpoint of fairminded, prudent, business men advance money 
 for the construction of plants and transmission lines under this 
 Act? The answer must be, No, and that for the reason that they, 
 or their representatives from a practical standpoint have no real 
 control over the management of the plant their money constructs. 
 Freed from chaff, this arrangement means that the constructors 
 of an enterprise turn it over to the Secretary of the Interior to 
 operate, they paying operating expenses and taking whatever profit 
 the management of the Secretary and his agents may earn, if any, 
 not exceeding an amount to be fixed by the Secretary, or stand 
 such loss as may be sustained, as the case may be. At the end 
 of fifty years the lessee's right to have the property operated ceases. 
 No assurance is given that the lease will be renewed, nor that the 
 United States will take the property and make the lessee w'hole 
 under the terms of the Act, nor that the United States will be 
 able to transfer the property to a new lessee who will do so. 
 
 To all intents and purposes, the investor is a silent spectator 
 in the grandstand, while the Secretary of the Interior and his 
 agents direct the men the investor pays for the administration and 
 manual operation of the plant while the life of the lease rolls by. 
 
 In view of the conditions imposed upon an enterprise and 
 investment which can only be quickened into life by falling w'ater, 
 of which a sovereign state, or its grantees, is the owner of the 
 right to use, the provision of the bill which we quote verbatim. 
 viz: 
 
 "That nothing in this Act shall be construed as affecting or 
 intended to affect or to in any way interfere with the laws of any 
 state relating to the control, appropriation, use or distribution of 
 water." 
 
CONSERVATION OF WESTERN POWER RESOURCES 187 
 
 if taken seriously, can only be regarded as a joke. A man 
 holding the key to a dungeon might as well invite a respected 
 citizen therein, gag him, hogtie him, close and lock the door and 
 in making his exit say: ''Nothing I have done shall be con- 
 strued as affecting or intending to affect or to in any way interfere 
 with your personal liberty or freedom of movement under the 
 laws of your state." 
 
 If the bill becomes law the congress, in effect will assert that 
 the Western States are incapable of properly directing and con- 
 trolling their domestic affairs insofar as the development, opera- 
 tion and business conduct of hydro-electric power plants is con- 
 cerned, therefore, by reason of federal ownership of public lands, 
 valueless in themselves, we dictate what they shall do, and w'hat 
 they shall not do, in regard to such matters, and appoint the Sec- 
 retary of the Interior, and his officers and agents, their guardian 
 with full power to act in the premises, granting him full authority 
 to make such rules and regulations regarding his own acts and 
 the state's grantees as he sees fit and proper and from which there 
 shall be no appeal. 
 
 The bill is impracticable from a business standpoint. Local 
 conditions must dominate the management and operation of a busi- 
 ness enterprise. The particular character of the enterprise and 
 its environments marks out certain fixed paths along which its 
 management and control must travel. An ideal may be desired, 
 but the ideal cannot be created by fiat, regulation or enactment, 
 it must be the fruit of constructive development. Constructive de- 
 velopment cannot be guided by a man thousands of miles away 
 and not substantially interested in the results obtained. It can 
 only be guided by a man directly behind the gun, whose heart and 
 soul is in his work, and directly responsible to the actual parties 
 in interest, not only for successful operation, but for such reason- 
 able financial success as returns a fair profit upon the investment. 
 His hours cannot be fixed by the hands of a clock. His respon- 
 sibility is satisfied only by an all around success and the reasons 
 why he succeeds or fails are of no moment. Such responsibility 
 and efficiency results only from the power to exercise such free 
 hand and sound discretion as the facts and exigencies of the par- 
 ticular case and moment demand. 
 
 All fair minded men favor true conservation, the abolishment 
 of waste. Therefore they must favor the development of water 
 
188 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 powers within the arid states. To accomplish this the three factors 
 in interest must come together on a practical plan for the unifica- 
 tion of interests. The open question is, can the minds of the 
 parties meet on a plan to be enacted into law that will be just 
 and fair from all standpoints and at the same time practical? It 
 is believed they can and the elements of such plan are few and not 
 complex. 
 
 The investor's money must be secured in accordance with rec- 
 ognized, sound business principles. 
 
 The direction and management of the enterprise must be 
 with the investor's agents, for he must be assured at all times that 
 the best skill of the day is properly working to the end of efficient 
 operation and a legitimate return upon the investment. 
 
 Purchasers of product must be on a substantial equality and 
 insured that the price required will be reasonable and not greater 
 than necessary to return compensation and a fair profit upon the 
 investment. 
 
 With these results accomplished it cannot be material who 
 owns the plant, unless the sovereign, federal or state, desires to 
 become the owner as a matter of public policy. 
 
 All desired results would seem accomplished if capitalization 
 were fixed at a certain ratio of cost; if the service cost to con- 
 sumers was regulated by state public service commissions, or, in 
 their absence, other competent authority; if the sovereign, after 
 the lapse of a reasonable number of years, has the right to be- 
 come the owner upon payment of a proper and just valuation and 
 if a flat charge upon the output as rental for lands occupied but 
 owned by the United States is paid, if such charge be deemed ad- 
 visable. What would be a proper and just value of the entire 
 property upon the taking over by the sovereign would be pre- 
 sumptuous for one individual to say, but the ripe judgment of 
 men skilled in the fair and legitimate investment of capital would 
 seem to be the potent factor determining this question from the 
 practical standpoint. 
 
 The matter in issue is but an economic, business proposition. 
 There is a point where the minds of the diverse interests ought 
 to meet, where rational fairness and practicable conditions will 
 inure to all. With this point reached and acted upon by legisla- 
 tion, progress will result, otherwise stagnation and waste will con- 
 
CONSERVATION OF WESTERN POWER RESOURCES 189 
 
 tinue and the so-called policy of conservation continue to be a 
 sham. The federal government may, by congressional enactment, 
 coerce a state and block its material progress, but it cannot coerce 
 the private investor. 
 
 Power to the value of millions of dollars is being yearly 
 dissipated and lost in the Western gulfs and oceans, promising 
 mineral prospects are lying idle, and thousands of acres of land 
 are now desert which might by fruitful and productive under pump- 
 ing irrigation. To permit the Western water power resources to 
 lie unused is to permit or compel an annual, inexcusable and im- 
 provident waste that amounts almost to a devastation, and is to 
 maintain a condition that, from a humanitarian standpoint alone, is 
 intolerable and impolitic, and grave indeed is the responsibility of 
 those who, having the power or direction within their hands, permit 
 or compel such loss. The dictates of humanity demand that living, 
 existing things be developed out of such idle resources, and in so 
 doing nothing is lost to future generations for the power of the 
 water in its fall is a present, living and existing thing throughout 
 every minute and second of present years and coming ages as long 
 as waters flow onward to the sea, and "the mill will never grind 
 with the waters that have passed." 
 
 It is believed an all wise Providence intended its boundless 
 resources, for the time imprisoned in the falling waters, to be 
 conserved and applied to the aid of man in ministering to his 
 necessities and in supplying him with such comforts and con- 
 veniencies and as the intelligence of the day makes practicable. 
 
 It is believed the congress, in its wisdom, should at once pro- 
 vide that the respective states, through their citizens, may have, on 
 practical terms and conditions, just and fair to all interests, na- 
 tional, state and private, the use of the public lands to the extent 
 necessary, whereby to wrest the power from the falling waters 
 and thereby upbuild the state and advance the good of human kind 
 during the present and future generations. 
 
 If it be said this cannot be done now, can it be done in the 
 future ? 
 
 If it be admitted it can be done in the future, w'hy can it not 
 be done now? 
 
Give the Miner a Square Deal 
 
 J. C. THORESEN, 
 SALT LAKE CITY, UTAH. 
 
 Recently a miner asked me why the farmer was given so many 
 advantages over the miner in securing surveys and patents from 
 the government, for his land claims. Answering the question him- 
 self, he said, "It is because farmers make the land law's." 
 
 Taking into consideration the following facts, the indications 
 certainly justify this miner in his conclusions. 
 
 Upon the application of the farmer the government surveys, at 
 its own expense, the land he desires to secure, and under the home- 
 stead laws it gives him, practically free of cost, 160 acres of land, 
 his own choice, if he but resides on it for three years; or, if he 
 chooses, after residing on it for fourteen months, he can secure 
 title by the payment of $1.25 per acre. In certain parts of the West 
 he can get 320 acres by merely cultivating certain portions of it 
 annually for three years, without even making his residence thereon. 
 Or he can secure 320 acres for $1.25 per acre by reclaiming it by 
 artificial irrigation. 
 
 The miner, on the other hand, first prospects (perhaps for 
 years) to find indications of mineral ; he then stakes off his claim 
 of 20 acres, makes and records his Location Notice, proceeds to 
 find "mineral in place" within his ground and in the not distant 
 past it had to be "in commercial quantities" complies with the 
 local and general mining laws, rules and regulations ; he must ex- 
 pend $500.00 in development work on his claim of 20 acres before 
 he is even permitted to have his claim officially surveyed at his own 
 expense, which costs him upwards of another $500.00 ; he must pay 
 the government $5.00 per acre for his ground and, if all these re- 
 quirements have been strictly complied with and so certified by the 
 agents of the government, a patent is issued to him for his claim. 
 This makes his ground cost him in the neighborhood of $50.00 per 
 acre, besides months and years of time required to comply with 
 these various restrictions. 
 
GIVE THE MINER A SQUARE DEAL 191 
 
 If the farmer fails to raise a crop it is generally his own fault, 
 either through ignorance or carelessness ; but where one farmer 
 fails there are ninety-nine miners who fail "to make their claims 
 pay." Hence, the miner's chance to get returns from his labors 
 and investments as against the farmer's is I to 99. 
 
 Then again, the land the miner secures is generally worthless, 
 except for "one crop" the mineral it may contain while the 
 farmer's land is good for a succession and variety of crops and 
 often for other purposes. If the farmer fails in one, he may suc- 
 ceed in another; but not so with the miner; if he fails in finding 
 mineral in commercial quantities and qualities (which, if at all, in 
 nearly every case is after extensive expenditure of time and money 
 in prospecting and development, besides the foregoing outlay of 
 $1,000 for surveys, patents, etc.), all his efforts are a total loss. 
 
 It was formerly presumed that mining was very profitable a 
 get-rich-quick proposition and that farming was slow and uncer- 
 tain as to results, especially in the arid west. 
 
 But time and experience have proven just the opposite. A 
 farmer, with the same standard of knowledge and experience in his 
 line that an average miner has in his, is sure to succeed. He gets 
 some crop each year and his claim improves continually with every 
 dollar expended and every day's work. His living is certain, with 
 much less capital invested than the miner requires. He lives in 
 peace with his family. But the poor miner gets no returns for years 
 his efforts and expenditures often prove that there are no returns 
 at all from his claim. His lonely life in the hills, as he burrows 
 into the mountain through a small prospector's tunnel, is not to be 
 compared with the pleasant life of the farmer. 
 
 Why this discrimination? Is it not a fact that our land laws 
 were made by our eastern neighbors w'ho were acquainted only with 
 agricultural pursuits, and had but a slight knowledge of mining? 
 This is certainly true of a majority of members of past congresses. 
 
 Has not the time arrived when the miner should receive some 
 consideration and be put upon an equal footing with the agricul- 
 turist? Why not let his claim be surveyed by the government 
 without expense to him, and give him title for $1.25 per acre, the 
 same as to the farmer? 
 
 Mining claims could often be surveyed by the U. S. surveyors 
 in their regular work without much extra expense, and in such 
 
192 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 cases the miners would be accorded the privilege which is always 
 extended to the farmer. Special surveys of homesteads are being 
 made in forest reserves for the farmer or squatter, at the sole ex- 
 pense of the government, but the miner's claim is "passed up." 
 
 The West is now much better understood. It has many able 
 representatives in Congress and in the various departments of the 
 Federal Government, and I am certain all will join in securing this 
 great boon and "square deal" for the mineral development of our 
 country. 
 
 Our government expends vast sums in the aid of agriculture 
 in a thousand different ways, which is very commendable, but a 
 very limited amount is appropriated for the development of the 
 mineral resources of our country. 
 
 The world is eagerly demanding our gold, silver, and other 
 minerals. We have them in unbounded quantities, with plenty of 
 men and means to bring them out, if only a little encouragement 
 be given by the government. 
 
 Let us give the miner a chance! 
 
E Pluribus Unum 
 
 BY EDWARD G. REINERT, 
 DENVER, COLORADO. 
 
 Not long ago the newspapers published a list of worthless 
 stocks, bonds and loans which had .been left in the strong boxes 
 of E. H. Harriman, Jay Gould and Russell Sage when they died. 
 In each case the exhibit showed a preponderance of losses in wild- 
 cat railroad investments. The mining stocks held by these million- 
 aires represented only an insignificant share of their unsatisfactory 
 purchases. 
 
 Elaborate lists of obsolete securities have been published and 
 are available to those who desire to investigate. Mining, which in 
 these days is so often accused of all the crimes of promotion, to 
 the exclusion of other industries, represents so small a part of the 
 unhappy ambitions of investors that it should not be considered 
 in any discussion of unwise investments. Smythe's handbook of 
 "Obsolete American Securities and Corporations" sets forth twenty 
 pages of "First National" banks that have failed or suspended 
 business in the United States. The frequent repetition of that one 
 designation is sufficient evidence that the banking business itself 
 is not the safest opportunity for capital. Thirty years ago a writer 
 in the North American Review pointed out that eleven eastern and 
 southern states had repudiated bonds to the amount of $310,000,000. 
 
 But it is not my purpose to indulge in invidious comparisons. 
 Men are very much the same in all ranks, professions and climates. 
 It is only because the mining industry is so frequently put upon the 
 defensive in respect to its financial methods that we sometimes 
 find it necessary to study investment systems in general and touch 
 up the history of those industrial enterprises in which our Eastern 
 critics live and move and have their being. Mine promotion has 
 repeated, on a very small scale only, the tendencies that have ap- 
 peared in connection with all industrial progress. We puff and 
 spout in vain when we discourse upon plans to "get rid of the 
 faker" and "elevate the promotion business." After years of in- 
 timate contact with movements to purify finance, I have come to 
 
194 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 the conclusion that counterfeiters and imposters, like the innocent 
 and gullible, are an inherent element in our social constitution ; 
 it cannot be removed, but may perhaps be neutralized. In any 
 event, the seamy side of business should not be permitted to darken 
 our constructive efforts. Men of good intentions are the rule, not 
 the exception ; if this were not so, there would be no progress. 
 
 What I desire to offer is a few broad historical reflections upon 
 the business of investment, to the end of bringing our conclusions 
 to bear upon the current problems of mining finance. Let us put 
 aside the critical for the scientific attitude. 
 
 (1) The word investment was invented to describe a process 
 by which surplus wealth, or capital, seeks to reproduce and in- 
 crease itself through the organization and construction of the 
 means of producing more wealth. This definition reveals the mo- 
 tive force of modern industry. But the constructive power of 
 capital is not unlimited, because its motive may be curtailed by the 
 restriction of those market outlets for its produce which are the 
 means of keeping capital fluid ; capital can only function as a con- 
 structive agent in industry through the sales of the commodities 
 which it reproduces. To put the matter more simply, when a given 
 people has all the steel works that it needs, 'twere folly to build 
 more, for no one has yet discovered a market for steel products on 
 the Moon. When we have enough steel factories to supply all the 
 materials of this character that the people of the world can pos- 
 sibly use, investment in new' steel factories will become a risky 
 proceeding. Moreover, when the ownership of steel factories be- 
 comes highly concentrated, conduct and market systematized and 
 their management unified, it becomes increasingly difficult to pro- 
 mote and finance new institutions of this character. The man who, 
 in the face of this inevitable situation, seeks to promote a steel 
 factory is a faker, because, if he has any brains and education, he 
 must know that he cannot make good. He is not a faker because 
 steel factories are bad things, but because more steel factories will 
 be a loss and a nuisance. Investment in the manufacture of steel 
 becomes henceforth a process of financing improvements and ex- 
 tensions to that which already exists as a foundation. I am not 
 here seeking to air personal opinions, but merely to utter a his- 
 torical judgment. 
 
 (2) Every civilization experiences the constructive power of 
 capital through a certain order of development, beginning with 
 
E PLURIBUS UNUM 195 
 
 the smallest conceivable units of organization and ending with the 
 largest. The industrial form becomes fixed and we encounter 
 thereat an inevitable economic resistence to invention and promo- 
 tion. That invention or promotion must be overpowering and revo- 
 lutionary which can hope to contest the field already won by a 
 standard invention or held by a gigantic organization of capital 
 greater than any mass of new capital that can be brought against 
 it. At no previous period in the recorded history of the world have 
 we known of any people possessing the accumulations of wealth 
 and the means of wealth production, based upon highly technical 
 knowledge and science, which are now visible in Europe and the 
 United States. Nevertheless, we find the parable of these very 
 things in the story of Rome ; a despotic attitude toward the pos- 
 sessors and non-possessors of wealth developed with the cen- 
 tralization of capital in the imperial state. We are repeating today 
 on a gigantic scale the history of the days of the first Caesar. If 
 the great Dictator were living in America today, he would be a 
 state's rights Republican. Caesar would have been a decentralizer. 
 in contrast with our own beloved and behated Theodore Roosevelt. 
 Caesar desired to enfranchise the people of Gaul and other outlying- 
 provinces, as a means of saving the nation. Mr. Roosevelt and his 
 school are yearning to disenfranchise the people of the West by 
 means of a federal land-leasing policy. 
 
 (3) During the period of independent constructive effort, 
 capital is apt to be loosely and recklessly managed and the returns 
 from successful creativeness are large. The making of new for- 
 tunes is rapid and the financing of alluring dreams is often scan- 
 dalously conducted. Because the chances are great, the spirit of 
 speculative embarkations is correspondingly rampant. The pioneer 
 in industrial finance is as daring as the pioneer of a new continent. 
 The resources and opportunities both of nature and of social de- 
 velopment enrich both the purse and the imagination. This is the 
 get-rich-quick era of a country's history. Presently it passes 
 away, and new ideals develop. The g-0f-rich-quick of the former 
 day become conservative, or at least bestow conservatism upon 
 their sons. The father who has accumulated a rapid fortune by 
 fur-trading with the Indians leaves an heir who loans money at 
 4/J per cent. An aristocracy of investment arises. To get rich 
 quick becomes a scandal ; building a new steel factory, when none 
 is needed, is an abomination before the Lord. Feudal exclusivenes? 
 
196 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 frowns down upon the man with a new idea. The railroad wild- 
 catter is succeeded by the president of a transportation company 
 kneeling suppliant before the throne of the Interstate Commerce 
 Commission. Try to build a new railroad from Chicago to Denver, 
 and see what the government will do to you. Try to sell a stock 
 or bond in Kansas, and learn what a "blue-sky" commission is 
 made for. 
 
 (4) The sign on the American silver dollar is E pluribus 
 uniwn. That means that we are one country composed of many 
 states. Since the fabrication of this strange device, we have added 
 many more. We of the West are the outlanders of the original 
 nation. In the main, the states of the great Rocky mountain re- 
 gion have been settled since the Civil war. We are a distinctive 
 division of the United States, possessed still of the pioneering in- 
 stinct, a little rude in our manners perhaps, but certain of our right 
 to develop ourselves as our grandfathers did in Pennsylvania and 
 Illinois. Of what import is it to us that our cousins of the East 
 are willing to accept a state of industrial fixity and insist upon a 
 rigorous notion of investment? The West has many resources 
 and opportunities both of nature and of social development ; it will 
 reason and act according to its own historical perspective, not ac- 
 cording to the historical perspective of an older order. On the 
 other hand, the old order of the East finds occasion to ridicule 
 mining investments because it is mining that typifies that stage of 
 development at w'hich the West has thus-far arrived. There exists 
 a provincial antagonism which springs from a historical opposition 
 between the old and the new, between the fixed and the unsettled, 
 between the imperialistic and the republican ideal. In spirit, but 
 not in form nor in law, the West is a different nation from the 
 East; from the point of view of the citizen of Denver, New York 
 City is a foreign metropolis. 
 
 (5) Whatever strain may exist, as between the view's of the 
 East and the views of the West upon questions of investment, 
 finance, politics and the administration of national affairs, reflects 
 the differences of social and industrial development. The West 
 is still in the midst of the constructive period ; the East has passed 
 it and is now in the period of recrudescence. The West understands 
 the East, but the East does not understand the West. The weak 
 by force of circumstances understand the strong, but the strong 
 have no time to understand the weak. It is no unusual occurrence 
 
B PLURIBUS UNUM 197 
 
 in history that the institutions of a new civilization may cast their 
 influence backward over the peoples that have been left behind 
 them in the race around the world. A free United States sent her 
 lessons to England and France; ultimately the West will teach the 
 people of the East. It is no mere accidental phenomenon, for ex- 
 ample, that nearly all the trans-Missouri states have adopted 
 woman's suffrage as an expression of their human superiority 
 over the older commonwealths. The West is a land of develop- 
 ment. In how many respects do we find that development ham- 
 pered by the ignorant or invidious power which the West must 
 suffer from the imperial autocrats of the old United States? Let 
 us mention a few instances : 
 
 (a) Our public lands are held in restraint of settlement be- 
 cause it is the wish of a people not ourselves that these lands should 
 pay tribute to the "mother country." 
 
 (b) So-called "investment bankers" of New York, Philadel- 
 phia and Chicago seek to provide a system of commissionershipS' 
 in the various eastern states to prevent Western enterprises from 
 seeking capital in their territory. "Biy-sky" legislation is another 
 of those autocratic devices designed to defeat the decentralization 
 of investment. 
 
 (c) The editors of Magazine Row habitually assert their 
 want of understanding by co-operating with the autocratic agents 
 to influence public sentiment against the interests of the West. Min- 
 ing has been repeatedly and skillfully lied about in the New York 
 press, while the public land question has been so insidiously mis- 
 represented that it is impossible to discover a fair opinion concern- 
 ing it among the Eastern people. 
 
 (d) As if to neutralize the avowed purpose of the new cur- 
 rency law, so far as the Rocky mountain states are concerned, the 
 administrators of that law have arranged to leave one-half of the 
 area of the United States without any of the twelve regional banks. 
 Between Kansas City and San Francisco, we do not find one of 
 these federal institutions. This neglect is a most palpable dis- 
 crimination against the great Rocky mountain region, whose na- 
 tional banking connections will thus be found either in a corn belt, a 
 cotton belt or an oriental shipping belt on the Pacific coast. 
 
 (e) In the matter of industrial protection against the com- 
 petition of the old United States, the West is without power to 
 
198 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 regulate the railway freight rates which should normally be used 
 as a substitute for tariff duties in encouraging our infant manu- 
 factures. Rate changes are controlled by a federal commission 
 which has its seat in the towers of the mighty. The autocratic 
 power which it possesses is a power over which the states of the 
 West have no voice. Ontario and Quebec and western Canada 
 can erect a tariff wall against New York and Pennsylvania, but 
 Colorado and Arizona and Utah cannot do so, because we belong 
 to the e pluribus unum, so carefully guarded by the constitution. 
 The arbitrament of w'estern freight rates is also denied to us by 
 the political supremacy of our entrenched competitors. 
 
 This is the situation. I have sought to present a social and 
 historical moving picture of those principles and events which 
 must govern any inquiry into western questions. The deliberations 
 of the American Mining Congress, insofar as they relate to the 
 express interests of the West, cannot escape conformity with the 
 political facts which have been briefly sketched out in the foregoing 
 pages. The West is rapidly approaching a crisis in its relationships 
 with the East and in its political status under a federal system. 
 
 But I pass that by, because the further discussion of it does 
 not fall within the province of this address. That in which we are 
 vitally interested is the problem of finance as it relates to western 
 industries, notably mining. The business of enlisting capital for 
 the development of new' areas in a relatively young division of 
 country encounters many untoward experiences and difficulties. 
 Dishonest promotion is, of course, a hurtful thing ; government in- 
 terference is far more hurtful. The tendency toward which we must 
 look with the greatest favor is the investment of western capital in 
 the West. Whenever a dividend is paid by a mine, it were far 
 better for us if it fell into the pocket of a western man. Too little 
 effort is expended in keeping our business opportunities at home. 
 To do this is to assert in some degree our financial independence 
 of the "mother country." I have pointed out that the worthless 
 securities left behind by Harriman, Gould and Sage represented 
 a great many wild-cat railroad stocks and bonds. Let it be said of 
 our western millionaires that, when they died, their estates showed 
 that they had dealt lavishly in mining ventures. 
 
 In a very literal sense, mining is a peculiar business. Per- 
 haps we should not expect the citizens of Vermont and Indiana 
 to understand it. We have much to gain by educating our own 
 
E PLURIBUS UNUM 199 
 
 people in the habit of developing their own mineral resources, in- 
 stead of trading in Wall Street. As western people, we do not have 
 to contend with them in the matters of sectional and historical dif- 
 ference which exist between ourselves and our Eastern cousins. 
 I believe, therefore, that a proper and important question for the 
 American Mining Congress to take up is that of promoting the in- 
 terest of the West in the West. Let it turn aside from the task of 
 protecting Eastern investors long enough to inquire about the pro- 
 tection of western investments from the people of the East. 
 
 It will not do to attempt to suppress the ideas of speculative 
 profit to be secured from the development of the West. The specu- 
 lative incentive, which prevails in the early years of a country's 
 progress, must apply to the newer regions of the United States as 
 though they were under a separate government. If the time has 
 arrived when the people of the East look upon investment as a 4^ 
 per cent proposition, we must protest against the extension of such 
 notions to the West. Western development calls for that rampant 
 individualism, the same old notions of freedom, which have made 
 every new country possible. 
 
 Conservationism is only one manifestation of the imperial de- 
 sire to prevent speculation in the opportunities of an undeveloped 
 region. No new fortunes are to be tolerated by men of the Pin- 
 chot type, who have already accumulated theirs. That is the es- 
 sence of conservationism. It is matched in a way by the "blue- 
 sky" movement such as the "investment bankers" of the imperial 
 metropolis have seen fit to define it: a movement to restrict invest- 
 ment to the new securities of the great railroad and industrial com- 
 binations whose management is centered in New York City. Mining 
 is not a 4^ per cent proposition. It is based on nothing less than 
 a 20 per cent ideal ; that is the way new' commonwealths are built. 
 
 The day of imagination has passed in the East; it still abides 
 in the West. With us there is still room for Napoleons, if their 
 opportunity is not sapped by the tyranny of the old United States. 
 In the language of a Colorado poet : 
 
 "The West is the promise; the East, the regret. 
 
Acetylene Mine Lighting 
 
 BY A. CRESSY MORRISON, 
 NEW YORK CITY. 
 
 The history of the introduction of acetylene into the mines of 
 the world by means of what is known as the carbide lamp is re- 
 markable for its brevity, and the general acceptance of the new 
 light has been startling in its rapidity. Acetylene in the mine 
 represents a paradox, in that it has given the miner a better light 
 for less money. Usually, improved means cost more money than 
 an old method, but with acetylene mine lighting, the economic 
 argument in favor of the illuminant continues after several years 
 of practical experience and in the face of radical reductions in the 
 price of the competing sources of light. The use of acetylene in 
 mines became almost universal in Europe before it had fairly 
 started here and the first two or three years in America were 
 rather difficult, because a lamp adapted to American needs had to 
 be developed and the miner himself had to be taught how to use 
 the lamp successfully. The carbide lamp is peculiarly well adapted 
 to use as a cap light, and in the coal mines of the country the cap 
 light is almost universal. In the metal mines, both the cap and the 
 hand lamp are in use. Acetylene is equally well adapted to either 
 form. Up to the present time no safety lamp, using acetylene as 
 a source of illumination, has been introduced for gaseous mines, but 
 in non-gaseous coal mines it is safe to say that 70 per cent of the 
 miners are now carrying acetylene lights. The introduction of 
 acetylene into the mines was resisted rather surprisingly, for it 
 was seen by all parties at interest that its widespread use would 
 upset long established trade relations. Then again, the carbide 
 lamp was forced to face the conservatism which is innate in human 
 nature. The very fact that it was cheaper and also better seemed 
 illogical and many held aloof. Once introduced, however, the 
 carbide lamp won its way straight to the heart of the miners 
 themselves, who soon learned that it was the greatest improvement 
 in illumination since the abandonment of the tallow dip and the 
 introduction of oils and waxes. 
 
ACETYLENE MINE LIGHTING 201 
 
 In enumerating briefly the advantages derived from the use 
 of acetylene in mines, safety should be placed first. This, of course, 
 includes health. 
 
 A systematic review' of the use of an illuminant must neces- 
 sarily begin with its source. In the case of the carbide lamp, this 
 source is calcium carbide. Calcium carbide is made in an electric 
 furnace at a temperature of 7,000 degrees F. It has all the char- 
 acteristics of crushed stone except when brought in contact wi f h 
 water. The ingots of carbide which come from the electric fur- 
 nace are crushed in a stone crusher to various sizes, packed in air- 
 tight metal drums and shipped ready for use. The carbide is not 
 an explosive; it is not affected by concussion; it cannot be burned 
 and the lumps could be placed in a fire without the fire having any 
 effect upon them. The drums are air and water-tight and will 
 stand very considerable rough usage without rupture. When car- 
 bide is brought into use in the carbide lamp, the quantity of car- 
 bide for a cap lamp contains about one-half a foot of gas. The 
 total amount for a miner's supply for a day is therefore but a few' 
 ounces and if it should all produce acetylene at once, it would 
 yield about two to two and a half cubic feet. This amount is so 
 small that up to the present time it has not been known to cause 
 any serious trouble under any conditions. Carbide will not give 
 off its gas fast enough under ordinary mining conditions to become 
 ignited unless it comes in contact with actual water. The moisture 
 in mine air will slowly slack the carbide, but not fast enough to 
 make an ignitable mixture, and there has never been any trouble 
 from this cause anywhere. There have been one or two cases 
 where a miner with a light on his cap has spit into the carbide 
 holder of another lamp and produced a little gas, which igniting 
 from his cap has caused a flash. The answer to this is that a 
 miner should not spit into his carbide. A case is known of a miner 
 carrying his supply of carbide in a glass jar, dropped it into a 
 puddle of water and then stooping down with his lighted lamp 
 to gather up the carbide and save it. This would result in an 
 ignition of the gas that was being made and a flash more startling 
 than hazardous. Calcium carbide should not be carried into the 
 mines in glass jars but always in a tin container. 
 
 Calcium carbide has not proved to be hazardous under any 
 conditions of mine practice. There is no reason for storing large 
 quantities in any part of a mine and no hazard could arise from 
 
202 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 so storing except in the case of a flood, in which event the water- 
 proof drums would hold back the water for an undetermined 
 period. Ninety-nine drums of carbide sunk with a steamer in New 
 York harbor this year. After remaining under water for six 
 weeks, they were recovered intact ; not one of them had yielded ; 
 they were repainted under the eyes of the insurance inspectors and 
 shipped to destination in perfect condition. 
 
 The residue from calcium carbide is merely ordinary slacked 
 lime. The odor from the residue comes from slight impurities and 
 has no effect whatever upon man or animals. 
 
 Acetylene itself is a rich hydro-carbon gas having the same 
 general characteristics as any other gas which is inflammable ; that 
 is, it is inflammable and when burned, it will give light and heat. 
 It obeys the same laws in the same way as city gas, except for 
 certain individualities which I will now enumerate. City gas con- 
 tains carbon monoxide. A very small percentage of this in the 
 air is sufficient to cause asphyxiation and death. Acetylene is 
 entirely free from this deadly gas. Exhaustive tests have been 
 made upon man and animals and it has been found that acetylene 
 is not poisonous. Any gas or combination of gases lacking oxygen 
 as an element will of course cause death by suffocation and in 
 this sense, anyone who walked into an atmosphere of actylene so 
 rich that the air was excluded would of course be suffocated, as 
 though walking into black damp. No such accumulation can occur 
 in mine practice, however. There is therefore, no danger from 
 acetylene in mines as there is no opportunity whatever for any 
 volume of the gas to be released. The odor of the gas which is 
 pungent will also be quite apparent when the percentage of acety- 
 lene is as low as one part in ten thousand. When acetylene 
 burns, it gives off as a product of combustion carbon dioxide and 
 water vapor, the amount given off being about one-tenth as much 
 as is given off by a city gas burner and very much less of the 
 same combustion products than are given off by any of the other 
 illuminants such as oils, waxes or candles, generally used in mines. 
 One great advantage of acetylene is the fact that it burns without 
 smoke or soot whereas the other illuminants used in mines give 
 off varying and sometimes very large quantities of smoke. Acety- 
 lene in burning uses less oxygen than other illuminants and there- 
 fore the air becomes less vitiated. The absence of smoke brings 
 into play for acetylene another factor, that is the reflector, which 
 
ACETYLENE MINE LIGHTING 203 
 
 is of great importance and which increases the useful candle power 
 of the acetylene flame from 10 to 30 times. While the candle 
 power of acetylene without reflector is in excess of the candle 
 power given off by an oil flame, the use of a reflector which throw's 
 all the light at the point of use, multiplies the candle power so 
 that twenty candle power at the working face is easily attained 
 and this is anywhere from ten to twenty times as much as is 
 given off by the oil flame. The advantages of this concentrated 
 light are generally recognized and are so marked that it largely 
 increases working efficiency. Acetylene gives a steady light all 
 day without much flicker and the absence of smoke makes the light 
 effective till the last moment of work. An examination of the 
 spectrum of acetylene discloses the fact that it is the closest 
 approach to sunlight of any of the illuminants. No artificial light 
 is a very close approximation of daylight or sunlight but acety- 
 lene is the nearest approach and therefore is nearest in harmony 
 with the requirement of the human eye, which has been developed 
 to see best by daylight. There can, therefore, be no eye strain or 
 injurious effect upon the eye. All these considerations seem to 
 make acetylene ideal from the chemical, physiological and optical 
 standpoint. 
 
 The question of the action of the acetylene flame in the pres- 
 ence of gases naturally found in mines has led to considerable dis- 
 cussion. As a preliminary statement, it should be said that acety- 
 lene should not be used in any mine where safety lamps are prop- 
 erly required but wherever open flame lamps are used, acetylene 
 has its place. No question has been raised regarding the use of 
 acetylene in the presence of any of the gases except black damp 
 and here it has been stated that acetylene will burn in an atmo- 
 sphere of black damp in which man cannot exist. Most careful 
 investigations have been made on this point and the study has led 
 to a more definite definition of black damp. Owing to the expres- 
 sion, in which might be called practical language, of the chemical 
 facts regarding black damp, there has arisen a misapprehension as 
 to what black damp really is, and many miners, mine superintend- 
 ents and even mining engineers have been led into the erroneous 
 belief that black damp is carbon dioxide. Under abnormal con- 
 ditions black damp might consist of nitrogen and a large percent- 
 age of carbon dioxide, but under practical conditions black damp 
 is a mixture of carbon dioxide with various proportions of nitrogen, 
 
204 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 seldom exceeding the ratio of one carbon dioxide to four nitro- 
 gen, this being the ratio of combustion. Complete slow combustion 
 changes the oxygen into carbon dioxide without increasing the 
 volume. The carbon dioxide simply replaces the oxygen. How- 
 ever, black damp is seldom as rich in carbon dioxide as this for 
 various reasons. Therefore, when black damp is found in a mine, 
 it must be considered as a mixture of nitrogen and carbon dioxide. 
 Nitrogen is inert as regard to the human system, but carbon diox- 
 ide has a physiological effect which in fairly large quantities may 
 resemble the effect of a narcotic. Carbon dioxide also has an 
 effect on flame extinction. A series of experiments conducted under 
 proper conditions has disclosed the fact that neither oil, candles, 
 acteylene or in fact any flame illuminant is an adequate protection 
 against pure carbon dioxide. All the authorities seem to agree 
 that 3 or 4 per cent of carbon dioxide will cause panting and that 
 6 or 7 per cent soon becomes unbearable. An analysis of black 
 damp, however, usually show's that the percentage of carbon dioxide 
 in mine air where black damp is present seldom reaches the serious 
 danger point, and if it reaches the danger point, it is usually 
 accompanied with sufficient nitrogen so that other factors are 
 brought into play. Open flame lamps give adequate warning of 
 black damp and acetylene is no exception. While it is not physio- 
 logically advisable for men to work in the presence of black damp, 
 the presence of sufficient quantities of black damp to extinguish 
 open flame mine lamps is not immediately hazardous; that is, the 
 lights having become extinguished, a warning is thus given and 
 men should and usually do leave that part of the workings at 
 once. The oil flame will burn in a still atmosphere containing 
 black damp until the oxygen in the mine air is reduced to 16 per 
 cent. An acetylene flame will burn in such an atmosphere until 
 the oxygen is reduced to 12 per cent. This means that the flame 
 must be kept perfectly still and there must be no air current 
 whatever. If the lamps are worn upon the cap or there is a 
 current of air, these extreme figures will be very considerably 
 modified. Danger to life from oxygen starvation does not begin 
 until certainly 10 per cent or less has been reached. Again it may 
 be said that no claim is made that air containing only 10 per cent 
 of oxygen is physiologically advisable any more than it can be said 
 that the air in an improperly ventilated auditorium filled with 
 people is physiologically advisabe. None of the common flame 
 
ACETYLENE MINE LIGHTING 205 
 
 illuminants will burn in an atmosphere where the oxygen content 
 has been reduced to the immediately physiological danger point 
 and therefore the oil, candle and acetylene flames give adequate 
 warning. It is clear, therefore, that where the impurity in mine 
 air is carbon dioxide, no open flame lamp is an adequate warning 
 but that where the atmosphere is black damp, all the flame illumin- 
 ants give warning. The miner's lamp, itself, has been subject 
 to many improvements and as now' sold throughout the country, is 
 simple, efficient, substantial and well calculated to serve its pur- 
 pose. With several hundred thousand lamps in use, there have 
 been very few and no serious accidents. The lamps are now pro- 
 vided with two or three extra carbide receptacles, and when one 
 is removed, containing the sludge, all that is necessary is to put 
 the cap on it and remove the sludge in the container from the 
 mine completely. The relative cost of using acetylene has been 
 estimated many times against oil, wax and candles at various 
 places and at various prices. Candle power considered, there is 
 really no comparison as to cost, the advantage being so much with 
 acetylene owing to the fact that the use of the reflector concentrates 
 the light at the point of use, whereas with oil, the rays go in all 
 directions and a large percentage are lost. Compared, however, 
 light for light, acetylene costs about half as much on the average 
 as oil and less than half as much as candles. The absence of 
 smoke in the case of acetylene increases the amount of useful light 
 and permits the more direct application of the rays in a given 
 direction. The increased illumination aids materially in safeguard- 
 ing the miner from the possibility of falls and gives better warning 
 of obstacles and dangers. The acetylene mine lamp is clean, both 
 in itself and its products of combustion. Its record is clean and it 
 has passed through the experimental stage to the point where lamps 
 are now made to meet all requirements and as most mine lamps 
 are now equipped with self-lighters, even the match hazard, which 
 accompanies other illuminants, is eliminated. The extended use to 
 which acetylene has been put, not only below ground but above 
 ground, has demonstrated its usefulness, beyond all question and 
 as its application to mine requirements has extended, the old pre- 
 judices have given away to the practical knowledge of the illumi- 
 nant and the universal verdict of the miners is that it is a distinct 
 and notable advance and one wholly to their advantage. Perhaps 
 the best statement of the whole subject in a nutshell is to be found 
 
206 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 in Bulletin 57 of the United States Bureau of Mines, page 127-8, 
 entitled "Safety and Efficiency in Mine Tunneling," by David W. 
 Brunton and John A. Davis, where the authors state : 
 
 "One is tempted to say that the ideal means of tunnel illumi- 
 nation is found in the portable acetylene lamp, combining as it does 
 the advantages of other illuminants, while avoiding most of their 
 defects. It may be obtained on the market today in a number of 
 different designs and sizes adapted for practically every kind of 
 work; the one most generally observed at the tunnels visited was 
 about the size of an ordinary fruit can and capable of burning for 
 eight or ten hours on one charge of carbide and water. Although 
 too large for use on a cap, it was provided with a hook so that it 
 could be suspended from any convenient place. Lamps suitable 
 for wearing on a miner's cap are obtainable and will burn for two 
 or three hours without recharging an operation easily performed 
 in tw'o or three minutes. The initial expense of an acetylene lamp 
 is not high and, with the possible exception of the electric arc, it 
 furnishes the brightest known artificial light used for underground 
 work, consuming only one-fifth as much oxygen as candles. It is 
 ordinarily provided with a reflector, which not only concentrates 
 the light upon the work w'here it is needed, but shields the flame 
 from drafts so that it will burn steadily unless placed directly in 
 front of the exhaust from an air drill. Extensive use by some of 
 the larger mining companies in this country has shown that the 
 cost of the carbide is much cheaper than either oil or candles, the 
 use of acetylene lamps cutting the cost of light practically in half. 
 At the Saginaw mine, Menominee Range, Mich., the cost is re- 
 ported as only two cents per shift of ten hours. Such lamps re- 
 quire practically no attention, are completely portable, and are not 
 subject to breakage as are incandescent lamps. By giving the 
 workman plenty of light his efficiency is not only increased, but he 
 is better able to guard against the dangers of underground work, 
 such as an insecure roof, an unexploded stick of dynamite in the 
 muck pile, or any other of the many clangers to which he is at all 
 times exposed." 
 
A Federal Leasing System 
 
 BY HON. JOHN F. SHAFROTH, 
 SENATOR FROM COLORADO. 
 
 A leasing system by the nation, creating the relation of land- 
 lord and tenant with the citizens of a state or territory, is inconsist- 
 ent with our form of government and generates conditions that 
 will make it a failure. The government can sue the lessee for a 
 breach of the contract, but the citizen can not sue the government 
 his sovereign on the old theory that "the king can do no wrong." 
 What a travesty on justice. They do not stand upon an equal foot- 
 ing as landlord and tenant between citizens of the same country. 
 The government is not only the landlord, but the lawmaker and 
 practically the determiner of all disputes. Years ago a great wrong 
 w'as perpetrated on the citizens of the San Luis Valley, Colo., by 
 the secretary of the interior refusing them rights of way for canals 
 and reservoirs for irrigation projects under the general law. A 
 rich valley of more than 1,000,000 acres ever since has remained 
 a barren waste. For years we have pleaded with the government 
 to bring suit in the United States courts against the claimants of 
 water to test the rights claimed, but without avail. Senator Thomas 
 is now' trying to have a bill passed authorizing the persons injured 
 to sue the government, in its own courts, to determine their rights. 
 
 The purpose of our republic is to control national, and not 
 local, affairs ; to govern its citizens and not to go into a leasing" 
 business which must produce disputes between the sovereign and 
 the citizen. The object of the government has always been to aid 
 settlement and development in order to produce loyal citizens who. 
 not only by their lives but by their resources in times of distress, 
 will support the republic. A man will fight and die for his own 
 home and property, but not for that of his landlord. Who ever 
 heard of a country that was made great by tenants? To produce 
 the best conditions the freest opportunity must be given for that 
 development. Anything that imposes restrictions or difficulties 
 hinders and impedes them. In order that a leasing system may be 
 self-supporting there must be that selfish interest on the part of 
 
208 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 the landlord which exacts a sufficient rental to make the property 
 pay, irrespective of development. If the rental is low, the system 
 will not be self-supporting; if the rental is high, it produces an 
 increased tax on production which causes an increased price of 
 many times the royalty to the ultimate consumer. 
 
 DOUBLE JURISDICTION MAKES FEDERAL LEASING SYSTEM 
 IMPRACTICABLE. 
 
 There will always be a conflict of jurisdiction between the 
 officers of the nation and of the state as to the police powers to be 
 exercised relative to the properties which are the subject of the 
 leases. These conflicts will surely produce dissatisfaction, irrita- 
 tion and litigation. 
 
 We have in Colorado and in most of the Western states coal- 
 mining bureaus, with the necessary inspectors. They are and have 
 for years been exircising police powers which belong exclusively 
 to the state. They can compel large and costly improvements to be 
 made in order to prevent gas explosions, such as the construction 
 of air flumes extending hundreds and hundreds of feet. They can 
 require daily sprinkling of the coal dust. They can order timbering 
 and propping on a large scale to prevent cave-ins. They can seize 
 a mine and shut it down if they believe it dangerous. In fact, it is 
 within their power to make a coal-mining enterprise a success or 
 failure. All of this power is necessary to prevent the sacrifice of 
 human lives. When the state attempts to exercise its police pow'ers 
 as to the working of a mine leased by the nation, it is certain that 
 conflicts between the officers of the federal government and of the 
 state will arise, producing not only irritation and discontent, but a 
 limitation of the jurisdiction of the federal government over its 
 leased lands. The bills all provide for the secretary of the interior 
 prescribing the rules as to diligence, skill, care in operation of the 
 property, and as to the safety and welfare of the miners. 
 
 We have also in Colorado and most of the mining states metal- 
 liferous mining bureaus and inspectors with the same powers as 
 to safety and sanitation. 
 
 We have in the arid West full corps of water commissioners 
 seventy in my state with numerous deputies. They have power 
 under state laws to distribute the waters of their districts according 
 to the decrees of the state courts for domestic, agricultural, mining 
 and power purposes. If for power purposes, large reservoirs are 
 
A FEDERAL LEASING SYSTEM 209 
 
 constucted by lessees of the government, the use of the water tlierer 
 from will supplement the flow of the stream at times when it may 
 not be needed for irrigation. To withhold that water from irriga- 
 tion until winter, when it will be most needed for the generation of 
 power, will be unbearable. To place the disposition of those w'aters 
 under two jurisdictions, each having a different interest to serve, 
 can not fail to produce confusion, chaos, disputes, and sometimes 
 personal conflicts. If there is one thing above another for which a 
 farmer will fight, it is water with which to save his burning crop. 
 Will not these conditions make a leasing system by the federal gov- 
 ernment impracticable? Does not all of this demonstrate that the 
 advice of the late Justice John M. Harlan of the United States 
 supreme court is sound when he said: 
 
 A national government for national affairs and state governments for 
 state affairs is the foundation rock upon which our institutions rest. 
 Any serious departure from that principle would bring disaster upon the 
 American system of free government. 
 
 DISASTROUS EXPERIENCE IN LEASING LEAD MINES OF MISSIS- 
 SIPPI VALLEY. 
 
 The country has had an experience which should teach us a 
 lesson. In 1807, in order to stimulate the production of lead, a 
 munition of war essential to the defense of the nation, congress 
 authorized the secretary of war to lease the lead mines upon public 
 lands in certain territories of the union at a royalty of one-sixth 
 of the production. It never attempted to impose such a system 
 upon public lands within the limits of a state. The law was in force 
 when Missouri, Arkansas, Iowa, Illinois, Wisconsin and Indiana 
 were admitted into the union. It was then that citizens, legislators 
 and governors began to protest against the leasing of any natural 
 resource within the limits of a sovereign state. It was then that 
 Senator Thomas H. Benton of Missouri began his fight, which 
 lasted for years, against the legislation. After the admission of 
 Illinois into the union its governor openly advised that the citizens 
 of that commonwealth absolutely refuse to pay any royalty to the 
 federal government for the ores extracted, on the ground that, in 
 equity, the ores belonged to the citizens of the United States, people 
 who had located and mined the ground, and the government could 
 not appropriate to its own use resources which it held only as a 
 trustee. 
 
210 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 President Polk, in a message to congress in 1845, said: 
 
 The system of granting leases has proved to be not only unprofitable 
 to the government, but unsatisfactory to the citizens who have gone 
 upon the lands, and must, if continued, lay the foundation of much future 
 difficulty. 
 
 The cost of maintaining the system had been four times as 
 great as the royalties collected. The secretary of war approved the 
 report of a military examiner, who declared that the benefit to the 
 government bore "no just proportion to the injury done to the 
 mineral region of the country, first by retarding the settlement of 
 the country, and, second, by the demoralizing influence of the sys- 
 tem." 
 
 Committees of congress reported time and again in favor of 
 the repeal of the leasing statute. One of the reports contained the 
 following : 
 
 Your committee believes that it is bad policy to introduce or continue 
 in any state or territory in which the public lands are any system the 
 effect of which shall be to establish the relation of landlord and tenant 
 between the federal government and our citizens. 
 
 ******** 
 
 When the United States accepted the cession of the northwestern 
 territory, the acceptance was on the express condition and under a pledge 
 to form it into distinct republican states and to admit them as mem- 
 bers of the federal Union, having the same rights of freedom, sov- 
 ereignty and independence as the other states. This pledge your com- 
 mittee believes would not be redeemed by merely dividing the surface 
 into states and giving them names, but it includes a pledge to sell the 
 lands, so that they may be settled, and thus form states. No other mode 
 of disposing of them can be regarded as a compliance with that pledge. 
 
 In another report we find the following : 
 
 Now, no interest is felt by the tenant in the improvement of the 
 property itself; he does not become fixed in his employment to any spot, 
 is sparing of his outlays, erects no permanent works, nor does he call 
 in the aid of science and practical skill to overcome the obstacles which 
 meet him in his enterprise. Make them private property, capital, science 
 and skill would be employed in erecting machinery and the deepest 
 bowels of the earth explored with eagerness and profit for their hidden 
 treasures. Subject them to the unimpeded action of individual energy, 
 new and rich developments would be continually made, and the whole 
 country benefited by the augmented supply at a cheaper rate which 
 such investments would certainly produce. 
 
 At last, in 1847, after retarding the development of the country 
 for forty years, the law was repealed. 
 
 President Fillmore, in a message to congress on December 2, 
 1849, referring to the policy to be pursued as to the mineral lands 
 of California, said: 
 
 I was at first inclined to favor the system of leasing, as it seemed 
 to promise the largest revenue to the government and to afford the best 
 security against monopolies; but further reflection and our experience 
 
A FEDERAL LEASING SYSTEM 211 
 
 in leasing the lead mines and selling lands upon credit have brought 
 my mind to the conclusion that there would be great difficulty in collect- 
 ing the rents, and that the relation of debtor and creditor between the 
 citizens and the government would be attended with many mischievous 
 consequences. 
 
 The supreme court of the United States, in Mining Co. vs. 
 Consolidated Mining Co. (102 U. S., 167), decided in 1880, in 
 reviewing the history of the systems of royalty as applied to the 
 precious metals, and the careful consideration given by congress, 
 and the conclusion of our government as to the best policy to be 
 applied to the mines of California, said : 
 
 Matters remained in this condition with slight exception until July 
 26, 1866, when congress passed a law by which title to mineral land 
 might be acquired from the government at nominal prices, and by which 
 the idea of a royalty upon the product of the mines was forever relin- 
 quished. (14 Stat,. 251.) 
 
 What a glorious result followed from that policy. Millions and 
 millions of dollars in precious metals, mined, perhaps, at a cost in 
 labor on the average equal to the value of the ores produced, but 
 which furnished an indestructible circulating medium as basic money 
 that relieved commerce and produced an era of prosperity through- 
 out the entire world. 
 
 Is it practicable, after such a signal failure of the federal 
 leasing system, to resurrect that tried and condemned policy and 
 make it a success ? Are not human interests and passions the same 
 now as then ? The legislatures of the Western states are protesting 
 now 1 just as those affected in the same way protested then. The 
 legislature of California has demanded that the public lands be taxed 
 if they are to be held in perpetuity by the federal government. 
 
 It has been said that times have changed since 1847 an d that 
 now a leasing system by the federal government would be a success. 
 What is there to sustain such a contention? Has there been any 
 experience that would justify such an assumption? No; but there 
 has been and is now taking place a vexing experience which dem- 
 onstrates the contrary. 
 
 LEASING UNDER FORESTRY BUREAU HAS PROVEN A FAILURE. 
 
 Under the law setting aside forest reserves, which was enacted 
 to conserve, by the shade of trees and brush, the snow from melting 
 at the sources of streams until midsummer, when the waters would 
 be needed for irrigation in the valleys below, the forestry bureau, 
 without any direction in the law, proceeded to charge for the graz- 
 ing of cattle and sheep upon those forest reserves. It first started 
 
212 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 with a low charge, and has increased the rates in some reserves 
 more than 700 per cent, in an effort to make the system pay. Yet 
 the result has been that the collections from the grazing taxes and 
 timber sales have amounted to only about one-half of the expenses 
 of the administration. 
 
 The following table shows the expenditures and receipts for 
 the last two years : 
 
 Fiscal Year. Expenditures. Receipts. Net loss. 
 
 1912 $5,217,827.41 $2,109,256.91 $3,108.570.50 
 
 1913 5,092,111.41 2,391,920.85 2,700,190.56 
 
 The appropriation for the year 1914 is $5,299,679. 
 
 Do these figures indicate that a leasing system of the federal 
 government is practicable ? Do they indicate that the change in the 
 times has been favorable to the existence of the system of landlord 
 and tenant, between the sovereign and its citizens? The difficulty 
 is that in order to make a leasing system a success it is necessary 
 to increase royalties, and that is one of the very causes that pro- 
 duce irritation between the officials and citizens. It is the same 
 feeling of resentment that always follows when the landlord raises 
 the rent. It is very much magnified by governmental action, because 
 our citizens, knowing that all the Middle Western states received 
 the benefit of their own resources and that we are entitled by our 
 respective enabling acts to the same treatment, feel that such action 
 upon the part of the federal government is oppressive. Our people 
 can never get over the feeling that wrong is being perpetrated 
 upon them. 
 
 Is a leasing system by the federal government under such cir- 
 cumstances practicable? How long will the government be willing 
 to expend $3,000,000 a year in excess of receipts for the purpose 
 of maintaining a federal leasing system when the people most inter- 
 ested abominate it and believe that it is against their interest? 
 
 There might be some excuse for a state leasing system as to 
 its own lands, because, if successful, it creates a fund which takes 
 the place of taxes for the support of the government among the 
 very people who pay the royalties. But a leasing system by a state 
 is impracticable. Colorado has a sale and leasing system under 
 which it leases considerable of its grazing lands, but it is able to 
 obtain only nominal rentals 5 cents an acre per year for such 
 lands without water. Such lands sell for $5 to $10 per acre. A 
 5 per cent return would yield 25 to 50 cents per acre per annum, 
 
A FEDERAL LEASING SYSTEM 213 
 
 but 5 cents an acre is only from i per cent to one-half of I per cent 
 on the value, or less than the taxes that would be paid upon the 
 same were they in private ownership. In other words, rather than 
 maintain a perpetual leasing system, it would be more remunerative 
 to the state to give its lands away, so they could become the sub- 
 ject of taxation. So it is selling as fast as applied for. The re- 
 ceipts to the national government from grazing taxes and sales of 
 timber from the forest reserves are only i-J cents per acre per 
 annum. Of these receipts 25 per cent and 10 per cent are paid to 
 the state for school and road purposes, but that is only a little over 
 one-third of a cent per acre per annum, which is not one-fifth of 
 what the taxes would be if the land were in private ownership. 
 
 LEASING SYSTEM FOR COAL LANDS WILL PROVE A FAILURE. 
 
 A leasing system is still less practicable as to coal lands. Com- 
 petition is so sharp in the production of coal that no operator can 
 hope to succeed unless he has the most improved machinery and 
 the best facilities for mining and marketing his product. Enormous 
 capital, therefore, must be invested in nearly every instance, and a 
 railroad must be built to the mine from the nearest operated line. 
 Men will not make such large investments when they can obtain 
 only a lease, subject to forfeiture for failure to perform any of its 
 provisions. 
 
 No better illustration of this fact exists than that found in the 
 testimony of Gov. Spry of Utah before the house committee on 
 the public lands. He said: 
 
 We have the Utah Copper Co. out there in Salt Lake valley, operat- 
 ing at Bingham Canyon, about 20 miles from the city. There is a 
 company that went in there, and solely because of confidence in that 
 dirt they spent $30,000,000 before they had $1 returned to them from 
 profits. * * * 
 
 If we had put that proposition (refering to a leasing system) up to 
 the Utah Copper Co., they would have laughed at it. * * * 
 
 Gov. Spry further testified that the company employs 3,000 
 men and is responsible for a population of 25,000 people in the 
 Salt Lake valley. Under a leasing system capitalists would not 
 have developed this great property. Consequently the nation would 
 not have received the benefit of its large product, with its influence 
 in lowering prices, and Utah would not have received the addi- 
 tional 25,000 inhabitants. 
 
 Is it not plain that a governmental leasing system is imprac- 
 ticable, especially as to large enterprises, and is it not equally plain 
 
214 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 that the states affected would thereby be retarded both in develop- 
 ment and population? 
 
 Capitalists will not lend money to open up, develop and buy 
 expensive machinery for coal mines held under leases, subject to 
 forfeiture. Who ever heard of a bond issue secured by mortgage 
 upon a leasehold mining estate ? There is no market for such bonds. 
 Hence the enterprising business men, unless they are very rich, will 
 practically be excluded. 
 
 Now, nearly all of the large coal companies are organized by 
 men of small means, who interest the capitalists in the enterprise. 
 Lessees usually work the mine to their own advantage and not 
 for its permanent improvement, as do proprietors. 
 
 The state of Colorado owns enough coal land to supply the 
 inhabitants of that state for 300 years, yet it is able to lease only 
 3 per cent of its coal lands at 10 cents per ton royalty, and less 
 than one-half of those leased lands are being worked. Although 
 there are leasing law's for coal on state lands in Wyoming, Utah, 
 Idaho, Oregon, New Mexico and North Dakota, yet no one has 
 found it sufficiently attractive to take out a lease in any of those 
 states. If a leasing system backed by the good object of obtaining 
 money for school purposes in the lessees' own state is a failure, how 
 much more certain must be the failure of a system by the federal 
 government, the royalties of which the people feel are wrongful 
 exactions ? 
 
 A most inconsistent position of the government in connection 
 with the leasing of its coal lands to its citizens arises from the 
 fact that in order to make the system a success it must encourage 
 the high price for coal, so as to tempt the operators by profits to 
 enter into leases. On the other hand, the government owes a duty 
 to the people to curb the price of coal, and hence discourage high 
 prices. 
 
 COST OF COAL UNDER OWNERSHIP AND LEASING SYSTEMS. 
 
 While a leasing system by the government has been a success 
 in some countries from the standpoint of the lessee, it has been a 
 failure in those same countries from the standpoint of the con- 
 sumer and to the industries dependent upon cheap coal. Under its 
 system of mining the coal by proprietors the United States has pro- 
 duced the cheapest coal in the world and yet paid the highest 
 
A FEDERAL LEASING SYSTEM 215 
 
 wages to the miners. It is this cheap coal that has stimulated our 
 production of iron, steel and many other industries. 
 
 In Senate Document No. 482, by Thomas P. McDonald, there 
 is given a table, compiled from official reports, which shows that 
 under the system now in force in the United States the price of 
 coal at the mouth of the mine is not much over one-half as high 
 as in those countries which have a leasing system. Mr. McDonald's 
 table, referring to bituminous coal, is reproduced, as follows : 
 
 Value 
 per ton 
 Year. Tons. at mine. 
 
 United States 1911 ' 405,757,101 $1.11 
 
 Nova Scotia 1911 2 6,208,444 2.01 
 
 New South Wales 1911 3 8,691,604 1.82 
 
 New Zealand 1912 4 2.066,073 ( 5 ) 
 
 New Zealand (state mine) 1912 6 371,628 2.00 
 
 Victoria (state mine) 1912 7 396,042 2.28 
 
 West Australia * 249,890 2.22 
 
 production in 1911. By E. W. Parker of the U. S. Geological 
 Survey. 
 
 2 Report of department of mines for year ending Sept. 30, 1911. 
 
 3 Annual report minister of mines, New South Wales. 
 * Official reports relating to mines and minerals. 
 Not given. 
 
 Report of manager state coal mine, Nov. 30, 1912. 
 7 Report of manager state coal mine, 1912. 
 1 Report of mines for 1911. 
 
 The following table, taken from the same senate document, 
 shows the price of bituminous coal per ton at the mine for 1911, 
 according to the United States Geological Survey, to be even lower 
 
 than that given above: 
 
 Price 
 
 States. Tons. at mine. 
 
 Illinois 53,679,118 $1.11 
 
 Indiana 14,201,355 1.08 
 
 Pennsylvania 144,754,163 1.01 
 
 Ohio 30,759,986 1.03 
 
 West Virginia 59,531,580 .90 
 
 These figures demonstrate that in the production of bituminous 
 coal there is no monopoly in the United States. Nor can there 
 ever be, since there is enough coal in the public lands to supply the 
 world for 5,000 years, and the lands can be disposed of under re- 
 strictions against large holdings, which will follow the title. 
 
 In view of these figures, can it be said to be practicable to 
 change from the tried policy of the disposition by sale of the coal 
 lands to a leasing system ? 
 
216 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 In the statement of Mr. McDonald before the senate committee 
 on territories, on May 7, 1913, at page 177 of the hearings, is the 
 following : 
 
 The keen competition in the production and sale of coal in the 
 United States under our system of private ownership of the coal land 
 is saving the industries that consume our coal, as compared with those 
 countries operating under the leasing system, hundreds of millions of 
 dollars annually. Our present consumption is about 400,000,000 tons 
 per year. Now compute the annual saving to the industries of the United 
 States on this annual coal bill of 400,000,000 tons as against New South 
 Wales, a saving of $0.64 per ton, $256,000,000; Nova Scotia and New 
 Zealand, a saving of $0.89 per ton, $356,000,000; West Australia, a saving 
 of $1.11 per ton, $444,000,000; Victoria (state mine), a saving of $1.17 
 per ton, $468,000,000. 
 
 This indicates a saving to the industries of the United States of 
 approximately a million dollars per day no mean advantage when we 
 are seeking a world's market for the products of our mills and factories. 
 
 Because of these facts we contend that it is utterly impractica- 
 ble for the government to establish a leasing system under which 
 operators paying royalties can meet the sharp competition now 
 existing among companies which own their own mines and use 
 the most modern machinery for the extraction and transportation 
 of coal. Hence the proposed change will result only in locking up 
 the resources of the West, and retarding their development. By 
 continuing the unlawful permanent orders of withdrawals or by 
 acomplishing the same thing by excessive valuations, communities 
 and industries may in a few instances be driven to take leases, but 
 for a general policy of development it will prove a failure. 
 
 For these reasons I contend that the establishment by the gov- 
 ernment of a leasing system for the natural resources of the public 
 domain within the boundaries of a state would not be practicable. 
 
Why Optimism? 
 
 GEO. OTIS SMITH, 
 DIRECTOR, UNITED STATES GEOLOGICAL SURVEY. 
 
 Europe's war finds its echo in America's industry. What 
 contrast could be greater: on the one shore of the Atlantic all 
 activity seemingly destructive in purpose; on the other shore, 
 every energy directed along constructive lines : absolute waste 
 of life and property as opposed to production of wealth and 
 betterment of life. 
 
 Even though it is at a distance that we view the terrilbe dis- 
 aster that threatens the whole continent of Europe, optimism 
 seems a lost art. Yet sooner or later this epoch of catastrophe 
 must be followed by a period of repair, and the longer this period 
 is delayed the greater will be the needs involved in the recon- 
 struction and replacement. Where war has torn down at ter- 
 rible speed, peace must build up slowly. 
 
 The present world crisis thus becomes America's oppor- 
 tunity, and already possibilities are opening up on every hand. 
 Yet mark the words just used opportunity and possibilities. The 
 element of certainty is not so prominent that we may expect to 
 gain much in this period of readjustment that must follow* ex- 
 cept as we grasp the opportunity ; to win industrial prosperity 
 we must go after it. Possibilities will become ours only as pre- 
 paredness replaces unpreparedness. For many reasons, there- 
 fore, optimism under present conditions needs to be something 
 more than a state of mind. 
 
 Those of us who may have formed the habit of regarding 
 industrial conditions in this country as fairly definite and fixed 
 have had a rude aw r akening during the past few months. The 
 interruption of international trade stopped our exports of cot- 
 ton and copper and our imports of dye-stuffs and potash, where- 
 by several important industries W 7 ere wellnigh paralyzed, and 
 even now the recovery seems slow if not uncertain. Yet varied 
 as have been these changes in market relations and commercial 
 interactions, and startling as has been this disturbance of the 
 
218 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 whole balance of industry, certain fundamental facts and laws 
 remain for us to build upon and indeed the lower course of 
 foundation stones for optimism has already been laid. 
 
 Six weeks ago when I selected the title for this talk before 
 the American Mining Congress, I expected a more difficult 
 task in explaining the faith that is in me. In these few weeks, 
 however, the business situation has so materially improved that 
 optimism may seem almost compulsory and my presentation of 
 the subject that much more commonplace. Evidence of business 
 betterment is before us on every hand, and the reasons for op- 
 timism have been set forth in the past month by many speakers 
 and writers, especially men in close touch with the business sit- 
 uation. 
 
 This evidence in the case is known to all and needs only to 
 be called to mind. The United States farmer has harvested a 
 five billion dollar crop and there is a high-price market for all 
 our surplus food stuffs; already our grain is pouring across the 
 Atlantic from every great seaport. Foreign orders have started 
 our factories to turning out goods such as have been heretofore 
 manufactured in the war-swept countries. The millions of men 
 who are fighting are not w'orking, and yet these hordes of sol- 
 diers must be clothed and equipped. Rush orders are reported 
 for gloves and shoes by the million pairs, for blankets by the 
 hundred thousand, for sweaters and under-garments by the mil- 
 lion, and even shaving-brushes by the half million. Many tex- 
 tile mills are running over time and factory operation has in- 
 creased, which at once tends to relieve the stagnation in the 
 steam-coal trade. The steel situation has turned from serious 
 depression to rapid improvement and the metal workers are re- 
 ceiving large export orders. All these facts point to a general 
 business improvement in which the whole mineral industry may 
 soon expect to share. 
 
 No less real, though perhaps less conspicuous, is the effect 
 of the new federal banking system in ending our financial emer- 
 gency, which w'as acute and threatened to become chronic. To- 
 day the financial horizon is so nearly cloudless that the prophets 
 of bad weather have little upon which to base their predictions. 
 The new system makes the money reserves mobile as never be- 
 fore, and extension of credit is now possible, without the veto 
 power remaining in the hands of a small group of big men. 
 
WHY OPTIMISM? 219 
 
 There is more promise to the industrial world in having the con- 
 trol of credit under law', with the people's own officers, rather 
 than in having it under cover, with the representatives of big 
 business. 
 
 The establishment of foreign credits in this country carries 
 large promise of the continuance of the present gratifying re- 
 ceipt of export orders and the consequent industrial activity. Our 
 current indebtedness to England and other creditor nations is 
 apparently less than has been generally supposed, so that the 
 shift in balance of trade which has been so rapid during these 
 four months of war may even lead the more optimistic of us to 
 see our country changing from a debtor nation to a creditor na- 
 tion. Sir George Paish is reported as declaring a billion dollar 
 trade balance in favor of the United States as possible even in 
 1915, which would be a 50 per cent increase over 1913. Already 
 the recovery has been rapid since the outbreak of the war. In 
 August the balance was against the United States by 20 million 
 dollars, but in September our exports exceeded our imports by 
 17 million; for October this favorable balance increased to 57 
 million, and last month the exports for the ten principal custom 
 districts exceeded the imports the first week by 10^ million dol- 
 lars, the second week by nearly 22 million, the third week by 14 
 million, and the fourth week by 16 million, or 63 million for the 
 whole month. 
 
 Still another reason for belief in business betterment is the 
 recognition, now becoming widespread, of the general interde- 
 pendence of big business and the general public. On the one 
 side, the people are realizing that they are and have been in real- 
 ity the silent partner in big business, and now that there has 
 come the promise of some regulation that will in large part pre- 
 vent monopolistic centralization, the people are interested in get- 
 ting their share of returns that can come only with operation at 
 a profit. On the other hand, the managers of the large corpora- 
 tions, the trustees of the investing public, are beginning to see 
 that a certain financial security goes with public confidence, and 
 that the attitude to the public so tersely expressed thirty years 
 ago by a pioneer in railroad financing does not pay dividends 
 today. 
 
 Secretary Redfield recognizes three periods of business con- 
 dition as naturally following the declaration of war on August 
 
220 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 i last those of shock, stimulation, and readjustment. These 
 three must be expected to affect in the same order all branches of 
 American business, though the transition from one period to the 
 next may not be simultaneous in all branches. Thus those of us 
 who may be specially interested in the copper market may find 
 some encouragement in the fact that for several weeks after war 
 was declared the exportation of wheat felt the shock and thou- 
 sands of carloads accumulated at Eastern ports. Yet since Sep- 
 tember, wheat has been pouring across the Atlantic as never before. 
 With cotton the period of shock has been longer, but stimulation 
 of export has now begun. With copper the resumption of sales 
 to Europe seems slow in coming, but come it must, for in the mod- 
 ern world, whether at war or peace, the red metal is a necessary 
 of life. 
 
 Of course optimism is apt to go to extreme. Already we are 
 hearing such expressions as "trade boom," or "opportunity unpar- 
 alleled in history" and "avalanche of prosperity," and even hard- 
 headed business men are quoted as thus characterizing the present 
 situation. Some of us, how'ever, are timid when it comes to ava- 
 lanches, for even avalanches of prosperity will sweep men off their 
 feet. All this kind of talk indicates that a period of over-stimu- 
 lation may threaten us, a condition that is somewhat symtomatic of 
 the American temperament. The four months' record, however, 
 can be summarized thus : while European countries have been 
 mobilizing their armies and calling to the field of battle their re- 
 serves of soldiers, America has mobilized its credit and begun to 
 send forward to the market its vast reserves of food-stuffs and 
 mineral products. 
 
 Turning now to the special review of our mining industry as 
 affected by the w'ar, what reasons are there for optimism? I find 
 the largest source of assurance of the ability of this industry to 
 weather the period of readjustment in the record of its develop- 
 ment in the past. The epoch of rapid growth of the mineral in- 
 dustry began about 35 years ago, and this third of a century just 
 passed has witnessed a wonderful development. Clarence King in 
 the first administrative report of the United States Geological Sur- 
 vey analyzed the situation in 1879 in these words: "We are yet at 
 the very threshold of the industrial life of the Republic." and look- 
 ing forward he added : "The mineral industries will soon reach an 
 annual yield of a thousand million dollars of value." May I now 
 
WHY OPTIMISM? 221 
 
 remind you that last year's record was two and one-half thousand 
 millions. 
 
 For this period of development since 1880, statistics of the 
 mineral production are available and the extent of the expansion of 
 the industry can be summed up in the statement that the value of 
 the output has increased nearly seven-fold while our population has 
 less than doubled. If we compare directly the output per capita of 
 population, the record of increase in the more important mineral 
 products becomes really instructive or even inspiring. Thus in 
 this period of 33 years the consumption of coal per capita has in- 
 creased from less than a ton and a half to nearly six tons an in- 
 crease of 357 per cent. Similarly the production of iron ore in- 
 creased 337 per cent, of petroleum 391 per cent, copper 1,200 per 
 cent, cement 2,087 P er cent ; but gold and silver increased only 23 
 and 22 per cent respectively, while with lead the increase was 125 
 per cent, and with zinc 638 per cent. This is indeed a record of 
 which mining men of this generation may be proud. 
 
 If statistics for the more important agricultural products are 
 studied in a similar manner it is found that the total increase in 
 the same period has not much more than kept pace with the 
 growth in population. This is true of the two leading grains, corn 
 and wheat, the one having somewhat more than doubled, the other 
 not quite doubled in the third of a century, so that the production 
 per capita shows only a small percentage of increase. With cotton 
 the gross increase has been larger, approaching 130 per cent, but 
 wool has utterly failed to increase as rapidly as the population. It 
 is only sugar that shows an increase, both in domestic production 
 and in consumption, at all comparable with that of the half dozen 
 minerals mentioned, the per capita increase being 394 per cent, or 
 about the same as the other carbon compounds, coal and petroleum. 
 
 There are other comparisons that may be made with the result 
 of strengthening an optimistic tendency. In this period metal min- 
 ing has passed from the bonanza stage to the low grade proposi- 
 tion a change which, as Doctor Raymond has remarked, by the 
 creation of larger and more permanent communities has laid safe 
 foundations of civilization and progress. The baser metals have 
 come to the front and the small increase in output of gold and sil- 
 ver has been made in part with these noble metals in the role of 
 by-products in copper and lead mines. 
 
222 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 An even more gratifying phase of this mining development is 
 the marked increase in man's productive capacity. Let us take the 
 2O-year period 1889-1909 and analyze the coal-mining record. 
 Roughly stated, the number of mine-workers a little more than 
 doubled in that period, the output of coal more than trebled, and 
 the capital investment more nearly quadrupled. The exact per- 
 centages are 123 per cent increase in employes, 226 per cent in- 
 crease in production, 252 per cent increase in capital. Stated in 
 terms of efficiency, the mine-worker increased his individual out- 
 put from 471 to 691 tons a year, while the average annual output 
 per dollar of capital remained nearly the same, about two-fifths of 
 a ton, the increase in capitalization per ton of output being less 
 than 8 per cent. Most of this increase in capital outlay was due to 
 equipment expenditure, the improvement in mechanical equipment 
 appreciably adding to the mine-worker's efficiency and comfort. 
 
 In iron mining the record for the same period is even more 
 striking; the number of miners increased less than one-half, the 
 capitalization nearly trebled, and the output nearly quadrupled. In 
 the iron mines, then, both labor and capital became more efficient, 
 the output per miner increasing from 385 to 995 tons and the pro- 
 duction per dollar of capital from one-seventh to one-sixth of a 
 ton. In the case of coal mining, we know that this improvement 
 did not halt with the census year of 1909, for since then the coal 
 output per miner has increased another 71 tons, or more than 10 
 per cent in the four-year period. All this tells the story of steadily 
 increasing efficiency of mine-worker, mine equipment, and mining 
 methods that is, of the contributions by labor, capital and engin- 
 eering. 
 
 The net results of this marvelous development as well as this 
 increased efficiency is that not only has the mining industry kept 
 pace with the demands of other industries, but that in certain min- 
 eral products We are able to turn out much more than we can con- 
 sume at home. In the last five years this excess of copper mined 
 has been about 50 per cent and of copper refined in American works, 
 fully 100 per cent, one-third of the copper from domestic ores and 
 one-half of the metal turned out by the refineries having been ex- 
 ported. The other mineral product which is produced in the United 
 States in such quantity as to make the industry largely dependent 
 upon a foreign outlet is petroleum, of which 20 per cent is ex- 
 ported in one form or another, but chiefly as refinery products. Of 
 
WHY OPTIMISM? 223 
 
 such important mineral products as coal and cement the exports 
 have been insignificant, and the same is true of exports of lead and 
 zinc smelted from domestic ores. Yet for all of these mineral prod- 
 ucts the mine, mill and smelter capacity is far in excess of the de- 
 mands of domestic consumption. Obviously there is good oppor- 
 tunity for increase of output without appreciable capital outlay, pro- 
 vided a market can be found for the product. 
 
 Under present conditions the domestic market may well be 
 looked to for increased consumption of the home output of some 
 minerals which have been imported from European countries, such 
 as aluminum, arsenic, barytes, fluorspar, magnesite and manganese, 
 most if not all of which can be found in the United States in suf- 
 ficient quantities to meet the domestic demand. Again, the Ameri- 
 can manufacturers of certain articles that have been imported from 
 Europe should be expected to make large demands for the metals 
 which form the basis of those manufactures. Judging from the 
 inquiries that come every day to the Geological Survey, this type of 
 the expansion of the home market is lively and should result in the 
 aggregate in some appreciable increase in the demands upon the 
 mineral producer. 
 
 It is, however, the opportunity of a larger foreign market for 
 American mineral products that now seems more alluring. During 
 the war period the war itself will continue to create demands upon 
 the mineral industry of America. The historian Ferrero is quoted 
 as terming the European combat a war of iron and coal ; he might 
 even more aptly included gasoline as indispensable in modern war- 
 fare. The consumption of metal on the firing line and of fuel be- 
 hind the line, on both land and sea, is largely in excess of any nor- 
 mal use in time of peace. 
 
 And when the peace comes to Europe for which peace-loving 
 America prays, the indirect effects of war must continue to benefit 
 American industry. The markets now opened to our zinc, our steel, 
 our coal, by reason of the enforced shut-down of Belgian smelters, 
 German mills, and English and French mines, must be supplied 
 from this country even after the treaties of peace are signed. Years 
 will be necessary to put industry on its former footing in the coun- 
 tries now at war, and it seems reasonable to expect that currents 
 of commerce now set up will not be quickly changed after peace 
 has been restored. 
 
224 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 Industrial independence is a goal toward which a nation should 
 face, but a goal which it should not have either the intention or the 
 desire to attain. Even in a country so diversified as ours in its 
 natural bounties domestic production of everything consumed is 
 not desirable nor profitable. Exchange of commodities with foreign 
 countries becomes necessary, for instance, just as soon as America 
 can mine and smelt copper or produce and refine petroleum more 
 cheaply than it can grow tea or raise sheep or cattle. Then the 
 home market for cheap meat and wool and tea necessitates a foreign 
 market for our copper and oil. Of course, the more we as a people 
 are independent of goods sent from other countries the less we are 
 dependent on a foreign market for our own products. Large im- 
 ports necessitate large exports, else the balance of trade will swing 
 too far on the wrong side. Nor can we shut our eyes to the volume 
 of exports needed to meet the interest obligations due the foreign 
 capital invested in our railroad and industrial securities. 
 
 As we look toward the south we find that our commerce with 
 South America for the last four years has been one-sided to the 
 extent of an unfavorable annual trade balance averaging more than 
 80 millions of dollars. The fact that the balance of trade is against 
 the United States in two of the three "A B C" countries should be 
 taken only as an invitation to export more. That 80 millions not 
 only measures the present opportunity for exports to South America 
 but also suggests the chance for further development of trade rela- 
 tions. We need meat and hides from Argentina, tin ore from 
 Bolivia, rubber and coffee from Brazil, nitrate from Chile, platinum 
 from Colombia, cacao from Ecuador, w'ool from Peru and Uruguay 
 and coffee from Venezuela. What can we export in exchange? 
 
 To increase industrial prosperity this country needs to export 
 finished rather than crude products and to import raw materials 
 rather than manufactures. It is the product of American labor 
 rather than the bounty of pur natural resources that preferably 
 should go into the world's markets. Betterment of industrial con- 
 ditions can come best through expansion of manufacturing. The 
 increase in the element of labor in the product exported will mean 
 that we are not bartering away our heritage of natural resources, 
 but rather that we are using these resources as a basis simply for 
 the expenditure of labor, which renews itself. 
 
 Fortunately only a small part of our iron and steel exports is 
 in the form of pig, bar, billets and ingots, and indeed not only do the 
 
WHY OPTIMISM? 225 
 
 manufacturers of iron and steel represent by far the largest values, 
 but the steel rails and wire alone outweigh the crude metal exported. 
 In our copper exports, however, the ratio is quite the opposite, the 
 value of exported manufactures of copper being only about one- 
 sixth of that of the copper exported in the form of pig, ingot and 
 bar. This contrast is suggestive, and indeed some immediate expan- 
 sion in the export of copper manufactures seems warranted. For 
 example, the item of electrical equipment and supplies, of which 
 the exorts have doubled in the last eight years, with only a small 
 percentage going to Europe, suggests that we now' have an excellent 
 opportunity to secure a larger market, while the principal European 
 competitor of the United States is temporarily eliminated. 
 
 In the matter of crude minerals, whether fuels or metals, the 
 export trade of the United States promises expansion. Too much 
 emphasis can hardly be placed upon America's strategic position in 
 the possession of large reserves of coal. Not only does the United 
 States mine 40 per cent of the world's output of coal, but our coal 
 tonnage in the ground is one-half the known reserves of the world. 
 Mr. Parker has lately pointed out that two diverse policies have 
 governed the two countries that rank next to the United States as 
 coal producers. England has promoted her commerce by exporting 
 about 20 per cent of her coal output, w'hile Germany, with larger 
 coal reserves, has exported little coal, preferring to use it in her 
 own factories, the products of which, however, go all over the world. 
 It would seem that America might safely occupy middle ground in 
 the policy of coal exports and yet increase greatly her foreign trade. 
 The exports have been only about 4 per cent of the total production, 
 and of this only a small fraction one and one-fifth million tons 
 went across the seas last year. A change, however, has already set 
 in, for large contracts are reported with Italy, Greece, Argentina 
 and Brazil. 
 
 Coming down to bottom facts, the United States will profit by 
 the European war only as the nation makes larger and wiser use 
 of its mineral resources. Foreign markets in the main can be won 
 and held only as the quantity or quality of the "Made in America" 
 product rivals that of the goods offered by the other producing na- 
 tions. The buyer, whether he be in the far East or in South Amer- 
 ica, wants the most and the best for his money. Of course at a 
 time like the present we can not shut our eyes to the obligations 
 of a world-humanity, and just as American food-stuffs are now' 
 
226 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 being given to the starving Belgians, so America capital may later 
 be forced to bear its share in the financial readjustments that must 
 follow a long-continued war. Yet it would seem a safe rule of 
 national conduct that industry should begin at home, and therefore 
 every industrial opportunity in America should be improved. If 
 these opportunities are recognized and grasped every one of us can 
 indulge in optimism. 
 
The Adjustment of Industrial Disputes Affecting: the Public Service 
 
 BY HON. JAMES A. EMERY, 
 WASHINGTON, D. C. 
 
 Ever since the organization and report of the Anthracite Coal 
 Strike Commission in 1902, an increasing amount of thought has 
 been given to practical methods of settling the enormously de- 
 structive and wasteful industrial controversies which at times para- 
 lyzing industry and transportation, have frequently caused incal- 
 culable economic loss ; not only greatly injuring and sometimes 
 ruining individuals, but obstructing or stopping service upon which 
 the public is dependent for daily necessities. The Lemeux Act. 
 Canada's legislative experiment with this problem, has been the 
 subject of much discussion in our own country. It does not deny 
 the right to strike or lockout, but endeavors to compel the parties 
 to the controversy to submit their differences to an arbitration, the 
 findings of w'hich either or both may subsequently reject, but with- 
 out which neither may legally strike or lockout. It is contended 
 by the Canadian authorities and by many shrewd observers that the 
 Act has a valuable moral effect. Although it is admitted that in 
 the final test it is incapable of practical enforcement, since events 
 have demonstrated that government could not, without civil war, 
 undertake to confine a labor organization and its sympathetic sup- 
 porters who struck in disobedience of the law. But the law and the 
 public opinion which it developed have undoubtedly had the not- 
 able moral effect of decreasing trivial strikes and causing both par- 
 ties in controversies to think before acting. The principle of the 
 Canadian Act cannot be applied to private industry in our country 
 under our organic law. It would create a condition of "involun- 
 tary servitude." 
 
 The mere stoppage of private industry, however serious to 
 those involved, does not represent the form of strike most injurious 
 to the public. We suffer from notable strikes, or threats of strike, 
 not only on interstate railroads but on the various traction systems 
 upon which cities, great and small, and their suburban communities 
 which have grown up about them, are absolutely dependent not 
 
228 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 only for daily transportation from residence to work, but for a 
 continuous supply of the necessities as well as the conveniences of 
 daily life. The suspension of such service is a community disaster, 
 sometimes equal in the loss, suffering and inconvenience which it 
 entails to the stoppage of the local light or water system. What is 
 true of such a community catastrophe is true in a larger w'ay not 
 only of the great transportation systems, but of a few industries 
 producing the fundamental necessities of life. 
 
 In purely private employment, these deliberate and concerted 
 stoppages of industry, while often entailing great losses to both 
 parties, are nevertheless the inevitable incident of the exercise of 
 elementary private rights. The state can neither compel individuals 
 to give work nor others to take it. Trie losses directly and indi- 
 rectly suffered, however deplorable, are but incident to the exercise 
 of personal rights, which, however directed by bad judgment, are 
 part of the tax paid for the preservation of individual freedom, but 
 when the service of a corporation or business becomes wholly af- 
 fected with the public interest or dominated by that feature so that 
 its uninterrupted operation is essential to Well being or the life of 
 the community, is it not a question whether corporations or large 
 groups of individuals organized for the furtherance of their private 
 interest, may not have their collective or individual contract of 
 service controlled and regulated to protect the interest of the public ? 
 
 It is not suggested that any individual or combination of in- 
 dividuals can be compelled to remain at work, but in view of the 
 public character of the service rendered, may the state recognize 
 and enforce, under penalty, a contract of service by which the indi- 
 vidual employed by a public utility and the public utility 
 itself, each under appropriate penalty, agree that the one 
 will not lock out its employes, nor the other become 
 party to a collective movement to paralyze the public 
 service by quitting until the issue relating to conditions of employ- 
 ment have been passed upon by some impartial tribunal constituted 
 by the parties. Such a contract, viewed from the standpoint of the 
 employer operating the public utility, means that he agrees by vir- 
 tue of the franchise which he receives and the character of his rela- 
 tion to the community, that he will condition his freedom of action 
 by agreeing in his franchise not to do that which will deprive the 
 community of his service. The individual or organized employe 
 is free to make or reject the contract offered. He is not compelled 
 
ADJUSTMENT OF INDUSTRIAL DISPUTES 229 
 
 to enter into the service of the public utility, but having done so, 
 he conditions his quitting by voluntary contract made in view of 
 the character of the service rendered. Would such a contract make 
 either party sustain any involuntary relation with the other ? Would 
 not the condition attached to the contract be one justified by the 
 character of the service rendered and the public interest involved? 
 For any form of arbitration which compels either party to continue 
 to sustain a relation created without preliminary condition, there can 
 be found but little defense. Private employment, least of all, dis- 
 closes any condition which would sanction it. The issue here pre- 
 sented is whether or not the interest of the public in the continued 
 operation of a utility privately owned and operated, but dedicated 
 to a public service, is so dominant in the light of existing social 
 conditions and necessities that its voluntary contracts of employment 
 may and ought to be so conditioned. 
 
 The discussion may well proceed within a very narrow range 
 of obvious public utilities. The principle, once recognized, is cap- 
 able of transfer, always within rational limitations, to other spheres 
 of like action. Within such limits is the application of the principle 
 suggested desirable ? It is obvious that it does not apply to all fields 
 of industrial controversy, nor can any remedy hope to, but would it 
 not ameliorate and greatly modify the conditions which too frequent- 
 ly exist in a vast and immediate field of necessary activity? Too 
 frequently, in discussions of these problems, we undertake to cover 
 too great an area of disturbance. A sound principle, rationally ap- 
 plied, within practical limits of immediate need and recognized au- 
 thority, is a more profitable subject of discussion than the extension 
 of untried and unprecedented proposals to the widest areas of dis- 
 turbance. Sufficient for the day is the problem thereof. 
 
Compulsory Arbitration 
 
 BY SAMUEL 0. DUNN, CHICAGO, ILL. 
 EDITOR OF THE RAILWAY AGE GAZETTE. 
 
 The president of the American Mining Congress has asked me 
 to write a paper on Compulsory Arbitration, and especially to indi- 
 cate my opinion as to the advisability of advocating some method 
 of bringing about such arbitration, or as close an approximation 
 to it as would be practicable under our existing form of government. 
 I regret that I have not had opportunity, since I consented to write 
 something on the subject, to get together a larger amount of ma- 
 terial and to put my thoughts in satisfactory form. All I can do 
 is to outline the experience of a few countries with different forms 
 of conciliation and arbitration, and indicate in a general way the 
 conclusion which it would seem w'e may reasonably draw from their 
 experience as to the form of governmental action regarding labor 
 disputes which would be the most practicable and expedient under 
 the conditions prevailing in the United States. 
 
 Governmental intervention in disputes betw'een some classes of 
 employers and employes is a natural result of the development of 
 modern industry. When industries were small, and there were no 
 large organizations of employers or employes, the public had little 
 interest in controversies between labor and capital. The number of 
 men employed by any person or concern was insignificant, and it 
 made little difference to the public if there was a lockout or strike. 
 
 Owing to the course of industrial development there are now 
 many concerns which employ thousands of men. In certain lines of 
 industry there are organizations including many business concerns 
 on the one hand, and the employes of many concerns, on the other 
 hand. A lockout or strike in one of these large concerns or lines 
 of industry may result in many millions of capital and many thous- 
 ands of men being rendered idle. This has given the public a 
 proper and important interest in disputes between capital and labor 
 which it did not formerly have. The public feels concern regarding 
 the economic waste that will result from such large investments 
 and so many productive workers being idle. It feels a special con- 
 
COMPULSORY ARBITRATION 231 
 
 cern regarding the possibility of lockouts or strikes in certain in- 
 dustries because they would cut it off from the very necessities 
 of life. 
 
 The situation as respects industries producing something or 
 rendering some service the unbroken production or rendering of 
 which is not essential to the public welfare is entirely different from 
 the situation as respects industries producing something or render- 
 ing some service the unbroken production or rendering of which is 
 essential to the public welfare. The public would not feel immedi- 
 ately and acutely the effect of the closing down of the steel mills, 
 for example. It would feel more speedily and keenly the effect of 
 a complete closing down of the coal mines, especially if this oc- 
 curred in a season when the demand for coal was great. Still more 
 keenly and acutely would it suffer from a serious interference 
 with the operation of the railways, for under the conditions of 
 modern civilization an interruption of railw'ay service would soon 
 arrest most of our industrial and commercial operations, and menace 
 with starvation the entire population of many communities. 
 
 Whatever may be true as to industries on which the public 
 is not dependent for necessaries of life, it seems to be perfectly 
 clear that the government has the right and duty to take whatever 
 steps may be necessary in order to prevent serious interferences 
 with the production of commodities or the rendering of services 
 on which the comfort, the welfare and even the life of the people 
 are dependent. 
 
 A distinction is drawn in law between public utilities and other 
 concerns, this distinction being based on the theory that the opera- 
 tion of only the former is of primary importance. It would seem 
 that under modern conditions the uninterrupted operation of coal 
 mines is almost, if not quite, as important to the public as the un- 
 broken maintenance of the service of public utilities and railways, 
 and that therefore there is as much justification, economic and 
 moral, if not legal, for the government interference in disputes be- 
 tween coal mine operators and their employes as between railways 
 and public utilities and their employes. 
 
 Whether this interference should take the form of compulsory 
 arbitration seems, however, very questionable. Compulsory arbitra- 
 tion involves, first, compelling the parties to submit their differences 
 to arbitration, and second, compelling them to accept the award 
 made. This is merely a modified form of slavery. To require 
 
232 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 capitalists to give employment to men or bodies of men whom they 
 do not want, at wages which they do not want to pay, or to require 
 an individual workingman or a body of workingmen to work for 
 concerns for which they do not want to accept, is inconsistent with 
 enlightened ideas of liberty. It is a form of industrial conscription 
 and should not be resorted to except in cases as extreme as those 
 which justify military conscription. 
 
 It is not necessary, if the government is to intervene in labor 
 disputes, whether on railways or in coal mines, for it to go the 
 length of adopting compulsory arbitration. Furthermore, the ex- 
 perience of governments which have tried various forms of inter- 
 ference in such matters has indicated that attempts at compulsory 
 arbitartion are not likely to be successful and that other forms of 
 governmental intervention are likely to be more successful and to 
 produce more satisfactory results. 
 
 The government which has made the most thorough and inter- 
 esting trial of compulsory arbitration is that of New Zealand. It 
 passed a compulsory arbitration law in 1894, entitled, "An act to 
 encourage the formation of industrial unions and associations and 
 to facilitate the settlement of industrial disputes by conciliation and 
 arbitration." The original act and the various amendments were 
 united into a Compilation Act in 1905 and various amendments 
 have been passed since. 
 
 The act as it stood in 1905 provided for the registration with 
 the Secretary of Labor of industrial unions and associations of 
 either employers or workers. Registration made the union or asso- 
 ciation a body corporate and rendered both it and its members 
 subject to the jurisdiction of a Conciliation Board and an Arbitra- 
 tion Court. Any industrial union might apply at any time for the 
 cancellation of its registration, but such cancellation did not relieve 
 the union or any of its members from the obligation of any agree- 
 ment or award in force at the time, nor from any penalty or lia- 
 bility. The cancellation of registration on the part of the labor 
 union removed it from the jurisdiction of the Conciliation Board 
 and the Arbitration Court. But employers could not thus escape. 
 They had to accept arbitration if their employes were registered 
 and demanded it. Under this law', therefore, arbitration was in a 
 sense voluntary for the workers but compulsory for the employers. 
 
 The colony was divided into eight districts in each of which 
 there was a board of conciliation consisting of three or five mem- 
 
COMPULSORY ARBITRATION 233 
 
 bers, one or two being elected by the unions of employers, and an 
 equal number by the unions of workers and the third or fifth 
 member by the others members, a president and two assessors, all 
 appointed by the governor on the recommendation of the unions of 
 employers and of workers. An award affected not only labor unions 
 but also all individual w'orkers working for an employer on whom 
 the award is binding. Unions of employers or of workers and 
 individual employers are liable to fines not exceeding $2,500, and 
 individual workers to fines not exceeding $50, for breaches of 
 awards. 
 
 In practice the Conciliation Boards were practically ignored 
 from the first, and almost every case went before the Arbitration 
 Court. In the absence of this legislation, which, it will be noted, 
 applied to all classes of commercial and industrial undertakings, 
 including agriculture, workingmen would have looked to their em- 
 ployers for improvements in their conditions of work and raises in. 
 their wages. But because the law existed almost every question 
 regarding conditions of work and wages had to be settled by the 
 Arbitration Court. The awards and agreements which have been 
 made under it cover a great variety of subjects, including minimum 
 wages, hours of labor, permits to incompetent workers, limitation 
 of apprentices, periods of apprenticeship, piecework, distribution of 
 work, holidays, meal hours, provision of tools, modes of payment, 
 notice of dismissal scope and duration of awards, interpretation of 
 awards, extension of awards, breaches of awards, and fines. 
 
 In the earlier years of the operation of the act conditions in 
 New Zealand were prosperous and the aw'ards usually resulted in 
 advances in wages. During this period compulsory arbitration was 
 in high favor with labor. But when the earlier awards began to 
 expire conditions were not so prosperous, and when the workers 
 appealed to the Court for further increases in wages these were 
 often refused. Labor then speedily began to show dissatisfaction 
 with the law and the Court. This dissatisfaction finally manifested 
 itself in an acute form. In November, 1906, disregarding the pro- 
 visions of the law, the employes of the street railways of Auckland 
 declared a strike. The men's grievances was that a conductor had 
 been discharged for alleged misconduct. Both the company and 
 the striking employes were fined for having violated the arbitration 
 law. In February, 1907, there was another strike ; this time in 
 
234 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 the meat packing houses at Wellington. In this case 266 strikers 
 were fined $25 each. 
 
 The next year there was a strike among the coal miners of 
 the West Coast, which lasted for eleven weeks. The men claimed 
 that seven miners who had been dismissed had been discharged be- 
 cause they were active unionists and socialists. The company of- 
 fered to take them back, but the miners refused to w'ork unless 
 some arrangement were made to prevent similar occurrences in 
 future, and offered the remarkable suggestion that when men were 
 to be dismissed they should be selected by ballot The union was 
 cited before the Arbitration Court and fined $375. Being unable 
 to collect the fine from the union, the Court proceeded against the 
 men individually and collected about $250. 
 
 These strikes were followed by others, and in September, 1908, 
 the Minister of Labor reported that since 1906 there had been 23 
 strikes, that the total number of strikers had been 1,117, the num- 
 ber of men rendered idle 2,389, the duration of the strikes 317 days, 
 the loss of wages to workmen almost $90,000, and the loss to em- 
 ployers about $80,000. The next year there was a coal mine strike 
 for a very curious reason. A new 1 workmen's compensation act 
 was to go into effect. The coal mine operators wished to insure 
 themselves against loss in the insurance department run by the 
 colonial government itself. The government insisted that before 
 it would write the insurance the employes of the mines must submit 
 to physical examination ; and the men struck rather than submit to 
 physical examination. The government then yielded and authorized 
 its insurance department to issue policies without examination. Soon 
 afterward there was a strike of the miners in the government coal 
 mines at Point Elizabeth. 
 
 The chief purpose of the arbitration law was to prevent lock- 
 outs and strikes. It had succeeded in preventing lockouts but had 
 failed to prevent strikes. Therefore, it was amended on January 
 i, 1909, to provide that every worker who was a party to an un- 
 lawful strike should be fined not exceeding $50 and every employer 
 who was a party to an unlawful lockout should be fined not ex- 
 ceeding $2,500. The Boards of Conciliation were abolished and 
 Councils of Conciliation substituted. Three permanent commission- 
 ers of conciliation are appointed by the government. In case of a 
 dispute one of them goes to the scene and tries to effect a settle- 
 ment. If he fails he sets up a Council of Conciliation consisting of 
 
COMPULSORY ARBITRATION 235 
 
 one, two or three assessors representing the employers and an equal 
 number representing the workers. Every dispute must be referred 
 to such a council before it can be carried to the Arbitration Court 
 There is, however, a way by which the workers may altogether 
 evade the purpose of the act and strike without danger of punish- 
 ment. After an award applying to them has expired they may 
 cancel their registration, after which they cease to be subject tc 
 the law. 
 
 I have no detailed information on the subject, but I understand 
 that the law as amended in 1909 has worked as badly as the original 
 act and that strikes have continued to occur in New Zealand. In 
 other words, compulsory arbitration there has failed to prevent 
 strikes, and the government has not even been successful in all 
 cases in enforcing the awards made by the Arbitration Court. In 
 this respect, as in the ownership and operation of mines and rail- 
 ways, and in most other respects, paternalistic government in New 
 Zealand has been very much less of a success than the advocates 
 of similar government in this country would have us believe. 
 
 The British colonies have tried within the last tw'o decades 
 many experiments with social and labor legislation. That in New 
 Zealand with compulsory arbitration is one of them. Another of the 
 most interesting and instructive of them has been that made by our 
 neighbor, Canada, by the passage and administration of the "Indus- 
 trial Disputes Investigation Act," more familiarly known, after its 
 author, as the "Lemieux Act." This measure is of especial interest 
 to those engaged in the mining of coal because its enactment grew 
 out of a coal mine strike in Lethbridge in the southern part of 
 Province of Alberta. This strike began in the summer of 1906 
 and continued until late in the fall, and the people of Western 
 Canada suddenly awakened to the fact that on the verge of a north- 
 ern winter they were confronted with the danger of a serious fuel 
 famine. The strike was finally settled. But the impression made 
 on the public mind was so deep that legislation to prevent the re- 
 currence of such conditions was passed and went into effect before 
 the end of March, 1907. 
 
 The Lemieux Act applies to railroads, street railways and other 
 public utilities and to mines of every class, metalliferous as well as 
 coal. It provides that before a lockout or strike can legally take 
 place in any of these industries the parties must refer their differ- 
 ences to a board for hearing. The party about to lockout or strike 
 
236 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 must give notice to the government of its intention, together with 
 a statement of the nature of the controversy. The Minister of 
 Labor then calls on each party to name a member of the board. 
 The two members chosen by them are given an opportunity to agree 
 on a chairman. If they fail to do so within a specified time the 
 Minister of Labor appoints the chairman ; and if either party fails 
 to name a member of the board to represent it the Minister of 
 Labor appoints him also. 
 
 The Board as thus constituted has almost the powers of a 
 court. It may subpoena witnesses, compel the production of docu- 
 ments, and take testimony ; but its duty is primarily that of a con- 
 ciliation and mediation board. If the board can bring about a settle- 
 ment by conciliation it prepares its report and sends it to the gov- 
 ernment. If it cannot do this it takes testimony and prepares a 
 report summarizing it, and also sets forth its conclusions as to the 
 merits of the controversy and its recommendations to the parties 
 and gives this report to the public. 
 
 There the intervention of the government ends. The law does 
 not require acceptance of the award. According to all reports this 
 very simple measure has worked well. Hon. W. L. MacKenzie 
 King, formerly Minister of Labor of Canada, delivered an address 
 before the Railway Business Association in New' York on Decem- 
 ber 19, 1912, in which he said that during the five and one-half 
 years up to September, 1912, there had been 132 applications made 
 for the formation of conciliation boards, and that strikes were avert- 
 ed in all but 15 cases. Of these controversies, 40 were in coal 
 mines, 10 in metalliferous mines, 53 on railways and 10 on street 
 railways. 
 
 The only similar federal law which w'e have in this country is 
 the Erdman Act, as amended by the Newlands Act. This measure 
 applies only to disputes between railway companies and railway em- 
 ployes directly concerned with the operation of trains. It creates 
 a permanent mediation and conciliation board of three members. 
 In case of a dispute which may lead to a lockout or strike either 
 of the parties may appeal to this board, which will then tender its 
 good offices. But its advances may be legally repulsed, for, unlike 
 the Canadian law, the act does not prohibit a lockout or strike in 
 advance of conciliation or arbitration. If the good offices of the 
 federal mediators are accepted they proceed to the scene of the 
 controversy and try to bring about an agreement. If they are un- 
 
COMPULSORY ARBITRATION 237 
 
 successful in this the law provides that the parties may resort to 
 arbitration by a board composed of two representatives of the rail- 
 ways, two representatives of the employes and two other persons 
 chosen by them. If the representatives of the railways and employes 
 do not agree on the impartial arbitration they may be selected by 
 the board of mediation and conciliation. Once the controversy has 
 been submitted to arbitration the award must be accepted by the 
 parties and put into effect for one year. 
 
 On the whole, the results of the operation of this act have been 
 good. Mediation and arbitration under it have averted many seri- 
 ous strikes. But the law has grave defects. Why should it apply 
 only to employes of railways directly concerned in the operation 
 of trains? A strike in railway shops might in a very short time 
 cause a serious interruption of traffic. And why should the law 
 apply only to railways and their employes? A coal mine strike 
 may cause as much loss and suffering to the public as a railway 
 strike. Finally, why should lockouts or strikes be permitted on 
 railways and public utilities and in coal mines before the questions 
 in controversy have been submitted to somebody representing the 
 public? The public has even more at stake than either of the im- 
 mediate parties. May not the public, therefore, properly demand 
 that at least all the facts shall be given to it before its rights are 
 disregarded and its interests sacrificed? 
 
 Another criticism which has been forcibly urged against the 
 Erdman-New'lands law is that while conciliation and arbitration 
 under it may prevent lockouts and strikes, they do not necessarily 
 result in fair settlements. Of the six members of the arbitration 
 board as now constituted, only two are in any sense impartial. The 
 other four are avowed partisans. And the only two who are im- 
 partial are never experts, for they are always chosen from some 
 business or profession entiely different from that in which the dis- 
 pute has arisen. In these circumstances the award is necessarily 
 made by the two impartial arbitrators and, as they lack expert 
 knowledge, and as the time allowed for the proceedings is short, 
 the usual result is a mere splitting of the difference, which settles 
 no principles and always results in some increases in railway wages, 
 whether fair or not. 
 
 The most thorough investigation of the railway labor situation 
 in this country ever made was that of the arbitration board which 
 settled the controversy between the eastern railways and their loco- 
 
238 PROCEEDINGS AMERICAN MINING CONGRESS 
 
 motive engineers some two years ago. This board was not organ- 
 ized under the Erdman Act, but was composed of one representative 
 of labor, one representative of the railways and five impartial arbi- 
 trators, all of whom were very prominent business and professional 
 men. So impressed was this board by the shortcomings of the 
 Erdman Act and the dangers of serious railway strikes, that it 
 recommended legislation forbidding such strikes prior to arbitra- 
 tion and providing for federal and state w'age commissions to deal 
 with labor controversies on railways. 
 
 The most serious shortcomings of the Erdman-Newlands law 
 is that it does not prohibit strikes and lockouts before arbitration : 
 and the best feature of the Lemieux Act of Canada is that it does 
 prohibit them before the facts regarding the questions involved 
 have been given a thorough airing. 
 
 With your permission I shall suggest, with some difference, a 
 plan for legislation which I believe would be better than either the 
 Erdman-Newlands Act or the Lemieux Act. The Erdman-New- 
 lands Act should be so amended as to make it apply to both con- 
 troversies between railways and any or all of their employes, and 
 between coal mining companies and their employes. Whether its 
 extension to disputes in coal mines would be constitutional is a 
 question which I expressly refrain from discussing at this point. 
 The present federal mediation and conciliation board should be re- 
 tained with its present functions, but its jurisdiction should be 
 extended in the same measure as the provisions of the law under 
 which it acts. Strikes and lockouts in advance of arbitration should 
 be prohibited in the industries mentioned. In case of arbitration 
 the arbitration board should be composed of one representative of 
 the employers, one representative of the employes, one member of 
 the Interstate Commerce Commission, one member of the new Inter- 
 state Trade Commission, and a fifth member to be chosen by these 
 four. The testimony taken by the board, together with its conclu- 
 sions and recommendations, should be made public, but, as in 
 Canada, the award should not be legally binding on the parties. 
 
 What would be the advantage of such legislation? It would 
 provide machinery for governmental intervention by which agree- 
 ments between parties themselves might be brought about. It would 
 prevent lockouts and strikes until after the facts regarding all the 
 points in controversy had been laid before the public. It would 
 secure arbtiration by a board, a majority of whose members would' 
 
COMPULSORY ARBITRATION 239 
 
 represent the public, and which at the same time would be so con- 
 stituted that we may fairly assume that it w'ould act with expert 
 knowledge. And after the parties had had time to think deliber- 
 ately about the points in controversy, and after a board as thus con- 
 stituted had ascertained the facts and presented them to the parties 
 and made them public, together with its recommendations, it is al- 
 most inconceivable that any concern or body of workingmen would 
 have the hardihood to reject the board's findings and recommenda- 
 tions and resort to a lockout or strike. 
 
 That such federal legislation would be constitutional as applied 
 to railways there cannot be any serious doubt. Whether it would 
 be constitutional as applied to coal mines is a different question. 
 But if such federal legislation as to disputes in coal mines would not 
 be constitutional, unquestionably similar state legislation w'ould be 
 so. Furthermore, similar state legislation applying to public utili- 
 ties of all kinds would be constitutional. 
 
 Would not such regulation of the relations between capital and 
 labor secure all of the advantages of compulsory arbitration and at 
 the same time steer clear of its disadvantages? New Zealand has 
 tried both compulsory arbitration and compulsory acceptance of 
 awards. Canada has tried compulsory arbitration with voluntary 
 acceptance of awards. Under the Erdman-Newlands Act we have 
 tried voluntary arbitration with compulsory acceptance of awards. 
 In my opinion which would be best suited to our own conditions 
 and needs would be that or compulsory arbitration with voluntary 
 acceptance of awards, carried out under some such plan as that 
 which I have outlined. 
 
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