The Star Tribune Editorial Board recently urged voters to learn more about two recent analyses of the impact of nonferrous mining in northern Minnesota ("Competing visions of mining's impact Sept. 2). One of these analyses was a personal letter to the U.S. Forest Service written by Prof. John Stock, a Harvard economist who was an adviser to the Obama administration. The other is a report titled "Unearthing Prosperity," released by Center of the American Experiment, where I work.
We appreciate this opportunity to compare and contrast Professor Stock's letter with our report. It is our belief that once Minnesotans examine these analyses in greater detail, they will find the methods used in "Unearthing Prosperity," a 43-page report containing 126 footnotes, to be more rigorous and our conclusions more sound than the letter written by Professor Stock.
Minnesota has some of the largest undeveloped deposits of copper, nickel, platinum and titanium in the world. Our study found that developing these resources would add $3.7 billion to Minnesota's economy every year and create more than 8,500 jobs. These numbers were obtained using the economic modeling software IMPLAN, considered to be the gold standard in the industry.
Among the jobs created are 1,902 high-paying mining jobs — direct jobs, as economists would say, with average wages of around $80,000 per year. Another 3,181 "indirect jobs" would be created by people supplying goods and services to the mining industry.
Because mining and support jobs pay high wages, IMPLAN estimates that 3,385 "induced jobs" would be created as these well-paid workers spend their paychecks in the broader economy on school supplies for their children, visits to the doctor's office, eating at restaurants, and on tourism-related activities.
It is important for Minnesotans to understand that Professor Stock intentionally omitted induced jobs from his analysis. This is significant because high-paying mining jobs are able to support more induced jobs than tourism jobs paying $16,500 per year. It should come as no surprise that people with higher incomes have more money to spend in the economy.
Induced jobs are a crucially important component for understanding the entire economic potential of mining in our state and they should not have been omitted from Professor Stock's analysis. By omitting these job numbers, the analysis is depriving Minnesotans of indispensable information needed to weigh the complete costs and benefits of mining copper, nickel, and titanium.
In addition to omitting important jobs numbers, the letter by Professor Stock assumes mining would result in a reversal of the projected growth in tourism in the Boundary Waters Canoe Area Wilderness. The letter assumes tourism would decline at a rate of 1.2 percent to 2.4 percent per year, or approximately 21.5 percent to 38.5 percent over 20 years, but provides exactly zero empirical evidence to support this assumption.
