Precious Metals and the Environment
By Ron Helwig
Many progressives or other left-leaning politically attuned folks have
a disdain for precious metals as a basis for a monetary system. While
their economic and social reasons for dismissing the bastion of sound
money have been fairly thoroughly discussed elsewhere, I haven’t heard
much debate on their environmental concerns.
The typical remarks about the damage caused to the environment by
precious metals extraction (AKA mining) are valid on their face. The
fact is, most of the easily retrieved gold and silver has already been
dug out, and there’s not a lot of nice sized nuggets awaiting the pick
and shovel of a grizzled old prospector. Modern mining technologies
basically take huge scoops out of the earth and process them by the
ton to get mere grams of value. And the actual processing often uses
dangerous and harmful chemicals like cyanide.
But just because current technologies and practices might cause harm
or at the very least add significant cleanup and remediation costs
doesn’t mean that it will always be that way. Knowledge and tools of
chemistry are improving all the time. Nanotech might cause some
breakthrough, and biotech has some potential for making great leaps
forward in environmentally friendly resource extraction. And even
current technologies are well known and the hazards can be controlled
and damage limited.
An even stronger case can be made, at least for purposes of a monetary
system, that we don’t need to mine anymore. We already have enough
gold and silver to operate a global economy based on precious metals.
Gold and silver have that important quality of divisibility that makes
it all work, regardless of how much we have on hand. We don’t even
need to melt down any jewelry. All we really need to do is let the
price rise to meet the demand for its use as money. Sure, we might
temporarily see things like $30,000 per ounce of gold. But gold, and
more importantly representations of gold such as certificates, can be
easily divided into really tiny units. I can envision banks issuing
notes the equivalent of a dollar but stating that they are backed by a
thousandth of a gram. I’ve even seen a presentation for a prototype
currency that embeds tiny amounts of gold leaf in a polymer note - a
similar idea to what Shire Silver does.
Plenty of other people have described how the divisibility of gold and
silver can make any particular amount sufficient for everyone’s needs.
What this tells us is that in order to return to a monetary system of
sound money based on precious metals, we don’t need to do any more
mining. Add in the fact that gold and silver are very likely the most
recycled materials in history, and our position is even stronger.
Environmental problem solved!