Gifts of jewelry — particularly gold — are a perennial favorite on Santa’s list. And with the metal’s price hovering near $800 an ounce, the tiniest golden bauble, bangle or bead will be a coveted commodity. But even if you don’t elect to splurge on this luxury, it will still cost you plenty because mining companies from around the world can take gold from U.S. lands basically for free, leaving taxpayers with nothing but the cost of cleaning up the damage that mining leaves behind.

Although the practice seems naughty, it’s all nice and legal because of an obsolete federal law. And although the U.S. House of Representatives recently passed legislation to close the loopholes, the metal mining industry’s allies in the Senate may block the long-overdue reforms.

The mining of gold and other hard-rock minerals on public lands is governed by the General Mining Law of 1872, which has remained virtually unchanged since it was signed by President Grant to encourage settlement of the West. The statute was designed to reward pioneers who survived the trek across the frontier with the opportunity to mine gold and other metals freely and in unlimited amounts.

The prospectors are long gone, but the incentives remain. Today, the highly profitable hard-rock mining industry — much of it foreign-owned — continues to receive generous U.S. tax breaks. And it pays virtually nothing for gold and other precious metals it takes from public lands with few restraints. In sharp contrast, oil, gas and coal companies have been reimbursing taxpayers for decades with billions of dollars in royalties that were paid for resources removed from federal property.

Not surprisingly, such free and easy access has resulted in the United States joining the ranks of the world’s top producers of gold, most of which ends up as jewelry. And despite its escalating cost, world demand is soaring. The United States now imports less gold than it sends overseas, predominantly to eager consumers in India, China and the Middle East.

The gold may be exported, but the mess made stays behind. The production of just one gold ring generates about 20 tons of waste, according to one mining policy organization, much of it left to litter the landscape as well as polluting rivers and streams. Today, most gold is mined from open pits, which can run a mile long and equally as deep. Utah’s Bingham Canyon, which produces gold as well as copper, silver and molybdenum, forms a crater large enough to be visible from outer space…

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