Obama's Position On Mining Law Questioned

Democrat Barack Obama opposes a bill that would change the nation's 135-year-old mining law - the same stance as mining industry executives who employ a Nevada-based lobbyist advising the presidential candidate.

The Obama campaign and Billy Vassiliadis, a longtime Nevada power broker, contend there is no connection, saying they have never discussed Obama's position on the mining bill.

However, the Illinois senator's stance on pending legislation and his adviser's ties to the mining industry are raising questions in a state where mining is an economic engine in rural areas. Democrats will vote in presidential caucuses Jan. 19, and Obama's position could help him against rivals Hillary Rodham Clinton and John Edwards, who have not taken a clear position on the bill.

The General Mining Law of 1872 allows the mining industry to pull gold, silver and other minerals from federal lands without paying royalties. The industry opposes changes to the law and several efforts to reform it have failed.

A House-passed bill would impose a royalty of 4 percent of gross revenue on existing hard-rock mining operations and 8 percent of gross revenue on new mining operations. The reform bill also would put new environmental controls on hard-rock mining, set up a cleanup fund for abandoned mines and permanently ban cheap sales of public lands for mining.

Obama said the legislation, favored by environmentalists, "places a significant burden on the mining industry and could have a significant impact on jobs." He also opposes the proposed fees.

Obama's statements are largely in line with the those of Nevada Sen. Harry Reid, a miner's son who has long fended off significant reform and defended the industry as critical to the rural West. Nevada is the largest gold-producing state in the nation and ranks behind only South Africa, Australia and China internationally.

Vassiliadis, a longtime Nevada power broker, is a member of Obama's Nevada steering committee and has contributed $2,300 to his campaign. He is a lobbyist for the Nevada Mining Association at the state level and the chief executive of the advertising and lobbying firm hired by two mining companies to lobby for them in Washington.

Denver-based Newmont Mining Co., one of the world's largest gold producers, hired Las Vegas-based R&R Partners' Washington, D.C. office in January. The firm has represented silver and gold miner Coeur d'Alene Mines Corp., in Washington since 2006.

Obama campaign spokeswoman Shannon Gilson said Vassiliadis has advised the campaign only on politics, never policy.

"I have not had a single conversation, not one, with anybody in the Obama campaign about mining," Vassiliadis said.

Vassiliadis is not a federally registered lobbyist. His firm, R&R Partners Inc., generates most of its revenue from advertising and public relations, Vassiliadis said. It's best known for developing the Las Vegas tourism tag line, "What happens here, stays here."

Obama regularly assails the relationship between special interests, lobbyists and politicians. He has called for more transparency in government and separation from lobbyists' influence is a central tenet to his claims as the candidate of change.

"If everything is out front, you know who is doing (lobbyists') bidding and who is doing the bidding of the American people," Obama said recently in New Hampshire. "And that's the kind of politics we need to set up."

Obama does not accept campaign donations from federal lobbyists.

Obama says he believes mining reform is necessary and has called for increased dialogue to forge a compromise.

Dan Randolph of Great Basin Mine Watch said the senator's position "implies that Senator Obama is really only listening to one side of the issue."