Solving the Knowledge Problem in Natural Resources Law: Mining, Property Rights, and the Critical Minerals Challenge
Abstract
The United States’ growing dependence on foreign sources for rare earth elements and other critical minerals is commonly attributed to environmental regulation, permitting delay, or foreign industrial policy. This Article argues that those explanations miss the core problem. The crisis is institutional. By abandoning the property-rights framework of the General Mining Law of 1872 and replacing it with administrative discretion under twentieth-century statutes such as the Mineral Leasing Act, FLPMA, and NEPA, the United States dismantled the legal institutions that once induced mineral discovery and supported long-horizon investment. Drawing on economic theory and legal history, the Article shows how property-based access to public minerals solved the twin problems of mineral development: incentivizing decentralized discovery under deep uncertainty and enabling capital-intensive investment in sunk assets. The core problem is thus a Hayekian knowledge problem. Rare earths provide a diagnostic case. Contemporary policy responses-subsidies, industrial planning, and executive action-have pushed the administrative system to its limits but cannot substitute for secure, mortgageable mineral rights. The Article concludes that restoring domestic critical-mineral capacity requires reopening mineral patenting and reestablishing rule-based property rights as the foundation of mineral policy, rather than continuing to rely on discretionary regulation and industrial policy to compensate for their absence.
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