Front Page Titles (by Subject) Mineral Rights and Government - Literature of Liberty, October/December 1979, vol. 2, No. 4
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Mineral Rights and Government - Leonard P. Liggio, Literature of Liberty, October/December 1979, vol. 2, No. 4 
Literature of Liberty: A Review of Contemporary Liberal Thought was published first by the Cato Institute (1978-1979) and later by the Institute for Humane Studies (1980-1982) under the editorial direction of Leonard P. Liggio.
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Mineral Rights and Government
“Government Support of Private Claims to Public Minerals: Western Mineral Rights.” Business History Review 5(Autumn 1979):364–385.
Legal definitions of land tenure and property rights determine the nature and pace of economic growth. Economic activity and interest can, in turn, influence legislation. This legal-economic interaction in nineteenth-century United States can be clearly seen in a study of government support for private property mineral rights in the famous gold and silver mining region of the Comstock Lode in Nevada.
Since the Comstock region lacked organized government and since the U.S. Congress had, in 1866, no procedure for transferring mineral rights to private individuals, mineral claimants had to voluntarily develop property rights institution to legitimize and protect their investments. The evolution of private ownership of mineral rights in the Comstock Lode illustrate the response of legal and government institutions to private economic enterprise. Eventually the Comstock mineral law was incorporated into the Federal Mining Statutes of 1866 and 1872, which still governs the assignment of private rights to metal on the public domain.
At the time of the Comstock Lode discovery in January, 1859, claims to property titles to the land and mineral rights were bound to cause confusion because the land was in the “public domain” with no provisions for private appropriation. Miners were technically trespassers even though the Federal Government did not usually enforce its own claims. Further-more Congress had generally reserved mineral lands from private ownership. Since disputes naturally arose over rival claims to underground overlapping veins of gold and silver, the need arose for more precise and enforceable property titles and ownership. Thus, voluntary written rules were devised prescribing claim location and size as well as arbitration procedures. An example of this private development was the Gold Hill rules (1859), which were enforced by a claim recorder and a miners' court. Only those miners who followed camp rules were granted locally-recognized mineral rights.
The mining camp rules for Gold Hill and Virginia City, Nevada changed with subsequent economic developments. The need for capital to explore deeper veins of gold led to incorporation of the mines and mining stock. After Congress granted Nevada territorial status in March 2, 1861, the new territorial government supplemented the mining camp rules in support of local and private mineral rights. But in reality the territorial government courts could not deal with so much litigation. In 1864 the threat of the federal government's taxing and selling the laissez-faire established mineral rights to pay the Civil War debt pressured local miners to seek a state government for Nevada. Opposition to federal intervention in local mineral rights continued after statehood and the Nevada Senators defeated Congressional bills to sell off the mining lands already “owned” by local Nevada miners. In 1866, Congress “ratified existing claims, and placed the legislative and judicial support of the federal government behind such local property regulations as the Gold Hill camp rules.” The miners' goal in the legislation was to remove the threat of government abrogating local rights and to protest existing property rights.
Thus, the Nevada experience reveals how resource owners are moved by economic interest to obtain clear legal definition of their rights. This need for clear property title led to a series of institutions that assigned and guaranteed private mineral rights. The mining camp rules of 1889, the territorial government measures in 1861, the state government provisions of 1864, and the federal mining law of 1886.