"I do not believe that any one law can effect protection to
mining investors, nor that the protection afforded through the
Post Office Department forbidding the use of mails for fraudulent
advertising matter can fully cover that ground. The greater part
of mining frauds are perpetrated without the use of the mails.
"The proposed law, in our judgment, is the longest possible step
toward preventing mining frauds. A second step has been taken in
the form of a publicity law. My belief is that no system of laws,
either state or national, will prevent men from gambling in mines
more effectually than such laws now prevent gambling in its more
common forms. These may restrict and furnish protection to those
who are wise enough to open their eyes, but it will be impossible
to protect all the fools all the time. It is the purpose of the
American Mining Congress, after having secured the enactment of
laws providing penalties for fraudulent representations and
requiring publicity, to perfect an organization to SECURE
EXECUTION of these laws, and also to carry on campaigns of
education showing to investors, first, that mining is a
legitimate business and not a gamble; second, that mines are
found and not made; third, that investments in mining should be
made with the same care and prudence exercised by business men
when embarking in other business enterprises. . . . The next work
of our organization will be along the line of developing some
manner of control of corporations by which paid-up capital stock
shall represent actual value."
Mr. Callbreath would seem to be one fore-doomed to his own
troubles; yet it is clear that he and his organization stand for
legitimate mining as opposed to prospect-selling. In strictly
accurate phrase, it is the prospect which is found, and the mine
which is made and investment cannot properly begin until a body
of ore has been blocked out in a proved prospect. Add to the
glamor of risk the haze of fraud, and the foregoing will show the
nebulous condition of mining investments in relation to mining
laws in America to-day.
What we really need is a Bureau of Mines at Washington. Nobody
protects the mining investor. Nobody guards the widest open gate
into the savings deposits of this country.
The American Mining Congress, it should be stated, had a quasi
pre-inaugural pledge from President Taft in favor of a Federal
Bureau of Mines. Toward this we have made a start. A bill
establishing this Bureau has already passed both the House and
the Senate, and bids fair to become a law. But the activities of
this new department will be confined to safe-guarding
mineworkers. The next step should be to enlarge the province of
the Bureau so as to include the supervision of the mining
industry for the protection of investors.
It seems quite likely that the states and the nation will need to
unite if adequate protection to the investing public is to be
expected. But when did state and nation unite to solve a great
popular problem? When did section ever unite with section or even
resident with nonresident? This is America.