2

Postwar Energy Demands and the Southwestern Experience

SADLY, THE NORTHERN Cheyenne’s initial experience with coal development was not unique. The opening of this small, southeastern Montana reservation was part of a much broader, post–World War II movement to develop energy resources across the American West. In fact, long before the 1973 Arab oil embargo called attention to the importance of domestic energy production, private firms had been quietly, but fervently, locking up western minerals to meet America’s incessant postwar energy demands. These multinational corporations understood potential instabilities in global oil supplies, possessed capabilities to prospect and evaluate western energy deposits, and had a firm grasp of the complicated regulatory structure for accessing domestic minerals. In other words, they had the knowledge, skills, and resources that federal and tribal officials did not. Employing these advantages, mining firms pursued energy resources of all kinds on both public and tribal lands. But unquestionably, their efforts centered on the West’s most abundant resource: low-sulfur coal.

THE QUIET CREEP

Ironically, the great push for western coal began during the period of, and was partly triggered by, America’s infatuation with consuming foreign oil. As has been well documented, American use of petroleum skyrocketed in the years following World War II, tripling from 5.8 million barrels a day in 1948 to 16.4 million barrels by 1972. Common understandings link this sharp rise in oil use to increasing levels of postwar American prosperity, thus increasing demand. But changes in global oil production were as important as rising consumption to explaining oil’s emergence as America’s dominant fuel choice. Quite simply, the Texas oil fields that fueled American might during World War II were not expansive enough to power the country’s postwar economic boom. For that, foreign oil was needed.1

In the immediate aftermath of World War II, the United States, Great Britain, and other western states worked feverishly with multinational oil firms and Middle Eastern royals to unlock the vast petroleum reserves underlying the Arab and Persian worlds. The complicated deals they constructed flooded America and the world with cheap oil, making the United States a net importer of petroleum for the first time in 1948. Just two years later, oil supplanted coal as the United States’ primary energy source, and this unyielding flow of petroleum worked important changes in American patterns of consumption, which is where most scholars pick up the story. Cheap oil made cheap gasoline and electricity possible, which in turn fueled the dramatic suburbanization of postwar America. On this foundation of cheap imported petroleum, the country returned to its earlier infatuation with the automobile, producing an extensive car culture with all its accompanying accoutrements, including expanded highway systems, motels, fast-food restaurants, suburban shopping malls, and even drive-in churches. As American tastes and values shifted to accommodate the abundance of cheap fuel, the rising demand provided the market to justify further production. It was this dialectic process between foreign oil production and incessant American consumption that produced the incredibly wealthy and powerful global oil companies that dominate world energy production today.²

These conditions also set the stage for a new era in the American energy industry: the entry of multinational oil and gas companies into the coal mining business. During the postwar period of rapid American growth and cheap Middle Eastern oil, coal production dropped to its lowest levels since the Depression and prices remained remarkably stable and low. Large oil and gas firms flush with cash from Middle Eastern production took advantage of these low barriers to entry and began quietly buying devalued coal companies by the dozens. Such giants as Gulf Oil, Continental Oil, Occidental Petroleum, and Standard Oil of Ohio gobbled up the longstanding coal concerns Pittsburgh and Midway Coal Mining Company, Consolidation Coal Company, Island Creek Coal, and Old Ben Coal, respectively. By the mid-1960s, energy industry observers were noting a dominant trend of conglomerated “energy entities” replacing individual corporations focused on the production of a single energy source, which had been the traditional approach. Bracing for a drawn-out battle with the emerging nuclear power industry and concerned about rising instability in the Middle East, oil companies understood the need to diversify their holdings with cheap, domestic sources of energy, and coal was by far the most abundant.3

Much of this corporate consolidation took place with an eye toward the American West. Explosive postwar western growth ignited energy companies’ interest in the region, and by locating fuel sources and constructing power plants near this expanding demand, they could reduce transmission costs. Changes in mining technology also made western coal easier and less expensive to mine. Engineering firms developed larger and more powerful drag lines to remove overburden covering western coal, which was generally younger and thus located closer to the surface than its eastern counterpart. The cost advantages of surface mining with massive equipment, rather than employing an army of underground miners, became especially clear after passage of the 1969 Federal Coal Mine Health and Safety Act, which imposed costly new regulations on deep-shaft mining. Moreover, the lack of entrenched western labor unions—particularly John L. Lewis’s United Mine Workers—removed one of the larger impediments to efficient and profitable mining. Widespread eastern coal strikes in 1971 and 1974 further reinforced this advantage for western coal.⁴

Beyond these production advantages for western coal, America’s emerging concerns over air pollution provided mining companies with yet another reason to invest in this emerging energy source. Due to one of those ancient geological processes that now shapes much of today’s geopolitics, western coal generally formed in freshwater swamps, not in brackish or saltwater swamps as in the East. This meant that as millions of years of geologic heat and pressure transformed decaying plant matter into carbon-rich material, western coal often contained significantly less sulfur than its eastern counterpart. Historically this distinction mattered little, for coal companies generally avoided low-sulfur, subbituminous western coal because it contained less thermal heat than eastern bituminous or anthracite coal. Beginning in the mid-1960s, however, in response to public pressure, the federal government began to address the nation’s declining air quality by authorizing research into methods for monitoring and controlling air pollutants. These initial efforts focused on limiting sulfur emissions from coal-burning utilities and industrial manufacturers, which sent mining firms scrambling to secure low-sulfur alternatives. Imported low-sulfur oil provided an obvious solution, but by the late 1960s, such critics as the editor of Coal Age were warning that America’s dependence on foreign oil created “a serious deficit in our balance of trade and our security could be threatened.” The half-hearted 1967 Arab oil embargo confirmed suspicions regarding instability in global oil supplies, and the 1970 Clean Air Act made clear that sulfur emissions would be highly regulated. Both events greatly enhanced western coal’s transformation into a highly desirable, “clean” fuel and further accelerated the movement of coal production west.5

*

As energy firms reoriented their perspective westward, they encountered a regulatory system well attuned to their needs. Eighty percent of coal west of the Mississippi was found on public or Indian lands rather than on private property, meaning federal law, not private contracts, governed its procurement and development. These existing laws replaced a previous, nineteenth-century legal regime that had encouraged the wasteful overproduction of western resources with a leasing system reflecting Progressive desires to rationalize and control development. The goal was to inject federal oversight, but in practice, the new system looked very similar to the old. Federal agencies without the resources to carry out their legislative mandates simply abdicated responsibility to multinational mining companies with the manpower and expertise to do the job. These firms, of course, were all too happy to survey and propose which public and tribal lands should be opened to development, and they hoped to do so without attracting competitors that could drive up prices in subsequent auctions.6

For energy companies looking to secure potentially valuable coal at cut-rate prices with little to no competition, the mid-twentieth-century legal regime worked beautifully. In fact, every coal lease issued by the Department of the Interior prior to the mid-1970s was done at the request of an energy company rather than because the agency determined that a strong market existed for the particular resource. As Gary Bennethum, a mining engineer with the Bureau of Land Management, confirmed in 1974, despite the fifty-year existence of the competitive bidding process, “there has never been a Bureau[-initiated] lease sale.” Moreover, of the 247 leases issued at competitive lease sales, only 76 attracted more than one bidder. The average royalty established through this “competitive” process was merely 12.5 cents a ton for federal coal and 15.8 cents for Indian coal. Compare these royalties to the fact that in 1920, when the government switched to this leasing regime, the average price of coal on the open market was $3.75 a ton, while by 1972 it had more than doubled to $7.66. Public and tribal mineral owners, however, enjoyed only a fraction of coal’s increasing value. By 1974, the federal government and Indian owners had collected barely $30 million from the production of almost 250 million tons of coal.⁷

Beyond establishing incredibly low royalties through this distinctly noncompetitive process, the Department of the Interior further undercut the intent of the mining laws by failing to enforce production requirements contained in the leases issued. This lack of enforcement allowed energy companies to lock up coal reserves in long-term leases, which they kept in their portfolios to be developed should global oil prices rise. Despite this obvious advantage, federal regulators did not require firms to allocate capital to the development of these coal leases or pay the public or Indian owners for the privilege of monopolizing their resources.⁸

In the 1960s, sophisticated, multinational energy corporations with the ability to evaluate potential coal lands, the necessary familiarity with federal laws for developing domestic sources, and a firm understanding of the increasing instability of the global oil market took full advantage of this opportunity to secure valuable energy sources with minimal investment. Coal leasing exploded in the 1960s (figure 1). During the decade, the Department of the Interior issued 67 percent of all leases ever granted. These new leases covered 939,000 acres of public and Indian lands—nearly four times the amount of acreage under lease prior to 1960—and close to 20 billion tons of recoverable coal. Only 11 percent of these leases, however, actually produced coal before the 1973 Arab oil embargo. In fact, in the entire history of the leasing program to that point, leased federal or Indian coal mines contributed less than 1 percent to the nation’s coal production, despite the fact that these lands contained 45 percent of recoverable domestic reserves. Further, these nonproducing lands were controlled by a small number of large companies. By 1974, the largest fifteen leaseholders, which included major oil firms like Continental Oil (CONOCO), Shell Oil, Sun Oil (SUNOCO), and Gulf Oil, held 70 percent of the nation’s coal leases. Of these leases, only 7 percent were producing coal. Energy firms had successfully tied up Indian and public coal, but they paid very little for the privilege.9

Figure 1. Number of public and Indian coal leases, 1920–70. Author-generated graph. Data from James S. Cannon and Mary Jean Haley, Leased and Lost: A Study of Public and Indian Coal Leasing in the West (New York: Council on Economic Priorities, 1974), 6.

By the early 1970s, numerous government and private entities began decrying the structural flaws preventing the equitable development of the country’s vast coal reserves. Tasked with reviewing the effectiveness of the program, the General Accounting Office condemned the competitive leasing process in 1972, explaining that “the mere leasing of federal land is not accomplishing the objective of the leasing program,” which was to efficiently develop domestic energy sources and return fair profits to taxpayers and Indian owners. One year later, the National Academies of Sciences and Engineering noted that the mining laws were “conceptually and operationally outmoded” and declared that energy firms had so manipulated the leasing process that “the situation has become nearly chaotic.” Assessing the program in 1974, the Council for Economic Priorities was even more direct in its criticism, stating, “In practice, the [Department of the Interior] has abdicated all responsibility for land use planning to corporate interests and has mismanaged the competitive leasing program so badly, it makes a mockery of the word competition.”10

Recognizing the utter failure of the system to meet the original intent of the leasing legislation, the Department of the Interior halted further federal coal leasing in 1971. Two years later, after numerous reviews condemned the program, the agency announced an official moratorium, allowing limited mining to maintain existing operations but suspending prospecting permits “to allow the preparation of a program for the more orderly development of coal resources upon the public lands.” This moratorium continued until 1976—right through the 1973 Arab oil embargo—until Interior officials devised new policies and procedures to ensure that public coal was developed in a responsible manner that returned revenue to the nation and reclaimed disturbed land.¹¹

*

But the moratorium did not extend to tribal lands. Despite the fact that the Indian mineral development program was built on the same leasing template used for public minerals, and thus suffered the same problems, tribal leasing continued apace. In the eyes of many, it simply had to. Federal officials, energy executives, and even tribal leaders portrayed the tribes’ vast energy reserves as the answer to crippling reservation poverty. Ceasing to lease would stymie development deemed essential to Indian survival.

Such enthusiasm for tribal energy development was understandable given the depth of Indian poverty. In 1960, at the beginning of the decade of intense leasing activity, the median income for all Indians was just $1,348, with Indian males claiming $1,792 compared to $4,300 for their white male counterparts. By the end of the decade, Indian income had risen to $4,347 but still was one-third the average 1970 American income of $13,188. This discrepancy in Indian wealth and the associated conditions of such poverty were particularly pronounced on rural reservations, where approximately 70 percent of Indians lived. In 1967, 76 percent of reservation families earned less than the poverty threshold of $3,000. Unemployment hovered at an astonishing 40 percent. The median years of schooling for Indian males was 8.4 years, two years less than the national average, and 22.4 percent had less than five years of school all together. In 1961, the Bureau of Indian Affairs could count only sixty-six Indians graduating from four-year colleges; in 1968, the number was still under two hundred. Infant mortality rates on rural reservations were nearly four times the national average, and the median life expectancy for reservation Indians was merely sixty-three years old, seven years below the average American.12

By the mid-1970s, these depressing statistics moved Congress to create the American Indian Policy Review Commission to make the first full accounting of Indian policy since the 1920s. Among its many tasks, the commission catalogued the substantial natural resources contained on Indian reservations and investigated how these assets were being used. The results confounded the commissioners. According to the BIA’s head of Trust Services, in 1975 Indian reservations contained 50 of the nation’s 434 billion tons of recoverable coal. That same year, the U.S. Geological Survey estimated tribes held 100 to 200 billion tons of the nation’s 1,581 billion tons of known coal reserves. Under either measurement, at least 10 percent of the country’s demonstrated coal resources were found on Indian reservations. In the West, where the locus of coal production had shifted and where the majority of Indian reservations were located, this meant tribes controlled a full 30 percent of the highly desirable, low-sulfur coal.¹³

In addition to coal, Indians possessed other energy resources in abundance. The Geological Survey conservatively estimated Indian oil and gas reserves to be 4.2 billion barrels of oil and 17.5 trillion cubic feet of gas, representing 3 percent of the nation’s capacity. Many thought the tribal cache to be much higher. The Navajo tribe itself claimed to possess 100 billion barrels of oil and 25 trillion cubic feet of gas. Uranium numbers were also in dispute, but by 1979 the Department of Energy and national Indian groups agreed that tribes most likely possessed 37 percent of the nation’s recoverable stash. While the specific figures could be contested, there was no doubt that American Indians stood to be major players in the energy industry. As LaDonna Harris, founder of Americans for Indian Opportunity, put it, “Collectively, they’re the biggest private owners of energy in the country.”14

Considering the extent of tribal resources, of which energy minerals were just a subset, the American Indian Policy Review Commission struggled to explain the pervasiveness of reservation poverty. Its 1977 final report noted:

From the standpoint of personal well-being the Indian of America ranks at the bottom of virtually every social statistical indicator. On the average he has the highest infant mortality rate, the lowest longevity rate, the lowest level of educational attainment, the lowest per capita income and the poorest housing and transportation in the land. How is this disparity between potential wealth and actual poverty to be explained?

More baffling was the fact that these abundant tribal resources included the same energy sources that multinational energy firms were now seeking to develop with increasing vigor. The commission drew the only conclusion it could, stating that “at least one explanation [for the discrepancy] lies in the fact that a very significant part of this natural abundance is not controlled by Indians at all.”¹⁵

For years, American Indians and their allies, including Felix Cohen during the 1930s, had argued this same point. In order to maximize benefits, tribal governments should control tribal resources. But federal law denied tribes this right. It paid lip service to sovereignty, efficient management, competitive bidding, pollution reduction, and other public goods. Yet in practice, the law left the control of energy resource development in the hands of government agencies not up to the task. The result was predictable. With Indians shut out and flaccid federal oversight, private energy firms well-versed in the intricacies of mining law and with abundant capital to invest in cheap coal stepped in and took over.

THE PREQUEL: NAVAJO AND HOPI ENERGY DEVELOPMENT

The Navajo and Hopi nations of the American Southwest would come to understand this wrecked system better than any other group. For generations, the tribes’ desert landscape had been deemed too remote and inhospitable for industrial development, but by the early twentieth century, tribal members, federal officials, and mining firms were learning of the region’s ample mineral deposits. In 1923, federal agents orchestrated the formation of the Navajo Tribal Council specifically to manage such resources. In 1955, the Hopi Tribal Council was reconstituted for the same purpose. It was not, however, until the Southwest’s post–World War II transformation into the centerpiece of the nation’s new military-industrial complex that energy firms began targeting these resources in a sustained manner. During the war, area boosters had touted the region’s strategic location and its vast, open land to secure numerous military bases, and after 1945, massive infusions of federal dollars spurred unprecedented growth in associated defense industries. Midwesterners flocked to fill these jobs, area farmers subdivided their struggling farms to meet the ensuing housing demand, and federal subsidies generated enough affluence to confirm most residents’ faith in the American Dream.16

But to keep the dream afloat, enormous amounts of cheap energy were needed. New Deal dams had generated enough hydroelectricity to run wartime factories, but after World War II, southwestern energy demand increased exponentially. In 1940, the peak electricity consumption for New Mexico, Arizona, and Southern California, collectively, was only 1,329 megawatts on the most demanding summer day. By 1960, peak demand for Southern California alone was 5,467 megawatts. This explosion in demand sent regional leaders, utility executives, and federal officials scrambling to locate additional energy sources. L. M. Alexander, a senior official with Arizona’s Salt River Project—originally a federally subsidized irrigation project that was now transforming into one of the region’s largest utilities—summed up his and other energy companies’ driving commitment: “[We] make certain there is enough electricity to operate every air conditioner, heater, and other type of electrical appliance our customers may want to use. They [the consumers] dictate—it is up to us to respond.”¹⁷

And respond they did. To meet surging energy needs, mining firms and utilities began working with the federal government to access minerals locked away on public and Indian lands. In particular, early efforts focused on Navajo oil; energy executives obtained leases that increased reservation oil production by more than 300 percent during the 1950s. Oil drilling not only unlocked desperately needed energy for the region but also resulted in substantial tribal revenues. In 1959 alone, the Navajo netted close to $10 million in oil royalties. Combine these royalties with rents and bonuses paid for accessing reservation lands, and by 1962, the tribe had secured close to $76.5 million in oil proceeds. One wonders what the tribe could have received had the BIA been demanding fair market value.

Oil was not the only Navajo energy source in high demand. In 1951, the discovery of uranium on the Navajo Reservation triggered another frenzy of activity over this newly valuable resource. Timothy Benally, director of the Navajo Uranium Workers office, recalled, “Right after World War II, when the government found out what uranium could do, they decided to mine some of those areas and a lot of it was found on the reservation. People just went crazy looking for uranium, prospecting all over the reservation.” Uranium development produced millions more, though as many have documented, the adverse environmental and health legacies of this mining remained long after the tribe dispensed all royalty revenue.18

Considering mining’s monetary benefits, Navajo leaders warmly welcomed these early energy deals and collaborated with federal officials whom they trusted were working on the tribe’s behalf. Explaining the relationship between his government and their federal trustee in 1956, Tribal Chairman Paul Jones noted:

Basically we are determined to work cooperatively with Federal and State agencies in the development and execution of programs in which Navajos have such a heavy stake. . . . We do not approach this cooperative relationship with a defensive attitude based on the conviction that outside agencies are primarily designed to exploit us. Rather, we believe they and most of their personnel are sincerely devoted to the solution of problems.

Three years later, as oil and uranium royalties mounted, Jones continued to celebrate reservation resource development, publicly thanking “Divine Providence” for bringing his community “unexpected wealth from . . . natural resources.”¹⁹

In fact, Navajo leaders actually hoped to quicken the pace of development and increase the tribe’s role in mining ventures. In 1959, for instance, the same year Chairman Jones counted his divine blessings, the tribal council bypassed the BIA and negotiated directly with the Delhi-Taylor Oil Company to provide drilling rights for over five million reservation acres. Importantly, this agreement was not a typical lease but a partnership that promised the Navajo a 50 percent share of the profits, if also an increased percentage of the risks. Not for the last time, however, the BIA thwarted this attempt by a tribal government to increase its role in energy development. Claiming the trustee duty compelled them to prevent such a risky arrangement, federal officials vetoed this tribal-led energy project.20

*

Throughout the 1950s, then, Navajo oil and uranium provided vital energy for the expanding Southwest and desperately needed revenue for the tribe. Coal, however, would be the crown jewel in the region’s future development plans. Changes in electricity transmission technology made cheap Indian coal particularly attractive to civic leaders, who sought to burn this dirty energy source far away on reservations and then transmit electricity via new, high-voltage wires to their clean and booming metropolises. In the mid-1950s, a consortium of energy companies began work on the Colorado Plateau’s first coal-fired power plant, to be located on the eastern edge of the Navajo Reservation. To provide coal to the Four Corners Generating Station, BIA officials facilitated negotiations between the Navajo tribe and Utah International that opened almost 25,000 reservation acres to mining, returning fixed royalties to the tribe of 15 cents per ton. Beginning operations in 1962, Utah International’s Navajo Mine would grow to be the largest strip mine in the world, supplying coal to the Four Corners plant, which by most accounts became America’s single largest atmospheric polluter.²¹

But the world’s largest strip mine and America’s dirtiest power plant were just the beginning. Seizing on the momentum of these projects, in 1964, ten private utilities formed Western Energy Supply and Transmission Associates (WEST) to construct the largest regional power grid the world had ever seen. The “Grand Plan,” as it was termed by one of its visionaries, James Malloy of Los Angeles’s Department of Water and Power, was conceived as an integrated network of hydroelectric dams on the Southwest’s mighty but infrequent rivers, nuclear facilities on the West Coast, and most important, dozens of coal-fired power plants along the interior Colorado Plateau. In addition to producing electricity for exploding population centers in Southern California, Nevada, and Arizona, power generated from this network would also fuel the Salt River Project and, later, the Central Arizona Project, both of which pumped millions of tons of precious water uphill, through the desert, to irrigate farmlands and supply such urban centers as Las Vegas and Phoenix. Trying to capture the magnitude of the project, a WEST spokesman explained that the program would “produce more than three times as much power as TVA, seventeen times as much as the Aswan Dam project in Egypt and eight times as much as the Soviet Union’s largest power project.” In the intoxicating times of the postwar American Sunbelt, anything seemed possible.22

Like many grandiose western schemes, the project, WEST’s proponents claimed, would be a purely private endeavor, but nothing of this magnitude gets done in the American West without federal aid. WEST officials quickly recognized that although their proposed coal-fired boilers could provide the region’s base supply of electricity, they would need to tap into the Bureau of Reclamation’s existing power grid to efficiently meet peak demand. From the federal perspective, a partnership with the private utilities also made sense. Interior Secretary Stewart Udall understood that the dated U.S. hydroelectric system could not keep up with the Southwest’s exploding energy demands, and environmental challenges made the construction of more large-scale federal dams untenable. Thus, in June 1965, federal and WEST officials announced plans to connect their systems, designing a joint private-federal grid that would produce electricity in the most efficient manner possible and allow excess power to be moved wherever it was most needed. And once committed, no one became a stronger advocate for this fantastic regional scheme than Stewart Udall, who hailed the partnership as “a giant step forward in the development of a formula for joint public and private resource development in the Colorado (River) Basin that will become a model for the Nation.” Addressing Arizona State University graduates the same month this private-public partnership was announced, Udall beamed, “If we can perfect this new and unique partnership to produce low-cost electrical power for all, it will be the best region in the nation both to live in and work in.” Arizona’s native son intended to make his home a model of planned regional development for the rest of the country.²³

By the time Udall began promoting his desert paradise, the groundwork for acquiring Indian coal to fuel the Grand Plan had already been laid. In 1961, the Sentry Royalty Company—the same prospecting arm of the Peabody Coal Company that would later secure Northern Cheyenne coal rights—began exploratory activities on Black Mesa, a massive butte located within the Joint Use Area shared by the Navajo and Hopi tribes. The very next year, a subsidiary of Gulf Oil, the Pittsburg & Midway Coal Mining Company, obtained a prospecting permit for the eastern side of the Navajo Reservation. At WEST’s formation in 1964, then, both Peabody and Gulf had already exercised lease options in these contracts to extract coal from over 35,000 acres on the Navajo Reservation. Just two years later, Peabody obtained more leases from the Hopi and Navajo to mine Black Mesa, and another joint venture by Consolidation Coal and the El Paso Natural Gas Company secured 40,000 more Navajo acres for coal mining. These same multinational energy firms would later become active on Northern Plains’ reservations, but they first exploited the broken leasing regime here on Navajo and Hopi lands. In doing so, they strategically positioned themselves to supply the many WEST-affiliated power plants scheduled to come on line in the late 1960s and early 1970s.24

Interestingly, with the exception of the last coal lease obtained by Consolidation Coal and El Paso, these energy firms acquired Navajo and Hopi mineral rights through negotiations with the BIA and tribal councils rather than through the competitive bidding process. Recall that federal law allowed for this possibility for Indian coal if BIA officials determined it was in the tribe’s best interest. Yet even a cursory review of the resulting lease negotiations make clear the dangers involved in negotiating complicated mineral deals with the world’s largest energy firms. Simply put, tribal leaders and federal officials were not equipped to do battle. This is not to say that savvy and powerful energy executives simply overwhelmed their incompetent and weak opponents, or that they used their supreme bargaining position to easily force Indians into exceptionally bad deals. Far from it. As the economist Brian Morton demonstrates, Navajo and Hopi leaders actually struck deals that were either comparable to or better than federal leases issued for public coal during the same period. Still, Morton acknowledges these deals were “suboptimal”; the financial terms could have been much better, and tribes could have demanded more control over mining operations to ensure such things as better environmental protection.25

So why did the tribes end up with suboptimal leases? The long list of reasons should now sound familiar. To begin with, tribal leaders possessed little geological or market information for their minerals and lacked experience in negotiating long-term energy contracts, both of which left them unprepared to structure deals to return the greatest profits over the life of the contract. Anthropologist Lynn Robbins interviewed nineteen Navajo council members who “negotiated” the 1966 coal lease for Black Mesa, in the area jointly shared with the Hopi tribe, and found that most council members “knew nothing of the value of the coal, the extent of coal deposits on their own lands, alternatives to coal developments, or the possibility of raising coal prices through competitive bidding.” Instead, Robbins noted that few of the councilors were proficient in English, they did not have sufficient time to review lease documents, and the interpretations of the contracts provided by the energy company and the tribe’s own lawyers were insufficient to convey details of potential mining impacts. As council member Ken Smith explained, “we were asked, in effect, to say yes or no to the proposal” and not given sufficient time or information to carefully deliberate the decision.²⁶

On the Hopi Reservation, tribal council members possessed a similar lack of information, especially with respect to strip mining’s impact on the local ecology. As the Hopi’s BIA land officer admitted to Alvin Josephy, a prominent Indian scholar active on both reservations at the time, the Hopi Tribal Council “didn’t know [the energy companies] were going to pile mountains of dirt and just go off and leave it. If [the council] had known what they were going to do, you couldn’t have got that lease for any amount of money.” According to this official, the lease was worked out between the Hopi’s attorney and BIA officials in Washington, D.C., with the tribal council never receiving advice from the local BIA office.²⁷

Added to a dearth of information, reservation poverty clearly hamstrung tribal leaders’ ability to evaluate the long-term benefits of energy projects. These officials understood their authority to lead rested upon their ability to return financial benefits to their desperate communities, and they narrowly focused on this result to the exclusion of all other considerations. Again, interviews with Navajo leaders who approved the 1964 and 1966 coal leases reveal how BIA and corporate promises of wealth drove their decisions. As Robbins reports, these leaders “believed [any] sacrifices to be decidedly limited,” and “realiz[ing] the desperate need for a source of tribal income,” they “believed tribal revenues from coal sales and new jobs created by construction, maintenance, and mining would be worth the sacrifices.”28

Of course, if Navajo and Hopi leaders did not fully understand the deals they signed or were poorly positioned to negotiate them, the tribal populations they served were even more oblivious and powerless to shape development. During the 1966 Navajo negotiations, for instance, members of the local chapters that provided the basic political organization of the tribe were unaware negotiations were even occurring. According to Peterson Zah—at the time a young legal aid attorney assisting tribal members, but who later would become tribal chairman (1983–87) and president (1990–94)—this was not uncommon on the Navajo Reservation. Many Navajo never knew of the mineral leases until they were being evicted and given nominal consideration for their land, or given incomplete information about the environmental impacts of mining and “railroaded” into moving.²⁹

The situation on the Hopi Reservation was even more distressing, as the BIA, energy companies, and the tribe’s own representatives conspired to shut tribal members out of the deliberation process. For decades, the Hopi had been embroiled in an intense intratribal dispute over which governing institution formally represented the community. When energy companies came calling in the 1950s, the tribe’s non-Indian attorney, John Boyden, convinced the Department of the Interior to recognize the Hopi Tribal Council as the legitimate governing body, rather than a coalition of traditional village chiefs known as the Kikmongwis. Despite ample evidence that the tribal majority opposed the council’s authority and policies, Interior vested the tribal council with the authority to execute mineral leases. The agency then approved numerous tribal council energy deals, including the monstrous 40,000-acre coal lease, signed in 1966, to allow Peabody to mine Black Mesa. None of the details of these deals, however, were shared with tribal members. As Alvin Josephy noted in 1971, “The negotiations and the signing of the [Black Mesa] lease were conducted by the council and their lawyer in such secrecy that few other Hopis were aware of what was going on.”

It gets worse. John Boyden, the lawyer leading negotiations on behalf of the Hopi, who had worked so hard to get federal officials to recognize the tribal council so that it could issue mineral leases, was secretly and simultaneously working for the Peabody Coal Company! At the same time Boyden was negotiating away Hopi coal rights underlying Black Mesa, he was representing Peabody in front of the Utah Water and Power Board. There, he quietly secured water rights for a proposed power plant designed to burn the Hopi coal he and his tribal council client granted to Peabody. The situation represented the worst of the worst for tribal members opposed to mining. Summing up the outrage shared by Hopi villagers once news of the Black Mesa lease leaked, one traditional leader condemned the council in the strongest possible terms:

Your organization [the tribal council] was founded yesterday, “illicitly,” a tool designed by the government to disrupt our cultural ways of life, rob us of our land and resources for industrial development of our land, to live like whiteman’s ways, snare into financial difficulties, a scheme to claim our land by means of foreclosures. Without sufficient fact weighing you have blundered most dangerous positions, our land is in jeopardy and the generations to come.

But the deed was done. Even when knowledge of energy development created opposition, the political process for expressing such opposition was hijacked by energy companies, the Interior Department, and a few Hopi leaders.30

Stymied by internal tribal politics—politics adroitly exploited by outsiders—Navajo and Hopi anti-coal activists also found their federal trustee ill prepared to advocate on their behalf. Especially at the local level, BIA officials responsible for helping tribes negotiate mineral contracts were often as ignorant as their tribal clients in understanding how to construct energy leases that maximized return to Indian mineral owners. A decade after the Navajo and Hopi leases, the General Accounting Office was still noting the pervasive inadequacy of federal expertise, telling a Senate committee that the local BIA office overseeing these leases, “by its own admission, does not have adequate minerals expertise. Minerals management is, generally, carried out by staff without formal minerals training.” Beyond the lack of expertise, local officials also lacked knowledge about the Indian resource base. Again, subsequent federal investigations revealed that only after energy companies nominated the particular tracts of land they wanted to prospect would federal officials conduct “a rudimentary exploration on each tract,” though even “these surveys [were] rarely extensive.” According to the Federal Trade Commission, the BIA’s evaluation of reservation mining proposals amounted to “essentially guesswork.” Faced with facilitating complicated mineral negotiations between equally inexperienced tribal leaders and the world’s largest energy firms, federal officials were, at best, overmatched.31

At worst, the federal trustee duty was compromised by other, seemingly more pressing, obligations within the Department of the Interior. This large federal agency was charged not only with meeting its trustee duty to responsibly manage Indian resources but also with managing public resources to meet national needs. These dual mandates often brought several of Interior’s bureaus—the Bureau of Reclamation, the Bureau of Land Management, the Geological Survey, and the Forest Service—into conflict with Indian interests. The risk for such conflict was especially acute with large-scale, private-public partnerships like WEST, where different resources had to be coordinated across multiple bureaucratic jurisdictions. By their very nature, these massive development projects united powerful interests within and outside the federal government, including southwestern congressmen, civic leaders, regional utilities, agribusinesses, and federal agencies that prioritized regional development over tribal well-being.

Such regional priorities became readily apparent in the mid-1960s as more tribal members questioned whether they were receiving all they should from reservation mining. As we saw with the Hopi—and will see again on the Northern Plains—Navajo mining opposition was tied closely to internal tribal politics, especially after the 1963 Healing v. Jones court case that designated portions of Black Mesa a Joint Use Area to be shared by the Navajo and Hopi. This decision split the Navajo over whether to partition the area, remove tribal members from their ancestral homelands, and relatedly, allow additional mining on Black Mesa. Raymond Nakai, the new tribal chairman, supported partition as well as ongoing negotiations with Peabody. Nakai’s political opponents on the tribal council, however, opposed both. In December 1964, the tribal council moved to assert control by passing a resolution affirming its exclusive right to manage Navajo minerals and then revoking Peabody’s Black Mesa prospecting permit, which Nakai had authorized a few months earlier. With Peabody’s permit revoked, this internal tribal dispute suddenly threated one of the key coal sources for WEST’s regional power grid.32

Peabody representatives were cautious not to intervene directly in this intratribal matter, but federal officials showed no such restraint. In June 1965, the same month the Bureau of Reclamation announced its partnership with WEST, Interior Secretary Udall called a meeting in Washington, D.C., to mediate the Navajo dispute. But to federal officials’ dismay, the tribal council boycotted the gathering, forcing Udall to take his case to the press. In his July press conference, the Interior secretary publicly admonished Navajo leaders, noting:

We have some very serious problems and some very fine opportunities in terms of economic development [on the Navajo Reservation]. I am hoping that some of them will come to a head within the next few weeks and if they do . . . most of them are going to involve not just the [Navajo] tribe; they are going to involve the state of Arizona. They are going to involve some of the large industrial concerns—this WEST electric power organization is keyed into the development of the Navajo and Hopi resources.

Udall next ratcheted up the pressure by appointing a special task force to address land management issues on the Navajo Reservation. In response, the Navajo’s non-Indian attorney, Norman Littell, released his own press statement, complaining that federal officials had issued “a not-too-subtle implied threat on the Navajo Tribe that they had better do what Udall wishes” and that the secretary himself “has gone to great lengths over the past two years to force on the Navajo Tribe a lease agreement for Peabody Coal Company on his own terms.” According to longtime Navajo activist John Redhouse, Littell’s exposure of top-level government influence won him and the tribal council the support of most Navajo. The tribal attorney, rather than Chairman Nakai, now became the point man for coal negotiations.³³

Despite this shift in leadership, Littell and his tribal council client understood the need for coal revenue and felt constant pressure to develop this resource. By November 1965, Udall’s efforts forced the council back to the bargaining table, where Littell led months of new negotiations with Peabody. These talks ended in February 1966 with the tribal attorney returning triumphantly to the reservation and, as BIA Area Director Graham Holmes remembers, “walking up the Council aisle, waiving papers for the Council to approve, like the Savior had returned.” Persuaded this was the best deal it could muster under federal pressure, the council ratified the renegotiated agreement, which was hailed as a victory for the Navajo, though it included a mere 25 cents per ton royalty. Meanwhile, Peabody secured cheap coal to fuel one of the key cogs in WEST’s power-generation grid, the Mohave Generating Station.34

Interior officials applied similar pressures to obtain the coal and water necessary for the even larger, and aptly named, Navajo Generating Station. Located on land leased from the Navajo tribe adjacent to the recently completed Glenn Canyon Dam, this facility would supply electricity to the Central Arizona Project, a massive irrigation scheme concocted by Arizona Senators Barry Goldwater and Carl Hayden to pump water through the desert and onto nearly a million acres in central and southern Arizona. Originally the project called for dams to be constructed along the Grand Canyon, but Interior scrapped these plans under pressure from environmental groups, especially David Brower’s Sierra Club. The Navajo Generating Station thus was an ingenious back-up plan to have a WEST supplier, the Peabody Coal Company, provide coal to a WEST member, the Salt River Project, which would run a power plant that sold electricity to another WEST partner, the Bureau of Reclamation, to move water uphill through the Arizona desert. And of course, this last WEST affiliate was part of a federal agency that, through another of its sub-agencies, the BIA, controlled access to the Indian coal and water needed to run the entire system. The conflict of interest was palpable.³⁵

Yet despite the conflict, the Department of the Interior and WEST pushed ahead with this grandest of all plans, easily obtaining the necessary coal by expanding previously negotiated leases with the Navajo and Hopi tribes to mine Black Mesa. To meet the power plants’ vast water needs, the Bureau of Reclamation—again, part of the same agency that was tasked with protecting Indian resources—convinced the Navajo to commit more than 34,000 acre-feet of water, leaving the tribe with less than 16,000 acre-feet from the Colorado River for future needs. In exchange for this concession, WEST promised to lease Navajo land for the power plant, purchase their coal, provide a limited number of jobs to Navajo laborers, and contribute $125,000 to the Navajo Community College.36

Not all were impressed by the equity of the exchange. Reviewing the agreement a few years later in 1971, Alvin Josephy, who by this time had served as a special consultant on Indian affairs to Interior Secretary Udall and authored a presidential report on the state of tribal communities, described the deal as an explicit “bilking of the Indians.” In a blistering exposé entitled “The Murder of the Southwest,” Josephy wrote:

A conflict of interests seems to have been overlooked in the rush to get the deal settled. As trustee for the tribe’s resources, the Department of the Interior was leasing the land at Page, giving away the Navajo’s water, and selling the coal at Black Mesa; but, through the Bureau of Reclamation’s role as purchaser of power at Page, it was also on the receiving end. It had a vested interest in the acquisition of the site and water at Page and the coal from Black Mesa. In a sense, [the Department of the Interior] was both buyer and seller.

And this condemnation came from the president’s and Interior secretary’s own advisor.³⁷

*

By the early 1970s, Josephy’s was not the only voice criticizing the use of Indian resources to meet non-Indian needs. As the infrastructure tying together WEST facilities began to take shape, many Navajo and Hopi protested the changes they witnessed to their land. Navajo tribal members organized the “Committee to Save Black Mesa” to voice complaints about energy companies’ incessant road construction, the wasteful use of precious water supplies, and the potential relocation of more than six hundred Navajo families to make room for massive strip mines. Next door, Hopi anti-coal activists tied the irreparable environmental harm being done to their tribe’s spiritual identity. As one group of Hopi elders explained:

The area we call “Tukunavi” [which includes Black Mesa] is part of the heart of our Mother Earth. Within this heart, the Hopi has left his seal by leaving religious items and clan markings and paintings and ancient burial grounds as his landmarks and shrines. . . . The land is sacred and if the land is abused, the sacredness of Hopi life will disappear and all other life as well.

Beyond these spiritual pleas, Hopi villagers also continued their fight against the tribal council. Aided by the newly formed Native American Rights Fund, members filed a 1971 lawsuit to halt reservation mining, arguing that the council lacked legal authority to issue coal leases. The court ultimately threw out the case, ruling the tribal council’s sovereign immunity protected it from suit, but the publicity generated by the anti-coal backlash resulted in special, on-site Senate hearings to assess the social, economic, and environmental implications of WEST’s regional plans. Anthropologist Richard Clemmer posits that these hearings may have contributed to the cancellation of even larger projects, but existing development continued unabated.38

And such was the fate of many Indian energy projects begun before the 1970s. The potent mix of environmental justice claims, declarations of cultural loss, and sensational accounts of corruption temporarily captured national attention, but organized opposition to reservation development in the Southwest came mostly too little too late. In 1970, Time magazine, the Washington Post, and the ABC nightly news all ran stories on the Navajo’s and Hopi’s travails. By 1971, however, as the New York Times warned that “the magnificent red buttes and virgin forests of the Navajo nation may soon . . . become a vast slag heap . . . to satisfy the need of Los Angeles and Phoenix for more electricity and smog,” the majority of these reservation energy deals were done and the projects under way.³⁹

Revelations regarding the unsavory conditions in which these early deals were consummated did have substantial impacts on the future direction of Indian mining. New tribal leadership emerged to offer a different model for controlling such development. In 1970, Peter MacDonald unseated Navajo Tribal Chairman Nakai by tapping into growing nationalist sentiments among younger tribal members who tied exploitative energy development to a larger critique against the objectification of Navajo culture. To these young activists, corrupt, capital-driven mining projects represented the final step in incorporating Navajo society into the national mainstream, replacing indigenous values and customs with non-Indian patterns that threatened to colonize not only the land but also tribal lifeways. Informed by third world intellectuals spurring nationalist movements abroad and contemporary minority movements within the United States, this colonial critique blamed bad energy deals on an imperialist federal government intent on “modernizing” (that is, anglicizing) the “savage” Navajo, exploitative corporations and urban consumers that sought to capitalize on Indian resources, and corrupt or incompetent tribal leaders who let it all happen. Reflecting this sentiment, the new chairman vowed to end “the colonial relationship between the Navajo Nation and the cities of the Southwest” by insisting on “Navajo control of Navajo resources.”40

But Peter MacDonald did not seek to simply halt all reservation mining. He understood that once energy infrastructure was in place, it would be incredibly difficult to dislodge. The strip mines, power plants, and connecting roads and wires crisscrossing his reservation provided tangible reminders of how much effort and capital had been expended to extract Navajo coal. These items also indicated how strong the forces were that intended to continue production. For MacDonald, then, success lay not in attacking and shutting down ongoing operations but in shaping this development to meet Navajo needs. The new leader thus taxed and regulated those projects responsible for so much local opposition, ensuring that more revenue stayed on reservation while limiting the overall scope of development. For future projects, MacDonald explored new commercial arrangements outside the typical lease form that better positioned the tribe to control the pace and scale of mining and regulate its unwanted impacts. By exerting control over this industry, not foreclosing it, MacDonald believed his government could develop the economic base necessary to free the Navajo from their dependence on federal subsidies and regional development plans. In a theme that other tribal leaders would later pick up on, the Navajo chairman understood energy development as an opportunity to realize tribal sovereignty, not just a threat to it.⁴¹

Still, the early, intrusive energy projects on the Navajo and Hopi Reservations remained as testaments to the hard lessons learned. During the 1960s, tribal leaders who were theoretically positioned to negotiate and issue mineral leases were simply unequipped to do so. Locked within the same broken, bureaucratic system used to manage public minerals, the tribal leasing program shared all the same inadequacies. Tribal and federal officials lacked geological and market data to evaluate leasing bids and failed to generate competition to establish fair market mineral values. Yet the situation on tribal lands was even more dire. Suffocating reservation poverty lent an air of urgency to federal trustees’ efforts to secure tribal revenue, and Navajo and Hopi leaders could hardly afford to turn away any revenue source, however meager. Their desperation made it nearly impossible to critically evaluate mining proposals from the world’s largest energy firms. Encouraged by ignorant or duplicitous federal officials, Navajo and Hopi leaders thus welcomed the opportunity to develop their minerals, failing to recognize potentially harmful impacts on their communities and landscapes.

But tribal members living near energy projects understood the consequences all too well. Faced with the loss of home and community, these Navajo and Hopi launched the first wide-scale Indian opposition to industrial energy development. Sadly for them, their voices were often silenced by tribal politics orchestrated by outsiders. Moreover, competing directives within the Interior Department sometimes compromised their federal trustee, subjugating the trust duty to other, seemingly more pressing, national concerns. Whether thwarted by ignorant or corrupted representatives, these Indian anti-coal activists sounded the alarm but were unable to halt the threat.

Their resistance, however, was not without effect. Southwestern protests informed a new generation of leaders dedicated to tribal control of tribal resources. These leaders responded to their constituents’ desires to reject imperialistic energy projects, but they also explored innovative ways to make development meet tribal needs. In addition, the resistance helped train consultants and attorneys to assist tribal communities. Out of the southwestern experience, for example, the Native American Rights Fund would emerge to guide the tribal response to energy development. As prequels do, these events shaped the course of future, more successful actions to control reservation mining along the Northern Plains.