The Cost Of Overregulation: Conflict Minerals Rule Reduces Employment … Among Those It Was Supposed To Help
The provision in the Dodd-Frank Wall Street reform bill that asks U.S. companies to trace the origin of certain “conflict minerals” they use to produce products was meant to improve the lives of the people living in the Democratic Republic of Congo. Instead, according to The Washington Post, it has reduced employment in the country and possibly driven more of the country’s young people into deadly conflict. The Post writes, “[T]he legislation, signed by President Obama four years ago, set off a chain of events that has propelled millions of miners and their families deeper into poverty, according to interviews with miners, community leaders, activists, and Congolese and Western officials, as well as recent visits to four large mining areas.”
This report follows a September letter in which officials in the Congo argued the U.S. and other countries’ efforts to stem the use of conflict minerals has done little to improve the lives of the people living in the Congo. Rosa Whitaker, the U.S.’s first assistant trade representative to Africa, also explained this fall how the U.S. law has harmed the African economy. Whitaker reported that, saddled with hefty compliance costs, U.S. companies have essentially stopped trading with 10 African countries and since U.S. companies will no longer deal with the African nations.