Saturday, April 18, 2009

What the Future Holds for Bolivia

Like a lot of Americans, I mostly knew Bolivia (in a vague way) as the place where Butch Cassidy and the Sundance Kid finally met their fate, so when I saw some recent photographs from Bolivia, I was shocked at how familiar the scenery looked to me. I was looking at scenes from the giant salt flats that cover thousands of square miles down in that South American country, and it looked exactly like Bonneville, Utah, and since I race on the Bonneville Salt Flats every August, I know the scenery quite well. The thing about salt flats is that they all look the same.

They’re not all the same. The Bolivian salt flats, known as Salar De Uyuni, are hundreds of times bigger than those on the Utah-Nevada border, and there’s another monumental difference— the Uyuni salt flats contain more than 75% of all the lithium on the planet. For those Americans who don’t read a lot about electric battery technology, lithium is the element that allows modern batteries to store electricity at much higher levels than is possible with any other composition. Since the next generation of cars will run on lithium batteries rather than gasoline, and since Bolivia has most of the earth’s lithium, we can look for Bolivia to become the new Saudi Arabia of this century.

The leaders of the Bolivian government, well aware of the precious resource that their nation now holds, have looked at the historical record of undeveloped countries who had something which was desperately wanted by richer and more powerful nations, and they don’t like what they see. For that reason, the government of Bolivia has decided that they will not export the raw material for lithium batteries. Absolutely none, and not under any circumstances. If the world wants lithium batteries in the abundant quantities required by future electric cars, then the richer nations will be forced to build the battery factories in Bolivia, and build the lithium batteries with Bolivian workers. Only then will the finished batteries be exported.

For those readers of this blog who are young enough to see this play out, watch for a showdown. Bolivia was powerful enough to kill the Yankees, Butch Cassidy and the Sundance Kid, but don’t look for that victory to be repeated. If America can go to war over oil, it can go to war over lithium.