Canadian diamond mines: good or bad?

[velvetpage]

I'm talking specifically about the Victor Project,, in Northern Ontario, right against James Bay.

I've never been that far north in any area. It's a day beyond where the last road ends; you get their by taking the Polar Bear Express train. Right now, a road across the ice connects coastal communities; these communities are actually more cut off in the summer, because then it's boats or planes - no ground transport at all.

These communities are almost entirely Cree in their population. They have some of Canada's highest rates of addiction, mental illness, and suicide. They were previously home to, and source of students for, residential schools, possibly the blackest mark on Canada's history and certainly the longest.

The DeBeers family is building an open mine for diamonds there.

I read about this just now in Saturday's paper, which had a large spread about the Mohawk College recruitment team that went there to talk to high school students about its nursing program, which reserves a certain number of spots for Native students with the intention of improving access to health care in remote communities. The team went up last year, too, and says there's a palpable difference there this year. The mines are almost ready to open, and the sense of hope in the community has increased tremendously. There are jobs and opportunities with De Beers, and more spin-off jobs in hotels, transportation, and the service sector as the general level of wealth in the community skyrockets from barely-subsistence to solid working class over the next few years. The native community overall approves of the project and sees it as the road to the future. (Note: I know the native communities are exempt from provinicial taxes. I hope the Federal government will exempt them from Federal taxes for the first few years while they get on their feet, and invest in a good banking infrastructure that doesn't exist up there, to help people manage that new income.)

And on the other hand. . . De Beers is a horrible company. They're responsible for some of the worst corporate abuses of power in Africa and elsewhere. They artificially drive up the price of diamonds, which should not be the most precious of gems because they're actually quite easy to come by. I find it disturbing that the diamond mines being opened in Canada are all located in the spots where the people are most ripe for exploitation of any kind. I'm sure that's partly simple geology, but is there more going on there? Have they chosen that area because they can control its economy so completely that no one will want to kick them out, even if they renege on many of their promises and destroy what they said they'd preserve? What kind of response would whistle-blowers get in the community, when all the wealth comes from this one company with a century's worth of African blood on its hands already?

EDIT: Another link, this one entirely negative, which unfortunately doesn't address economic concerns at all: http://www.greenkarat.com/about/issuesanswers/gem.asp?gclid=CMSGrvz035ECFQLwPAod9jZSeg

So, friends list, what do you think? Net good, net bad, or an even mixture of both?

Comments

[pyat.livejournal.com]

Net good, I'd say. They are a horrible company, but mostly because they CAN be horrible in Africa. Several big chocolate companies are also horrible in Africa, but benign corporate citizens elsewhere. Hopefully the additional source of diamonds in a stable country won't make them worse, elsewhere.

Also, while diamonds are surprisingly common in parts of Africa, they're almost unknown in North America, so at least there is a local scarcity of the resource to drive the price up. Not sure if that's a factor for the good or bad, though.

[velvetpage.livejournal.com]

The fact that this time, they're working in a developed Western nation with decent regulation of industry and a history of unionized workforces is definitely a plus. I hope the workers unionize, or that they're looking to other Canadian mining operations for ideas of pay and benefits that De Beers has to live up to. (It's the generalization feature of unions: even when not every operation is unionized, the union ends up setting the standard by which the others operate. If they want to keep unions at bay, the choice is simple: beat the union deal so the workers won't have a reason to want the union.)

[pyat.livejournal.com]

Canada has also instituted a set of very rigorous guidelines to ensure that diamonds sold here were not bought originally from rebel armies or warlords, etc. Apparently, there is some demand for "Canadian diamonds" from people around the world who want to be reasonably sure they have an "honest" diamond.

By mining them here, De Beers doesn't have to worry about the code.

[velvetpage.livejournal.com]

One of the problems with the diamond industry is that gems are so untraceable, so it's generally impossible to tell where any given stone originated. But the efforts of the government in that respect are laudable.

[dornbeast.livejournal.com]

I remember reading something about cut diamonds being "fingerprintable" by shining a laser through one. If I remember this correctly, then it is possible to tell where a stone originated, just expensive.

The next problem, of course, is forged documents.

[asqmh.livejournal.com]

Anything DeBeers is involved in is net bad, in my opinion. Based on the world diamond supply, a flawless, 1 karat diamond should run in the neighborhood of $100. Y'know, rather than causing civil wars and bloodshed and death. Cartels of any sort - diamond, drug, coffee, corporate - are typically a bad idea in my mind.

If ya can't tell, I kinda have a person beef against diamonds. The more I learned, the more I hated the shiny shards of death. If/when I am ever engaged, my ring will not sport one of those things.

[velvetpage.livejournal.com]

I have a beef against diamonds, too. The problem is that nobody else has shown any interest in developing these northern communities. They've been stagnant and hopeless for generations, in large part because of the things white people did to them. Now a group is coming in that will be putting money into the community in ways that should be manageable, giving some twenty thousand people a way of earning an honest living that they haven't had in decades.

I came to the conclusion some time ago that if I ever got any diamonds again, I wanted them to be taken from heirloom jewelry and reset, rather than further supporting the cartels. I'm not sure if a Canadian supply would change my mind on that, but it might.

[saomigray.livejournal.com]

My first instinct is that, yes, these people will be exploited, simply because it is so easy to do so.

Having never had money, many of these people will not know how to manage what they have now. Also, with the level of income increasing so quickly across the board, won't the cost of living go up dramatically and make what everyone is making worth less than in the past?

It seems that intensive training is in order for these newly middle-class folks to make the best financial decisions for themselves.

Do you think this is more the responsibility of DeBeers, the Canadian government, local leaders or the individuals?

I'd be incredibly interested to see how this plays out in the coming years.

[velvetpage.livejournal.com]

I'd say that's the responsibility of all of them, in conjunction with other companies that offer financial services. And I agree - training in how to make good use of their money is in order.

As for cost of living - it's already sky-high in those areas, because most of their food has to be flown in from further south. Increasing the number of people there might have the net effect of increasing the available variety, though. In other respects, I doubt the cost of living will go up too much, because it's still not a desirable place to live. There are several months of the year when there's only a few hours a day of sunlight. If the only people who want to live there are the people who've always lived there and the people being paid to run the mines, then cost of living shouldn't skyrocket beyond people's means.

"...these people will be exploited, simply because it is so easy to do so."

[athelind.livejournal.com]

You load sixteen tons, what do you get?
Another day older and deeper in debt.
Saint Peter don't you call me, 'cause I can't go!
I owe my soul to the company store. (http://www.rootsweb.com/~wvcoal/sixteen.html)

This is going to be exactly the same as the US coal mining towns of the 19th and 20th centuries. DeBeers is going to own everything in the area, and the workers will be stuck paying their prices, getting advances, and getting screwed. The only difference in this instance is the form of the carbon.

These people are friggin' evil. If they can't practice Apartheid at home anymore, but they can still find already-isolated, ghettoized communities to exploit. The market for diamonds exists because they've CREATED it, and maintained it through blood and corruption.

And that doesn't even scratch the surface of the ecological impact.

On the flip side... nobody else seems interested in ANY kind of economic development in those communities.

Ultimately, though... the "Net"... this is a Faustian bargain.

[velvetpage.livejournal.com]

There are a few differences. First, De Beers needs Canadian diamonds to clean up its image, and it needs the mines to be models as far as diamond mines go. Second, there's a lot of government regulation in Canada designed to prevent exactly what you're describing here. Third, I'd be willing to bet the mining unions in the North are already active in those communities in anticipation of this expansion.

"...I'd be willing to bet the mining unions in the North are already active in those communities..."

[athelind.livejournal.com]

I really, really hope you're right.

But still... I'd feel better about the whole thing if it were ANYONE but DeBeers. The fact that they're up there at ALL is a blatant indication of just how far their stranglehold on the diamond market has gotten, and the seeping, insidious corruption that suggests.

Surely SOMEONE else looked at those diamond resources, and said, "hey, if we could get the right investors, we could completely undercut the monopoly and rake in dough hand over fist." And they would have.

SOMEHOW, DeBeers stopped that from happening.

Faustian.

[momentrabbit.livejournal.com]

I have difficulty with the concept of open mining, given the end result (http://en.wikipedia.org/wiki/Image:Diavik_Diamond_Mine.jpg), from ecological angles alone. It's devastating.

I note that the open mine depicted there is a diamond mine, in the NWT, and is expected to have a twenty-year lifespan. Even assuming the DeBeers' proposed mine would be a good thing for the local community (who should have the final yay/nay say on that mine, I feel) how long will it be operational for? What happens afterwards? Once they're done sucking it dry, what will it have profited the people who live there?

Images of Sudbury at the end of the nickel 'boom' come to mind.

[pyat.livejournal.com]

Ooops - commented here instead of your post. Too! Many! Windows!

And, by cracky, that's a big hole.

[momentrabbit.livejournal.com]

Indeed! Visible from orbit (http://www.wikimapia.org/#lat=64.496111&lon=-110.273333&z=13&l=0&m=s), albeit barely with the use of a powerful lens and complicated image stabilization algorithms.

Addendum: "diamondiferous"?! That is a truely diamondastic word. n.n

[pyat.livejournal.com]

I hear the Great Wall of China is visible to observers in the Andromeda Galaxy!*


_{*Observers are assumed to be in possession of a space-based inferometric telescope array occupying an area of at least 1 square parsec.}

[(Anonymous)]

I used to work in the diamond industry as a field geologist during the late 80s- early 90s. When I mentioned the possibility of working for this project to some of my colleagues at a recent conference, the almost universal reaction was a quick intake of breath.

Their reputation is just that bad.

deBeers, through a series of cutout companies and abuse of the fairly lax Canadian mining code were able to prevent any successful diamond mining in Canada for over thirty years. Monopros and its various incarnations would stake and then sit on any possible diamond site - no intention of doing any work but with every intention of preventing anyone else from working. When the laws stated that the claim must be put into production or let lapse, a 'new' company would take over the claims and begin the process again.

Their economic policies are often a similar shell game - the company store. You can't actually get the money you are owed because you are too busy paying for the things you need to survive at a very, very inflated cost. If deBeers was to offer the Cree the same sort of deal that the Innu negotiated with DiaMet and DHL for the arctic mines, then that would be good... but expecting them to hold to it is problematical. Particularly in Ontario which has poor native and labor policies of late.

There are very good reasons why high-ranking deBeers executives often have an arrest on sight warrant in the US.

It could be a good thing. Could be. But their reputation is so bad that I turned down work with them - I was told quite bluntly by several colleagues that if I did, I wouldn't be able to work anywhere else.

Just sayin'

Jeff

[pyat.livejournal.com]

Yikes...

Thanks for the insight, Jeff. That does put a different complexion on things.

[velvetpage.livejournal.com]

Which is to say, the outside people who go there to run the mines are going to be either unable to get a job elsewhere, or willing to do whatever the company requires because they know they won't get work elsewhere if they're let go. That's a bad situation.

And I intensely dislike the idea that they've been sitting on these claims for decades and refusing to work them. It doesn't bode well for their future intentions.

[(Anonymous)]

They made some very, very determined efforts to buy out DiaMet and DHL back in the late 80s. According to some of the published accounts, the efforts bordered on legality. At that time, however, deBeers was busy trying to plug the leaky Russian diamond embargo as well as prevent the Australian mines from coming online.

It is my understanding that the federal government intervened on the side of the Canadian mining concerns. deBeers had too many things to deal with.

Despite the best efforts of deBeers, the advent of practical airborne geophysics, computer modeling, and cheap computers to do the modeling on, proved too much for them to deal with. In the past, the work was very manpower intensive over a very few spots. Suddenly, instead of a few dozen anomalies to check, there were THOUSANDS. Each one, a potential kimberlite pipe. Kimberlite pipes are actually quite small, only a few Ha in size. And, since the material is quite readily erroded, they are often the site of lakes or swamps thanks to our wonderful post glacial climate.

Now that there are Canadian diamonds, pleasantly blood and indentured labor free, they want in on the act. Canadian and Aussie diamonds command a premium price on the market due to their lack of blood, violence, etc.

For those feeling skeptical about the benefits for the community, please look into the experiences with DiaMet in the NWT - the Innu pretty much own and run the mine and much of the the money goes to long term economic and social development. I am not sure if that is a game that deBeers is capable of playing.

I worked for a German uranium mining firm in the arctic and they were incapable of this sort of interaction with the locals, feeling it was better to influence officials and then conduct 'business as usual' as they did in Latin America and Africa. It did not go over well - the company no longer operates in Canada.

So, yeah, I am in favor of such development provided it is done right - particularly for the natives.

Jeff

[tormentedartist.livejournal.com]

I saw a program about the diamond industry and I think you should keep the De Beers family far the fuck away from your country. I HATE the diamond industry and would never buy one of those over priced rocks.

I've told my girlfriend this too.