De Beers announced with great fanfare
in July that it was abandoning its policy of buying diamonds
in African conflict zones, occasioning both applause and
predictions of De Beers' demise. But the diamond cartel,
while modifying its tactics, has not changed its basic strategy.
Almost since its inception at the end of the 19th century,
the diamond cartel has had a singular strategy: stifling,
by any means necessary, the flow of gem diamonds from sources
not under its ownership or control.
The problem with diamonds isn't their
scarcity, but their abundance. They are found not only in
geological formations like volcanic pipes that can be fenced
off and mined, but also in vast alluvial areas like river
beds or beaches, places that can't be restricted. When Europe
ruled Africa, the cartel had little problem making arrangements
with colonial administrators to police or close down freelance
diamond gathering. After African colonies got their independence,
the cartel came to terms with dictators like Mobutu Sese
Seko, whose police kept out -- and occasionally massacred
-- suspected smugglers. Where governments were less cooperative
or capable, the cartel commissioned mercenaries to suppress,
often by maiming or killing, prospective diamond hunters.
At one point in the 1960s, the cartel gave bounties to remnants
of the Katanga gendarmerie to hunt down "smugglers" in Angola.
It also paid a Lebanese mercenary named Fred Kamil in Sierra
Leone to arrange ambushes that would persuade Mandago tribesman
to quit the diamond trade. Since these measures didn't fully
eliminate the "leakage" to diamond-cutting centers in Belgium,
Israel and India, it also acted as a buyer of last resort
to keep prices from falling.
But that is history. The cartel now
has found an ingenious new mechanism for achieving its ends:
the United Nations. After spending months laying the conceptual
groundwork in the media, as well as working through the
Clinton administration and human-rights communities, it
has convinced the U.N. Security Council to impose a global
ban on "undocumented" gem diamonds from "conflict zones."
Undocumented diamonds are, of course, just those diamonds
picked out of river beds that De Beers wants eliminated.
The "conflict zones," Angola and Sierra Leone, are the alluvial
areas in which De Beers previously depended on paid guns.
Instead of using colonial administrations,
dictators or mercenary gangs to stop Africans from gathering
and selling stones, the U.N. will use its resources (backed,
no doubt, by the cartel's own contingent of lawyers and
detectives) to accomplish that task. The cartel managed
this favorable outcome by playing on the guilt of the West.
The idea that "blood diamonds" were responsible for ferocious
civil wars in Africa was too much for altruists and activists
in developed nations. Mr. Clinton, meanwhile, saw diamonds
as an opportunity to enhance his own standing among these
groups. On July 21, he called for "an international conference
to consider practical approaches to breaking the link between
the illicit trade in diamonds and armed conflict . . ."
Mr. Clinton's press release made no secret of the liaison
with the diamond cartel, noting that at a May conference
in South Africa, the U.S., Britain and Belgium, among others,
had agreed with De Beers upon the importance of establishing
a global certification scheme for diamonds. Like all persuasive
ideas, the concept of blood diamonds is not without a basis
in reality. Diamonds, like any resource, can be converted
to money. Money can be used to buy arms and ammunition.
What the concept neglects, however, is that governments
are the principal means by which warriors get funded and
armed. Countries such as the Sudan, Ethiopia, Somalia, Rwanda,
Burundi and Liberia have managed to sustain ferocious civil
wars for years without having or selling diamonds. Even
countries rich in diamonds have found alternative ways to
finance their warfare: In Angola, Unita rebels were armed
by the Central Intelligence Agency, South Africa's intelligence
service and Zaire. In the Congo, at least seven African
governments are presently intervening in the civil war with
arms and troops. A regime backed by the U.N. and U.S. that
inhibits the sale of uncertified diamonds, diamonds that
in practice come from fields the cartel doesn't control,
probably won't stop civil wars, then. It will, however,
make it far less costly for De Beers to control the diamond
market. Another brilliant coup for the cartel.