Gold, the Congo and 60 Minutes

Some thoughts on last night’s Gold and Congo on 60 Minutes, which can be viewed here (transcript here):

– First off, while the story was damaging, and may cost the industry a few sales this Christmas, the high price of gold will probably hurt the trade more this holiday than “60 Minutes” will. I have become something of a connoisseur of the stories-damaging-to-the-jewelry-industry genre, and this was hardly a “5” on the stories-damaging-to-the-jewelry-industry scale. 60 Minutes’ own report on conflict diamonds in 2001 was a lot worse.

– Secondly, it seems bit misleading to assert, as 60 Minutes did, that gold “largely” funds the Congolese civil war. While I’m hardly an expert on conflict minerals from Congo, I have always heard that col-tan, found in cell phones and other electronics, was a far bigger factor in the Congolese civil war. In fact, based on its web site, the Enough Project, dedicated to fighting “conflict minerals,”  seems far more focused on electronics –  even if its head, John Prendergast, did dutifully, if somewhat robotically, recite the line about “gold and other conflict minerals” twice on 60 Minutes last night. (I should note that the Enough Project is part of the Center for American Progress, a think tank with strong ties to the Obama Administration. I hope to interview Prendergast soon.)

At one point, reporter Scott Pelley said, “The jewelry industry must have known about this.” But actually, it hasn’t. The Enough Project seems to have talked far more to the electronics industry than the jewelry industry; the No Dirty Gold campaign is mostly focussed on environmental issues; and gold is not included in the current “Conflict Minerals” bill in Congress.

– However, that emphasis may change. One interesting point Matt Runci made in my recent interview is that NGOs respond to media interest. “Conflict diamonds” was pretty much a dead issue until the “Blood Diamond” movie premiered in 2006; then NGOs like Amnesty International suddenly became active again. Already, the “No Dirty Gold” campaign is starting to talk about “blood jewelry.” So this might put this issue on the agenda.

– Yet, while this kind of criticism is painful, and in this case not particularly fair, we can also learn from it. If there is anything that has been a guiding principle of our industry in the last few years, it is that our materials should not be financing conflict. The most depressing thing about last night’s show was it seemed almost exactly the same as the conflict diamond stories from eight years ago, from the atrocity testimonials to the work conditions for the miners.

So what should be done? 60 Minutes seemed to be pushing for a “Kimberley Process” for gold.  That wouldn’t be a bad idea, but doing a Kimberley Process isn’t easy. (You’ll note there is still only one of them.) The reason the KP exists is because diamonds were involved in three civil wars, several nations were dependent on diamond revenue, and there was international consensus something had to be done. I don’t see that here – yet. And let me remind you, even when you have a Kimberley Process, it doesn’t end all the arguments. It also starts new ones.

The Enough Project has its recommendations for what is to be done here.  They are general, but worth looking at.

– On the bright side, once again, Tiffany came out smelling like a rose. Their investment in traceable sourcing is paying off for them. At the end of the show, Pelley mentioned a possible program to “track gold to its source.” That may be years away, but traceability is where the industry’s future is, for all the materials we use.

– Any other thoughts or comments?

JCK News Director