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The De Beers burn diamonds to maintain their price.


The market system is driven, in part, by scarcity. The less there is of something, the more money can be generated in the short term. This sets up a propensity for corporations to limit availability and hence deny abundance of production. It is simply against the very nature of what drives demand to create abundance. As an example, the Kimberly diamond mines in South Africa have been documented in the past to burn diamonds in order to limit supply and, therefore, keep prices high. Diamonds are rare resources which take billions of years to be created. This is nothing but problematic. The world we live in should be based on the interest in generating an abundance of necessary resources for the world’s people, along with strategic preservation and streamlined methods to enable that abundance. This is a central reason why, as of 2010, there are over a billion people starving on the planet. It has nothing to do with an inability to produce food, and everything having to do with an inherent need to create/preserve scarcity for the sake of short-term profits.

Abundance, efficiency and sustainability are, very simply, the enemies of profit. This scarcity logic also applies to the quality of goods. The idea of creating something that could last, say, a lifetime, with little repair, is anathema to the market system, for it reduces consumption rates, which slows growth and creates systemic repercussions (loss of jobs, etc.). The scarcity attribute of the market system is nothing but detrimental for these reasons, not to mention that it doesn’t even serve the role of efficient resource preservation, which is often claimed.

While supply and demand dictates that the less there is of something, the more it will be valued, and, hence, the increased value will limit consumption, reducing the possibility of “running out”, the incentive to create scarcity, coupled with the inherent short-term reward which results from scarcity-driven pricing, nullifies the idea that this enables strategic preservation. We will likely never “run out” of oil, for example, in the current market system. Rather, the prices will become so high that no one can afford it, while those corporations who own the remaining oil, will make a great deal of money from the scarcity, regardless of the long-term social and environmental ramifications. In other words, remaining scare resources, existing in such high economic value that it limits their consumption, is not to be confused with preservation that is functional and strategic. True strategic preservation can only come from the direct management of the resource in question in regard to the most efficient technical applications of the resource in industry itself, not arbitrary, surface price relationships, absent of rational allocation.

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