South Africa: A New History of the development of the Diamond Fields

by unknown

Cecil Rhodes and What Happened After His Death

Now that Cecil Rhodes is dead and his holdings scattered, some of the secrets of the great diamond monopoly he created are beginning to come out. It is gravely asserted that there are now within easy reach enough diamonds, if mined and sold, utterly to demoralize the diamond market throughout the world an drender the stones to which such a high value is now attached worth little more than so many pieces of glass.

Cecil Rhodes and "Barney" Barnato (Barnett Isaacs) effected the consolidation of the diamond mines, forming what was in some respects the first "trust" their principal object being to get rich by restricting the output and preventing a gall of values from which the diamond market might never recover. In this, both Rhodes and barnato succeeded, and as soon as they secured control of the five South African diamond mines they put two of the out of business.

Meanwhile there is one element in the problem which threatens the monopoly of the De Beers Company, and to which naturally its manager devotes scant attention. That is the possibility of a sudden great production of diamonds from some new source, either as the result of scientific discoveries or of the finding of great new mines whose existence is not now suspected. Sir William Crookes has already manufactured small diamonds before the eyes of his audience, and says that the possibility of making large artificial diamonds owing to facilities afforded by the enormously high temperatures which are obtainable in recent years by electricity, is now a matter of the near future. De Beers officials profess not to be disturbed by the possibility of making large artificial diamonds, which, if turned out from a laboratory would make their $85,000,000 of stock values hardly worth more than so much old paper. At the same time they are not so confident in the matter of other big diamond mines being found.

Mr. Williams says the natural geologic conditions in which diamonds occur are all known,...." "He admits that the diamondiferous blue clay in which the vast bulk of the South African diamonds has been found, was at the time of its discovery a complete revelation to the diamond experts.

Finally, as the result of the persistent working of these mines for twenty years, the while science of diamondology has been changed, and it is now accepted truth that the place where diamonds are most likely to be found is in the crater of an extinct volcano.

The five extinct craters lie a few feet below the surface of the veldt, with nothing to indicate their existence beyond a slight elevation of the ground into an ordinary kopje. Up to the present they have been examined to a depth of something over 1,400 feet, with no indication of a diminution of the supply of diamonds. In the early days of the Kimberley mines the diamonds were found in small numbers in the "yellow ground" which had come to be accepted as their only abiding place in South Africa. When the bottom of the "yellow ground" had been, at a depth of fifty to sixty feet below the surface, it was supposed to come to an end. But the hard underlying rock was cut by accident and it was found, to the delight of the miners, that this also was diamond-bearing. It was a Breccia composite, essentially like the "yellow ground" above, but much more compact and hard, and of the prevailing bluish slate color. This was the famous "blue ground".

The consolidation effected by Rhodes and Barnato was a physical it it was not an economic necessity. When the mines were discovered, the mining law was that a man could not own more that one claim of 30x30 feet, except in the case of a discoverer of a mine, who was allowed two extra claims. When these mines were discovered there was an immediate rush, and within a few day all of the ground had been staked off in little plots 30x30 feet. In the crater of the Kimberley mine alone there were nearly 100 such claims. Then commenced the work of digging out the clay and gravel.... As a consequence, as the mine got deeper...there was a great waste of labor, duplication of work, and confusion, the miners underbid one another bringing down the price, and finally the claims began to fall on each other and tumble inward. The same occurrences were happening in all the mines.

With so much out of control Rhodes saw that nothing could save the diamond industry but to bring the whole management under one head. When he invaded the Kimberley mine and commenced to bid for properties there outside of Barnato's control the stock went up by leaps and bounds far in advance of its value, and a battle royal was on the attracted the whole of South Africa. Finally, in July, 1880, Barnato came to terms and sold out to Rhodes at an enormous profit, becoming an important factor in the De Beers Consolidated, as the new company was called.^[1]

References

1. "South Africa: A New History of the Development of the Diamond Fields." (1902): New York Time Archives. [PDF newspaper.] New York Times.