Recession Sparks New California Gold Rush

Washington Post: As Gold Hits Highest Price in Decades, the Jobless Show Up in California and Elsewhere

(Washingtonpost.com)  This story was written by Karl Vick.

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Maybe it was the nail in Ray's head. Maybe it was the economy. His wife said one as much as the other drove the decision to auction off everything that wouldn't fit in the trailer and leave Vermont for the mother lode.

"Thought we'd try to make a living at it," Kim Lague said, standing in a mining camp that was busier during the Great Depression than it was in the Gold Rush of 1849, and is busy once again.

And so, 18 months after a co-worker's pneumatic hammer drove a 2 1/2 -inch stainless-steel nail into Ray Lague's skull -- "the plunger of the gun brushed my hat and discharged" -- the once-thriving contractor took his place among the prospectors lining the steep banks of the South Fork of the Stanislaus River, 40 miles west of Yosemite National Park. The bearded man helping him drag the mining gear into the water was a jobless logger who lost his home to foreclosure.

Fifty feet downstream, an unemployed concrete-truck driver scoured the river bottom beside a laid-off furniture mover, back to prospecting after a day spent wrestling with the unemployment office.

"You have to consider the economy," said Gary Rhinevault, caretaker of the Lost Dutchman's Mining Association campground, where 45 prospectors pay as little as 30 cents a day to pitch their tents. "In 1932 there were more prospectors out trying to make a living than in the 1850s."

Even in the trough of today's great recession, most of the prospectors still double as hobbyists. The Lost Dutchman's club allows members to camp for six months at a time, and its dozen or so claims are crowded first with the motor homes of freewheeling retirees.

But as the economy soured, their ranks were swelled by adults of working age, pulled by gold prices flirting with $1,000 a troy ounce -- the highest in more than two decades -- and pushed by unfortunate circumstance. While there is no way to quantify the trend, anecdotally it is clear that the jobless are showing up not only in California but also elsewhere around the country where gold has been found in the past.

"I have been seeing a lot of it this year, with so many people getting laid off or hours cut way back," said Tim LeGrand, owner of TN Gold & Gems in Coker, Tenn. Permits for prospecting in the nearby Cherokee National Forest, named for the tribe pushed westward after gold was discovered in the early 1800s, have more than doubled since 2007.

"People come out with high hopes and don't realize the work that is involved until they get into it," LeGrand said. "Most try a few days and give up. Many struggle on and learn to pan. Very few get enough gold to do them any financial good."

On the South Fork, everyone claims to know this.

"No one's making a living down here," said Tony Stroud, an unemployed machinist who, like the other prospectors repeating the phrase, surely believes the words.

And yet, here they all are, investing $1,500 to $5,000 for the suction dredges that vacuum up gravel, for the sluices that separate the gravel from the black sand, and, not least, for the big plastic pans that, after the machines have done the heavy work, reveal the glimmers of color that set hearts to racing and render reason irrelevant.

"You didn't hear it from me," Stroud went on a moment later, "but a guy in Columbia said downstream he took 14 ounces out in 48 hours. And we're going to jump his hole."

Robert McFadden, seated to his right on a picnic table, set down his morning beer.

"What's the appeal of prospecting?" he said. "Hope I can get rich, number one."

The river is cluttered with the miners' gear and the boulders they constantly rearrange in the search for a spot not already groomed of flakes. Yet the feeling is orderly, tents and motor homes lined around a rustic clubhouse that evokes familiar notions of prospecting as reliably as the bushy beards sported by many of the men.

In a shady bend a mile downstream, DeWayne and Nick Shepard labored in frustration beside the Michigan flag, planted upon arrival 30 days earlier on a trip planned for three years.

Their vision of prospecting was informed by repeated viewings -- "must be hundreds of times," Nick said -- of "Gold Fever" and other cable television programs produced by members of the family that owns the camps.

"He shows you, in his pan, what must be $15,000 in gold he says he got in two days," said Nick Shepard, 28, who left his masonry job to come west with his retired father.

"We had hoped to come out and make enough money, take care of some things."

But even if their truck's transmission had held up, they would still be deep in the hole.

"We wonder if there aren't people who got sucked in worse than us," DeWayne said.

The Lagues watched the same shows.

"Realistically, when we first started out, they say you can make an ounce a day," said Kim Lague, in the 31-foot trailer the couple now calls home. "Now it's down to, we just want to make an ounce a month."

Their work is cut out for them. Large dredges can churn through so much river bottom that environmentalists fret for the salmon. California Gov. Arnold Schwarzenegger (R) signed a bill this month banning gold dredging while the question is studied, but it is not yet being enforced and it faces a likely court challenge.

In any event, the two-inch nozzle of the dredge the Lagues chose to start with disturbs very little.

"More of a toy than anything," said Stephen Buttram, the jobless logger spending the day helping Ray Lague. Buttram, 37, moved to the camp after losing his three-bedroom house in Pioneer, Calif.

"I pretty much sold everything I had, my furniture, everything, trying to keep up," he said, moving stones to expose gravel for Ray to hose up. "I paid for my dad's funeral with my credit cards."

The Lagues were falling behind on their own bills. Ray had laid off all workers in his contracting businesses and was spending more time looking for work than working.

"The furthest west I'd ever been was St. Louis," he said. Now, chest-deep in a mountain stream, he looked to Buttram. "Want to check it? Just for the heck of it?"

They waded over to the dredge, which looked a bit like a snowmobile floating between the rocks. Gazing into the boxes that shone with the glitter of the mica and pyrite that so excited Ray his first couple of times out, Buttram shook his head.

"Just a fleck," he said.

"Nothing for a snuffer bottle, eh?" Ray ventured, meaning a squeeze tube used to suck up the smallest bits.

"No," Buttram said. "Nothing to write Mom about."

Lague gazed at the mica. "If that was gold, you'd be, 'Yeah!' " he said, and threw his arms wide under the blue summer sky. Then his hands met in a gesture that combined relish and determination.

"Day's not over yet," he said.

[quapawsix]

Your christian beliefs is showing
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by Ace22257 August 24, 2009 6:35 PM EDT
They have days on end to look for gold.....shouldn't they be out looking for work instead? I dont feel sorry for "most" people who get themselves into situations like this vecause somewhere out there there is always some kind of job to be found if you look hard enough. Cant find a job in your field? There's ALWAYS work to be found in the ever growing fast food industry. Some of these people chose not to lower themselves as to accept a less than glorified job, they would rather go without ratherthan work at a supermarket or a McD's or take on a cleaning position. Let them go without if they so chose.....it's their call......in the meantime keep panning for your "fools" gold.......

[swin5]

It's George Bush's fault.

[Ace22257]

They have days on end to look for gold.....shouldn't they be out looking for work instead? I dont feel sorry for "most" people who get themselves into situations like this vecause somewhere out there there is always some kind of job to be found if you look hard enough. Cant find a job in your field? There's ALWAYS work to be found in the ever growing fast food industry. Some of these people chose not to lower themselves as to accept a less than glorified job, they would rather go without ratherthan work at a supermarket or a McD's or take on a cleaning position. Let them go without if they so chose.....it's their call......in the meantime keep panning for your "fools" gold.......

[oldasdirttoo]

Good for them. They need to obey all state and federal regulations. But at least they are trying to help themselves instead of waiting for the gov't to come up with a plan that is always, to little and to late.

[reveal5]

Looks like these folks could use healthcare reform..They are probably mostly uninsured and this type of work is dangerous. Easy to trip, pull out your back, get a finger or hand injury, break an arm or leg... Here's a thought, pass healthcare reform and help these poorer Americans who are having a tough time just surviving. These folks could easily be damaged and further exacerbate their allready precarious existence. Help them out, pass healthcare reform and allow them medical care if they are injured and don't have money for a doctor. Seriously.

[Joe_NY_15]

by reveal5 August 24, 2009 2:02 PM EDT

Don't you ever get tired of carrying Obama's water ? why are you so obsessed with shoving healthcare down people's throats....you are like an Obama cheerleader, RA RA RA, give me O, give me a B, give me an A,M,A what does it spell, SOCIALIZED MEDICINE .....YEAH !!!

[specialty8]

No Joe, just like Skyk,Misha and some others whatever Obama says has to be whats right. They like to be led right off the cliff with no questions asked. Some people just like getting abused.

[wheresmycountry]

I want to go back to the Bush days when everything was wonderful! Yeah, right. The only difference between then and now is that the credit card companies are finally as broke as we are.

[voultron]

Great. This is all California needs; A bunch of yahoos screwing up the streams and rivers on the off chance they may find the mother load.

Before these post-49er throw-backs further degrade California waterways, they may try taking a few courses at the local junior college to retrain for another profession. It's cheaper, expands one's knowledge and skill sets and there is no need to screw up the natural environment in the vain attempt to strike it rich.

[Constitionalist]

And just how are they to pay for these courses? And in this economy, where are they to find a job? If you had actually read the article you would notice that these are professionals whose work dried up. If you were in their position you would also be doing everything you could to survive.

[lwaslt]

Did anybody tell your reporters that suction dredging is now illegal in California? The practice was destroying fish habitat and fish spawning areas, just as many fish populations are crashing. Your picture of the guys washing in the stream should be a clue as to what it did to water quality.

[Newster1]

Very few get enough gold to do them any financial good."

Thats because the state was mined to hel1 and back over 100 years ago, whatever major amounts of gold there were, it's been long ago found by the thousands who poured over hill and dale over 100 years ago and carved up the streams, rivers, mountains and everything else like a swarm of ants.

[fedup12]

It was in the story did u read it? Not being enforced though...

[specialty8]

Change you can beleive in alright.