Realistic approaches to improving the quality of life in Canada's resource dependent communities are being hampered by philosophical ambiguities, misplaced assumptions, and poorly defined terms of reference. A dominant development theme in communities of this type has been diversification, particularly in terms of the economic base. However, for a variety of reasons, resource dependent communities in this country have experienced very little diversification. A major obstacle lies in the locus of decision-making. Most natural resource develoeprs are transnational firms which maximize profits by manipulating labor inputs and extraction costs across national boundaries. Consequently, even communities predicated upon renewable resources may find their goal of long-term stability undermined by global circumstances. This inherent antagonism between philisophy and economic reality seems to have been largely ignored by those who see chronic instability in these communities as essentially deriving from deficiencies in local decision making and entrepreneiural ethic. Moreover, there is evidence to suggest that government policy has been counterproductive in fostering a belief that solutions lie in local empowerment. But local engranchisement seldom has any impact on the global environment within which decisions affecting extraction and marketing of the resource are made. Non renewable resource based communities are in an even more precarious position. In both cases, any hope of economic diversification tends to be totally dependent upon the fortunes of the core resource. The drive for sustainability in resource dependent communities has also indirectly fostered a 'fortress mentality'. The alienation and powerlessness created by dependence upon a single employer has encouraged many communities to strive for autonomy, particularly in terms of infrastructure, in the assumption that long-term stability derives from institutional completeness. Again, some government programs have aggravated this rationale by encouraging communities to become unrealistically and inappropriately entrepreneurial in what is seldom an entrepreneurial environment. The outcome is frequently disillusionment and a costly duplication of scare resources. This paper argues that a dominant cultural ethic in this country, which places a high priority on individual security, has compromised the importance of economic diversification programs.