The Party's Over Part 2

If we could somehow carry ourselves back in time to central and western Europe in the year 400 AD and fly a few hundred feet above that continent, our bird's-eye view would reveal a land covered from horizon to horizon by dense forest, with only occasional clearings. In each of those clearings we might see a cl.u.s.ter of thatched huts, with smoke rising from one or more wood fires.

The Europeans of 400 AD relied on an energy regime based mostly on wood. They built their houses and furniture with wood; they made tools from it, including plows, pumps, spinning wheels, and wine-presses; they made transportation devices (carts and boats) from it; and they used it as fuel with which to heat their homes and cook. Whatever bits of metal they used - blades, coins, jewelry, horseshoes, nails - came from wood or charcoal-fired hearths.

If wood was supremely useful, it was also abundant. A vast forest lay within sight of virtually every town or village. In addition to its immediate benefit of supplying fuel, the temperate oak forest of Europe also supported a profusion of wild game animals, including deer, boar, and numerous bird species, such as pheasant and quail. Human settlements were small, seldom numbering more than a few hundred people; the total population of Europe probably - exact figures are not known - did not exceed 25 million (compared to 600 million today, if European Russia is included).

That the ancient Europeans revered the forest is evidenced by their traditions concerning the sacredness of certain groves, by their customs of making sacrifices and offerings to trees, and by their extensive lore regarding tree-spirits. But, with the coming of Christianity, these early pagan att.i.tudes (the Latin paga.n.u.s means "peasant") were gradually replaced by the idea that the wilderness is inherently fallen and corrupt, to be reclaimed only by pious human work. Far from fearing the overcutting of forests, later medieval Europeans saw the clearing of land as their Christian duty. Cutting the forest meant pushing back chaos, taming Nature, and making s.p.a.ce for civilization.

While wood was the princ.i.p.al fuel in medieval Europe, it was far from being the only available energy source. Generally, civilized humans have two broad categories of energy needs: for lighting and heating on the one hand, and for motive power for agriculture and transportation on the other. Until recent times, these two categories of needs were usually served by two separate categories of energy sources.

Lighting and heating required fuel. In medieval Europe, the burning of wood (occasionally straw or dried animal dung was used) provided heating fuel for virtually everyone. Fuel for lighting came from the burning of wax, tallow, rushes, or olive oil - but was considered too costly for any but the wealthy, except on special occasions.

Motive power at first came primarily either from human labor or animal muscle, though these would later be supplemented by power from water and wind. Despite the fact that the human engine is capable of generating comparatively little power, much of the land in Europe - as well as in China - was tilled directly by humans using a hoe or spade, without the help of an animal-drawn plow. Because people typically eat less than draft animals do and because their efforts are intelligently directed, they often provide a more economical source of power than do oxen, horses, or mules.

In medieval Europe, as in the great civilizations of China, Rome, and the Near East, forced human labor was common. While in Germany and eastern England a substantial portion of the peasantry was made up of free persons who held and worked lands in common, most communities elsewhere came to be organized around manors controlled by lords whose right to land could be defended, when necessary, by full-time specialists in violence (soldiers, va.s.sals, knights, and sheriffs). Agricultural tenants, in order to gain the right to cultivate a plot of land, were required to work a certain portion of each year on their landlord's estate. Serfs were bound to the land as quasi-slaves; and though they retained certain economic and legal rights, many existed perpetually on the verge of starvation. Ironically, however, it is also true that, in view of the many holidays and festivals celebrated in medieval societies, the typical serf back then actually enjoyed considerably more free time on a yearly basis than does today's typical American salaried worker.

In the early medieval period, most of the power for pulling plows and carts was provided by oxen. Only during the 12th century did horses come to be used as draft animals in any great numbers, this shift being due to the invention and widespread adoption of the horse-collar. Both before and after this time, horses were widely used for military purposes, a mounted cavalryman being both more mobile and more formidable than a footsoldier. In Spain and southern France, mules provided motive power for agriculture and transportation. Mules would later also become the primary source of animal power in regions of the Americas dominated by Spain - namely Mexico and most of South America. In addition to pulling plows and carts, oxen, horses, and mules also provided power for machinery: at first, for grain mills; later, for pumps to drain mines and for textile looms.

A significant implication of the use of large ruminant animals for traction was the necessity of growing food for them. Oxen, which can live on gra.s.s stubble and straw, were cheaper to maintain than horses, which also need grain. A horse typically requires between four and five acres of land for its food production; thus the use of traction animals reduced the human carrying capacity of the land while at the same time adding to it by enabling the plowing of larger fields. The net result varied. Animals were costly, and only a prosperous individual could afford to keep a horse. However, until the beginning of the 20th century, the trend was toward the increasing use of animal power. By 1900, Britain had a horse population of 3.5 million, consuming 4 million tons of oats and hay each year, thus necessitating the importation of grain for both animals and humans. In the US during the same period, the growing of horse feed required one quarter of the total available cropland (90 million acres).

Throughout the medieval period, human and animal power was increasingly supplemented by power from watermills and windmills. Watermills had been known from the time of ancient Greece; the Romans, Chinese, and j.a.panese employed them as well. The Romans had contributed the significant innovation of gears, which permitted the wheel to be moved to a vertical position and enabled the millstone to turn up to five times faster than the propelling wheel. Toward the latter days of their Empire, the Romans appear to have been taking increasing advantage of such equipment, perhaps because of a scarcity of slave labor, though such incipient industrial efforts subsided with the collapse of their civilization in the fifth century. However, in the 12th and 13th centuries, Europeans, led by the Cistercian monks, began using water wheels more extensively, and for a greater variety of purposes, than in any time or place previously. Windmills were costlier to operate than watermills, but could be built away from streams and could be used, for example, to drain water from the soil and to pour it into ca.n.a.ls - hence the windmill's significant role in the reclamation of land in the Low Countries.

Originally, both windmills and watermills were primarily used for grinding grain, an otherwise arduous process. A first-century verse by Antipater of Thessalonica describes the perceived benefits of the water wheel in both mythic and human terms: Cease from grinding, ye women of the mill; sleep late even if the crowing c.o.c.k announces the dawn. For Demeter has ordered the Nymphs to perform the work of your hands, and they, leaping down on top of the wheel, turn its axle, which with its revolving spokes, turns the heavy concave Nysirian millstones. We taste again the joys of primitive life, learning to feast on products of Demeter, without labor.2 Gradually, ingenious though anonymous inventors worked to develop and extend the use of windmills and watermills. One of the most important of these refinements consisted in the use of gears both to harness the machine's motive power to operate tools, such as saws and looms, and to operate several implements simultaneously. Eventually, mills would be used to pump water from mines, crush ores, make paper, and forge iron, among other tasks.

It should be noted that Europeans also harnessed wind power for transportation by means of sails. Sailing ships already had a long history throughout the Mediterranean as well as in China; during the medieval period their use gradually increased with improvements in shipbuilding and navigational technology, so that, by the latter part of the 16th century, European ships were conveying an estimated 600,000 tons of cargo annually. Many countries additionally maintained large fleets of sail-propelled warships.

The development of watermills and wind power in the Middle Ages could be said to have const.i.tuted the first industrial revolution. It was a period of sometimes explosive rates of invention and the development of Cla.s.s B and C tools (including the printing press); but perhaps more importantly, it was the time when the very first Cla.s.s D tools appeared, consisting of iron components for windmills and watermills, such as the heavy tilt-hammers used in iron forging.

Iron played no small part in this first industrial revolution. The use of iron can be traced back to the 15th century BC in the Caucasus, and cast iron and coal firing were known in China as early as the fifth century BC - developments not seen in Europe until the 14th century. Moreover, in China and India a high-quality carbonized steel (known in Europe as Damascus or damask steel) was being made as early as the second century - Europeans would not produce steel of equal quality until the 19th century.

However, despite being somewhat late on the scene with regard to such improvements, Europeans increasingly made use of iron during the medieval period, with demand for it often being stimulated by a long-simmering arms race. With crusades, wars, invasions, and peasant rebellions recurring throughout the period, there was constant need for more and better swords and pikes and - following the introduction of gunpowder (another Chinese invention) in the 14th century - for arquebuses, cannons, and iron bullets, all in addition to the cooking utensils, cauldrons, armor horseshoes, nails, and plowshares that were the day-to-day products of local smiths. Between the 11th and the 15th centuries, significant developments included the replacement of hand bellows by a hydraulic blowing machine and the invention of the blast furnace, permitting the production of cast iron and low-grade steel.

Demand for other metals - copper, bronze, gold, and silver - was also on the rise during this period. While the manors of the early medieval period were almost entirely self-sufficient, so that money was required only for the purchase of imported luxury goods, a gradually increasing trade required ever larger quant.i.ties of copper, silver, and gold coins.

The production of all these metal goods required fuel. Smelting necessitated high temperatures achievable only by the burning of charcoal, which is made by charring wood in a kiln from which air is excluded. The quant.i.ties of charcoal - and therefore of wood - that were required were far from negligible: the production of each ton of iron required roughly 1,000 tons of wood.

Altogether, the medieval energy economy - based on wood, water, and wind as well as on human and animal power - relied on resources that were renewable but not inexhaustible. Oak forests could regenerate themselves, though that took time. But trees were being cut faster than they could regrow, and the result was a rapid depletion of medieval Europe's primary fuel source.

While the construction of more and larger ships and the invention of the blast furnace contributed to the accelerated felling of trees, the ultimate cause was simply the increase in human population: many forests were cut merely to make way for more crops to feed people and domesticated animals. Prior to the Industrial Revolution of the late 18th century, there were two prolonged population surges in Europe: between 1100 and 1350 and between 1450 and 1650. Following the first surge, there was a sharp recession due to the Black Death; following the second, population growth tapered off partly due to recurring famines. From an ecological point of view, Europe had become saturated with humans, whose demands upon the environment were resulting in a rapid destruction of their temperate-forest ecosystem. Any further population growth would have to be based upon the acquisition of a new energy source.

Much of the southeast of England had been deforested by the end of the 11th century, and by 1200 most of the best soils of Europe had been cleared for agriculture. Wood shortages became commonplace in the 12th and 13th centuries. Between 400 and 1600 AD, the amount of forest cover in Europe was reduced from 95 percent to 20 percent. As scarcities appeared, wood began to be transported ever further distances by cart and by water. By the 18th century, blast furnaces were able to operate only one year in every two or three, or even only one in five or ten. Wood shortages led to higher prices for a variety of goods; according to Sully, in his Oeconomies Royales, "the price of all the commodities necessary for life would constantly increase and the growing scarcity of firewood would be the cause."3 In sum, the medieval period in Europe was a time of technological innovation, population growth, and energy-resource depletion within a region that, compared with China and the Islamic world, must be considered a cultural backwater. But this was the cultural, demographic, and geographic crucible for two immense developments. The first, whose significance was almost immediately recognized, was the commencement of the European age of exploration and colonization, which would eventually transfer vast wealth from the New World to the Old. The second was the gradually increasing use of a new kind of fuel.

The Coal Revolution.

According to the report of an early missionary to China, coal was already being burned there for heating and cooking, and had been so employed for up to 4000 years.4 Likewise in early medieval Europe, the existence of coal was no secret, but the "black stone" was regarded as an inferior fuel because it produced so much soot and smoke. Also, it occurred only in certain regions and had to be mined and transported. Thus, until the 13th century, it was largely ignored in favor of wood.

As wood shortages first began to appear, poor people began heating their homes by burning coal - most of which came from shallow seams and was a soft and sulfrous type that produced an irritating, choking smoke. Much was "sea-coal," which consisted of lumps collected from beaches and derived from cliff outcrops. By the late 13th century, London - a town of a few thousand inhabitants - was already cloaked in smog during the winter months. By the 16th and 17th centuries, even the rich were forced to make do with this inferior fuel. In the words of Edmund Howes, writing in 1631, "the inhabitants in general are constrained to make their fires of sea-coal or pit-coal, even in the chambers of honourable personages."5 However, coal was soon found to have advantages for some purposes - especially for metal working, since the higher temperatures possible with coal-fed fires facilitated the smelting of iron and other ores. Moreover, experimenters soon discovered that the roasting process used to make charcoal could be adapted to coal, the result being an extremely hot-burning fuel called c.o.ke. The use of c.o.ke in iron and steel production, beginning in England in the early 17th century, would so transform those industries as to const.i.tute one of the key developments paving the way for the Industrial Revolution.

By the 17th century coal had revolutionized far more than metallurgy and home heating: its use had become essential for manufacturing gla.s.s, bricks, tiles, and salt (through the evaporation of sea water) as well as for refining sugar, brewing beer, and baking bread.

Meanwhile, the extraction of coal - a dreary, dangerous, and environmentally destructive activity at best - led by necessity to a series of important mechanical inventions, including the mechanical lift and the underground tunnel with artificial lighting and ventilation. As mines were sunk ever deeper, sometimes to a depth of 200 feet or more, water tended to acc.u.mulate in the bottoms of the shafts. Workmen drained the water either with hand pumps or bucket brigades. In 1698, Thomas Savery devised a pumping engine that condensed steam to create a vacuum to suck water from mineshafts. The engine was extremely inefficient, requiring enormous amounts of energy to lift modest quant.i.ties of water. Just ten years later, Samuel Newcomen introduced a self-acting atmospheric engine operating on different principles; and though it const.i.tuted the first crude steam engine, it was used solely for pumping water from coal mines: at that time, no one apparently envisioned its possible employment in manufacturing and transportation.

In addition to water seepage, coal miners faced another problem: that of transporting the coal from the depths of mines to rivers or ports. Typically, balks of wood were thrown down to facilitate the movement of coal-bearing wagons. In 1767, Richard Reynolds constructed a trail of cast-iron rails, running from Coalbrookdale to the Severn, to hold the wagon wheels on track. Scores of similar tramways were constructed during the following two decades; in all cases, traction was supplied by horses.

Toward the end of the 18th century, inventors began toying with the idea of using the new steam engine (by now greatly improved through the efforts of James Watt) for locomotive power. After the expiration of Watt's patent, a Cornish engineer named Richard Trevithick devised a new high-pressure engine and, in 1803, installed it on a carriage in which he made several journeys through the streets of London. But public highways were too rough to accommodate the steam carriage, and so the idea languished for another two decades until George Stephenson hit upon the idea of putting the steam locomotive on rails like those used in the tramways of coal mines. When hired by a group of Quaker investors to construct a railway from Stockton to Darlington in 1821, Stephenson built the first steam railroad; and eight years later his locomotive, named the Rocket, won a compet.i.tion on the newly constructed Liverpool and Manchester Railway, demonstrating once and for all the superiority of the new technology over horse-drawn rail carriages.

Until the mid-19th century, all ships had traveled by renewable human or wind power. Beginning in the 1840s, steam power began to be applied to shipping; by the 1860s, new developments, such as the steel high-pressure boiler and the steel hull, enabled a typical steamship to transport three times as much cargo from China to Europe as a typical sailing ship, and in half the time.

The effects of these innovations on the economic life of Europe were dramatic. Trade was facilitated, both within nations (between the countryside and the city as well as between cities) and among nations and continents. More trade meant the extraction of more ores and other resources. The steam engine also greatly accelerated the transformation of those resources by industrial processes, as inventors devised a variety of steam-powered machines - including powered looms, cotton gins, lathes, die presses, and printing presses - to supplement or replace human labor.

Coal also had important chemical by-products. Of these, the earliest to have a significant social impact was manufactured (or artificial) gas. The first gaslights appeared in England in the 1790s, when William Murdock, an engineer and inventor, lit his own factory and then a large cotton mill in Manchester. The first gas street lighting was installed in London in 1807. In the United States, Baltimore was the first city to light its streets with gas, in 1816. Paris adopted gas street lighting in 1820. Soon nearly every town with a population of over 10,000 had a gas works, and the discharge of coal tars from the production of manufactured gas was being blamed for drinking-water pollution and the contamination of crops. In 1877, inventor T. S. C. Lowe discovered a way to make "fuel gas" from steam enriched by light oils recovered from gas-making residual tars. Fuel gas (also known as "carburetted water gas") was seen by the gas industry as a means of combating the inroads being made by electricity on gas lighting.

With the discovery of coal-tar dyes in 1854, coal byproducts also gave rise to the establishment of the chemical industry. The new synthetic dyes revolutionized the textile industry and led to the growth of the German chemical and pharmaceutical companies Hoechst and I.G. Farben.

Coal was thus central to the pattern we call industrialism. Even wage labor seems to have originated in the mining industry, and, as Lewis Mumford once noted, the "eight-hour day and the twenty-four-hour triple shift had their beginning in [the coal mines of] Saxony."6 By the late 19th century, the factory, with its powered machines, had revolutionized human labor, the economy, and society as a whole. First in England, and then in America, Germany, and a growing roster of other nations, settled cultivators and craftspersons became managers, wage-earning employees, or unemployed urban paupers; and economies that previously had been based on local production for local consumption became increasingly dependent on the long-distance trade of raw materials and finished goods.

One way of gauging the pace and extent of this transformation is to chart the quant.i.ties of coal being mined and used during the 19th century. In 1800, the annual world coal output stood at 15 million tons; by 1900, it had risen to 700 million tons per year - an increase of over 4,000 percent. In the last two years of the 19th century (18991900), the world used more coal than it had in the entire 18th century.

However, this vast expansion in coal usage was not evenly distributed over the globe. It occurred primarily in Europe and North America; and of all countries, Britain used by far the most - between one third and one half of the global total throughout the 19th century. (Germany, a rival industrial power, was also a significant user.) The ability of British industry to take advantage of this new energy resource had important geopolitical consequences: British cargo steamers carried raw materials from around the world to British ports, whence they were taken by trains to factories; manufactured goods were then hauled by train from factories to ports, whence they were distributed to colonies thousands of miles away. This system of trade was based both on policies, laws, and treaties that greatly favored the colonizing nation over the colonies, and on a highly mobile, industrialized form of military power capable of enforcing those laws and treaties. While colonialism had existed prior to the widespread use of fossil fuels, Britain's industrial version of it greatly intensified its essential practices of extracting wealth and consolidating political power.

Other nations envied Britain's colonial empire but lacked either the energy resources or the geographical prerequisites (such as coastlines and ports) or other historical advantages (including prior colonies and investments in industry).

America's energy path during the early decades of the 19th century differed greatly from that of Britain. Because of its abundant forests and numerous rivers, the United States relied primarily on wood- and water-power for its early industrial development; and during the first half of the century, much of the energy for agricultural production came from African slaves. As late as 1850, half of the iron produced in the US was smelted with charcoal. Locomotives and riverboats continued to burn wood well into the last two decades of the century, when America's forests began to be dramatically depleted. Only in the mid-1880s did a shift to coal begin in earnest; by 1910, coal accounted for three-quarters of the nation's energy supply. Like Britain, the US was favored with abundant indigenous deposits, especially in the mountainous regions of Pennsylvania, West Virginia, Kentucky, and Tennessee.

Global dependence on coal peaked in the early 20th century, when its contribution to the total world energy budget surpa.s.sed ninety percent. In the course of a hundred years, coal had transformed much of the world. New forms of production, new inventions and discoveries, new patterns of work, and a new geopolitical balance of power among nations were all due to coal. Cities were lit, and factory-made goods were produced in abundance. In addition, a great surge of population growth began, which was to be by far the most dramatic in world history.

The 13th-century Europeans who had reluctantly begun burning coal to heat their homes would scarcely have understood the ultimate implications of their actions. For them, coal was a sooty black stone with only a few practical uses. Surely, few stopped to think that, while all of their other energy resources were renewable (if exhaustible), coal was both exhaustible and nonrenewable. At the population levels and scales of usage prevailing in the Middle Ages, the limits to coal must hardly have seemed imaginable. Nevertheless, a threshold had been crossed: from then on, an increasing proportion of the world's energy budget would be derived from a source that could not be regrown or reproduced on a timescale meaningful to humans.

The Petroleum Miracle, Part I.

In the late 19th and early 20th century, another new source of energy began to come into use: petroleum. As had been the case with coal, few people at first had any inkling of the consequences of the increasing exploitation of this new energy resource. But as coal had so dramatically shaped the economic, political, and social contours of the 19th century, petroleum would shape those of the 20th.

Again, necessity was the mother of invention. As motorized machines proliferated during the 19th century, vegetable oils, whale oil, and animal tallow were typically used for machine lubrication, and whale oil as fuel for lamps. Toward the end of the century, commercial whale species were being hunted to the point of extinction, whale oil was becoming increasingly costly, and tallow and vegetable oils were proving inadequate as lubricants for the ever-larger and more sophisticated machines being designed and built.

Petroleum had been known for centuries, perhaps millennia, and had been used in warfare as early as 670 AD, when Emperor Constantine IV attached flame-throwing siphon devices to the prows of his ships to spew burning petroleum on enemy vessels. Oil also had a long history of use for sealing and lubrication, and even for medicinal purposes. However, the exploitation of petroleum was limited to small quant.i.ties that seeped to the ground surface in only a few places in the world.

Beginning with the successful drilling of the first commercial oil well by "colonel" Edwin L. Drake in northwest Pennsylvania in 1859, petroleum became more widely available as a cheap and superior lubricant and, when refined into kerosene, as lamp fuel. The problems of whale-oil depletion and machine lubrication had been solved. But, of course, oil soon would prove to be useful for many other purposes as well.

Fortunes were quickly made and lost by dozens of drillers and refiners, as a rapidly expanding supply of petroleum fed the nascent demand. By 1866, Drake himself was bankrupt; meanwhile, an extraordinarily business-savvy early oilman named John D. Rockefeller had begun purchasing crude in Pennsylvania, Ohio, and West Virginia and refining it under the name Standard Oil. Soon he had the largest refining operation in the country and was absorbing his compet.i.tors, using selective price-cutting strategies and obtaining kickbacks from the railroads that transported both his and his compet.i.tors' crude.

Rather than buying up the other refiners and producers outright, Rockefeller set up a trust by which stockholders in Standard Oil controlled the stock in dozens of other oil companies as well. Rockefeller's business strategy was simple and consistent: be the low-cost producer, offer a reliable product, and ruthlessly undercut and a.s.similate any compet.i.tor. In addition to its refineries, Standard developed its own production and distribution systems, building pipelines and the first oil tankers. By 1880, Standard controlled ninety percent of the oil business in the US - and the rest of the world as well.

Rockefeller used Standard's domestic business tactics of predatory pricing, secrecy, and industrial espionage to absorb foreign oil companies - especially those in Europe, where industrialization and urbanization were stimulating an ever-increasing demand for kerosene and lubricating oil. Kerosene quickly became the foremost US-manufactured export; and Standard, with its European subsidiaries, became perhaps the first modern transnational corporation. In a mere decade and a half since founding Standard in 1865, Rockefeller had nearly achieved the goal he envisioned from the start: a worldwide monopoly on petroleum.

However, that monopoly hinged at least in part on the control of global production, a control that was soon threatened by the discovery of major reserves outside the American northeast. The first such threat emerged from the Russian empire, where oil was discovered in 1871 in Baku, a region on the Aspheron Penninsula in the Caspian Sea. Ludwig n.o.bel, known as the "Russian Rockefeller" - and brother of Alfred n.o.bel, the discoverer of dynamite and donor of the n.o.bel Prize - arrived in Baku at the beginning of the oil rush there and quickly established commercial dominance in production and refining. By 1885, Russian crude production was at about one-third of the American production levels. But since demand within Russia itself could not absorb such an amount, the n.o.bels sought foreign markets. Help came from the French branch of the Rothschild banking family, which, over the previous century, had financed wars, governments, and industries, and now owned a refinery at Fiume on the Adriatic. The Rothschilds bankrolled a railroad from Baku to Batum, a port on the Black Sea, enabling the n.o.bels' oil to flow to European markets.

The Rothschilds soon bought their own oil wells and refineries in Baku, entering into compet.i.tion with the n.o.bels. They also expanded the distribution of Russian oil to Britain, prompting Standard to set up its own affiliate in London, the Anglo-American Oil Company. The Rothschilds then looked further afield, namely to Asia, seeking still more markets for the ever-growing supply of Baku crude. In the early 1890s, they contracted with international trader Marcus Samuel to build a system of distribution throughout South and East Asia. Samuel began by embarking on an Asian tour; soon he was supervising the construction of storage tanks throughout Asia, undertaking major improvements in tanker design, and obtaining the right of pa.s.sage through the Suez ca.n.a.l, which had previously been denied to oil shipping. Samuel's objective was nothing less than to beat Standard Oil at its own game, offering exported Russian oil throughout the Far East at prices Rockefeller could not match. Samuel's company - at first called the M. Samuel Company, later Sh.e.l.l Transport and Trading - achieved a coup that could hardly escape Standard's notice.

During the 1890s, Rockefeller, the n.o.bels, the Rothschilds, and Samuel engaged in what became known as the Oil Wars. Periods of price-cutting were punctuated with attempts at takeovers or grand alliances.

At the same time, oil production in the Dutch East Indies (now Indonesia) was growing at a furious pace under the commercial control of the Royal Dutch Company, which offered still another challenge to Standard's international dominance.

Further, while all of this global compet.i.tion was intensifying, the oil business was changing in fundamental ways. With Thomas Edison's promotion of electric lighting in the 1880s, demand for kerosene peaked and began to recede. However, new uses for petroleum more than took up the slack. Oil-burning furnaces appeared toward the end of the century, as well as oil boilers for factories, trains, and ships - all promoted by Standard. By 1909, half of all petroleum extracted was being sold as fuel oil. But by far the most important new use of petroleum was as fuel for the internal combustion engine, developed in the 1870s by German engineer Nikolaus Otto. Gasoline, when first discovered, had, because of its extreme volatility, been regarded as a dangerous refinery waste product; when used in lamps, it caused explosions. Initially, it was simply discarded or sold for three or four cents per gallon as a solvent. Now it was seen as the ideal fuel for the new explosion-driven internal combustion engine.

Another important development was the appearance of a market for natural gas. The latter had frequently been found together with oil (most oil fields have gas deposits). Gas was also often found in coal deposits, and many early coal miners had died from asphyxiation from deadly "coal gas" or from gas explosions. Natural gas is mostly methane, but it also contains small amounts of ethane and heavier hydrocarbon gases, such as butane, propane, and pentane. During the first few decades of oil drilling, natural gas was often regarded as having no value and was simply flared (burned off). However, as prices for manufactured gas for street lighting rose and as environmental hazards from its production became more apparent, natural gas was seen as a cheap and environmentally more benign subst.i.tute. In 1883, Pittsburgh became the first city to replace manufactured gas with the cheaper natural gas. Three years later, Standard Oil formed the Standard Natural Gas Trust. But within a few years, electric street lighting and home lighting appeared as commercially viable options. As gas lights were gradually replaced with electric lights, local gas works were sold and consolidated, their infrastructure of pipes converted to the distribution of natural gas for cooking and heating.

Even though petroleum production, refining, and distribution had become huge and quickly growing commercial enterprises, the 19th century was the century of coal to its very end: only after the turn of the 20th would the world witness the true dawning of the petroleum era.

Electrifying the World.

Before we continue with the story of petroleum, it is necessary to survey another energy development that would shape the 20th century in nearly as profound a way as would oil: electrification. Unlike petroleum or coal, electricity is not a source of energy, but rather a carrier of energy, a means by which energy can conveniently be transmitted and used. Electrification enabled the development and wide diffusion of home conveniences, business machines, and communication and entertainment devices - all connected by miles of wire to a variety of energy sources ranging from coal or oil boilers to hydroturbines to nuclear fission reactors. By making energy easy to access and use, electricity stimulated the use of energy for ever more tasks until, by the 20th century's end, most people in industrialized cities were spending virtually every moment of a typical day using one or another electrically powered device.

The first electric generator was invented in London in 1834, but decades elapsed before electricity saw commercial applications. Thomas Edison (1847 1931), a former railroad telegrapher, began his career as an inventor by devising improvements to the telegraph and telephone. His laboratory was described as an "invention factory": Edison was the first to apply industrial methods to the process of invention, hiring teams of engineers to work systematically to devise new commercial technologies. This was a strategy widely adopted throughout corporate America in the following century. In 1878 Edison turned his attention to the electric light; in 1879 he lit his factory with electricity; and three years later, his workers installed carbon-filament electric lamps in the financial district of lower Manhattan. Edison, ever the astute businessman, supplied the entire system of generators, transmission lines, and lights, taking care to price electricity at exactly the equivalent of the price of piped gas.

Edison's system for generating and distributing electric power used current flowing in one direction only - direct current, or DC. This had the disadvantage of requiring neighborhood generating stations, since direct current was rapidly dissipated by resistance along transmission lines, given the technology then available (today high-voltage direct current can be transmitted long distances with relatively little line loss). Indeed, most of the factories and homes lit by early DC systems maintained dynamos on-site - which were both expensive and annoying: the generator in the bas.e.m.e.nt of J. P. Morgan's mansion in New York made so much noise that his neighbors frequently complained. At that time, virtually no one envisioned the regional, centralized electric distribution systems we now take for granted.

Engineers of the time knew that alternating current, or AC - where electricity flows back and forth along transmitting wires, alternating its direction many times per second - was a theoretical possibility and could overcome the transmission limitations of direct current. However, no one had yet solved the basic technical problems, and no practical AC motor yet existed.

In 1884, a Serbian-American inventor named Nikola Tesla (18541943) approached Edison with his designs for an AC induction motor. Though Edison recognized the younger man's exceptional intelligence and immediately hired him to improve existing DC dynamos, Tesla's plans were ignored. The two men were utterly dissimilar in their approaches to invention: while Edison was a tinkerer with little understanding of theoretical principles, Tesla was a supreme theoretician comfortable with advanced mathematics. Tesla would later write: If Edison had a needle to find in a haystack, he would proceed at once with the diligence of the bee to examine straw after straw until he found the object of his search. I was the sorry witness of such doings, knowing that a little theory and calculation would have saved him ninety percent of his labor.7 Tesla broke with Edison after a financial dispute (the latter offered a $50,000 bonus for a job he thought impossible, then refused to pay when Tesla accomplished the task), obtained financing, equipped his own laboratory, and proceeded to design, build, and patent the first AC motors. A Pittsburgh industrialist named George Westinghouse heard of Tesla's work, purchased rights to his patents, and went into compet.i.tion with Edison.

By 1893, the financier J. P. Morgan had engineered a takeover of Edison's company and several other electrical device manufacturers; the resulting General Electric Corporation then settled into a "War of the Currents" with the Westinghouse company over the future of electrification. GE publicists made absurd claims about the dangers of AC power, while spectators at the Columbian Exposition were awed by the most impressive demonstration of electric lighting yet seen -provided under contract by Westinghouse. Flags fluttered, a chorus sang Handel's Hallelujah Chorus, and electric fountains shot jets of water high into the air. Twenty-seven million people attended the fair during the following months, all witnessing the practical wonders of alternating current. Tesla's victory was further underscored when the Niagara Falls Power Project, completed in 1896, chose Tesla's advanced AC polyphase designs for its giant dynamos. J. P. Morgan would later comment that his backing of Edison's DC system had const.i.tuted the single worst business decision of his career.

Tesla went on to invent or provide the theoretical foundations for radio (while Marconi is still usually given credit for this invention, the US Supreme Court affirmed the priority of Tesla's patents in 1943), robotics, digital gates, and even particle-beam weapons. While other scientists gleaned much of the credit for many of these developments and corporations made fortunes from them, Tesla preferred the role of lone visionary, giving yearly press interviews in which he articulated colorfully his plans for worldwide broadcast power, communication with other planets, and cosmic-ray motors. Tesla died nearly penniless at the height of World War II; his papers were immediately seized and sequestered by the Office of Alien Property. Though mostly forgotten for decades, Tesla is now widely regarded as the true father of 20th-century electrical technology.

At the turn of the century, as the War of the Currents was cooling off, the Utilities Wars were just heating up. Cities wanted electric street and home lighting, but controversy raged over the question of whether the utilities responsible for delivering the electricity should be privately or publicly owned. Financiers like J. P. Morgan and Samuel Insull (of Chicago's Commonwealth Edison) lobbied to make utility monopolies a perpetual "dividend machine" for investors while public-power advocates in hundreds of towns and cities around the country insisted that costs to consumers should be controlled through public ownership. In most cases, the private interests won, resulting in the creation of giant utility corporations like Pacific Gas & Electric (PG&E) and Continental Edison; however, scores of communities succeeded in creating publicly-owned munic.i.p.al power districts that typically sold electricity to consumers at much lower prices.

During the 1930s, President Franklin D. Roosevelt battled the private utility interests in his campaign for rural electrification. His largest and most successful public works project, the Tennessee Valley Authority, at first administered by the visionary Arthur Morgan, built dams and distribution systems, making electric power almost universally available throughout the rural East. Today, rural power co-ops and munic.i.p.al power authorities still control about 20 percent of electrical generation and distribution in the country, and recent developments, such as the bankruptcies of Enron and PG&E - with executives profiting handsomely while customers and employees paid dearly - have revived the public-power movement throughout the nation.

Even before the beginning of the 20th century, electricity already had many uses in addition to lighting. Electric streetcars and subways began replacing horse-drawn streetcars in the larger cities in the 1890s, and this led to a major change in urban development patterns: the growth of suburbs. In 1850, the edge of the city of Boston lay a mere two miles from the city center; by 1900, electrified ma.s.s transit had allowed the city perimeter to spread ten miles from the business district. Previously, city centers had been the most densely populated areas; now, urban cores began emptying as residents moved to the suburbs, leaving the heart of town to financial and commercial activity.

As factories were electrified, opportunities for automation cascaded, further fragmenting production tasks and eliminating the need for skilled labor. A former Edison employee named Henry Ford recognized these possibilities early on, and the electrified a.s.sembly line he created for the production of his motorcars stood as an example for other manufacturers of how to cut costs and ensure uniform quality. A Model T Ford sold for $825 in 1908, but by 1916, automated ma.s.s production had brought the price down to $345.

As homes were electrified, even domestic work began to be automated, and housewives were bombarded by advertis.e.m.e.nts informing them of the potential gains in "productivity" and "efficiency" available through the use of gadgets ranging from vacuum cleaners and washing machines to electric toasters, mixers, and irons.

Because of its unique properties, electricity was used in ways that would not have been possible with other forms of energy. The field of electronics - encompa.s.sing radio, television, computers, and scores of other devices based first on vacuum tubes and later on semiconductors - would revolutionize communications and entertainment as well as information storage and processing.

While electricity offers extreme convenience to the user, it is an inherently inefficient energy carrier. For example, when coal is burned to drive dynamos, only 35 percent of its energy ultimately becomes electricity. Inefficiencies are also inherent in transmission lines and in end-use motors, lights, and other powered devices. However, as long as primary energy sources remain cheap, such inefficiencies can be easily afforded. At current prices, an amount of electricity equivalent to the energy expended by a person who works all day, thereby burning 1,000 calories worth of food, can be bought for less than 25 cents.

Coal is still the princ.i.p.al primary energy source for the generation of electricity in the US and throughout the world. In 2004, public and private US electric utilities derived 51 percent of their power from coal, 20 percent from nuclear fission, 7 percent from hydro, 16 percent from natural gas, 3 percent from oil, less than 1 percent from wind and photovoltaics, with the remainder coming from other alternative sources.

Electricity's availability for a vast range of tasks has led to a ma.s.sive increase in total energy usage. Whole industries - such as aluminum production - have arisen that are completely dependent upon electricity. On the whole, during the 20th century electricity consumption increased twice as fast as the overall energy consumption.

The Petroleum Miracle, Part II.

In the first half of the 20th century, as electricity was revolutionizing homes and workplaces, the industrialized world's reliance on coal gradually subsided while its use of oil expanded greatly, reshaping nearly all spheres of life.

The structure of the petroleum industry underwent significant shifts in the early years of the century. In 1902, Samuel was forced to merge his company with Royal Dutch to create Royal Dutch-Sh.e.l.l. And with the discovery of oil in Persia (now Iran), the Anglo-Persian Oil Company (later British Petroleum, or BP) came into being. Persian crude would be the first commercial oil to come from the Middle East.

Meanwhile, in the US, Rockefeller's cutthroat business tactics and near-monopolization of the domestic industry led to an anti-trust suit brought by the Federal government. In 1911, a decision of the Supreme Court forced the breakup of Standard Oil Company into Standard Oil of New Jersey (which later became Exxon), Standard Oil of New York (Mobil), Standard Oil of California (Chevron), Standard Oil of Ohio (Sohio, later acquired by BP), Standard Oil of Indiana (Amoco, now BP), Continental Oil (Conoco), and Atlantic (later Atlantic Richfield, then ARCO, then Sun, now BP). Rockefeller eventually profited handsomely from the split, and the new companies carefully avoided directly competing with one another.

At the turn of the century, Russia had briefly become the world's largest oil producer. However, political upheavals in that country undermined the further development of the industry. Soon new discoveries in the US - in California, Texas, and Oklahoma - made America again the foremost oil-producing and -exporting nation, a position it would hold for the next half century. In 1901, the Spindletop oil gusher in Texas marked a shift in the center of gravity of American production away from the Northeast and toward the Southwest. Further spectacular Texas and Oklahoma discoveries in the 1930s led to dramatic overproduction and price volatility: for a short time, the price of crude fell to four cents per barrel, making it literally cheaper than drinking water. The Texas and Oklahoma discoveries also engendered several new companies, including Texaco and Gulf Oil.

These developments taken together resulted in the domination of the world petroleum industry throughout the rest of the century by the so-called "Seven Sisters": Exxon, Chevron, Mobil, Gulf, Texaco, BP, and Sh.e.l.l. By 1949, the Seven Sisters owned four-fifths of the known reserves outside of the US and the USSR and controlled nine-tenths of the production, three-quarters of the refining capacity, two-thirds of the oil-tanker fleet, and virtually all of the pipelines.

Throughout the first decades of the century, the US was in a position to control the world oil price. This changed in the second half of the 20th century, as we will see shortly, when US production declined while production in the Middle East increased.

During the first half of the century, as electricity steadily eroded the market for kerosene as a source of illumination, new uses for petroleum products stoked ever greater demand for oil. By 1930, gasoline was the princ.i.p.al refined product of the petroleum industry, and aviation fuel was beginning to account for a noticeable share of oil production. And as the chemical industry switched from coal tar to petroleum as raw material, new synthetic materials - nylon and a wide range of plastics - began to replace traditional materials such as wood, metal, and cotton in manufactured consumer products.

It is difficult to overstate the extent of the transformations of the world economy, of industry, and of daily life that can be attributed to the use of petroleum during the 20th century. We can perhaps appreciate these transformations best if we discuss separately the fields of agriculture, transportation, and warfare.

Agriculture.

One of the greatest problems for agriculture had always been the tendency of soils to become deficient in nitrogen. The traditional solutions were to plant legumes or to spread animal manures on the soil. But these nitrogen sources were not always adequate. In 1850, explorers of islands off the coast of Chile and Peru had discovered entire cliffs of guano - the nitrogen-rich excreta of sea birds. Over the next two decades, 20 million tons of guano were mined from the Chilean and Peruvian islands and shipped to farms in Europe and North America. Once that supply was exhausted, the search was on for a new source of usable nitrogen.

In 1909, German chemists Fritz Haber and Carl Bosch devised a method for fixing atmospheric nitrogen by combining it with hydrogen to make ammonia. At first, the process used coal to fuel the machinery and as a source of hydrogen; later, coal was replaced by natural gas. As geographer Vaclav Smil has argued in Enriching the Earth: Fritz Haber, Carl Bosch, and the Transformation of World Food Production8, the Haber-Bosch process probably deserves to be considered the princ.i.p.al invention of the 20th century since today ammonia synthesis provides more than 99 percent of all inorganic nitrogen inputs to farms - an amount that roughly equals the nitrogen tonnage that all of green nature gains each year from natural sources (legumes, lightning strokes, and animal excreta). More than anything else, it is this doubling of available nitrogen in the biosphere that has resulted in a dramatic increase in food production throughout the century, enabling in turn an equally dramatic increase in human population. At the same time, however, the widespread agricultural application of synthetic ammonia has led to nitrogen runoffs into streams and rivers - one of the most significant pollution problems of the last century.

Agriculture was also revolutionized by tractors and other motorized equipment as well as by motorized systems of distribution. Previously, one-quarter to one-third of all agricultural land in North America and Europe had been devoted to producing feed for the animals that pulled plows and wagons; thus the replacement of animals by motorized equipment meant that more land could be freed for human food production. Also, because tractors could cover more ground more quickly than draft animals, fewer farmers were needed to produce an equivalent amount of food; hence larger farms became economically feasible, indeed advantageous. As small subsistence farms were increasingly put at disadvantage, more farmers left the countryside to seek work in the cities.

The development of petrochemical-based herbicides and pesticides after World War II increased yields even further. In the 1960s and '70s, international development agencies promoted the use of motorized farm equipment, synthetic ammonia fertilizers, and chemical herbicides and pesticides throughout the less industrialized nations of the world; known as the "Green Revolution," this program resulted in predictably enhanced yields, but at horrendous environmental and social costs.

Transportation.

The transportation revolution of the 20th century had social, economic, and environmental consequences that were nearly as profound as those in agriculture. Central to that revolution were the automobile and the airplane - two inventions dependent on the concentrated energy of fossil fuels.

In its early days, the automobile - invented in 1882 by Carl Benz - was a mere curiosity, a plaything for the wealthy. Nevertheless, the idea of owning a private automobile was widely and irresistibly attractive: the young and the upwardly mobile could not help but be seduced by the motorcar's promise of speed and convenience - even though the reality of journeying any distance in one actually entailed considerable inconvenience in the forms of noise, dust, mud, or mechanical breakdown. Promoters of the automobile claimed that widespread car ownership might relieve the nuisance of horse feces covering urban streets (for cities like New York and Chicago, this posed a serious pollution dilemma), but few gave much thought to the problems that near-universal automobile ownership might itself eventually entail.

One of the princ.i.p.al hindrances to the growth of the early auto industry was the lack of good roads. In order to travel at the speeds of which they were capable, automobiles needed surfaces that were smoothly paved - but few existed. Demand for more public funding for highways was already growing, fed partly by bicyclists, but motorists added dramatically to the public pressure. Beginning at the turn of the century, car owners and manufacturers, together with oil and tire lobbyists, succeeded in persuading all levels of government to, in effect, subsidize the automotive industry - at a rate that would c.u.mulatively amount to hundreds of billions of dollars - through appropriations for road construction.

Henry Ford, America's most prominent automotive industrialist, proposed to make cars so cheap that anyone could own one. Ford made sure to pay his factory workers enough so that they could afford to buy a coupe or sedan for themselves. However, as inexpensive as the Model T was by today's standards, it still represented a cash outlay beyond the means of most American families.

Automated, fuel-fed ma.s.s production was proving capable of turning out goods in such high quant.i.ty as to overwhelm the existing demand. Until this time, the average family owned few manufactured goods other than small items such as cutlery, plates, bowls, window gla.s.s, and hand tools. Virtually none had motorized machines, which were simply too expensive for the typical family budget. The industrialists' solutions to this problem were advertising and credit. More than any other product, the automobile led to the dramatic expansion, during the 1920s, of both the advertising industry and consumer debt. Car companies nearly tripled their advertising budgets during the decade; they also went into the financing business, making car loans ever easier to obtain. By 1927, three-quarters of all car purchases were made on credit, and there was one car for every 5.3 US residents.

That same year, 1927, was the first in which there were more people buying a car to replace a previous one than there were people buying a first one. As the roaring twenties drew to a close, the market for automobiles became saturated while American families saddled themselves with a record amount of consumer debt. But car companies kept producing more Fords, Buicks, Hupmobiles, and Stutzes, thus setting the stage for a recession. The auto industry was not solely responsible for the full-blown economic catastrophe that followed - overly lenient rules governing stock speculation played a prominent role as well - but it contributed in no small way to the ensuing bankruptcies, bank failures, and layoffs.

By now, the automobile manufacturers together controlled a significant proportion of the national economy: General Motors was the world's largest corporation, with Ford and Chrysler following closely behind. Whatever the Big Three automakers did sent ripples through the stock market, the banking system, and national labor organizations. The auto industry had united the interests of other giant industries - oil, steel, rubber, gla.s.s, and plastics - in the manufacturing, fueling, and marketing of a single product, and in the transformation of the American landscape, lifestyle, and dreamscape to suit that product. Subsidiary businesses sprang up everywhere - from spare parts distributors to local gas stations and repair shops, from fast-food chains to drive-in theaters.

Urban sprawl, which had begun in a few large towns with the installation of electric trolleys, exploded discrete cities into "metropolitan areas" with few clear boundaries, rolling on for mile after mile along major arteries. In New York, urban planner Robert Moses - who himself never drove - put the automobile at the center of his design priorities, creating grand new bridges and freeways for commuters while gutting entire neighborhoods to make way for on-ramps and off-ramps. For over forty years, from the 1930s to the late '70s, Moses rebuilt Manhattan to suit motorists; at the end of the process, traffic and parking problems were worse than they had been at the beginning, and the city had sacrificed much of its charm, neighborhood integrity, and historical interest along the way.

Many European cities responded to the automobile differently by investing more in trains, trolleys, and subways. Partly as a result, per capita auto ownership in Europe for a time remained significantly lower than in the US; meanwhile, the narrowness of old European city streets and the higher price of fuel encouraged the design of smaller cars.

The European approach to ma.s.s transit could have taken hold in the US, which maintained excellent inter-urban pa.s.senger rail lines and many fine urban streetcar systems until mid-century. However, in 1932 General Motors formed a company called United Cities Motor Transit (UMCT), which bought streetcar lines in town after town, dismantled them, and replaced them with motorized, diesel-burning buses. In 1936, GM, Firestone, and Standard Oil of California formed National City Lines, which expanded the UMCT operation, buying and dismantling the trolley systems in Los Angeles and other major cities. By 1956, 45 cities had been relieved of their electric rail systems. The bus services that replaced them were, in many instances, poorly designed and run, leaving the private auto as the transportation mode of choice or necessity for the great majority of Americans. Public transportation in America reached its broadest per-capita usage in 1945, then fell by two-thirds in the succeeding twenty years.

The American love affair with the auto was also encouraged by what would become the biggest public-works project in history: the Interstate Highway System. Modeled on Hitler's Autobahn, the Interstate System came into being through the Interstate Highway Act, pa.s.sed in 1956 partly as a measure for national defense. The bill authorized $25 billion for 38,000 miles of divided roads; by comparison, the entire national budget in 1956 was $71 billion, and the Marshall Plan had cost only $17 billion. It was the Interstates, more than anything else, that would eventually nearly destroy the American pa.s.senger rail system: the trains simply could not compete with so highly subsidized an alternative.

Car ownership meant convenience, power, and even romance, as the typical young couple found freedom and privacy in the back seat of the parents' Chevy. Soon they'd be married, the husband commuting to the office, his wife chauffeuring the kids to music lessons and little-league games. The gift or purchase of a first car would become as important a rite of pa.s.sage for every teenager as graduation from high school. Life would become unimaginable without the Mustang, Camaro, or Barracuda in the driveway, ready and waiting for adventure.

However, the love affair with the car always had its dark side. While in Paris in 1900, novelist Booth Tarkington overheard and recorded the comment, "Within only two or three years, every one of you will have yielded to the horseless craze and be the boastful owner of a metal demon ... Restfulness will have entirely disappeared from your lives; the quiet of the world is ending forever."9 But noise would prove perhaps the least of the car's noxious effects; air and water pollution, the loss of farmland due to road construction, and global warming const.i.tute far worse damage. Car culture has also resulted in the disappearance of wildlands and poses a constant danger to animals: the toll in road kill is about a million wild animals per day in the US alone.

Out-of-pocket expenses for car ownership today average about $1,500 per vehicle per year. But if all of the environmental and social losses were factored in, that cost would be closer to $25,000 per car, according to some calculations. One of the greatest of those "external" costs is car crashes: since 1900, more than twice as many Americans have died in auto collisions than have been killed in all of the wars in US history.