Oil Versus Coal: Warfare as Midwife of Change of Fuel Source


 

اکوان

 

Author: Kaveh Ehsani, Leiden University 
[ From “The social history of labor in the Iranian oil industry : the built environment and the making of the industrial working class (1908-1941)” ]

 

In 1911 the United States adopted oil-fired boilers for its new heavy warships. Britain also had begun searching for a sustainable way to undergo the conversion. Winston Churchill, newly appointed at the First Lord of Admiralty asked his predecessor Admiral Fisher to preside over the Royal Commission on Oil Supply for the Navy, with John Cadman, a professor of chemistry at Birmingham and the future director of APOC, also serving as an influential member of the Commission. Churchill asked the Commission “You have got to find the oil; to show how it can be stored cheaply; how it can be purchased regularly and cheaply in peace; and with absolute certainty at war”[67].
By 1914 Fisher had returned for a second stint as the head of the Admiralty and succeeded in getting the British navy to convert all its boilers from coal to oil[68]. The strategic problem with oil was its uneven geographic distribution since, aside from the United States and Russia, all the other major protagonists in WWI were oil importers[69]. As a result, for Britain oil was far more costly (four to twelve times more) than coal, especially since the Island had significant coal deposits and was itself a major exporter[70]. The opportune discovery of oil in Khuzestan in 1908 significantly reduced that major obstacle for Britain (see chapter 2) and smoothed the way for the eventual conversion to oil[71].
Oil had significant advantages over coal: It weighed less per thermal unit, was easier to transport, had twice the thermal energy of coal by bulk, and did not require stokers as it could be pipe fed automatically into engines. This released tremendous space in battleships, expanded the range of their operations[72], and significantly reduced labor requirements[73]. In addition, internal combustion engines were less bulky, and more economical than steam power during off-peak use since they could be turned on or off with ease. Oil burned cleaner than coal and produced less smoke, a major advantage in sea warfare, which relied on stealth. WWI became a major conduit for the ascendency of oil as a major global strategic resource in large part as a result of these advantages as well as the type of decisions made by the wartime British government[74]. It led to the allocation of tremendous resources to, and created a major demand for, the mass production of military hardware that operated with the internal combustion engines, such as tanks, airplanes, automobiles, and submarines[75]. These technologies existed before, but as exceptions and luxury items of leisure for the affluent. But, partially as a result of the internal combustion engine’s major impact on the outcome of the war, oil ended up becoming one of the cornerstones of the post war economic and economic shift to Fordism and industrial mass production and consumption[76]. Equally significant to the ascendency of oil during WWI was the conflict’s wider and long lasting social, cultural, and political repercussions. According to Giddens, “the meshing of industrial production and military strength is of prime importance among the influences that have shaped the modern world… Industrial production provided the means for the industrialization of war, but the activities and involvements of nation states are at the origin of the phenomenon”[77]. In Britain especially, with its Victorian traditions of minimal central government involvement in the regulation of the economy and social affairs and the strong autonomy of local elites and governing institutions, WWI affected the very culture and institutions of governance and the relations between state and society[78]. As the scope of the conflict expanded war became the concern of ordinary people and not just elites. Since it permanently affected class relations and the attitudes and policies of both business and government, and had a direct bearing on the actions of APOC and the British government in Khuzestan in the post war era, we will discuss it briefly.
War and the Politics of Conscription, Class, and Gender:
WWI was a total war, and like no previous military conflict it fused together society, economy, and politics. Hobsbawm calls WWI and its aftermath “the age of catastrophe” and argues that its destructiveness was caused by its similarity to unbridled competitive capitalism, which has no ultimate aim except limitless accumulation, acquisition, and global expansion[79]. The conflict engulfed the general public as conscripts, workers, canon-fodder, and ultimately made them pay for the costs of the carnage. But, at the same time and ironically, the very scope of war brought with it the expansion of the public sphere and opened up new avenues for political participation by the working classes, women, and ordinary people. This unplanned expansion subsequently allowed the working classes to enter directly the political sphere though a combination of electoral politics, trade unionism, and radical collective actions, such as the 1926 general strike. The majority of the general population, including many workers, trade unions, and most politicians representing them, came around in support of the patriotic effort. But, in exchange for the sacrifice of mass participation in war they demanded reciprocal sacrifices by property owners, both in material terms as well as political- a new social and political bargain, so to say[80].
This important development overlapped with structural developments in corporate capitalism (see the sections below on the second industrial revolution and the structural transformations of capitalism), forcing the state and large corporations like APOC to view labor and labor relations in altogether new perspectives. In this new configuration laborers could no longer be seen merely as anonymous producers of surplus value, but increasingly as “human capital” and, ultimately, as political citizens whose votes and political actions could affect laws and policies. While labor had demonstrated that it was able to organize politically to improve its lot and in the process to exert some pressure for the redistribution of wealth, and even present an existential threat to rates of profit or the capitalist order itself, it also needed to be treated as an investment, to be educated and trained to cope with the increasingly complex divisions of labor, a more hierarchical and alienating work process, and trusted to handle and operate ever more intricate and costly technology[81]. The changing approach of APOC directors to labor and urban issues in Abadan in the mid1920s had already begun to be shaped by these wartime changes. In the rest of this section I will analyze in some detail several aspects of the social history of wartime Britain that will help provide an explanatory context for the later strategic tilt toward paternalism adopted by APOC in Khuzestan from the mid 1920s. WWI casualties were staggering, including in the Middle East[82]. The exponential growth of the military had brought about a change in the criteria of soldier recruitment, with far reaching social repercussions. The smaller professional military and reserves at the onset of the war soon proved inadequate for the scale of the conflict, necessitating a new government policy of actively manufacturing public opinion through systematic propaganda to present the war as a patriotic affair. The initial populist surge orchestrated by the War Secretary Lord Kitchener led to the joining of 2.25 million volunteers, but even this proved insufficient and by 1916-1918 universal conscription had been implemented for the first time, making the war and its staggering human and economic costs the concern of the nation as a whole. As a result, the army’s ration strength (as a measure of the scale of enlisted manpower) increased from 165 thousand in 1914 to 5.4 million in 1918[83]. The British public had generally supported the war, but its end brought about a cultural break with Victorian conventions, caused by the grief of shattered families and communities. The war had affected entire generations with more than 8 million having been mobilized, two million wounded, and nearly a million casualties and an equal number still receiving pensions in 1922[84]. However, in addition to conscription and its social consequences, there was another paradoxical side to the conflict: the war demands necessitated the maximization of production (to feed the war and the population), and in the process brought about nearly full employment, for the first time in history[85]. This included women’s employment in dangerous munitions factories, heavy industries, and clerical work[86].
Prior to WWI Britain was an overwhelmingly working class country, but with a significant portion of the workforce engaged in agriculture and domestic service. As ordinary and working people were directly called upon to bear the human and economic cost of war for patriotic duty, their reciprocal expectations from the political and economic system that was demanding such a sacrifice changed dramatically. As able-bodied men were recruited for war, the insatiable demand for labor had a manifold effect: It increased the negotiating power of trade unions to demand better wages and work conditions and job security. Politically, it created an unprecedented space for labor to participate directly at the highest levels of governmental and administrative policymaking. This forced large employers to accommodate labor and to accept state mediation with trade unions. This new trend led to the relative improvement, at least for a short time, of the standard of living of the working classes in war related economic sectors. At the same time, the costly wartime necessity to accommodate labor, coupled with the insatiable war-driven demand, encouraged employers to invest heavily in labor saving technologies and to search for new industrial management methods and work re-organizations that would eventually contribute to the de-skilling of industrial workers and intensify the unemployment crisis of the post-war years[87]. This was especially the case in the large industries and mining sectors that had significantly expanded to supply the war effort, most notably steel, shipbuilding, and coal[88]. The following table shows the significant decline in labor strife during the war, compared to the period before and after the conflict.

Screenshot_2016-05-01-21-43-03
However, as the costs of the war skyrocketed the financial situation deteriorated, rapidly turning Britain from the world’s foremost international creditor to a major debtor. To deal with the situation Britain had to liquidate much of its overseas assets (in the US railroads, primarily), to borrow abroad,[89] and to impose taxes at home. As a result, by the end of the war the number of taxpayers had increased sixfold, and the rate of income tax had been raised up five times[90]. As taxes and prices increased so did labor unrest,[91] and the need of the government to respond and quell discontent by reluctantly engaging in expanding social policies that were anathema to the elite’s dominant liberal free market ideology.

Notes :
65. Hobsbawm su gests that reliance on the captive colonial markets encouraged this inertia. S e Hobsbawm, The Age of Extremes, 148–149.

66. Roger Adelson, London and the Invention of the Middle East: Money, Power, and War, 1902-1922 (New Haven: Yale University Press, 1995), 56–62, 83–108. 67 See Ibid., 98.

68. Nicholas A Lambert, Sir John Fisher’s Naval Revolution (Columbia: University of South Carolina Press, 2002), 274–304.

69. Of course, there were other important centers of production, like Rumania, Galicia, Burma, and Mexico. However, aside from the fast dwindling resources of Burma, these were also regions under geopolitical dominance of other rival great powers.

70. David Landes, The Unbound Prometheus; Technological Change and Industrial Development in Western Europe from 1750-Present, 2nd ed. (Cambridge: Cambridge University Press, 2003), 281.

71. See details in chapter 2; andMarian (Kent) Jack, “The Purchase of the British Government’s Shares in the British Petroleum Company 1912-1914,” Past and Present, no. 39 (April 1968): 139–68; Adelson, London and the Middle East, 97–100; Ronald Ferrier, History of the British Petroleum Company, vol. 1 (Cambridge, UK: Cambridge University Press, 1982), 158–201.

72. That is the range of ship movements, since railroads, privately owned in Europe, were reluctant to convert to oil. In the UK coal was readily and cheaply available, and railroads had a strategic advantageous relationship with coalmine owners, who depended on railroads for their marketing.

73. According to Landes half of naval ship crews were stokers and half of the cargo space was taken up for coal storage. Landes, The Unbound Prometheus, 279–281.

74. Geoffrey Jones, Multinationals and Global Capitalism: From the Nineteenth to the Twenty-First Century (New York: Oxford University Press, 2005), 49; E. J. Hobsbawm, Industry and Empire: The Birth of the Industrial Revolution (New York: New Press, 1999), 150; Ferrier, History of the British Petroleum Company. Oil consumption in France, for example, increased 42 fold in the course of the WWI. Briggs, A Social History of England, 252.

75. For example, by 1918 the newly constituted Royal Air Force (RAF) had 30 thousand officers and 264 thousand other ranks, more soldiers than the entire army had had in 1914 prior to the start of the hostilities. See Briggs, A Social History of England, 252. Adelson, London and the Middle East, 171.

76. Hobsbawm, The Age of Extremes, 28. This is not to say that the shift to oil was absolute and immediate, despite the significant increase in its demand. Coal remained a key source of energy throughout the interwar period but its relative importance declined, especially in the post war era, with major consequences for labor and coal miners. In fact, steam power based on coal consumption increased tenfold in the last three decades of the 19th century. However, Britain’s exports of coal dropped dramatically after the war, directly affecting labor relations and social conflict. British exports of coal went from 20 million tons in the 1880s to a high of 75 mt in 1913, before dropping to 49mt in 1920s and 40mt in the 1930s. See Hobsbawm, Industry and Empire, 150.

77. Giddens, The Nation State and Violence, 226.

78. See Francis Michael Longstreth Thompson, The Cambridge Social History of Britain: 1750-1950, vol. 2 (Cambridge: Cambridge university press, 1990).

79. WWI was presented as a zero sum game: Previous wars fought for limited and specific objectives…WWI was based on international rivalry modeled on economic competition without limit or objective. There were no limits to the “natural frontiers” of Standard Oil. Hobsbawm, The Age of Extremes, 29–30.

80. Perkin, The Rise of Professional Society.

81. See Marx’ early analysis of this trend toward the production of relative surplus value, chapter 15, Marx, Capital, 1: 492-642.

82. German casualties were 1.8 million, France lost 1.6 million, and Britain more than 800 thousand according to Hobsbawm, The Age of Extremes, 26; Briggs, A Social History of England, 258. Total war casualties dwarf these figures once we take into account the toll for the other belligerents, such as the Ottoman territories, Russia, Austro Hungary, and the non-belligerent nations, such as Iran, who were helplessly caught in the grinding wheel despite their declared neutrality. Adelson offers very different casualty figures, which brings me to assume the figures provided in the previous references to fatalities, whereas the present figures refer to the wounded as well as the dead. None of the sources consulted specify the difference. According to Adelson, in 1914-1918 Britain deployed more troops in the Near and Middle East (nearly 6 million) than in France (5.5 million). However, overall casualties in France were much higher (2.7 million) than (600 thousand). Adelson, London and the Middle East, 171.

83. Briggs, A Social History of England, 252. “Ration strength” seems to refer to the total number of rations issued as a way of keeping count of troop numbers in and out of direct conflict.

84. Ibid., 260–261; A. J. P Taylor, The Oxford History of England. 1914-1945 (Oxford: Clarendon, 1976), 120. Note the discrepancies in various sources regarding war casualties. Compare with footnote 62.

85. The discussion in this passage is based on Pat Thane, The Foundations of the Welfare State (London: Longman, 1982), 126–130.

86. Taylor, The Oxford History of England. 1914-1945, 38.

87. Thane, The Foundations of the Welfare State, 126–130; Perkin, The Rise of Professional Society, 186–203.

88. Feinstein, Temin, and Toniolo, The European Economy Between the Wars, 17–37.

89. Hobsbawm estimates that Britain lost 25% of its global investment, which it had to sell to finance the war. The financial costs of the war amounted to more than £500 million, mainly in US railroad securities. By 1929 Britain’s debts to the US amounted to more than 150% of its national output. Hobsbawm, The Age of Extremes, 97–98. Before the war, despite its relative decline compared to its main rivals, Germany and the US, Britain had done relatively well as a financial power, while its captive colonial markets provided an important outlet and supplied it with revenues, with India, in particular, financing more than 40% of Britain’s deficit. Hobsbawm, Industry and Empire, 148–149. See also Landes, The Unbound Prometheus, 363; Taylor, The Oxford History of England. 1914-1945, 40–42, 124.

90. Briggs, A Social History of England, 257; Perkin, The Rise of Professional Society, 191–192. The social history of taxation during the war clearly has great relevance to the critique of the rentier state theory that I have presented in chapters 2 and the epilogue. As the history of wartime Britain demonstrates taxation was imposed as an exigency of the total war, with great reluctance by the political elite, under complex historical conditions that we have discussed here. The political bargains in the form of franchise and social welfare policies that emerged between the state and various social classes were not the automatic consequence of taxation, but the result of a protracted and ultimately unpredictable social conflict and class struggle.

91. Taylor, The Oxford History of England. 1914-1945, 39; Perkin, The Rise of Professional Society, 193–203.

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