Introduction (Read Part I)
This is part II in a series of pieces attempting to dig up chunks of history and relate those chunks to the present IOTA experience. Expect the first few parts of the series to lay fairly rigorous groundwork in order to enable proper payoff of later pieces in the series. The Sands of Time series proceeds through history in chronological order, so the reader will gain maximum benefit by reading the pieces in the order they're written. Start with Part I of the series.
In Part I, we learned that GDP per capita was unchanged for hundreds of years leading up to about 1760. The First Industrial Revolution lasted from 1760 to 1840, and can be summarized as follows:
... the United Kingdom kicked off what historians now call the First Industrial Revolution in the late 1700’s. In only a handful of decades, Great Britain had led the cutting edge technology development of new manufacturing (textiles, steal) and production (chemicals, energy) processes. They figured out how to use steam power, combined that with newly invented factories, and started to make machines that would do the jobs previously done tediously by hand.
After a treatment of the First Industrial Revolution, we then briefly introduced the Second Industrial Revolution. The innovations of these combined time periods (1760 - 1840 and 1870 - 1914) significantly improved economic prosperity, as can be seen by the era boxed in red below.
Now we'll look at some of the driving forces of the Second Industrial Revolution. The questions should be: What is the reason for such a drastic uptrend in prosperity, especially into the early 1900's? How did some of these stories play out, and how might they relate to the modern day technology/information revolution?
The Second Industrial Revolution began in 1870, and is more widely known as the “Technological Revolution”. It was ushered in by immense innovations in the processes and ideas on which the previous Industrial Revolution was built: complete rethinking of manufacturing which led to production lines and economies of scale, interchangeable parts (!), more widespread use of machines in everyday life, and further advancements in chemical production processes which most notably increased steel production speed while significantly reducing its cost
Second Industrial Revolution
This time period was characterized by a large quantity of radical changes that happened more quickly than any time in human history. There were many simultaneously moving parts, so lessons from the Second Industrial Revolution offer a useful framework with which to think about the 2020's. A number of parallels can be drawn, but we'll focus on three linchpins of this era. We begin with a brief history of oil (part II). Parts III and IV will focus on electricity and paper during the Second Industrial Revolution.
Petroleum is a yellow-black liquid that's formed when carbon from ancient organic material is compressed and heated deep within Earth's crust. It's usually found trapped in pockets of rock formations. The word petroleum literally means "rock oil" in Latin, and 石油 literally means "rock oil" in Chinese. But don't let the lack of naming creativity fool you - the history of oil is as interesting as it is relevant for understanding present-day IOTA. Oil was discovered independently across the globe at various times in the past, and has been used in its raw form for thousands of years as fuel and as a component in building materials. Let's illustrate just how global it's been.
The 易經 (Yijing), one of the Chinese "Five Classics", recounts that petroleum was being used as fuel during the Zhou dynasty. You'll recall that we learned about another one of the "Five Classics" when we delved into the 春秋 in Evolution of Journalism. The Chinese would later be the first to drill for oil, and they would do so using tipped pieces of bamboo.
The ancient Greek named Herodotus was the first person to approach history from an investigative point of view, and the first to arrange history into a narrative format. Cicero would later call him "The Father of History". In his famous book, The Histories, Herodotus suggests that asphalt made from oil was used in the walls of Babylon, and that the oil came from various nearby locations including the island of Zante in the Ionian Sea.
The Achaemenid Persian Empire's clay tablet Persepolis Fortification Archive reveals that oil was one of the commodities traded at the time of the otherwise poorly documented empire's reign.
By the tenth century, Persian alchemists had begun dabbling in the practical chemistry of oil refinement. "The Herodotus of the Arabs" Al-Mas'udi described oil fields that allowed Azerbaijan to pump out shiploads of petroleum to the region.
It's tough to find a consensus start to the modern oil industry. Some sources attribute the dawn of modern oil to James "Paraffin" Young. Young was born in Glasgow, and took a liking to chemistry from an early age. He attended night classes throughout his youth while being an apprentice with his cabinetmaker father. When Thomas Graham, one of his chemistry lecturers at the local night college, moved to University College in London, Young tagged along and ended up doing research projects for Graham. Over the years, Young would modify Faraday's voltaic battery, invent a chemical process for making sodium stannate while managing a chemical company, serve on the committee that was meant to solve potato blight, and even start a newspaper, the Manchester Examiner. In 1847, he noticed petroleum seeping out of the rocks at his local coal mine in Derbyshire. He was able to distill a lighter oil and a thicker oil out of the substance - one for lamp oil and the other for machine lubrication. He set up a business to refine the process, but depleted the local mine in four short years.
Young had noticed that oil dripped from the roof of the coal mine for some reason. Having depleted his mine of petroleum, he thought he could find a way to turn the abundant coal into that dripping petroleum. He hypothesized that he could devise a process that would make oil out of coal by heating the coal. The hypothesis was confirmed when he was able to use low heat to distill coal into a form of crude oil. From that starting point, he could derive his original commercially successful products of lighter and thicker oil (for lamp oil and machine lubrication). But the new substance also enabled the production of a variety of other end-products, including a waxy substance that he called "paraffine oil" for its waxy texture.
A patent was granted for the process of making the oils and waxy substance in 1850, putting Young back into business. He partnered with Meldrum and Binney to open the first commercially successful oil companies in the world. The companies were based in Glasgow and West Lothian. He would file for a Scottish paraffin wax patent in 1852, and would file for a U.S. patent at some point during that time as well. By 1866, Young had bought out his partners, turned the companies into "Young's Paraffin Light and Mineral Oil Company", and then sold the enterprise when it was one of the largest chemical plants in the country.
Other sources attribute the dawn of modern oil to Abraham Pineo Gesner, the Canadian physician and geologist who invented kerosene. In his early twenties, Gesner started a business that sold horses to plantations in the Caribbean. After two of his trips resulted in shipwrecks, his enterprise failed when he decided against a third attempt. He returned to his father's farm burdened with debt where he would marry the daughter of Dr. Isaac Webster. His new father-in-law, being concerned for the well being of his daughter, offered to take care of Gesner's debts if he would agree to study medicine and earn a steady living as a physician. Gesner took his father-in-law up on the offer. He left for London to study medicine at Bart's Hospital and surgery at Guy's Hospital. An excerpt from his biography:
He appears to have taken lectures also in mineralogy and geology, for on completion of his medical course he brought back to Nova Scotia not only a medical diploma but also a keen interest in the earth sciences.
Gesner decided to settle in Parrsboro, Nova Scotia to practice medicine because of its proximity to Minas Basin. The Basin was known to be rich in minerals and to have "curious geological features". The decision immediately paid off!
As he made his visits to patients, either on foot or on horseback, he recorded observations and gathered specimens. Soon he had a representative collection and a fund of knowledge, not only of the local area, but also of Cape Blomidon across the basin and of the Chignecto shore north to Joggins. He acquired such geological books as were available, and was especially impressed with a paper on the geology and mineralogy of Nova Scotia written by Charles Thomas Jackson and Francis Alger of Boston. Using this as his model, Gesner, in 1836, wrote his first book, Remarks on the geology and mineralogy of Nova Scotia (Halifax). It had a more popular manner than its predecessor and it improved somewhat on the subdivisions of the geological regions of the province. As a result of this work Gesner was asked in 1837 to examine certain areas in New Brunswick for coal, and the following year was engaged by the government of that province to make a geological survey. His is said to be the first appointment of a government geologist in a British colony.
He was on the move again when he uprooted his family to Saint John in 1838 where he would conduct summer geological field work for the government. He employed native Indians to help him trek deep into the Canadian wilderness who were reportedly unprepared for the Gesner's relentless hiking zeal. They respected him so much that they called him by a name that means "Wise Man". He recorded everything he saw, including nature formations and mineral deposits. His lack of practical experience in the mining industry, however, meant that he was over-enthusiastic about many of the mineral deposits that he came across. He frequently failed to properly assess the deposits' commercial suitability (quality and quantity).
This led to backlash from investors who had utilized his glowing reports. After five summers of expeditions, investor complaints had mounted to the point that the government removed Gesner from the job, forcing him to borrow money from friends in order to finance his next summer's journey. It became clear after that expedition that he would be in serious debt once again. In an attempt to pay off the new debt, Gesner opened a museum to display the geological materials he had collected throughout his many explorations. But, the museum went under and his friends had to repossess its materials which had been posted as collateral.
From there, Gesner moved back to his hometown and bought his father's farm. If he would have stuck to being a farmer and physician he would have been financially stable, but he couldn't resist the urge to learn and experiment. Like James Young, Gesner took an interest in Faraday's contributions to electricity. Gesner built on Faraday's experiments by building electric generators, motors, and even working on wire insulation techniques.
In 1846, Gesner started experimenting on the tarry material he had saved from La Brea Pitch Lake, and was able to distill the material into light oil that he believed was superior to the ubiquitous whale oil of the time. He began traveling to give lectures on his new discovery. The experimentation continued until he tried to acquire the mining rights for a deposit of bitumen in New Brunswick. "Tried to acquire", because William Cairns tried to acquire the same deposit at the same time. Cairns won the mining rights in a contentious court case against Gesner.
Gesner started thinking about founding a company that could produce his lamp oil, but first needed a marketable name. He combined the Greek words for lamp fuel-oil with conventional chemical nomenclature to birth the name "kerosene". Next, he didn't foresee his native Canada as being conducive to building his envisioned company, so he moved to New York City, filed three patents in the U.S., and started the Asphalt Mining and Kerosene Gas Company. The company's factory on Long Island was so well organized that modern engineers studied its design for years to come. Kerosene business was booming, and heated up even more when a company sales associate brought back a simple oil lamp design from Austria. After a name change to North American Kerosene Gas Light Company, Gesner owned both the fuel and lamp hardware verticals in the illumination industry.
Abraham Gesner is now referred to as "The Father of the Petroleum Industry".
Gesner and James Young were unaware of each other's work for many years. Gesner had discovered the distillation process slightly before Young had. Young filed his paraffin oil patent in the U.S. during the early 1950's, the same time and place that Gesner filed his kerosene patents. The two men successfully ran their companies well into that decade before the international oil trade became widespread enough for the two to begin competing.
When Young became aware of North American Kerosene Gas Light Company, he brought a court case against Gesner for patent infringement, and won. Gesner was now 0 for 2 in major court cases! The Kerosene Company was ordered to pay royalties to Young's Paraffin Light and Mineral Oil Company right as petroleum was beginning to be widely commercialized in western Pennsylvania. Gesner, ever the master of persistence, would overcome his business misfortune yet again by writing a textbook that became the definitive source of knowledge for the petroleum industry. He would also be appointed to a distinguished professorship back home in Canada.
Western Pennsylvania was always rich in "oil seeps". Drilling salt water wells was a popular business in the early 1800's, but unwanted oil seepage into the water was causing difficulties. Samuel Kier, while working on the salt wells, recognized that the medicinal oil his wife was prescribed had the same chemical composition as the nuisance oil polluting his wells. Kier became the first to intentionally drill for crude oil, and became wealthy by selling it as a medicine.
Upon further exploration of oil uses in the 1850's, Kier learned that his crude could be distilled into an oil used for lighting. He built the first oil refinery, but never patented his product, process, or lamp.
When a New York lawyer named George Bissell heard rumors of Kier's success, he commissioned a Yale University chemist to validate Pennsylvania's oil reserves. The chemist confirmed that the area had oil, so Bissell founded the Pennsylvania Rock Oil company in 1857. Bissell needed to hire someone to actually do the drilling though. Edwin Drake was an unemployed railroad conductor who didn't know anything about oil, drilling, or geology, but who had a free transportation to Pennsylvania (former railroad conductor). Logically, he was hired for the job and sent into the field. He reported to Bissell that the "land was oil rich" and that the oil industry could be "extremely profitable". He was made president of the company, and embarked in earnest on a quest to strike oil.
His attempts failed miserably. He was unable to find any oil through his public struggles and his steam drill catching fire. "Of course, people came to snicker". On top of the danger and public humiliation, his company grew weary of his efforts and ceased funding the project. He was effectively fired. Drake had to take out a $500 loan to continue the now personal quest, and locals derisively referred to the whole thing as "Drake's Folly". But his fate would change on August 27, 1959 when his drill bit accidentally slipped from 828 inches, to 834 inches into what's now known as a joint in the bedrock.
Drake struck oil.
As an interesting aside, King Richard III of England declared the unit of measurement for wine barrels to be one tierce (equivalent to 42 gallons) in the 1400's. The guild of workers who crafted barrels was very strong at the time, which entrenched the production of watertight tierce barrels for shipment of fish, soap, butter, and wine. When Drake's drill struck oil in the 1859, he chose to empty his washtub of oil into tierce barrels from the local whiskey distillery. Viola. The 42 gallon barrel became the unit of measurement for the oil industry. One could argue that King Richard III's most influential decision was the one that determined the unit of measurement used by one of the most powerful institutions in human history, OPEC. Speaking of oil cartels, the first oil "association" was formed after prices in Pennsylvania's Oil Creek Valley fell from $10 to $0.10 due to oversupply.
Western Pennsylvania was the seed for what has become a global petroleum trade. A few years after striking oil, Pennsylvania grew its oil production to thousands of barrels per day, saw tiny townships turn into metropolises (Titusville went from 250 residents to 10,000), and heavy industry flourished (eight refineries built between '62 and '68!).
Pennsylvania wells were responsible for producing ONE THIRD of the world's oil!
By 1871, the fever pitch of the 60's was calmed by large scale consolidation by familiar names. John Rockefeller's Standard Oil was buying every well and refinery it could get its hands on, eventually leading to Standard Oil's monopoly 10 years later. Rockefeller's oil success made him the wealthiest person in modern history with an estimated net worth of ~$420 billion. Pennsylvania oil supplies began drying up by the late 90's.
Young, Gesner, and Drake get most of the attention in the annals of petroleum history, but there were many other oil pioneers around the same time. Georg Christian Konrad Hunäus found large oil reserves while drilling for coal in 1858 Germany, and would eventually produce the majority of Germany's oil. A Russian military engineering group dug a well in Baku during the 40's, and other hand-dug wells are credited in 1853 Poland, 1857 Romania, and 1858 Canada. Romania is the first country to officially have its oil exports documented, and Azerbaijan's oil history deserves full-length feature article by itself.
Energy needs of the world increased as we entered the First Industrial Revolution, and soared as we lived through the Second Revolution. Interestingly, despite the oil boom and kerosene's efficiency supremacy, energy needs would continue to be largely met by old methods of whale oil for lighting, wood and coal for household heating and cooking, and coal for industrial uses.