The Rational Optimist (26 page)

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Authors: Matt Ridley

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Until 1800 most of the raw cotton spun in England came from Asia. But Chinese and Indian cotton growers either could not or would not increase their output. They had little fresh land to exploit and little incentive either: the zemindar landlord or the imperial bureaucrat took the profit of any productivity increase. Instead it was the southern states of America that took up the opportunity. From producing an insignificant quantity of cotton in 1790, America became the world’s biggest producer by the 1820s and by 1860 was growing two-thirds of the world’s cotton. Cotton accounted for half of all American exports by value between 1815 and 1860.

Slaves did the work. Cotton was a labour-intensive crop, in which a single man could sow, weed (again and again), harvest and clean the product of just eighteen acres, and there were few economies of scale. In land-rich, thinly populated America, the only way to expand production was to kill the market in labour altogether: to force the workers to work for no wage. As the economist Pietra Rivoli puts it: ‘It was not the perils of the labour market, but the suppression of the market that doomed the lives of slaves.’ The affordability of cloth for the English working class was made possible by the buying and selling of captured Africans.

King coal

So far fossil fuels have played only a small part. Now imagine what would have happened next if Britain had possessed no accessible coal reserves. Coal exists all over the world, but some British coal fields were close to the surface and close enough to navigable waterways to be cheaply transported. The cost of transporting coal overland was prohibitive until the railway came along. It was not that coal was a cheaper source of power than the alternative – coal took a century to compete on price with water power in factories – but that it was effectively limitless in supply. The harnessing of water power soon experienced diminishing returns as it reached saturation point in the Pennines. Nor was there any other, renewable fuel that could supply the need. In the first half of the eighteenth century, even the relatively tiny English iron industry was close to moribund for lack of charcoal fuel on a largely deforested island. What timber there was in the south of England was in demand for ship building, which bid up its price. So in search of charcoal to feed their forges, the iron masters left the Sussex Weald and moved to the West Midlands, then to the Welsh Marches, to South Yorkshire and eventually to Cumberland. Imports of wrought iron from well-forested Sweden and Russia met the growing demand from the mechanisation of the textile industry, but even these imports could not meet the needs of the industrial revolution. Only coal could do that. There was never going to be enough wind, water or wood in England to power the factories, let alone in the right place.

This was the position in which China found itself. In 1700 it had a vibrant textile industry, perhaps equally ripe for mechanisation, but it was a long way from coalfields, and its domestic iron industry was dependent entirely on charcoal, whose price was rising as forests retreated. Part of the problem was that Shanxi and Inner Mongolia, where the coal was, had been depopulated by barbarians and plague in the three centuries after 1100, so the country’s demographic and economic centre of gravity shifted south to the Yangtze valley. Because none of the coal reserves were close to navigable water, China’s iron industry gave up its early experiment with fossil fuel. The price of iron rose in China, discouraging inventors from using it for machinery. So industrial activity in China experienced diminishing returns and as the population grew, people had less and less incentive both to consume and to invent. Besides, the imperial bureaucracy would have had an attack of the vapours if asked to allow independent entrepreneurs to ‘put out’ work, unregulated, in the countryside, let alone build factories.

Efficiency in the coal industry did not itself contribute significantly to rising productivity in Britain even in the nineteenth century. Cotton contributed thirty-four times as much as coal to productivity growth in industrialising Britain. Coal’s cost per tonne at the pithead in Newcastle rose slightly between the 1740s and 1860s, though the price in London fell because of lower taxes and falling transport costs. The miner’s safety lamp aside, coal used few new technologies after the steam-driven pump. Well into the twentieth century, the equipment of the typical miner consisted of a lamp, a pick-axe, wooden pit props and a pony. The great increase in coal consumption (five-fold in the eighteenth century, fourteen-fold in the nineteenth century) was the result mainly of more investment, not more productivity. Contrast this with the iron industry, where the amount of coal needed to smelt a tonne of pig iron and then refine it into wrought iron halved every thirty years. It took almost as much human muscle power to mine a tonne of coal in 1900 as it did in 1800. Not until opencast (strip) mining began in the second half of the twentieth century did the tonnage produced per miner really begin to rise steeply.

This is one reason that the coal industry, like all mining industries before and since, was characterised by dreadful working conditions tolerated only because of somewhat higher wages than could be got in farm labour. They were higher, at least initially, or else Scottish and Irish people would not have flocked to Tyneside in the nineteenth century. The wages of a coal hewer in the North-east of England were twice as high, and rising twice as fast, as those of a farm worker in the nineteenth century.

Without coal, innovation in England’s textile, iron and transport industry would have had to stagnate after 1800, when all that ferment of invention had as of yet had almost no effect on living standards. As the historian Tony Wrigley has put it: ‘Until almost the middle of the nineteenth century it was still reasonable to fear a fate for England similar to that which had overtaken Holland. Hence the prominence of the stationary state in the prognostications of the classical economists.’Wrigley made the case that it was the transition from an organic economy, which grew its own fuel, to a mineral economy, which mined it, that enabled Britain to escape stagnation. It was coal that gave the industrial revolution its surprising second wind, that kept the mills, forges and locomotives running, and that eventually fuelled the so-called second industrial revolution of the 1860s, when electricity, chemicals and telegraphs brought Europe unprecedented prosperity and global power. Coal gave Britain fuel equivalent to the output of fifteen million extra acres of forest to burn, an area nearly the size of Scotland. By 1870, the burning of coal in Britain was generating as many calories as would have been expended by 850 million labourers. It was as if each worker had twenty servants at his beck and call. The capacity of the country’s steam engines alone was equivalent to six million horses or forty million men, who would otherwise have eaten three times the entire wheat harvest. That is how much energy had been harnessed to the application of the division of labour. That is how impossible the task of Britain’s nineteenth-century miracle would have been without fossil fuels.

Now Lancashire could beat the world for both quality and price. In 1750, India’s muslins and calicoes were the envy of weavers everywhere. A century later, despite wages that were four or five times higher than in India, Lancashire was able to flood even India with cheap cotton cloth, some of it manufactured from Indian raw cotton that had made a 13,000-mile round trip. This was thanks entirely to the productivity of Lancashire’s mechanised mills. That is how much difference having fossil fuels made. No matter how low his wages, an Indian weaver could not compete with the operator of a steamdriven Manchester mule. By 1900, 40 per cent of the world’s cotton goods were produced within thirty miles of Manchester.

Industrialisation became contagious: the increased productivity of cotton mills encouraged demand from the chemical industry, which invented chlorine for bleaching, and from the printing industry, which turned to drum printing to print coloured cloth. By cutting the price of cotton, it also released consumer expenditure for other goods, which stimulated other manufacturing inventions. And of course to make the new machines, it demanded high-quality iron, which was made possible by cheap coal.

The crucial thing about coal was that, unlike forests and streams, it did not experience diminishing returns and rising prices. The price of coal may not have fallen much in the 1800s, but nor did it rise despite an enormous increase in the volume of consumption. In 1800 Britain was consuming over twelve million tonnes of coal a year, three times what it had used in 1750. The coal was still being used for two purposes only: domestic heating and general manufacturing, which at that date meant mostly bricks, glass, salt and metals. By 1830, consumption of coal had doubled, with iron manufacture taking 16 per cent and collieries themselves 5 per cent. By 1860, the country had consumed a billion tonnes and was now using it to drive the wheels of locomotives and the paddle wheels of ships. By 1930 Britain was using sixty-eight times as much coal as it had in 1750 and was now making electricity and gas with it as well. Today most coal is used for generating electricity.

Dynamo

Electricity’s contribution to human welfare can hardly be exaggerated. To my generation it is a dull utility, as inevitable, ubiquitous and mundane as water or air. Its pylons and wires are ugly, its plugs tiresome, its failures infuriating, its fire risks frightening, its bills annoying and its power stations monstrous symbols of man-made climate change (complete with Al Gore hurricanes coming from their stacks). But try to see its magic. Try to see it through the eyes of somebody who has never known power that was invisible and weightless, that could be transmitted miles through a slender wire, that can do almost anything, from lighting to toasting, from propulsion to music playing. Two billion people alive today have never turned on a light switch.

Imagine yourself at the Vienna exhibition of 1873. There is a stand exhibiting the work of the splendidly named semi-literate Belgian inventor Zénobe Théophile Gramme, and it is manned by his business partner, the equally euphonious French engineer Hippolyte Fontaine. They are showing off the Gramme dynamo, the first electricity generator that can produce a smooth current, and a steady light, when set spinning by hand or by a steam engine. Over the next five years, their dynamos will power hundreds of new industrial lighting installations all over Paris. In the Vienna exhibition, one of the workmen makes a careless mistake. He connects the wires from the spinning dynamo accidentally to the spare dynamo that is there to provide a backup in case the first one fails. The reserve dynamo immediately begins to spin all by itself, in effect it becomes a motor. Fontaine’s mind starts spinning too. He calls for the longest wire that can be found and connects the two dynamos by a wire that is 250 metres long. The reserve dynamo springs to life as soon as it is connected. Suddenly it became clear that electricity can transmit power over a distance far greater than belts, chains or cogs could.

By 1878, Gramme dynamos, turned by water in the river Marne, were transmitting power to two other Gramme dynamos working as motors three miles away, which in turn were pulling ploughs by cable through a field at the Menier estate near Paris, watched by wide-eyed grandees of the London Institute of Mechanical Engineers. A cascade of inventions followed: electric railways from William Siemens, better light bulbs from Joseph Swan and Thomas Edison, alternating current from George Westinghouse, Nikola Tesla and Sebastian de Ferranti, turbine generators from Charles Parsons. The electrification of the world began, and although like the computer it took decades to show up in the productivity statistics, its triumph was inexorable and its effect far-reaching. Today, 130 years later, electricity is still transforming people’s lives when it first reaches them, bringing colourless, smokeless, weightless energy into the home. One recent study in the Philippines estimated that the average household derives $108 a month in benefits from connecting to the electricity grid – cheaper lighting ($37), cheaper radio and television ($19), more years in education ($20), time saving ($24) and business productivity ($8). Heck, it even affects the birth rate as television replaces procreation as an evening activity.

The earth receives 174 million billion watts of sunlight, about 10,000 times as much as the fossil-fuel output that human beings use. Or, to put it another way, a patch of ground roughly five yards by five yards receives as much sunlight as you need to run your techno life. So why pay for electricity, when there is power all about you? Because, even allowing for inconveniently timed winter, night, clouds and the shade of trees, this drenching rain of photons is all but useless. It does not come in the form of electricity, let alone car fuel or plastic. Joule for joule, wood is less convenient than coal, which is less convenient than natural gas, which is less convenient than electricity, which is less convenient than the electricity currently trickling through my mobile telephone. I am prepared to pay good money for somebody to deliver me refined and applied electrons on demand, just as I am for steaks or shirts.

Suppose you had said to my hypothetical family of 1800, eating their gristly stew in front of a log fire, that in two centuries their descendants would need to fetch no logs or water, and carry out no sewage, because water, gas and a magic form of invisible power called electricity would come into their home through pipes and wires. They would jump at the chance to have such a home, but they would warily ask how they could possibly afford it. Suppose that you then told them that to earn such a home, they need only ensure that father and mother both have to go to work for eight hours in an office, travelling roughly forty minutes each way in a horseless carriage, and that the children need not work at all, but should go to school to be sure of getting such jobs when they started work at twenty. They would be more than dumbfounded; they would be delirious with excitement. Where, they would cry, is the catch?

Heat is work and work is heat

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