Significant role in the Business Practices of Global Companies and individual prospectors. This class is one hour and 15 minutes. Prof. Dochuk good morning. Welcome back from spring break and welcome back to our history of oil in american life. Today we are going to look at a critical phase between the 1930s and 1950s. A moment in which some important turns take place in the life of american oil. Two sectors we have been looking at, major oil and independent oil. This is a period in which the nation itself is kind of awakened to a new role in global politics. He quitee, in 1941, famously stated that the u. S. Was entering a new era of global leadership. It was the American Century dawning in the early 1940s and playing out during world war ii. We will look at how oil combined with religion helps create competing visions of American Authority on the global stage. If you recall prior to spring break, we had been spending time in the interwar period, looking at oil and some of these scandals that emerged. The teapot dome scandal. We look at the competition of corporate and labor politics at the time, challenges that arise from surplus in terms of regulation of oil. What that means for government regulation. We see in the interwar period, u. S. Oil is going through fits and starts and difficult circumstances. Nevertheless, as we are proceeding today, we will see that despite the fits and starts, the u. S. Sees its oil initiatives expanding rapidly. That will accelerate into the 1940s. I gave you an outline just so you are able to follow along. On the back, just some framing questions to consider. These are questions we can use to help guide discussion on wednesday, which we will use to followup the lecture today, first being how and why did matters, politics and people of faith become essential to the development of american oil in the mid20th century . What were the competing visions of the nations oil and the nation itself that came to define the Petroleum Sector at this crucial juncture . How did the politics of oils warring sectors create the role of the u. S. In the world, and to what ends did this competition play out, both shortterm and by the end of class hopefully you are able to anticipate longterm trends as well. We have come across some of these names before, so they should be familiar. Quite a few others should be new to you. I did list a cast of characters just to help us follow along. As you see from the outline, im going to proceed in three parts. First, get a glimpse of American Power brokers circa 1940 and 1941. Get a sense of how power brokers in both sectors are starting to envision themselves and their particular sectors in relation to emerging geopolitics on an international scale. In that regard we will start back in the 1930s, which again we glimpsed at briefly, but we will dig down a little deeper before we move back into the 1940s. The second section will focus on a few political pivots that play out between the independents, the wildcatters, as we will call them, and major oil in the 1940s. Some of these will play out in washington, questions of regulation being front and center. But also the very likelihood of ofthe very likelihood independent oil as it sees itself threatened by the possible combination of federal government and major Oil Interests abroad. I want to spend the rest of the class, the third section, pausing to look at the ground level of two important initiatives. One undertaken by aramco and major oil in saudi arabia, and the second transpiring at the same time in alberta, canada, where independents are starting to look for their own domestic frontiers. Okay, so lets start in that important moment of the early world war ii years. As we discussed in previous classes and throughout, we are interested in oil not simply as material, not simply as a fuel or lubricant or economic interest, but we are doing our best to look at this in interdisciplinary terms. It is oil as a culture itself. Today again, framing and introducing religion into the narrative. We have found from the very beginning, oil has and persisted to have a mythological power in the american imagination. Founded and discovered in the civil war period, it was seen from its beginnings as a mystical resource, something that could promise the nation healing after the civil war. It had important notions of progress wrapped up in it, and in terms of modernity itself. Not the only material to generate these ideas and fantasies coal had a similar hold on the british citizens in the 19th century, and also on americans as well. Oil was always seen as particularly sacred. In part because it was difficult to locate and to grasp and to take control of. It was always seen as uniquely supernatural in its abilities to generate hope and dreams of the future, both for individuals and the nation itself. A quote in a magazine in 1900 expresses this well. Everywhere american oil is to be met with in the orient, in t lighted temples in the mosques, the holy sepulcher in has penetrated china and japan, reached the wilds of australia and shed its radiance over many a dark african waste. American petroleum is the true cosmopolite,ite omnipresent in its mission of elightening the whole universe. That narrative intensified by 1940 as it becomes an impetus for american expansion, certainly in terms of its leadership around the globe. This returns us to henry luce. Henry luce was a very powerful publisher in the 1940s, in charge of a number of important magazines. Life, time magazine. In 1941 in february, he used the pages of life magazine to beseech americans to create the first great American Century again. What many people dont realize is that he delivered this speech a month earlier at the American Petroleum institute. There, as you see quoted before you, it celebrated the work that oilmen had been doing up to the point to demonstrate the Frontier Initiative american of american capitalism and to continue that on an even greater stage in the years forward. Having within you a dynamic spirit of freedom and a genius for corporation and organization, it follows inevitably that you do not stop at the frontier of mountains or sea or jungle, nor at the manmade frontiers of knowledge or tradition or hope. I salute you. Luce wrapped up in this narrative of both american exceptionalism, and the role that oil will play in that. Oil is considered a pillar of american exceptionalism Going Forward. This will be the key to the rise of the American Century. It is important to see how he views religion as well, as a twin column of this foundation. For luce, petroleum is a limitless power that has the capacity to transform the world into something godlier and something good. Americas special blessing, oil. Nd its peculiar burden historians connect oil to luce s charge ain framing an American Century. We can fold religion into this story as well. Luces aspirations mirrored those of an entire cohort of corporate, church, and state visionaries that believe that a petroleum fueled christian democracy, that big religion, ecumenical, internationalist in persuasion, wedded to big oil and partnered with the state could guarantee the nations postwar influence. Why were they so committed to this vision . Their outreach on behalf of of what i will call a civil religion of crude was designed to steer the u. S. Out of several crises that emerged in the 20th century. We have become aware of some of these. First of all, because of the chaos of the boom in east texas, u. S. Production was woefully inefficient. Pools were draining too quickly and pricing was incredibly volatile. These powerbrokers that envisioned oil on the world stage are wary of what is going on in east texas. They are looking for secondly, ineared terms of texas t, it kept refineries busy. It was still not going to be enough to create this carbon age in america. A freeway society where Everyone Wants an automobile to drive to their suburban homes. More fuel is needed. These powerbrokers will start looking abroad in earnest. [laughter] this is been happening[laughter] up to this this is been happening up to this point, but in the mid 1940s, it becomes more urgent. As Oil Strategist look ahead, they feel that the depletion of reserves was approaching peak oil. It becomes well articulated in the 1950s when a geologist frames the theory of peak oil, saying that american oil reserves were going to collapse by 1970, forcing the country into a difficult situation. This kind of apocalyptic fear of america losing its oil sources is going to drive exploration abroad. Driven by fear but also optimism. Large corporations began chasing whiter prospects. Wider prospects. The socalled Seven Sisters pictured on the top right, which included five major u. S. Oil companies, texaco, gulf, standard oil of california, chevron, exxon, and standard new york, mobile. They all turned their attention, increasingly so this is a process of global exploration that started in the late 19th century but takes on a new urgency, whether it is asia, south america, and especially the middle east and saudi arabia. There were many in his many in business and government, s of powerbrokers, those that were in publishing, those that were in washington, those that were ceos and leading executives of these companies. Those that were lobbyists of major oil, some of the most influential share luces vision for expanding american influence abroad. You have encountered harold ickes before. Can someone tell me who he was . Student he was the secretary of the interior under fdr. Prof. Dochuk what was he like . What were his politics . Student he was concerned over the teapot dome scandal and wanted to have police over the oil industry. Prof. Dochuk so interest in regulating. He was appointed secretary of the interior, but also the oil czar of the roosevelt administration. Hot oil and asia. Hot oil being an issue. Someone who wants to work to bring the federal government to bear not just on leading oil, but in large part partner with oil companies. A curmudgeon, not so much a charismatic figure as henry luce might be, but buys into this vision of big oil and an expanded federal state partnering on an international stage. Others of course are going to partner as well and help frame the initiative of the civil religion of crude. We can look to the rockefeller family, especially John D Rockefeller junior. Have talked a lot about rockefeller senior, have not spent much time on junior yet. It is junior that obviously takes over the Family Business after world war i. But he recognizes quite early on that his is not a gift for management. How do you follow in your fathers footsteps in this case . This is when standard is being broken up as well into many parts. We see people taking ownership of standard new jersey. Rockefeller junior channels his energies, as well as funds into philanthropy. This will become his most important outlet. He will support traditional missionaries. He is a very devout baptist like his father. He will Fund Churches and missionaries in asia, including the luce family in which henry luce grew up on a Mission Field in china. There is a very natural connection here. Rockefeller junior is also going to look at funding the federal council of churches, will serve on the council of foreign relations. All of which is to say he has this internationalist vision. It is still very much religious in his case, but he is also wanting to expand philanthropy into a more secular scientific ground. Health for instance, improving technology, looking to develop undeveloped countries as he sees them, and modernize them. This is the way in which the religious vision combined with politics and philanthropy will kind of frame their vision of oil Going Forward. You see some of this illustrated in some of the standard oil magazines. Lamp being the magazine for exxon standard new jersey, meant to keep its stockholders and employees informed as to what the company is doing. But always, one of several images if you flip through these magazines, emphasizing the humanitarian work being done as well. Oil not simply as an economic interest certainly it is, driving this corporation but there is a sense of it being promoted by the company in line with rockefellers vision of using this wealth and material to extend modern democracy on a global stage. This vision is aided in 1940 when the Rockefeller Brothers fund is established. With the Third Generation juniorg, that is john d the 5 sons standing with their , father and through this agency we will see rockefeller philanthropy extend it each into all of these different types of programs. Much more so than their father into largescale Development Projects that will be more secular in their outlook, but never entirely drained of this religious impulse, this spirit of international service. Nelson rockefeller on the top right, certainly the most influential politically of the rockefeller sons. He will be working in south america, making plans of development with the american governments own efforts to promote growth in some of the poorer areas of south america. This is also playing out in a cold war context. Nelson rockefeller and the rockefellers in general worried about communism making its way into regions of south america. Their charge is to create potentials for christian american democracy in those regions before communists can get in. There is also fear of anticolonial sympathies, of nationalist fervor taking over this internationalist vision. There is a political worry that is driving the rockefellers forward. Nevertheless, i want to emphasize the way they are acting out of a sincerity of purpose passed down to them from their father, and ultimately from their grandfather. Vision is articulated well by william eddy, who has quite a typical profile in terms of the powerbrokers we will encounter in the next few minutes. Pictured above, he someone who grew up as the son of missionaries. This is a common theme. Missionaries are playing an Important Role in establishing a Second Generation of civil servants, who will not necessarily wear religion on their sleeve, but see the power of christianity filtered through broader projects of modernization to transform the world. He grew up in beirut. His parents helped found an American University in beirut, which would be an Important Institution for missions, but also training engineers and so forth in the business of oil. Trained at princeton university, for a time he was president of hobart college, and in the 1940s, just as luce is articulating this vision of an American Century, is giving these talks. He says things like, you and i who believe in christendom are not doomed to weakness. We serve the only totalitarian king. We who follow christ needed to cover ourselves in tolerance, charity, and wherever we walk we shall find ourselves standing on holy ground. Again, a very clear indication of his faith in a broadly inclusive, internationalist christian democracy. Eddy will also be important, and we will continue to discuss on wednesday. He is going to be influential in generating interest in saudi arabia. As we will look at on wednesday, saudi arabia becomes a field of interest in the 1930s. In 1932, standard oil of california, which becomes chevron, strikes oil in bahrain, and at that moment, it feels like there is much more to gain on the Arabian Peninsula as a whole. In 1933, it wins a concession from saudi arabia allowing it to explore. Tough going for the first 4 years or so until 1938, when its first major well comes in, indicating there is an expansive pool of oil in saudi arabia. As we enter the 1940s, he will become important as someone that can broker the relationship between saudi arabia and the roosevelt administration. You see evidence of that in 1945 aboard the uss quincy in the suez canal. He helps translate and in many cts as a diplomat between the saudi king and franklin d. Roosevelt. Again, talking about a pressing issue of israel, the potential of an israeli state in the middle east is disconcerting to the king. But also nurturing a relationship that will allow this partnership in major oil to continue. Eddy Going Forward will continue to act as a special envoy for the u. S. State department. This is the vision of luce, eddy, the rockefellers, and major oil. There is a parallel one emerging. There in the 1930s, just as saudi arabia is capturing the , backation of major oil in the four poorest counties of east texas, another boom occurs. This one will transform oil in some very important ways. This happens on the farm of daisy bradford, a revered christian woman. Oil is struck in october of 1930s by columbus merriam, a selfstyled prophet similar to the oil hunters we saw in our readings earlier about the late 19th century. Those who use charismatic means of hunting for oil. They are called poor boys. They are not able to drill too deep. The best they can hope for is oil in shallow soil. They find that in east texas. The Major Oil Companies have brushed aside the potential of that. In 1930, he proves there is oil there. It turns out to be a tremendous field. An oil lake 10 miles wide containing an estimated 5. 5 billion barrels. Largest discovered in the world at that point. Saudi arabia will turn that equation on its head. 1 3 of all total oil produced in the u. S. And that time. This is a mammoth field. The prophet, someone using that this someone it using methods that are not necessarily seen as scientific, it proves that even the poorest wildcatters can make it. This oil boom on a scale not witnessed before is the migration of wildcatters, small producers and drillers, and a host of workers, from roughnecks to the service industry, to barmaids and prostitutes they all descend upon east texas. In places like longview, texas, pictured below, we see a forest of derricks, which is typical in any boom. We also see an explosion population. Longview, texas for instance, one of the most important towns in this region. It triples in size ve