The correction of the evils connected with oil lies first in the work of geological experts. While the experts make some mistakes, they are far more nearly right than any other class of men who deal with oil or other mineral products. In the Osage Indian lands, which are unusually favorable to scientific investigation, the experts are said to have been right 87 per cent of the time. The drilling of a well costs S8 to $20 per foot and an average well there is 3000 to 4500 feet deep, and therefore costs around $50,000. Hence, it pays to study the problem carefully before work is begun. There ought also to be some way of preventing people from drilling wells which they cannot cap at once so that no oil or gas will be lost. Also wells should not be dug so close together that one spoils the flow of another. The capacity of many wells is estimated at 5 to 10 times the amount actually obtained from them, and much of this might be saved by employing experts. The saving should be accom plished not only when wells are drilled but when they are apparently exhausted. By forcing air, gas, or water through sands where oil has ceased to flow, the life of the wells may be much increased. Some wells in Ohio arc still yielding moderately after 40 years of pumping.
Another important effect of oil upon business has been the rapid growth of great companies, especially the huge Standard Oil Company. Of course such a company owes a great deal to the genius of its organi zers and to the energy of the American people, but it probably would not have attained its present dimensions if the peculiar conditions of petro leum did not put a special premium on large undertakings. For example the transportation of oil by rail is expensive in proportion to the value of the product, while pipe lines give oil almost the cheapest method of transportation. That is why there is one mile of pipe line for every 8 miles of railroad in the United States. In places like Mexico where the oil is shipped by sea and where lighterage would otherwise be necessary, the pipe lines are carried two or three miles into the ocean and attached to floating buoys. There the steamers may lie comfortably at anchor, paying no port dues, needing no pilots, and in little danger from col lisions. They can be loaded cleanly, cheaply, and so rapidly that one great tanker the " Standard " has a record of taking on 118,000 barrels in less than 28 hours. Such conditions give a great advantage to the companies large enough to build their own transportation systems. In fact until the pipe lines were by law declared common carriers so that anyone had a right to ship oil through them, the company thqt owned the lines could force the well owners to sell at its own price, for with thousands of barrels of oil rushing to the surface daily, the owner of a gusher could not afford to wait in the hope of getting cheaper trans portal ion.
The geographical or geological conditions which cause oil to gush out rapidly as soon as the reservoirs are tapped have had other inter esting effects. For instance they have caused the oil companies to be peculiarly vigorous in searching for markets in order to save the oil that was being wasted. The Standard Oil Company in particular has
pushed its sales in foreign lands. For example it has developed the 5-gallon tin can as an object of interest and value to buyers by stamp ing sacred animals on its sides. Thus the elephant in India, and the monkey in Tibet, for instance, make the cans symbols of good luck, so that in the Himalayan temples they arc even considered fit to hold incense. Elsewhere they are used to store water, milk, clothes, and money, and even as bird cages. One effort of the oil men has been to fight local prejudices in unprogressive lands and substitute kerosene for the native vegetable oils as a means of lighting. In order to cap ture the market a small tin lamp with " trustworthy " on the side was put on the market at 7 .cents although it cost 11 cents to make and ' deliver. The first year 875,000 were sold and the second year two I million. The extra kerosene sold because of the lamps far more than paid for the loss on the lamps themselves. These things illustrate not merely the alert methods in the oil industry, but the way in which peculiar geographical conditions cause peculiarities in business. Since oil is always in the stage of development, and since new wells are con tinually coming in with a rush, highly prompt and scientific methods are needed not only to cap the gushers and store the oil, but to get it onto the market as rapidly as possible, and to obtain a world-wide market so that the vast wastage may be prevented.
Coal and Iron as Examples of Permanent Mining.—As the founda tion of other types of business no industry except agriculture is more important than permanent mining. Coal, as we have seen, is so vital to modern business that its probable exhaustion is one of the world's greatest economic problems. Even today the deinand of the British coal miners for nationalization of the mines, the bitterness between France and Germany over the Saar coal basin, and the strikes in the American coal fields make coal the basis of some of the most perplexing social and political problems. Iron does not create quite such a serious problem, but its importance is so great that the price of pig iron or steel is one of the best indicators of the probable trend of business. One of the first signs that business is recovering from stagnation is increased orders for pig iron or steel, promptly followed by a rise in price. The reason is obvious: as soon as confidence is restored iron is needed to repair or replace wornout equipment and machinery. Again, one of the first signs, or as many people believe, one of the primary causes of hard times is lack of confidence among business men. Physical or mental depression makes them doubt whether large stocks of goods can be sold and promptly paid for. Hence, production is limited, and the factories and transportation systems stop renewing and re placing their equipment. Thus, the demand for iron is reduced, and the pig iron market gives a fairly accurate indication of how prices and business are likely to move.