"Behind this whole process of electrification lies the need, created by the Great War, for coal conservation and for a motive power that will speed up production of all kinds. We have abundant coal in the Union of South Africa and by consuming less of it on our railways we will be in a stronger position to export it and thus strengthen our international position and keep the value of our money up."
Since Sir William has touched upon the coal supply we at once get a link,--and a typical one--with the ramified resource of the Union of South Africa. No product, not even those precious stones that lie in the bosom of Kimberley, or the glittering golden ore imbedded in the Rand, has a larger political or economic significance just now. Nor does any commodity figure quite so prominently in the march of world events.
In peace, as in war, coal spells life and power. It was the cudgel that the one-time proud and arrogant Germany held menacingly over the head of the unhappy neutral, and extorted special privilege. At the moment I write, coal is the storm center of controversy that ranges from the Ruhr Valley of Germany to the Welsh fields of Britain and affects the destinies of statesmen and of countries. We are not without fuel troubles, as our empty bins indicate. The nation, therefore, with cheap and abundant coal has a bargaining a.s.set that insures industrial peace at home and trade prestige abroad.
South Africa not only has a low-priced and ample coal supply but it is in a convenient point for distribution to the whole Southern hemisphere,--in fact Europe and other sections. On past production the Union ranked only eleventh in a list of coal-producing countries, the output being about 8,000,000 tons a year before the war and something over 10,000,000 tons in 1919. This output, however, is no guide to the magnitude of its fields. Until comparatively recent times they have been little exploited, not because of inferiority but because of the restricted output prior to the new movement to develop a bunker and export trade. Without an adequate geological survey the investigations made during the last twelve months indicate a potential supply of over 60,000,000 tons and immense areas have not been touched at all.
The war changed the whole coal situation. Labour conflicts have reduced the British output; a huge part of Germany"s supply must go to France as an indemnity, while our own fields are sadly under-worked, for a variety of causes. All these conditions operate in favor of the South African field, which is becoming increasingly important as a source of supply.
Despite her advantage the prices remain astonishingly low, when you compare them with those prevailing elsewhere. English coal, which in 1912 cost about nine shillings a ton at pithead, costs considerably more than thirty shillings today. The average pithead price of South African coal in 1915 was five shillings twopence a ton and at the time of my visit to South Africa in 1919 was still under seven shillings a ton.
Capetown and Durban, the two princ.i.p.al harbours of the Union, are coaling stations of Empire importance. There you can see the flags of a dozen nations flying from ships that have put in for fuel. Thanks to the war these ports are in the center of the world"s great trade routes and thus, geographically and economically their position is unique for bunkering and for export.
The price of bunker coal is a key to the increased overhead cost of world trade, as a result of the war. The Belgian boat on which I travelled from the sh.o.r.es of the Congo to Antwerp coaled at Teneriffe, where the price per ton was seven pounds. It is interesting to compare this with the bunker price at Capetown of a little more than two pounds per ton, or at Durban where the rate is one pound ten shillings a ton.
In the face of these figures you can readily see what an economic advantage is accruing to the Union of South Africa with reference to the whole vexing question of coal supply.
We can now go into the larger matter of South Africa"s business situation in the light of peace and world reconstruction. I have already shown how the war, and the social and industrial upheaval that followed in its wake have enlarged and fortified the coal situation in the Union.
Practically all other interests are similarly affected. The outstanding factor in the prosperity of the Union has been the development of war-born self-sufficiency. I used to think during the conflict that shook the world, that this gospel of self-containment would be one of the compensations that Britain would gain for the years of blood and slaughter. So far as Britain is concerned this hope has not been realized. When I was last in England huge quant.i.ties of German dyes were being dumped on her sh.o.r.es to the loss and dismay of a new coal-tar industry that had been developed during the war. German wares like toys and novelties were now pouring in. And yet England wondered why her exchange was down!
In South Africa the situation has been entirely different. She alone of all the British dominions is a.s.serting an almost pugnacious self-sufficiency. Cut off from outside supplies for over four years by the relentless submarine warfare, and the additional fact that nearly all the ships to and from the Cape had to carry war supplies or essential products, she was forced to develop her internal resources.
The consequence is an expansion of agriculture, industry and manufactures. Instead of being as she was often called, "a country of samples," she has become a domain of active production, as is attested by an industrial output valued at 62,000,000 in 1918. Before the war the British and American manufacturer,--and there is a considerable market for American goods in the Cape Colony,--could undersell the South African article. That condition is changed and the home-made article produced with much cheaper labour than obtains either in Europe or the United States, has the field.
Let me emphasize another striking fact in connection with this South African prosperity. During the war I had occasion to observe at first-hand the economic conditions in every neutral country in Europe. I was deeply impressed with the prosperity of Sweden, Spain and Switzerland, and to a lesser extent Holland, who made hay while their neighbors reaped the tares of war. j.a.pan did likewise. These nations were largely profiteers who capitalized a colossal misfortune. They got much of the benefit and little of the horror of the upheaval.
Not so with South Africa. She played an active part in the war and at the same time brought about a legitimate expansion of her resources. One point in her favor is that while she sent tens of thousands of her sons to fight, her own territory escaped the scar and ravage of battle. All the fighting in Africa, so far as the Union was concerned, was in German South-West Africa and German East Africa. After my years in tempest-tossed Europe it was a pleasant change to catch the buoyant, confident, unwearied spirit of South Africa.
I have dwelt upon coal because it happens to be a significant economic a.s.set. Coal is merely a phase of the South African resources. In 1919 the Union produced 35,000,000 in gold and 7,200,000 in diamonds. The total mining production was, roughly, 50,000,000.
This mining treasure is surpa.s.sed by the agricultural output, of which nearly one-third is exported. Land is the real measure of permanent wealth. The h.o.a.rd of gold and diamonds in time becomes exhausted but the soil and its fruits go on forever.
The moment you touch South African agriculture you reach a real romance.
Nowhere, not even in the winning of the American West by the Mormons, do you get a more dramatic spectacle of the triumph of the pioneer over combative conditions. The Mormons made the Utah desert bloom, and the Boers and their British colleagues wrested riches from the bare veldt.
The Mormons fought Indians and wrestled with drought, while the Dutch in Africa and their English comrades battled with Kaffirs, Hottentots and Zulus and endured a no less grilling exposure to sun.
The crops are diversified. One of the staples of South Africa, for example, is the mealie, which is nothing more or less than our own American corn, but not quite so good. It provides the princ.i.p.al food of the natives and is eaten extensively by the European as well. On a dish of mealie porridge the Kaffir can keep the human machine going for twenty-four hours. Its prototype in the Congo is manice flour. In the Union nearly five million acres are under maize cultivation, which is exactly double the area in 1911. The value of the maize crop last year was approximately a million six hundred thousand pounds. Similar expansion has been the order in tobacco, wheat, fruit, sugar and half a dozen other products.
South Africa is a huge cattle country. The Boers have always excelled in the care of live stock and it is particularly due to their efforts that the Union today has more than seven million head of cattle, which represents another hundred per cent increase in less than ten years.
This matter of live stock leads me to one of the really picturesque industries of the Union which is the breeding of ostriches, "the birds with the golden feathers." Ask any man who raises these ungainly birds and he will tell you that with luck they are far better than the proverbial goose who laid the eighteen-karat eggs. The combination of F"s--femininity, fashion and feathers--has been productive of many fortunes. The business is inclined to be fickle because it depends upon the female temperament. The ostrich feather, however, is always more or less in fashion. With the outbreak of the war there was a tremendous slump in feathers, which was keenly felt in South Africa. With peace, the plume again became the thing and the drooping industry expanded with get-rich-quick proportions.
Port Elizabeth in the Cape Colony is the center of the ostrich feather trade. It is the only place in the world, I believe, devoted entirely to plumage. Not long before I arrived in South Africa 85,000 of feathers were disposed of there in three days. It is no uncommon thing for a pound of prime plumes to fetch 100. The demand has become so keen that 350,000 ostriches in the Union can scarcely keep pace with it. Before the war there were more than 800,000 of these birds but the depression in feathers coupled with drought, flood and other causes, thinned out the ranks. It takes three years for an ostrich chick to become a feather producer.
America has a considerable part in shaping the ostrich feather market.
As with diamonds, we are the largest consumers. You can go to Port Elizabeth any day and find a group of Yankees industriously bidding against each other. On one occasion two New York buyers started a compet.i.tion that led to an eleven weeks orgy that registered a total net sale of more than 100,000 of feathers. They are still talking about it down there.
South Africa has not only expanded in output but her area is also enlarged. The Peace Conference gave her the mandate for German South-West Africa, which was the first section of the vanished Teutonic Empire in Africa. It occupies more than a quarter of the whole area of the continent south of the Zambesi River. While the word "mandate" as construed by the peace sharks at Paris is supposed to mean the amiable stewardship of a country, it really amounts to nothing more or less than an actual and benevolent a.s.similation. This a.s.similation is very much like the paternal interest that holding companies in the good old Wall Street days felt for small and compet.i.tive concerns. In other words, it is safe to a.s.sume that henceforth German South-West Africa will be a permanent part of the Union.
The Colony"s chief a.s.set is comprised in the so-called German South-West African Diamond Fields, which, with the Congo Diamond Fields, provide a considerable portion of the small stones now on the market. These two fields are alike in that they are alluvial which means that the diamonds are easily gathered by a washing process. No shafts are sunk. It is precisely like gold washing.
The German South-West mines have an American interest. In the reorganization following the conquest of German South-West Africa by the South African Army under General Botha the control had to become Anglo-Saxon. The Anglo-American Corporation which has extensive interests in South Africa and which is financed by London and New York capitalists, the latter including J. P. Morgan, Charles H. Sabin and W.
B. Thompson, acquired these fields. It is an interesting commentary on post-war business readjustment to discover that there is still a German interest in these mines. It makes one wonder if the German will ever be eradicated from his world-wide contact with every point of commercial activity.
It is not surprising, therefore, that South Africa, in the light of all the facts that I have enumerated, should be prosperous. Take the money, always a test of national economic health. At Capetown I used the first golden sovereign that I had seen since early in 1914. This was not only because the Union happens to be a great gold-producing country but because she has an excess of exports over imports. Her money, despite its intimate relation with that of Great Britain, which has so sadly depreciated, is at a premium.
I got expensive evidence of this when I went to the bank at Capetown to get some cash. I had a letter of credit in terms of English pounds. To my surprise, I only got seventeen shillings and sixpence in African money for every English pound, which is nominally worth twenty shillings. Six months after I left, this penalty had increased to three shillings. To such an extent has the proud English pound sterling declined and in a British dominion too!
South Africa has put an embargo on the export of sovereigns. One reason was that during the first three years of the war a steady stream of these golden coins went surrept.i.tiously to East India, where an unusually high premium for gold rules, especially in the bazaars. The goldsmiths find difficulty in getting material. The inevitable smuggling has resulted. In order to put a check on illicit removal, all pa.s.sengers now leaving the Union are searched before they board their ships. Nor is it a half-hearted procedure. It is as drastic as the war-time scrutiny on frontiers.
To sum up the whole business situation in the Union of South Africa is to find that the spirit of production,--the most sorely needed thing in the world today--is that of persistent advance. I dwell on this because it is in such sharp contrast with what is going on throughout the rest of a universe that staggers under sloth, and where the will-to-work has almost become a lost art. That older and more complacent order which is represented for example by France, Italy and England may well seek inspiration from this South African beehive.
III
With this economic setting for the whole South African picture and a visualization of the Cape-to-Cairo Route let us start on the long journey that eventually took me to the heart of equatorial Africa. The immediate objectives, so far as this chapter is concerned, are Kimberley, Johannesburg and Pretoria, names and towns that are synonymous with thrilling chapters in the development of Africa and more especially the Union.
You depart from Capetown in the morning and for hours you remain in the friendly company of the mountains. Table Mountain has hovered over you during the whole stay at the capital and you regretfully watch this "Gray Father" fade away in the distance. In the evening you pa.s.s through the Hex River country where the canyon is reminiscent of Colorado. Soon there bursts upon you the famous Karoo country, so familiar to all readers of South African novels and more especially those of Olive Schreiner, Richard Dehan and Sir Percy Fitz Patrick. It is an almost treeless plain dotted here and there with Boer homesteads. Their isolation suggests battle with element and soil. The country immediately around Capetown is a paradise of fruit and flowers, but as you travel northward the whole character changes. There is less green and more brown. After the Karoo comes the equally famous veldt, studded with the _kopjes_ that became a part of the world vocabulary with the Boer War. Behind these low, long hills,--they suggest flat, rocky hummocks--the South African burghers made many a desperate stand against the English.
[Ill.u.s.tration: _Photograph Copyright by W. & D. Downey_
CECIL RHODES]
When you see the _kopjes_ you can readily understand why it took so long to conquer the Boers. The Dutch knew every inch of the land and every man was a crack shot from boyhood. In these hills a handful could hold a small army at bay. All through this region you encounter places that have become part of history. You pa.s.s the ruins of Kitchener"s blockhouses,--they really ended the Boer War--and almost before you realize it, you cross the Modder River, where British military prestige got a b.l.o.o.d.y repulse. Instinctively there come to mind the struggles of Cronje, DeWet, Joubert, and the rest of those Boer leaders who made this region a small Valhalla.
Late in the afternoon of the second day you suddenly get a "feel" of industry. The veldt becomes populated and before long huge smokestacks loom against the sky. You are at Kimberly. The average man a.s.sociates this place with a famous siege in the Boer War and the equally famous diamond mines. But it is much more for it is packed with romance and reality. Here came Cecil Rhodes in his early manhood and pulled off the biggest business deal of his life; here you find the first milepost that the American mining engineer set up in the mineral development of Africa: here is produced in greater quant.i.ties than in any other place in the world the glittering jewel that vanity and avarice set their heart upon.
Kimberley is one of the most unique of all the treasure cities. It is practically built on a diamond mine in the same way that Johannesburg rests upon a gold excavation. When the great diamond rush of the seventies overwhelmed the Vaal and Orange River regions, what is now the Kimberley section was a rocky plain with a few Boer farms. The influx of fortune-hunters dotted the area with tents and diggings. Today a thriving city covers it and the wealth produced--the diamond output is ninety per cent of the world supply--exceeds in value that of a big manufacturing community in the United States.
At Kimberley you touch the intimate life of Rhodes. He arrived in 1872 from Natal, where he had gone to retrieve his health on a farm. The moment he staked out a claim he began a remarkable career. In his early Kimberley days he did a characteristic thing. He left his claims each year to attend lectures at Oxford where he got his degree in 1881, after almost continuous commuting between England and Africa. Hence the Rhodes Scholarship at Oxford created by his remarkable will. History contains no more striking contrast perhaps than the spectacle of this tall curly-haired boy with the Caesar-like face studying a Greek book while he managed a diamond-washing machine with his foot.
Rhodes developed the mines known as the DeBeers group. His great rival was Barney Barnato, who gave African finance the same erratic and picturesque tradition that the Pittsburgh millionaires brought to American finance. His real name was Barnett Isaacs. After kicking about the streets of the East End of London he became a music hall performer under the name by which he is known to business history. The diamond rush lured him to Kimberley, where he displayed the resource and ingenuity that led to his organization of the Central mine interests which grouped around the Kimberley Mine.
A bitter compet.i.tion developed between the Rhodes and Barnato groups.
Kimberley alternated between boom and bankruptcy. The genius of diamond mining lies in tempering output to demand. Rhodes realized that indiscriminate production would ruin the market, so he framed up the deal that made him the diamond dictator. He made Barnato an offer which was refused. With the aid of the Rothschilds in London Rhodes secretly bought out the French interests in the Barnato holdings for $6,000,000, which got his foot, so to speak, in the doorway of the opposition. But even this did not give him a working wedge. He was angling with other big stockholders and required some weeks time to consummate the deal.
Meanwhile Barnato acc.u.mulated an immense stock of diamonds which he threatened to dump on the market and demoralize the price. The release of these stones before the completion of Rhodes" negotiations would have upset his whole scheme and neutralized his work and expense.
He arranged a meeting with Barnato who confronted him with the pile of diamonds that he was about to throw on the market. Rhodes, so the story goes, took him by the arm and said: "Barney, have you ever seen a bucketful of diamonds? I never have. I"ll make a proposition to you. If these diamonds will fill a bucket, I"ll take them all from you at your own price."
Without giving his rival time to answer, Rhodes swept the glittering fortune into a bucket which happened to be standing nearby. It also happened that the stones did not fill it. This incident shows the extent of the Rhodes resource, for a man at Kimberly told me that Rhodes knew beforehand exactly how many diamonds Barnato had and got the right sized bucket. Rhodes immediately strode from the room, got the time he wanted and consummated the consolidation which made the name DeBeers synonymous with the diamond output of the world. One trifling feature of this deal was the check for $26,000,000 which Rhodes gave for some of the Barnato interests acquired.
The deal with Barnato ill.u.s.trated the practical operation of one of the rules which guided Rhodes" business life. He once said, "Never fight with a man if you can deal with him." He lived up to this maxim even with the savage Matabeles from whom he wrested Rhodesia.
Not long after the organization of the diamond trust Rhodes gave another evidence of his business ac.u.men. He saw that the disorganized marketing of the output would lead to instability of price. He therefore formed the Diamond Syndicate in London, composed of a small group of middlemen who distribute the whole Kimberley output. In this way the available supply is measured solely by the demand.
Rhodes had a peculiar affection for Kimberley. One reason perhaps was that it represented the cornerstone of his fortune. He always referred to the mines as his "bread and cheese." He made and lost vast sums elsewhere and scattered his money about with a lavish hand. The diamond mines did not belie their name and gave him a constant meal-ticket.
In Kimberley he made some of the friendships that influenced his life.
First and foremost among them was his a.s.sociation with Doctor, afterwards Sir, Starr Jameson, the hero of the famous Raid and a romantic character in African annals. Jameson came to Kimberley to practice medicine in 1878. No less intimate was Rhodes" life-long attachment for Alfred Beit, who arrived at the diamond fields from Hamburg in 1875 as an obscure buyer. He became a magnate whose operations extended to three continents. Beit was the balance wheel in the Rhodes financial machine.
The diamond mines at Kimberley are familiar to most readers. They differ from the mines in German South-West Africa and the Congo in that they are deep level excavations. The Kimberley mine, for example, goes down 3,000 feet. To see this almost grotesque gash in the earth is to get the impression of a very small Grand Canyon of the Colorado. It is an awesome and terrifying spectacle for it is shot through with green and brown and purple, is more than a thousand feet wide at the top, and converges to a visible point a thousand feet below. You feel that out of this color and depth has emerged something that itself incarnates lure and mystery. Even in its source the diamond is not without its element of elusiveness.
The diamonds at Kimberley are found in a blue earth, technically known as kimberlite and commonly called "blue ground." This is exposed to sun and rain for six months, after which it is shaken down, run over a grease table where the vaseline catches the real diamonds, and allows the other matter to escape. After a boiling process it is the "rough"