Texas Oil & Consumer Boom

The Dawn of the Consumer Boom

• The consumer boom was enabled by the discovery of oil beneath Texas.
• Oil became the 20th century's primary power source.
• The Hamill brothers were pioneers in the oil industry in Texas.
• Prospectors believed that a hill near Beaumont, Texas signified oil.
• The oil reserves beneath Spindletop were worth over $11 billion today.
• The Hamill Brothers were hired to drill at Spindletop.
• Before the industrial revolution, oil was a nuisance and cursed if discovered.
• Whale oil was the primary source for lamps until oil was discovered.
• Oil is made from the remains of tiny organisms in the world's oceans
• Scientists discovered in Pennsylvania that oil could be used for lighting.
• Coal was still dominating the industry, but oil had twice the energy.
• Spindletop was not easy to drill as earlier attempts hit sand and collapsed.
• The Hamills were paid $2 for every foot they drilled.
• The Hamills used a steam engine that drills a pipe through the ground.
• At 600 feet, the drill hit a pocket of explosive gas and water, delaying progress.
• The Hamills used mud to hold up the walls of the bore hole.

Spindletop Discovery

• On January 10, 1901, the Hamills struck oil at over 1100 feet.
• The well gushed out over 80,000 barrels a day.
• The US became the largest oil producer in the world due to Spindletop.
• The backers of the rig became nearly $40 million richer overnight.
• Spindletop increased US oil production by 50%.
• Within a year, 500 oil companies were born, including Texaco and Gulf.
• The price of oil plummeted to 3 cents a barrel, cheaper than water.

The Rise of the Automobile

• Cheap oil was turned into gasoline, revolutionizing transportation.
• Millions of Americans lived within 50 miles of their home until gasoline was available.
• In 1908, Henry Ford began his third attempt to build cars in Detroit.
• There were only 8,000 cars in the US, which were expensive and unreliable.
• Henry Ford's production line was high volume and low cost
• Assembly line work was standardized and simplified.
• In 1913, a Model T cost two years' wages, but by 1924, it was just three months.
• The Model T was the car for the common man.
• 300,000 Model Ts were sold in 1913, and by 1924, there was a new one every 24 seconds.
• Car salesman Roscoe Sheller had to learn to drive to sell cars.
• There was a manual called "How to drive an Automobile" to teach new motorists.
• The Model T started a nation of student drivers
• Americans had a great sense of freedom and not being tied to one place because of the automobile
• Americans today drive 2.7 trillion miles a year.
• Cars transformed lives and allowed cities to explode outwards, creating suburbs.

The Rise of Los Angeles

• Brand-new highways and shopping malls with car parks were built.
• Los Angeles became the center of a massive entertainment industry.
• 800 films were produced a year in the 1920s, double the amount today.
• A sign reading "Hollywoodland" was built to advertise luxury homes.
• Los Angeles was the fastest-growing city in the world.
• Water was a vital ingredient for the growth of Los Angeles.
• William Mulholland was the superintendent of the LA City Water Company.
• LA was running out of water in 1904.
• Mulholland found a massive lake in Owens Valley, 200 miles northeast of the city.
• The Los Angeles Aqueduct was built to transport water from Owens Valley to Los Angeles.
• The aqueduct was 223 miles of steel pipe and concrete waterway costing the lives of 43 men.
• The aqueduct saved Los Angeles, and the city grew from 250,000 in 1900 to 2 million in 1930.
• The Owens Valley became a giant wasteland due to the aqueduct.
• Local farmers attempted to blow the aqueduct up over 10 times.
• In the 1990s, LA authorities began the long process of restoring Owens Valley.

The Great Migration, Prohibition, and the Rise of Gangsters

• World War I created massive demand for weapons, cars, and oil.
• Between 1915 and 1930, 1.5 million black Southerners moved north in search of a better life, known as the Great Migration.
• Many headed for the Ford plant in Detroit because Ford paid black and white workers the same.
• Resentment among white workers led to racial tension.
• In the summer of 1919, riots erupted in Chicago after a black teenager was killed for swimming in a white area.
• Riots erupted in 24 more cities across America in the "Red Summer".
• Black neighborhoods like Harlem, Paradise Valley, and the South Side of Chicago were created.
• In 1928, Oscar De Priest became the first black congressman in the North.
• Cities became a symbol for decadence and danger, leading to calls for prohibition.
• On January 16, 1919, the 18th Amendment to the Constitution was ratified, making the manufacture and sale of alcohol illegal.
• Prohibition created a nation of criminals.
• Willie Carter Sharpe was a thrill-seeking outlaw known as "The Rum-Running Queen".
• Moonshine flooded across the country, with 100 million gallons a year being produced.
• Ordinary cars were souped-up for more horsepower, creating America's first "Muscle cars."
• The illegal liquor trade was worth tens of billions and controlled by gangsters like Al Capone.
• On February 14, 1929, the Saint Valentine's Day massacre occurred at the headquarters of Capone's rival, George "Bugs" Moran.
• Ballistic forensics was used for the first time in a crime lab to analyze bullet casings.

The Downfall of Capone and the End of Prohibition

• Major Calvin Goddard established that just two "Tommy" guns were fired in the Saint Valentine's Day massacre.
• Frank Wilson, an accountant, went after Capone on tax evasion.
• In 1913, the 16th Amendment gave the Federal Government the right to tax personal income.
• Wilson uncovered ledgers and handwriting analysis to link Capone to the gambling business.
• On October 18, 1931, Al Capone was found guilty of tax evasion and sentenced to 11 years in prison.
• Prohibition massively increased the stranglehold of organized crime and cost the government billions in lost tax revenue.
• On December 5, 1933, Prohibition was abolished due to the need for tax revenue.
• The stock-market crash in 1929 brought the economy to its knees, ending the 3 decades of economic boom.