~ £)~ EXAS BUSINESS REVIEW Bureau of Business Research February, 1944 1,. f.. Montli y Summary of Economic and Business Conditions in Texas l':.., 1'8f theJSi~fl of the Bureau of Business Research, The University of Texas , -F A Buech Ie, Ed"itor. ~ff?")!!' ov • • iii " " -~ >-~ Entered u second clau matter on May 7, 1928, at the post office at Austin, Texaa,. under Act ~f August M. 191J . CENTS PER COPY ONE DOLLAR PER YEAR TEXAS BUSINESS REVIEW Business Review and Prospect It is customary for economic analysts and commen­tators early each year to present their views concerning the probable course of industry and trade _during the year. At the beginning of 1943 and 1942 this task was comparatively simple, for it was obvious that the full energy of the nation would have to be mobilized f ~r the war effort, and it was quite apparent ·at the opemng of each of these two years that the European phase of the war was not likely to be terminated within the year. It was not necessary, therefore, to qualify the statement .regarding the all-out production outlook with the proviso that the prospect would be greatly modified if Germany were to collapse within the year; and as for Japan, it is assumed that the war in the Far East will continue for some time after the fall of Germany. Compared with the two preceding years the oconomic analyst faces at this time a much more complicated problem than he did a year ago, or two years ago, in estimating the probable course of industry and trade within the year. The fall of Germany in 1944 has been forecast as a distinct probability by a leading military authority, according to press reports. Hence it appears to be more to the point to attempt to analyze the prob­ able course of industry and trade after Germany's de­ feat than to attempt it for the year 1944. Up until Ger­ many's defeat, all-out production is certain to continue on the highest plane possible of attainment. The defeat of Germany will usher in major readjust­ ments to a peace economy. The _initiation of these re­ adjustments will not await the surrender of Japan. In­ dustrial activity is expected to drop precipitously soon after the surrender of Germany but will remain com­ paratively high in terms of the 1935-39 base period now used by the Federal Reserve System. At present this index stands at nearly 250, and it is expected that there will be a temporary drop to between 125 and 160 in the Federal Reserve index during the acute stage of the reconversion period. Indexes of total business activity, however, are likely to be far less pessiniistic during the reconversion period than that of the Federal Reserve Board, which priniarily measures industrial activity. The index of total business activity includes not only physical production but also the distribution of goods, the sale of services, the trans­ fer of property and the level of employment and pay rolls. Without minimizing the dislocations that will be caused during the reconversion stage by closing or par­ tially closing of ship yards, plane factories, ordnance plants, automobile and auto parts plants, etc., now con­ verted entirely to war production, it is nevertheless a valid assumption that the total business activity index will decline much less than will the index of physical production. Among the factors contributing to this situa­ tion the following have been cited: 1. Many persons now employed in war plants will be able to regain employment almost immediately in service and other industries. 2. The disappearance of overtime work will spread employment. 3. Unemployment insurance, possible dismissal com­pensation, and liquid savings of individuals will cushion the hardship. 4. Many employees will be held on to perform the tasks involved in reconversion even though the results of their labors find only partial reflection in the produc­tion index. 5. Corporate managements will be accumulating in­ventories of raw materials and semi-finished products well before their own plant reconversion permits pro­duction of end products. · If, as it is expected, the Oriental phase of the war is prolonged for a considerable time after the European victory has been won, war production in certain lines such as aircraft and shipbuilding will be maintained at a high level, possibly even higher than the present high rate of production for these types of war equipment. In conjunction with this situation the output of civilian goods may be expected to increase immediately upon the release of raw materials and manpower. In the light of these factors, actual economic conditions during the reconversion stage are likely to be considerably less un­favorable than the indexes composed mainly of physical production factors would indicate. Thus, while the in­dustrial production index may temporarily be halved, business activity in general may not drop off more than 25 per cent. Some analysts fear a collapse in commodity prices similar to that which occurred in the late fall of 1918. Such a drop is inipossible, however, since with the ex­ception of farm products and food, commodity prices have risen comparatively little during the past four years. A few figures will make this clear. From July, 1914, to September, 1918, the index of farm products according to Standard's and Poor's increased from 71.4 to 157.0, a rise of 120 per cent; whereas from Septem­ber, 1939, to November, 1943, the index rose from 68.7 to 121.3, or 76.9 per cent. During the period from July, 1914, to September, 1918, the index of commodi­ties other than food and fann products rose from 65.7 to 129.7, or 97.5 per cent; while from September, 1939, to November, 1943, the corresponding rise was from 82.1 to 97.4, or only 18.6 per cent. It has been well stated that "whatever may be said of prices, production, and distribution controls, and however badly they may have worked in certain in­stances, the fact remains that they have saved us from the danger of a severe relapse in the prices of industrial commodities with its restrictive effect on business ac­tivity and corporate profits. Intensified export demand for foodstuffs is again counted on to forestall serious price weakness in that department, as it did in 1918-19." Another illustration of comparative price changes dur­ing the past thirty years is graphically presented in the chart on the cover page of the REVIEW. The period cov­ered includes World War I and World War II to date. TEXAS BUSINESS REVIEW The food price index of the Bureau of Labor Statistics (not farm products) rose from an annual average of approximately 80 in 1914 to 135 in 1918 or nearly 70 per cent; while from 1939 to 1943 tlie rise was from 95 to 137 or approximately 44 per cent. The average an­nual cost of living index was approximately 72 in 1914 and llO in 1918, an increase of nearly 53 per cent; whereas the average annual index in 1939 was 99 and 1943 approximately 124, representing a gain of 25 per cent during the four-year period. It is thus obvious that prices of food and the cost of living are being kept under control far more effectively now than thirty years ago. It is to be noted, however, that the average annual indexes of both food and costs of living are still rising sharply and that the fight against inflation may not yet be regarded as having been won. The fact, moreover, that the cost of living index has remained virtually unchanged since the middle of 1943 is not to be taken as conclusive evidence that it will not resume its rise. The same may be said of the food index. On the contrary the most difficult part of the battle against inflation still lies in the future. A third graph on the chart shows the index of the value of the dollar in terms of cost of living. On this basis the value of the dollar now is seen to be considerably below that in 1918. In this connection, too, it is to be noted that the value of the dollar index in terms of the cost of living was approximately 140 at the outbreak of World War I and 101 at the outbreak of World War II. TEXAS BUSINESS In common with all other sections of the country, Texas and the Gulf Southwest is focusing attention more and more upon providing the necessary conditions for successfully meeting post-war economic problems. A wide range of views is held in Texas as doubtless there is throughout the Nation concerning the ·economic out­look, some viewing the situation with the utmost pes­simism, and some, on the other extreme, seeing the millenium near at hand. Actually, however, neither of these extreme views is likely to materialize-at least not in the form which those who hold them expect. The groundwork must be laid and is being laid for systemati­cally meeting the new types of problems which are im­pinging upon us. These problems undoubtedly are more complex than ever before, but our means for meeting them are correspondingly greater. The writer recently made a one thousand mile circuit in East Central Texas under the auspices of the U. S. Bureau of Foreign and Domestic Commerce to deter­mine what people are thinking about with regard to post-war planning. His observations are summarized as follows: Facts on the community level are being collected on a wide range of subjects. These include natural re­sources, population groups, projects that can be entered upon immediately, some to be developed over the long­term period, others which can be initiated and carried through by individual concerns, and those requiring com­munity cooperation and planning. In their own businesses, the well-established individual firms have their plans fairly advanced. In such mu­nicipal undertakings as street extension, water and sani­tary improvements, and other lo.cal public developments, programs are also well under way. Comparatively little thought has been given thus far to newly established industries based upon the rapidly growing chemical raw materials field and the process­ing of their output into numerous manufactured products. Urgent war needs have dramatized certain of these chem­ical raw materials to the citizens of the region. It is their hope that discerning leaders will investigate all the peacetime production possibilities and seek their development. There is nothing but speculation, however, as to what will be done with the huge new war plants. In a trip of this kind one is impressed with the broad solid human base upon which the solution of our eco­nomic problems rests. Leadership, moreover, is not con­fined to the larger population centers but exists in all local areas throughout the state. The following extracts are typical examples of the lines of thought expressed in the smaller community: "We (Kenedy) are essentially a farming community and our first thought when the war began was that the high returns for farm products would give our farmers, at least, some profit on their operations and if we could pesuade them to get out of debt, they would be in bet­ter position to meet whatever reverses might come with post-war conditions and most of our local effort has been put forward to this end with very gratifying results. "Our farmers as a whole owe less money than ever before in our history, and we have more farms and farm­ers completely out of debt with money in the bank and bonds in their safety deposit boxes than ever before in our history. They are improving their farms through soil conservation and diversification methods and will be in position to take advantage of any condition that might arise from post-war conditions. I do not believe that any agricultural community can do any better work than this. "As to our town, after careful consideration of the successful towns of like-size in various parts of the United States, we find that the towns with several oil manufac­turing concerns, where excess farm labor can be used to some thirty to forty hours a week, seem to be the most prosperous and most contented communities. Now it seems absurd to talk about excess farm labor at the present time, but it is going to come with post-war con­ditions and that is what we have to consider. "We have already contacted several small concerns of the character that we have in mind that will have pay rolls from forty to eighty and we believe that we will be able to prevail upon at least two of these to move here some time during this year. "We really believe, though, that in agricultural com­munities such as ours, there is so much improvement possible that along this line more can be accomplished than by any other thing that we might do." Another illustration: "Yoakum is largely an agricultural community and our company is the only industry of any size in the community. As you perhaps know our company is a tanner of leather and manufacturer of leather products of various kinds. At present we employ approximately 700 people. "It is our belief that for a number of years following the close of the war there will be a big demand for the products we produce. Surplus stocks throughout the country and throughout the world have been depleted and it will take a long time until these inventories are restored and ample supplies provided again. Our com· pany has approximately 130 of its employees in the armed forces of the country. It is our belief that we can give immediate employment to all of these men who are released from military service and desire to be associated with us again. "We feel that we have an assured market to justify considerable plant expansion and plans have already been made for this plant expansion as soon as materials and construction labor are available. "Like most agricultural areas our community has been rather thoroughly drained of manpower due to military service and the drift of workers to war centers. To bring our community back to even normal employ· ment it can absorb a considerable number of returned soldiers and released war workers. "The city of Yoakum itself is preparing a consider· able schedule of public works and local improvements in the post-war period. During the past few years the city has liquidated a large part of its indebtedness and has incurred no new indebtedness. This will enable the city to finance public improvements when needed. Amongst the projects planned is a new sewer disposal plant, street improvements, a park and recreation center, and additional school facilities." __ Among other interesting small cities visited were Vic­ loria, Lufkin, and Jacksonville, each of which has its distinctive characteristics, its special problems, and its own peculiar post-war plans. Lufkin, for example, is a substantial city of approxi­mately 10,000 inhabitants and is the home of the South­land Paper Mills, Inc., Lufkin Foundry and Machine Co., Texas Foundries, Inc., and a number of lumber com­panies. For the most part these concerns have their post· war plans well thought out and are looking forward with considerable optimism. In the meantime they are going ahead with their war production on a large scale. CURRENT BUSINESS IN TEXAS The composite business index for Texas showed a moderate decline from December to January but at 198.6 was still 18.6 points, or more than 10 per cent, above January, 1943. The January indexes of employ­ment, pay rolls and electric power consumption were below those of the preceding month but were, with this exception of electric power consumption, above the corresponding figures a year ago. The indexes of mis­cellaneous freight car-loadings, runs of crude oil to stills, and departments store sales were well above both those of the preceding month and of January, 1943. JANUARY INDEXES OF BUSINESS ACTMTY IN TEXAS (Average Month of 1930=100%) J an., 1944 Dec ., 1943 Jan., 1943 Employment 153.6 161.5 136.6 Pay Rolls 252.3 276.3 211.3 Miscellaneous Freight Carloadings (Southwest District) 145.1 134.9 137.7 Runs of Crude Oil to Stills 241.7 232.4 193.9 Department Store Sales ____ 190.9 182.6 179.9 Electric Power Consumption ___ 246.2 278.2 252.l Composite 198.6 208.0 180.0 There has been a tendency during the past several years for the composite business index to decline mod· erately for a brief period at the turn of the year, hut in each of the past four years the upward trend has been resumed before Spring, and then continued strongly upward for the remainder of the year with only slight interruptions. It is not likely, however, that the sharp upward trend which has prevailed since the Summer of 1941 will continue mucl! longer. A rounding off of the curve is soon to he expected. FARM CASH INCOME DURING JANUARY Income from agriculture in Texas during January amounted to more than $67 million, nearly 16 per cent above the $58 million during January, 1943. The in­crease was the result mainly of the sharp rise in income from citrus fruit in the Lower Rio Grande Valley where the receipts from fruits and vegetables totaled nearly $13 million, more than twice that of a year ago. Other sources of income showing sharp gains over January a year ago were rice and eggs. The State index of farm cash income for January is nearly 308 compared with 224 in December and 266 in January, 1943. These figures show the enormous per· centage increase in farm cash income in 1943 in com· parison with that of the average month of the five-year period, 1928 to 1932, inclusive. AGRICULTURAL CASH INCOME IN TEXAS (Average month of 1928-1932=100%) Actual Cash Income CumulatiTe January, December, January, January to Febraa.ry Districll 1944 1943 1943 1944 1943 1-N _ 154.1 139.0 215.3 4,890 6,832 1-S _ _ 400.8 150.2 362.9 8,516 7,712 2 ---220.7 117.4 244.7 6,024 6,677 3 --229.8 264.3 211.7 2,473 2,278 4 --255.2 231.4 190.0 9,135 6,803 5 ---224.7 313.4 203.7 2,757 2,499 6 ----228.5 130.7 283.5 3,174 3,938 7 ---248.4 146.3 271.4 2,660 2,907 8 ---289.6 206.4 285.3 4,252 4,188 9 ---574.5 373.5 440.0 9,289 7,180 10 --310.0 390.5 334.1 1,519 1,637 10-A _ 648.5 635.4 288.7 12,712 5,658 STATE _ 307.7 224.3 266.2 67,401 58,309 Non : Farm. cuh income a 1 computed by thia Bureau underatatee actual fa_rm cash income by from six to ten per cent. Thia 11ituation remlta fTom the (act that means of aecuring complete local marketingt, especially by tru.ck., haTe not yet been fully deYeloped. In addition, means haTe not yet been deTeloped fer computing cub income from aU agricultural 1pecialitie1 of local imporun.ce In acattered areas throughout the State. Thia situation, howeTer, doe9 not impair the accuracy of the ind~tl to •'17 appreciable e:r.tent. In contrast to a year ago there is at present little to indicate what the year to year comparisons of farm cash income will be during 1944. Last year at this time the trend of farm prices was definitely upward, a situation which continued well into the year, and it was this fact that accounted for the major portion of the increase of farm cash income in 1943 in comparison with 1942. These is no present evidence that the composite price index of Texas farm products will change much from prevailing levels during coming months; and it is too early to estimate what probable marketings of crops will be. Present indications are that farm cash income in 1944 will not differ much from that of last year, with chances favoring a somewhat higher farm cash income in 1944 than in 1943. TREND OF FARM CASH INCOME ON THE NORTH AND SOUTH SECTIONS OF THE TEXAS HIGH PLAINS, 1927-1943 In the January, 1944, issue of THE REVIEW the trend of farm cash income in Texas was shown in numerical form by products, and in graphic form by groups of products for the State as a whole. The following tables give similar figures over the same period for the two sections into which the High Plains area of Texas has been divided. If space permits, similar tabulations for other crop reporting districts will be included in sub­sequent issues of THE REVIEW. The actual figures given in the tables are subject to revision as the study of farm cash income proceeds and further refinements are made; but it is not expected that the possible resulting changes will materially affect the trends shown in the tables. The figures for such highly commercialized products as cotton, cottonseed, and wheat given in the tables are not likely to be greatly modified as a result of further study, but the figures shown for certain classes of livestock and livestock products represent understatements of varying amounts. It will be noted that livestock and livestock products are important sources of income in both the north and south sections of the High Plains country; but differ­ences in the types of cash crops make the north-south subdivision of the region necessary. In the northern portion, 1-N, wheat is the dominant cash crop whereas in the southern portion, 1-S, it is cotton and cottonseed. It is interesting to observe in the table that in 1943 the total cash income in the two sections was almost the same but that the upward trend in 1-S has been some­what steeper than in 1-N. Income from cattle in 1-N was double that of 1-S in 1943, but the percentage increase of the income from cattle during the period 1927-43 was less than 100 per cent in the northern section compared with an increase of nearly 200 per cent in the southern section; while cash income from hogs al110 increased less rapidly­400 per cent in 1-N and nearly 2400 per cent in 1-S. The sharp increase in the income from hogs in both districts began in 1936. The upward trend in the income from dairy and poultry products has been quite similar in the two districts with district 1-N invariably showing the larger yearly income from these sources. The substantial farm incomes now being received from ~ variety of different sources other than cotton, wheat and cattle in these two districts, which during the fairly prosperous years of the late '20's were compara· tively unimportant, promises w~ll for t~e ~utu.re agri­culture of this region. There is every md1cat10n that t}Je long term upward trend indicated during the period under consideration will continue into the future. It is not to be expected, however, that the high level of in­come which now prevails because of war conditions will be maintained indefinitely. Up and down swings will undoubtedly occur. It is of interest to observe the seasonal changes in the distribution of farm cash income in these districts. The following table gives the indexes of seasonal varia­tion for the State as a whole and for crop reporting districts 1-N and 1-S. INDEXES OF SEASONAL VARIATION State 1-N 1-S January ----­ ---­-­ 61.6 74.6 67.0 February ---­----------····---­March -------------­ 53.6 54.3 54.3 91.2 51.4 53.5 April ----------­ 70.5 77.l 58.1 May ----­-------­ 86-4 65.6 57.9 June -------------------­ 91.2 126.7 49.9 July ----------------­ 75_5 187.8 30.8 August ---------------­ 104.9 80.3 23.5 September ---------------­188-4 78.8 82.2 October -----­-----······---­ 193.1 161.6 310.0 November -------------------­ 130.5 113.0 282.8 December ------···-······-··-----­ 89.9 88.9 132.9 With the exception of a decline in July the index of seasonal variation for the State as a whole rises from month to month, beginning in February, reaching a peak in October, and then declining through January. The index of seasonal variation in district 1-N follows quite a different pattern, rising from February through Mar~h, then declining for two months, rising sharply durmg June and July-the pincipal wheat marketing months­declining through August and September, and ris~ng sharply again during October and November-the rm· portant livestock marketing and cotton marketing months. For district 1-S the seasonal income pattern varies markedly both from that of the State as a whole and from 1-N. ·Here, there is a gradual rise from Feb­ruary through May, then a gradual decline through August. In September the index begins to rise sharply, reaching a peak in October, followed by a moderate decline in November and a sharp drop during December and continuing into January. Almost one-half of the annual farm cash income in district 1-S is received during the two months of October and November; nearly three-fourths during the three months of October, November, and December; and more than four-fifths during the last four months of the year. F. A. BUECHEL. Prodll'Ct 1927 Cotton ____ 4,190 Cotton Seed __ 882 Wheat ______ 15,756 Rice ______ Grain Sorghum 3,150 Corn ______ 176 Oats _____ 484 Cattle ___ 21,281 Calves -----1,707 Hogs ____ 1,807Sheep ____ 213 Poultry ------466 Wool ____ 202 Mohair --------­Eggs -----------899 Milk Products_ 2,291 Fruits, Veg., Canning ------------­ Peanuts ---------------­ TOTAL _______ 53,504 Product 1927 Cotton -----------24,612 Cotton Seed ___ 4,181 Wheat ------------175 Rice Grain Sorghum_ 2,440 Com -------------159 Oats --------------------­ Cattle ----------------7,071 Calves ----------­ 878 Hogs ---------------386 Sheep -------------60 Poultry ----------801 Wool ---------------­ 94 Mohair -----------­ 10 Eggs ----------------557 Mi lk Products _ 1,437 Fruits, Vegs., Canning -------­Peanuts ---------------­ TOTAL ----------42,861 1928 5,543 1,125 19,215 2,334 115 370 26,098 2,403 1,683 265 484 185 1,046 2,370 63,236 1928 18,241 3,197 463 1,836 109 7,194 1,275 885 112 883 169 16 634 1,487 36,501 DISTRICT 1-N-TRENDS OF ANNUAL FARM CASH INCOME BY PRODUCTS 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 5,903 2,042 1,7.12 2,437 4,436 1,275 2,202 2,607 3,798 2,747 1,250 469 282 297 527 338 630 652 988 710 29,644 20,092 14,697 5,922 5,424 10,172 2,643 5,038 23,574 13,267 ---­ -­ - - - --­ --­ -­ ----­ -----­ 908 2,306 656 500 566 968 522 1,686 1,478 645 63 lll 55 45 29 41 80 100 65 97 150 85 145 116 56 176 90 78 108 45 18,955 16,516 7,372 6,286 4,519 7,583 6,947 9,254 15,020 14,146 1,785 2,170 1,561 1,376 1,065 1,003 778 605 759 650 1,966 1,902 909 812 1,123 673 537 1,779 1,556 1,711 254 282 241 249 264 627 240 262 541 740 609 647 210 222 152 151 239 259 235 252 242 166 122 82 195 175 143 104 126 123 ----­ - --­ - - ----­ - ------­ 3 - 1,074 861 578 488 519 638 862 814 762 704 2,791 2,409 2,245 1,836 2,64D 2,517 3,251 3,956 3,209 3,041 --­ -­ - - - ----­ --­ --­ ----­ ----­ - -­ --­ - - -­ --­ - ---­ ---­ 65,594 50,058 30,785 20,668 21,515 26,337 19,164 27,194 52,222 38,878 DISTRICT 1-S--TRENDS OF ANNUAL FARM CASH INCOME BY PRODUCTS 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 27,552 11,159 ll,436 14,492 16,294' 5,196 13,291 20,152 32)14 16,512 4,757 2,096 1,831 1,688 1,988 1,325 3,670 5,064 7,721 4,500 745 337 340 172 187 405 82 168 760 716 667 1,756 529 401 425 810 403 1,286 1,666 1,570 '54 101 56 45 26 41 82 123 105 95 6,816 6,819 3,882 1,930 2,490 4,481 3,222 4,381 7,675 7,234 1,558 1,531 990 710 589 608 552 364 574 777 1,401 879 422 225 707 654 494 1,795 1,965 1,884 177 126 97 110 102 168 121 127 943 372 1,103 1,051 944 749 449 454 394 373 467 438 188 131 176 102 301 265 198 374 606 450 12 2 4 1 7 4 11 16 12 10 733 634 575 365 399 528 695 652 692 633 1,752 1,497 1,421 1,142 1,652 1,497 1,993 2,429 2,031 1,918 47,515 28,119 22,703 22,132 25,616 16,436 25,209 37,304 57,331 37,109 ($000) 1939 1,845 513 10,165 722 74 24 15,584 1,167 2,084 714 285 136 637 2,872 36,822 ($000) 1939 14,301 3,840 235 2,392 78 8,236 850 1,780 488 329 410 12 667 1,803 35,421 1940 2,235 591 9,945 --~ 1,349 97 22 16,388 1,082 2,009 753 365 210 1,008 3,431 - ----I 39,485 1940 16,328 3,974 197 2,654 115 8,444 813 1,468 578 408 622 23 839 2,249 38,712 1941 3,758 999 13,489 1,730 150 44 12,866 917 3,189 643 379 301 - 1,543 4,578 44,586 1941 38,957 10,077 607 3,321 165 9,791 494 2,611 442 380 730 20 1,284 3,011 71,890 1942 4,730 1,173 33,224 1,938 147 118 27,567 1,124 5,744 1,155 525 385 - 1,939 6,199 85,968 1942 49,081 12,136 1,110 3,836 181 15,395 696 5,283 745 474 965 26 1,572 4,048 829 96,377 1943 7,999 2,070 29,912 3,633 218 102 42,897 1,105 8,755 1,556 552 410 1,626 6,751 951 108,537 1943 45,640 11,674 1,574 . 7,557 253 20,601 785 9,480 666 611 987 25 1,526 4,695 1,154 107,228 ~ en @ ! ~ en ~ "I Geographic Dispersion of Ind11stry With Partict1lar Reference to Texas Economic develonment in Texas is concerned with considerably more ·than the display of merely local phenomena of an economic nature. Factual data per­taining to such outstanding items as the comparative size of the State's agriculture and livestock industries, of its overwhelminrr position in oil and gas production 0 1 . in the United Stales, or of its tremendous potentia ities in chemical development in which a substantial begin­ning has already been made, are indicative of the prom­inent place Texas occupies in the national picture. These developments, it may be emphasized, have not just hap­pened; they represent actualities, the interpretation of which, both as to origin and as to inherent character­istics, must be considered from the point of view of the many, even diverse fundamental factors involved. It is, however, in consideration of the State's post­war problems-problems which will be as insistent as they are difficult, as complex as they are inevitable­that the basic industries of Texas come particularly to the forefront. Texas' post-war problems of outstanding concern fall into four larger, more inclusive groups: Readjustments in Texas agriculture and forestry, new aspects of its oil and gas industries, the potentialities for the growth of a huge chemical industry in the State, together with the possibilities for commercial expansion in which international trade will be highly important. These groups present a wide array of problems, the practical solution of which will, in the very nature of the case, demand a wider comprehension, a broader un­derstanding and more thorough-going considerations as to the essentials involved than has been the case in the past. A question of paramount importance is how best to get at an understanding of the fundamentals of these post-war problems, with a view of being able to deal with them more adequately as they arise. They cannot be by-passed, and even a brief statement as to what the basic questions will include is not without value. It is, of course, with the immediate future that we arc primarily concerned. But for the sake of attaining a substantial perspective in which the events of the future will largely fall, it is necessary to have as full knowledge as possible of those world-wide movements which to a rrreat extent h:we determined the main out­ lines of eco1~omic development. It seems necessary to repeat that economic develop­ ment of the United States as a whole has centered about the spread of agriculture and manufacturing industry into the various major and well-defined natural divisions or natural regions of ihe United States, together with the subsequent growth and readjustments, including the growth of internal commerce. Failure to consider the essential factors concerned in this regional development, the shifts of industries, the regional interrelationships involved-all of which are factors in the regional econ­ omy of the various section of the United States-is to neglect one of the most distinctive and highly important phases of economic growth in America. The dynamic factors having to do with the origin and progressive advances of these enveloping movements- movements pertaining to the migration of peoples, the sequence in the unfolding of scientific progress and the genesis of great inventions, new developments in agri­cultural production, the rise of manufacturing, the growth of new industries, and so on--constitute a dis­tinct and important field of study within themselves. The impingement of these factors and forces upon and their subsequent adjustments to the diverse features compris­ing the American environment is still another subject at once broadly indusive and which possesses inherent elements of outstanding significance for the study of the economy of the United States as something unique among the nations of the world. This uniqueness, it should be emphasized, is dependent upon the characteristics and natural resources of the several major natural regions of the United States. This is but another way of stating the fact that the regional pattern of the United States is all-important in any analysis of study that seeks to get at the fundamental factors of the American economy at large. The word American is used advisedly here, as by and large the distinguishing aspects of the economy of Canada represents a spilling-over of developments from the United States into the different Canadian natural regions and the subsequent adjustments made therein. Attention, too, should be called to the fact that, al­ though the general characteristics of the regional econ­ omy of the several portions of the North American con­ tinent are quite obvious indeed, no adequate analysis exists as to the fundamental reatures of the regional pattern of the United States, whether with respect to the natural conditions (and which must be considered as a sine qua non) or as regards the interplay of eco­ nomic factors and forces exhibited in the agricultural, industrial, and commercial adjustments which in them­ selves are distinctive as expressions of this unique re­ gional pattern. In brief, in well-balanced interpretations of economic growth, it is, on the one hand, necessary to consider fully as well as to distinguish carefully between what may well be termed institutional factors and forces and, on the other hand, the conditions inherent in the make-up of the material environment. Economic growth, of course, involves much more than the impingement of institutional factors upon and subsequent reactions within a definite natural region, important as these obvious I y are, as inter-regional fac­ tors also play an important part, these inter-regional aspects being closely associated with communication and transportation facilities which make commerce possible. The ground-plan of Texas, its regional subdivisions each of considerable size, together with the associated natural resources which, too, are of a diverse nature, is sufficiently broad and diverse as to display in a definite manner the reactions of these various institutional fac­ tors and forces as they have come to terms with the Texas environment. And just as it is necessary in a scientific analysis of the natural regions and natural resources of Texas also to consider these material factors from a comparative viewpoint, including their relations not only to the North American continent hut also to the world as a whole, in order to obtain a necessary breadth of perspective, so it is likewise essential to view the facts of economic development in Texas, as well as the problems to be met in the future, from a standpoint that is world-wide not only in its inclusiveness but also as regards the basic significance of these problems. For instance, there is no question but that the prob­lems of the cottonseed oil industry in Texas are tied in with the potentialities of producing cheap vegetable oils in large volume in the Tropics, which in turn is not unrelated to the demands which "coolie" labor will no doubt insist upon in the post-war period. Problems of cotton growing in Texas will be concerned, on the one hand, with cheap cotton production elsewhere and with the tremendous potential rate of growth in the field of synthetic fibers on the other. Similar problems for oil, for natural gas, for pulp and paper, for synthetic resins and plastics, ana the like, no doubt come readily to mind. More especially there is the case of oil. World War II is making a great dent in American oil reserves. California, for instance, is unable to meet its production quotas. If the war continues long enough, the entire American oil industry may not be able to meet the mili­tary demands without endangering our reserves. Serious as our oil situation might become in this war, consider for a moment what could well be the situation in the event of a super-World War some 25 years hence. In this paper dealing with geographic dispersion of industry in particular reference to Texas, three groups of factors will be considered in outline. These are: (a) Well-recognized more inclusive movements, such as the world agricultural revolution which began to make itself felt as a world-wide force in the 1870's; (b) Major scientific developments and inventions which have proven to be basic and fundamental to the dynamics of economic development and which therefore have to be regarded also as institutional factors of the first order of magnitude; and ( c) The actualities of how these institutional forces and factors have come to terms with the material en­vironment as expressed in the dispersion and growth of industries, including agriculture and commerce as well; this, quite obviously, involves the reactions of these factors to the pattern of natural resources of Texas. The general aspects of the pattern of Texas natural resources in relation to the natural divisions of the State were pointed out in a descriptive manner in the TEXAS BUSINESS REVIEW of January, 1944. It is important to note, however, that the larger aspects of this problem of the patterns of natural resources in relation to the whole field of economic development, and particularly with reference to comparative features of economic growth have not as yet been subject to critical analysis anywhere. MIGRATION OF COTTON PRODUCTION Cotton production in Southeastern United States repre· sents the first large development of commercial agri­culture anywhere. The rise of cotton growing in Southeastern United States followed closely on the heels of the invention of the cotton gin; the supply of labor in that region was inadequate to the slow and laborious task of removina the cotton seeds by hand. But in a larger sense th~ ~nstitut~onal factor which brought the Cotton Kingdom mto existence was the growth of the cotton textile indus­try in England-an industry based on the one hand upon the new mechanical developments and on the other upon the overseas markets which were absorbina more and more of the English machine-made cotton fabrics. There was, however, another side to the larger move­ment: this was the peculiar physical adaptability of Southeastern United States to cotton production as well as its transportation to coastal points, from ,;hence it could be shipped overseas. The natural conditions inherent to the environment of the Southeast which made these things feasible in a pre-railway and a pre-agricultural machinery age need not concern us here, except to state that quite definitely they are distinct features of the natural environment of the Southeast. This much, however, should be said of the Southeast: this is a region unique to the North American continent. The only large region anywhere in the world at all analogous to Southeastern United States is southern China-but a cursory examination of this latter region reveals so many differences that few comparisons indeed can be made with Southeastern United States. · Likewise, the structure of the economic society en­gendered by the one-crop system producing a raw ma­terial for an overseas market will have to be passed over, except to say that the reasons for the one-crop system were. ~efinitely concrete ones, made so by the natural cond1t10ns, although no doubt the practice was also favored by economic circumstances. It is also important to note that the structure of the society engendered in the Southeast was carried westward with westward mi­gration of cotton production. Cotton production in Texas was hampered in the early days by the lack of inland transportation. The rise of large cotton production, first, in the Black Prairies in the 1380's and later on in the various Black Earth or Chemosem soil regions of the State was dependent first upon the extension of railways and second by the avail­ability of agricultural ·machinery. Likewise, the exten­sion of the range cattle industry into the plains of western Texas was conditioned by deep well drilling and the availability of windmills. What this means in brief is that a new environment was being occupied, that new types of natural resources were being subjected to agricultural conquest. For the Prairies and the Western Plains belong to the Con­tinental Interior Grasslands, as contrasted with the forested or woodland regions which, excepting areas of oasis agriculture, had been the world's agricultural lands since time immemorial. The vast areas of the Continental Interior Grasslands of the Middle Latitudes had never before been occupied agriculturally in historic time save in certain marginal areas. Instead, they had been the homes of nomadic tribesmen whether in Eurasia or the Americas--the Steppes of Russia and Siberia, the Plains of Hungary, the Great Plains of North America and the Pampas of Argentina. The question naturally arises as to ~hy these lands were not earlier brought under commercial development. TEXAS BUSINESS REVIEW BACKGROUND OF AGRICULTURAL DEVELOPMENT IN THE WESTERN WORLD Lack of space forbids even a brief outline of the big factors in world agricultural developments which took place prior to the 1870's. The geographic centers of origin of the world's crop plants, is for instance, a vast field within itself. The relationships of modern agri­culture to the facts connected with these centers of origin is a field of inquiry hardly touched upon by anyone. How the small grains came to be grown in the Brown Forest soils of Western Europe is another sub­ject which is both entrancing in its broader history and in its cultural significance. Paralleling the rise of small grains production in Western Europe was the closely associated production of livestock; both the small grains and the types of livestock of Western Europe were of non-European origin. Agriculture in West-central Europe was called upon to support an increasing popuI-ation from the period of the shift of civilization northward from the Mediter­ranean lands. The agricultural system of West-central Europe was that of Mixed Farming, the roots of which in that section extend back into the Neolithic. The areas of good soils in Western Europe are sharply limited; instead, the soils as a whole were only fair initially and they became worse with increased use under the three-field system which was in vogue during the Middle Ages. What the introduction of feed crops and the extension of pastures, together with the abandonment of the three­field system, meant to European agriculture is still an­other subject worthy of careful attention in obtaining a fuller perspective of the big movements that subsequently have so greatly influenced world agriculture. This much, however, can be said here: the three-field system represented a definite form of farming adjust­ments to the circumstances with which agriculture in West-central Europe had to come to terms, and one of these factors was the rather mediocre character of the soil resources-a condition decreed by nature. The abandonment of the three-field system together with the changes in agricultural production which this permitted was dependent upon the increased amount of livestock; it was, considered at large, another phase of adjustment to the soil characteristics of West-central Europe. These developments were well on their way by the opening of the 19th century-a period in which also the Industrial Revolution was getting under way in England, and it, too, was the period of steadily increasing popu­lation as well as one in which the available soil re­sources-the sources of subsistence-were gradually shrinking. The shrinking soil resources of Western Europe ex­presses simply the fact that these types of soils under the prevailing circumstances of utilization of the time were certainly not capable of increasing their yields; in general, it seems that their yields were gradually decreasing. Changes of considerable magnitude were, however, in the offing. More livestock and of better grades was made possible by the introduction of feed crops into what is now called the European system of crop rota­tion. Furthermore, the abandonment of the three-field system meant an increase by about one third in the amount of land in annual production. Peculiarly enough, the new agricultural and range livestock lands that were to he brought under cultiva­tion on a large scale after 1870, environmentally con­sidered not only required the new transportation and the new machinery for their utilization but they were ad­mirably adapted to its use. However, the development of these new advances in transportation, in production, and in markets did not take place all at once; instead, paralleling as they did the progress of the new industry, these advances proceeded at what would be to us a slow pace, together with other series of adjustments that also came slowly. As factories sprung up in the urban centers, particu­larly during the first half of the 19th century, there be­gan a steady migration of people moving to town. Previous to this pull to the industrial centers, peoples of Western Europe for one reason or another had been steadily migrating to the New World. During this period, too, in part as a consequence of the Industrial Revolution, the availability of commercial fertilizers made possible a pronounced increase in the yields of small grains, wheat especially, on the rather mediocre soils of Western Europe. In the meantime, the Mixed Farming practices which had grown up in West-central Europe had been trans­planted to East-central North America, and particularly to the Middle Atlantic states. This system was not trans­planted into Southeastern United States, because of the fact that the natural environment of the Southeast dif­fered so strongly from that of West-central Europe or East-central North America. Before cotton became important in Southeastern United States, that region as everyone knows had been one of specialized products produced primarily for an over­seas market. After the Napoleonic wars, cotton became the crop of the Southeast and for a considerable time, cotton was grown primarily for overseas markets. The westward spread of cotton growing throughout the Southeast was a rapid one; this movement, it is to be noted, was an important one in the economic growth of the United States as a whole. It afforded a means of tieing together the producing regions of the United States as exemplified in the rise of internal commerce, which became important particularly in the second quarter of the 19th century. The point of emphasis in this paper, however, is the fact that the Southeast became an important surplus producing region exporting raw materials, which in turn was tied in with the growth of the textile industry in Western Europe, particularly in England. At the same time industrial beginnings were being made in Northeastern United States, in New Enaland as well as in the Middle Atlantic States. The surpl~s prod­ucts of the Northeast, however, were not being sent to overseas markets; instead they were aoing to the trans­ 0 Appalachian Middle West (where a system of Mixed Farming of the European type was being developed) and to the cotton-exporting Southeast. TEXAS BUSINESS REVIEW AFTER 1870 The quickening of economic activ~ty, engendered by the new industrial developments, which became so ap· parent during the middle ~9th. century was center.ed primarily about manufacturIDg IDdustry, togethe~ with its repercussions upon agr~culture and ~ansportat~on. Unquestionably, the primary dynamic f~ctar ID all this was the growth of science and the re~ctl?ns ~er~f on inventions and their subsequent apphcat1ons m ID· dustry. It must be remembered, too, that industry itse.lf reacted upon scientific developments in no uncertam terms. Furthermore, there is the important fact that certain types of natural resources hitherto un'!sed ~nd which awaited utilization must be given consideration also in the series of world-wide developments that be­came predominant in the latter quarter of the 19th century. So far as new developments which were to prove rev_o­lutionary in modern industry were concerned, three dIS­coveries stand out in clear perspective. These were the Bessemer process announced in 1856, the discov~r>: of mauve in the same year by the 17-year-old Wilham Perkin and the drilling of the Drake oil well near Titus­ville, Pennsylvania, in 1859. _These ~iscoveries came at the same period; their revolutionary rmpacts upon world industry and world economic development came to the front in the latter part of the 19th century, or more precisely, in the period from 1870 to World War I .. The application of the Bessemer pr?Cess together ":1th the subsequent developments in a senes of steel-making processes made cheap steel widely available in large amounts for the first time in the world's history. Out of this, to take one important item, grew the vast expa~ion of railways which thenceforth were to play 8? promment a part in the newer phases of world economic growth. Out of Perkin's discovery of mauve {the first of the synthetic dyes) and the circumstances. of the _time~ Ger­ many built her very import8?t orgamc chemic~l mdus­ try which in many respects reigned supreme until World War I. ,, f th D _i_ And at the time of the "completion o e r~e well no one foresaw the importance petroleum was to have as a motive force in the automobile after 1900­much less its influence upon aviation. And by ~o stretch­ing of the imagination could its plac;:«: as an Impoi:tant chemical raw material have been envlSloned at the time. OPENING UP THE CONTINENTAL INTERIORS By and large the agricultural conquest of. the vast Continental Interior Plains of the Middle Latitudes be­ gan in the 1870's. These lands presented fundamental characteristics inherently different from the lands man· kind had previously used agriculturally on any con­ siderable scale. These interior plains are grasslands; by way of con­ trast mankind's agricultural production had formerly come almost entirely from forest or woodland regions. For reasons that lie beyond the confines of this paper, the soils of these grasslands are inherently different both physically and chemically and therefore contrast sharply with the soils of forest regions the world over. Grassland soils are dark colored; those of forests are light colored, rangi~g fro~ grays and b~owns through yellows into the va1ous kinds of red soils. The dark color of grassland soils is due to the organic matter intimately mixed with the mineral content forming the body of the soil. Excepting the Brown Forest soils, the various kinds of light-colored soils of timbered regions reflect the presence or absence of iron compounds and the degree of oxidation to which these compounds if present have been subjected. In the Brown Forest soils, the brown color is due in part to the smaller amount of organic matter incorporated in the soil body. The varying degrees of blackness in the grassland soils is due to the amount of organic matter incorporated in the soil. These statements for both grassland and forest soils apply only to those soils that have attained a mature stage in soil delevopment, and the statements in both cases apply only to what are designated as up­land soils; the soils of river lowlands the world over have to be considered individually wherever they occur. To sum up: The soils of the world can be divided from a practical, i.e., from a land utilization viewpoint, into the dark-colored grassland soils and the light­colored timbered soils. Each of these main divisions are further divided into Great Soil Groups, such as the Brown Forest soils in one category, or the Black Earth soils in the other. Obviously then the agricultural conquest of the grass­land soils of the interior plains lands of the Middle Latitudes meant that a new type of soil resource was available for utilization. The large-scale occupation of these dark-colored grassland soils gave rise to the world­wide agricultural revolution of the latter part of the 19th century, and which lasted until the period of World War I. But also the ·natural environment of the grassland plains is fundamentally different from that of forested regions. The grasslands are sub-humid regions; they comprise smooth contoured, broad interstream ar~ that is, the riven are fewer in number than in forested lands and furthermore, these streams are characterized by great irregularities in the amount of water they carry, being low, even and almost dry, during a large part of the year. In the grassland plains the water-table is lower and therefore deep wells, as a rule, are necessary. The character of the soils and the features of the en­ vironment combined with the conditions attendant upon a generally interior location, all together presented a situation new indeed to what mankind previously had had to make adjustments in agricultural production. Even the breaking of the grassland sod n~itated plows of a sort different from those in use previously. In brief, the outstanding features of these dark-colored soil regions are as follows: 1. The grassland soils are inherently rich chemically; their physical structure is excellent as a rule. They do not require commercial fertilizers, save under a few exceptional circumstances. 2. The limiting factor in crop production on these dark-colored soils is moisture. Conservation of moisture rather than application of chemical fertilizers is the chief means man has of modifying the natural condi­tions of these lands. 3. Because moisture is deficient in these soils, outside of the Prairies regions, yields are lower and therefore larger acreages are necessary in the sub-humid grass­land plains. Yields in all grassland soils are determined by the supply of available moisture in the soil. Yields in forest soils are dependent primarily upon the content of chemi­cal compounds required for plant growth whether these compounds are inherent to the soil make-up or are added by farm practices or the application of chemical fer­tilizers. In brief, agricultural operations in the grassland areas are on a larger scale from those obtaining in forest re­gions-a development which obviously is dependent upon large agricultural machinery and other forms of agri­cultural equipment and the like necessary for the effec­tive utilization of these lands. Obviously, these entail cash expenses and therefore the utilization of these lands for the growing of cash products. 4. Because of the limitations s~t by the prevailing climate conditions, the grasslands are regions of spe­cialized production-of wheat, or corn, or cotton, or range livestock, and so on-just as regions like South­eastern United States are characterized by specialized production, due in this case to the limitations set by the inherent conditions of the soil rather than by climatic factors directly. 5. There are also the comparative aspects involved in the agricultural conquest of these interior grasslands, for the revolutionary aspects associated with the large utili­zation of grasslands soils of North America were by no means limited to this continent; similar developments characterized the other interior grasslands of the Middle Latitudes in Eurasia, Argentina, and Australia. 6. It is obvious that, in view of the full sway of cir­cumstances which obtained, that reactions of world-wide import followed the agricultural conquest of these vast grassland regions. These reactions were expressed, on the one hand, in the kind and volume of agricultural products in international trade and, on the other hand, by the effects these large amounts of exportable sur­pluses had upon the older farming regions of West­central Europe and East-central North America. These older areas were forced by the pressure of inexorable forces to revamp their agriculture at large, and that in spite of the high tariffs which were established particu­larly by France and Germany. Of course, other factors than those mentioned were involved in these readjustments in the older farming regions, but the emphasis in this paper is upon certain larger and basic considerations which, in their entirety, have certainly not been given the discriminating atten­tion their importance merits in interpretations of com­parative economic development during the periods con­cerned. It was out of these forces that the New Cotton Belt developed in the Gulf Southwest, and the Cattle King­dom of the Southwest as well; the extension of hard winter wheat growing from Kansas into the Texas Pan­handle and, to a less important degree, wheat produc­tion in the Red Beds Plains also illustrates another phase of the same wide movement: the agricultural conquest of the grasslands. OIL AND CHEMICAL INDUSTRIES IN RELATION TO TEXAS Besides agricultural and range livestock production, two other industries, important enough to rank as world industries, have become important in Texas; these in-elude the oil and gas industry and the newer develop­ments in the chemical industry. The oil industry is essentially an American industry in that it had its origin here, and in the United States it has developed most of its distinguishing characteristics. The major shifts in oil production in the United States form the bases for an article by that title in the May, 1943, issue of THE TEXAS BUSINESS REVIEW. In brief, World War I brought the problems of oil production in the United States sharply into the picture of the American economy. It served, too, in bringing the prob· lem of oil to the attention of European governments: that is to say, European countries immediately grasped the fact that oil and especially oil reserves are strategic necessities both in peace and war. It was in the post-war decades, however, that the important oil regions of the world were sufficiently explored as to give to the student of the oil industry a perspective of the relative amount and world distribution of oil reserves. During these two decades, owing to a variety of cir· cumstances, the United States at large was not concerned particularly with a comparative view of oil resources, or of the relations of our oil reserves with those of the rest of the world. World War II, however, has driven home this im portant fact-that the United States of necessity will have to consider the oil industry and especially the problem of oil reserves from a world point of view. To sum up: Quite definitely the oil industry of the United States as a whole has reached a turning point; in the phase we are now entering, new points of view with different sorts of adjustments will necessarily pm vail. As a nation, the United States will have to give attention to obtaining sufficient oil to meet our needs. As a nation we shall be concerned with the total re· serves that can be rendered available in this country, together with their distribution in the United States; in addition, we shall have to he concerned with the occurrence of important oil reserves elsewhere. As regards the problem of reserves in this country more and more will national attention be centered upon the reserves of both oil and natural gas in the Gulf Southwest, and more especially upon Texas. Obviously, numerous technologic problems enter the picture and as time goes on some of the newer phases of technologic development will assume a greatly accen· tuated importance. One of the groups of technologic problems is con· cerned especially with deeper drilling and the things that deep drilling in a few sections of the country will reveal. That is, expansion in vertical exploration may be a very important factor in the immediate future in adding to our known oil reserves. Ai:iother group. of problems centers about the finding of 011 accumulat10ns, even small ones, within the range of present drilling; this includes expansion in hori· zon.tal exploration. In both of these groups, problems of mcreased recovery of oil in the reservoirs will be of outsta.nding importa?ce. Still another group of prob· lems IS concerned with the means whereby our oil and gas production can be more efficiently utilized. This brings quite definitely the whole field of hydrocarbon chemistry into the picture. GROWTH AND GEOGRAPHIC SHIFTS IN THE CHEMICAL INDUSTRY Preceded by a century or more of what may be designated as a scientific revolution, the . chemical in­dustry got its start with the LeBlanc process for making soda ash, or the Le.Blanc soda process, discovered in France in 1791. Wl.!at is important about this discovery is that a new set of raw materials were used by LeBlanc. Previously soda ash had been made from burning seaweed; LeBlanc used common salt, as the raw material; sulphuric acid and limestone were used_ as process materials. The LeBlanc process made ~oss1ble cheap production of alkali from common salt, which was a cheap and plentiful commodity. Thenceforth, and to this time, the heavy alkali industry has been associated with salt beds which were laid down as geologic deposits. The French needed soda ash for the French glass industry; war with Spain had cut France off from supplies of soda ash previously obtained from Spain. The French Academy set up a prize of 12,000 francs for a successful method of making soda ash. LeBlanc, private physician to the duke of Orleans, set out to win the prize. Having discovered the process which goes by his name, LeBlanc set up a plant for making soda ash, but this was confiscated in the period of the French Revolution. France, however, benefitted little from the discovery; it was in England that the production of alkali developed as an organized industry. In 1823 James Muspratt built an alkali plant in Liverpool, using brine wells from the Chesire salt deposits to supply salt. Sulphur, for making sulphuric acid, was obtained from Sicily, or, in the form of pyrite, from Spain. Both coal and limestone were readily accessible in England. The English alkali industry grew slo~ly. Soda ash was used, not so much for glass makmg, as for the growing soap industry. T}ie English,. h_owever, bene­ fitted in another way from the alkali mdustry. An unwanted by-product of the LeBlanc process was chlo­ rine. The English cotton textile industry at this period was expanding-rapidly. The act~ve qualities .of chlorine had been discovered by t}ie Swedish pharmacist, Scheele, in 1784. In 1785, the French scientist Berthellot dis­ covered the bleaching properties of chlorine, and sug­ gested the use of chlorine in textile bleaching. Mac­ Gregor a Glasgow bleacher, and father-in-law of James Watt, .:Vas first to try out the use of bleaching powder (chlorinated lime) on a large scale. Thenceforth, the capacity of the LeBI~nc proces~ to provide the by-product chlorine was an rmporta~t item in the alkali industry, even to the extent of holdmg on to the LeBlanc process after more efficient methods of producing alkalies had been developed. The last plant u8ing the LeBlanc process ceased operating in .192~. No plants using the LeBlanc process were bmlt m America. England dominated the chemical. industry, ":hich co1!'­ sisted largely of alkali and chlorme product10~, until the latter third of the 19th century. Chlorme, of course, was an important product of the English chemical industry. In the early 1860's Ernest Solvay in Belgium worked out the more efficient ammonia-soda, or Solvay process for making soda ash, or sodium carbonate. The process was simpler, and therefore more economical in use than the multi-stage LeBlanc process. The raw materials were common salt, coke, and limestone, ammonia being used in the process. Chlorine was not produced in this process. The first ammonia-soda plant was built in Belgium in 1866. The new process became firmly established in the 1870's. Immediately there arose sharp competi­tion between the LeBlanc and the Solvay processes for the alkali market, but it was not until around 1900, owing to the inertia of invested capital together with its advantage in producing chlorine as a by-product, that the LeBlanc process was definitely on the wane. The alkali market, it may be noted was an expanding one, owing to the growth of industries using alkalies as process materials. Furthermore, new Solvay plants were being estab­lished. In 1872 Ludwig Mond built a large plant using the Solvay process in England. In 1881 the Solvay Process Company established an ammonia-soda plant near Syracuse, New York. In 1892 an alkali plant was established at Wyandotte, Michigan, by what later came to be called the Michigan Alkali Works. In 1895 Mathieson Alkali Works established a plant at Saltville, Virginia. These were the pioneer alkali plants in the United States; all used the ammonia­soda process. They were established to provide alkalies for the growing American market. The mait reasons for their locations are self-evident. Hardly had they become established, however, than two new factors entered the alkali picture, greatly modifying the ~ituation as a whole. One of these fea­tures was concerned with the electrolytic process by which caustic soda, chlorine, and hydrogen were pro­duced simultaneously. T4is development obviously could not take place until large blocks of low-cost electric current were available. As a matter of fact, the second commercial electrolytic alkali-chlorine plant was establis}ied at Niagara Falls in 1897 by Mathieson Alkali. The Niagara Falls district remains to this day an important center of large production of alkali and chlorine by electrolysis, and, of course, of other electro­chemical products. The other feature entering the alkali picture was the fact that alkali-consuming industries began producing alkalies. In 1898, Pittsburgh Plate Glass Company, a large consumer of soda ash org~ized the Coh~mbia Chemical Company and an alkah plant was bmlt at Barberton, Ohio. In a sense, this Ohio plant was a forerunner of the alkali plant at Corpus Christi, erected a third of a century later, which began operations in 1934. The Corpus Christi plant was built by Southern Alkali Corporation, owned jointly by Pittsburgh Plate Glass and American Cyanamid Company. The period centering about the turn of the century was one of expansion of the American chemical wood pulp and. paper industry and the cotton textile indu~try was being moved almost bodily from New England mto the Southeast. These industries, the pulp industry in particular, especially after World War I, began making their own chlorine for bleaching purposes by the use of the electrolytic process, and as a consequence, th~y became interested in disposing of their low-cost caustic soda in the alkali market, thereby competing with the alkali producers. Later on the ammonia-soda process plants began to install ele~trolytic units, producing caustic ~oda and chlorine too-ether with hydrogen. In 192 I Solvay Process 'Con~pany built a large electrolytic plant. at Syracuse, New York. In recent yea~s th~re has an sen a greatly increased demand for chlorme, m part due to a variety of new uses; this demand has, of course, been greatly intensified by the war program. At the end of 1942 all but 20 of the 9 ammonia-soda plants in _the Uni~ed States '::,ere producing ch~orine ai:d electrolytic caustic soda. 1 he largest chlonne-caustic soda plant in eastern United States has recently been completed at Natrium, West Virginia. This plant was financed by the Defense Plant Corporati~n and is being operated by Columbia Chemicals (of Pittsburgh Plate Glass Company) . From 1884, "·hen the first Solvay plant was built at Syracuse, until the early :930's, all the heavy alkali plants were in states bordermg o~ the Great Lakes from Michigan east except the Mathieson plant at Saltville, Virginia. SHIFTS OF ALKALI PnoDt:CTIO:\ ISTO THE GuLF SovTHWEST The demand for alkalies and for chlorine is largely that of industries in which these products are used as process materials. As alkali-consumino-industries moved southward and westward there arose~ need not only for increased pro· duction of alkalies and for chlorine as well but for the production of these materials as near as possible to the consuming industries. . Among these consuming industries that were rnakmg important regional shifts into the Southeast and the Gulf Southwrst, especially after World War I. the fol­ lowing are outstanding: the viscose rayon ~ndustry, petroleum refinin g, the Kraft pu~p and .raper m?ustry, the aluminum industry. Later rndustnes of this sort which were mi~rating southward and southwestward in­ clude the mam~facture of glass and the making of soap. Sulphite pulp suitable foi~ rayon manufac.ture is being produced from Sou •hcrn pmes and fine white papers are being made from Southern woods. . A newsprint in­ dustry more recently has been e~lahhshed. The Dow process for making magn~sium from sea water uses chlorine as a process matenal. As a consequence, the production of alkalies and chlorine has now become an important industry in the Gulf Southwest. The Corpus Christi plant began pro­ ducing alkalies in 1931; an electrolytic chlorine unit was added a few years later. Champion Fiber and Paper Company near Houston k .s its own plant for producing chlorine for bleaching purposes and it produces caustic soda and hydrogen as "·ell. Dow Chemical at Freeport also has its own chlorine-caustic soda plant. About the same time the Corpus Christi alkali plant was being built, '.\Tathieson was building an alkali plant of similar size at Lake Charles, Louisiana, and at Baton Rouge the Solvay Process Company (a subsidiary of Allied Chemical and Dye Corporation) was constructing another alkali plant. Both of thes~ plants 4ave since been expanded; both have added electrolytic chlorine units. The Mathieson plant in 1941 added a unit for manufacturing synthetic salt cake-a product consumed Ly the Kraft pulp industry. These developments in this phase of the growth of the chemical industry in the Gulf Southwest were sum marized in the TEXAS BUSINESS REVIEW for January, 1943, and February, 1941. RISE OF COAL-TAR CHEMISTRY AFTER 1870 The discovery of mauve by Perkin in 1856 opened up a new world in the chemical industry. This mo· mentous discovery had been preceded by a half century of work on the development of organic chemistry on the continent of Europe. It must be kept in mind, however, that other than in Great Britain manufacturing industry had gained little hold in Europe by the middle of the 19th century. Europe as late as the 1870's was pri­marily agricultural; and an agricultural society of itself provided few incentives for the development of any important chemical industry, except for fertilizers. Liebig, for instance, was interested in the early part of his career in organic chemistry; later on, he turned to the field of agricultural chemistry, particularly to the problem of plant nutrition. In the earlier part of the 19th centur:y the French chemist Chevreul did consid­erable research work on animal fats, and the application of his results were important to the candle and soap industries of the time. The spread of industry from England onto the Con· tinent and to the United States created new conditions and new needs. The quickening in economic activity was paralleled by new developments in science and technology-all of which was marked by progressive advances in the period between 1870 and World War I. But at the time of Perkin's discovery in 1856 the time was not yet ripe for England to take full advantage of the vast potential field in which this discovery was a beginning. "The British Government," to quote E. E. Slosson, "gaYe the discoverer of mauve a title, but it did not give him any support in his endeavors to develop the industry, although England led the world in textiles and needed more dyes than any other country. So in 1874 Sir William Perkin relinquished the attempt to manufacture the dyes he had discovered because, as he said, Oxford and Cambridge refused to educate chemists or to carry on research." As a matter of fact, von Hoffmann who had been Perkin's teacher in London returned to Germany soon after 1856 where he trained a generation of chemists. Von Hoffmann is now remembered for his researches in organic chemistry, and particularly for his work on coal-tar products. It is of no little importance that in 1868 he was the founder of the German Chemical Society. In the years that followed, Germany built up a huge iron and steel industry, utilizing largely the discoveries in that industry which had been made in England. The iron and steel industry requires large amounts of metallurgical coke; coal-tar materials can be made in coke manufacture, and of these the Germans were quick to take advantage. Production of by-products in the new iron and steel industry of Germany provided large quantities of raw materials, which chemical science had advanced to the stage wherein it could be applied to the chemistry of derivatives from coal-tar. In addition, there was a considerable market for dyes for the rapidly growing textile industry of Western Europe. These dyes had formerly been supplied mostly from plant sources, such as the madder root, an Asiatic plant cultivated in France, and indigo which was grown over large areas in India. The active principle, alizarin, of the madder root (used in making an ancient dyestuff, ''Turkey red") had been discovered by two French chemists in 1828. Some 40 years later it was found that alizarin could be obtained from anthracene, a derivative of coal tar. This process of synthesizing alizarin was patented by Graebe and Liebermann on June 25, 1869-a day earlier than Perkin's patent was obtained in England for the same process. Thencefortl! England and France as well ob­ tained this red dye from Germany. Adolph Baeyer had established the formula for indigo in 1884. But it took 20 years of experiment~! work and millions o{ dollars to synthesize indigo commercially. As a matter of fact it had been discovered in 1840 that the chemical breaking up of indigo gave aniline. The term aniline, applied to this coloring material, was derived from the Arabic word "anil," meaning "the blue·stuff." Quoting from Slosson: "But how to reverse the process and get indigo from aniline p~led chemists for more than forty years until it was finally solved by Adolph Baeyer of Munich. . • . He worked on the problem of t:I!e constitution of indigo for fifteen years and discovered several ways of making it. It is possible· to start from benzene, toluene, or naphthalene. . . . ''The Badische Anilin-und-Soda Fabrik spent $5,000,­ 000 and seven~n years in chemical research before they could make indigo, but they gained a monopoly (or, to be exact, ninety-six per cent) of the world's production. A hundred years ago indigo cost as much as $4 a pound. In 1914 we were paying fifteen cents a pound for it. Even the pauper labor of India could not compete with the German chemists at that price. At the beginning of the present century Germany was paying more than $3,000,000 a year for indigo. Fourteen years later Germany was selling indigo to the amount of $12,600,­ 000. "Besides its cheapness," Slosson concludes, "arti­ficial [synthetic] indigo is preferable because it is of uniform quality and greater purity . . . artificial indigo is made pure and of any desired strength, so the dyers can depend on it. The value of the aniline dyes lies in their infinite variety." Summing up: At the time of outbreak of World War I Germany was the world's leading. producer of dyes and they were made from coal-tar derivatives. Like the earlier English chemical industry, the German dye in­dustry was an accessory one; its markets were provided by the textile industry. The dye industry, however, was the spear-head in the development of the organic chemical industry, an in­dustry which. is now a characteristic feature of all in­dustrialized countries. In 1914, however, it was almost entirely a German industry. AFTER WoRLD WAR I The critical deficiencies of Great Britain and the United States in 1914 as to organic chemicals at large awakened these countries to the critical needs for such ~ndustries. Bot\! countries had a large iron and steel mdustry and both made large quantities of coke from selected coals. But in neither case was there a by­product coal-tar industry. Instead of using coking pro­cesses in which the coal-tar products w~r~ saved, they used mostly t4e old type beehive coke ovens in which the coal-tar products were losL · Naturally, ho!Q countries soon initiated by-products methods in making coke, and soon a sizable coal-tar chemical industry patterned after the German one was operating both in England and in the United States. As one consequence, Germany lost the markets for dyes formerly provided by the United States. It may he noted that a somewhat analogous situation had existed also in the German potash industry, in which Germany also held a monopoly prior to World War I. In the post-war period Germany by one means or another pushed into the overseas markets for chemicals harder than ever­hut that is still another story. In the meantime, however, still other developments in the chemical world had been taking place. Around the turn of the century the French chemist, Sabatier, dis­tinguished (e>r his researches on catalytic action, de­veloped a method of 4ydrogenating organic compounds in tl!e presence of finely divided metals. Directly out of the applications of this process applied to the hydro­genation of fats and Qils an important start had been made by 1914 in the newer developments of the vege­table oil industry-an industry that grew tremendously in the post-war years, and one that has had important repercussions upon certain phases of agricultural pro­duction both in Europe and in the United States. In 1908-09 the German chemist, Fritz Haber, who in 1911 became Director of the Kaiser Wilhelm Institute for Physical Chemistry in Berlin, developed a method of producing ammonia synthetically by combining nitrogen and hydrogen. In this process Ha~r applied high pressures and high temperatures, aided by a catalytic agent. In conjunction witl! Karl Bosch the Haber process was put into commercial production to make ammonia, using atmospheric nitrogen. Previously, Oswald had developed a process of making nitric acid commercially from ammonia, in which a catalyst also was used. These processes applied to the manufacture of munitions made it possible for Germany to remain in World War 1 long after its supplies of Chilean nitrate had been exhausted. Dyes belong in the category of fine chemicals. Syn­thetic ammonia, }Jowever, can he manufactured in large volume by mass-production methods. In the progressive advances in chemical industry the Ha~r process is somewhat analogous to the Bessemei: process in the mechanical and engineering developments that grew out of the mass production of steel in the latter part of the 19th century. After World War I the application of catalytic agents in connection with high pressure syn­thesis made possible mass production of new lines of chemicals, Qf which synthetic ammonia was only one. World War I gave a tremendous stimulus to the production phases of the petroleum industry.. In 1912 the American chemist, William Burton, had rntroduced a process of cracking into the oil refining industry, and although this process played a part during Wor~d War I, its large use came in the post-war years with the almost spectacular increase in the American automobile industry. The cracking process in addition to breaking down complex hydrocarbons into si?11pler hydrocar~~ns within the gasoline range also yields large quantities of still simpler hydrocarbons which are gases not con­densable to liquids. These gas hydrocarbons belong to the olefin group and are not known to be present in crude oil_; in other. words, they are products of chemical conversion crackmg ~p· erations. Prior to the early 1920's th.ese gases, des1g· nated as refinery gases, were considered waste products. One of these gases is ethylene, which, of course, is a starting point for synthesizing a considerable number of important organic chemicals. . Since the early 1920's a large industry has been bmlt upon the .synthesis of.produ~ts ~~om these gases." "It is interestmg to note, m passrng, to quote from The Research Viewpoint," issued by Gustavus J. Esselen, l~c., "that it is now possible to make ethyl alcohol (which chemically is identical with the alcohol produced. by the fermentation of grain) more cheaply by synthesis from ethylene, than by the old fermentation pr~cesses. In fact, the most expensive method of produ~mg alcohol today is from grain at present prices. It is somewhat cheaper to produce it by fermentation of mola~ses, ~ut even that, except when molasses is unusually low m pnce, is not as economical as to produce the alcohol by synthesis from ethylene." . . Numerous other alcohols and a whole lme of rnter­mediates and industrial products can be made from these various hydrocarbons contained in refinery gases, as well as from those in natural gas. Summing up: The coal.tar derivatives, upon which the organic chemical industry of ~ermany from 1870 on was built, comprise the aromatic group of hydr?· carbon compounds. Petroleum, like natural gas, 1s composed of hydrocarbons of the paraffin group, with certain important exceptions. Refinery gases have large quantities of olefins which are unsaturated compounds; the paraffin compounds are saturated. Paraffins, also designated as the methane series, and olefins, the ethylene series, together with the acetylene series, comprise the aliphatic group of hydro­ carbons. The point of emphasis is that prior to World War I the organic chemicals industry was base.cl upon the aromatic group of hydrocarbons, of wh1c}i. benzene, toluene, xylenes, napthalene, and anthracene are more commonly known by name at least to the public. Since. World War I tremendous advances have been made in the knowledge of the nature and the uses of the aliphatic group of hydrocarbons-those derived from petroleum and natural gas. In addition to securing large quantities of aliphatic compounds from crude petroleum, the chemist has also been able to convert some of these aliphatics from petroleum into aromatic compounds. Toluene, of course, is an excellent example of this type of conversion. This new field at large has recently been summed up in The Research Viewpoint as follows: "The chemistry of petroleum is today quietly outstripping the famous chemistry of coal tar, which resulted in the development of whole new industries. Crude petroleum is proving to be an even more flexible and versatile raw material than coal tar. . . . Science has progressed a considerable distance along the road of the utilization of petroleum as a source of motor fuel and lubricants. It has only started on the equally promising road of utilizing crude petroleum as a chemical raw material." Only some of the mile posts in these extraordinary developments have been noted in the foregoing brief presentation. With this as a background, however, is it any wonder that the consensus of opinion, of those who have given the matter careful attention, is that Texas with its relatively large reserves of petroleum and natural gas holds a kej' position in the supplying of hydrocarbon compounds for the development of an outstanding organic chemical industry. In fact this phase of the chemical industry has already migrated into Texas, as evidenced particularly by the developments of Dow Chemical Company, ·Monsanto Chemical Company, Union Carbide and Carbon Corpora· tion, and American Cyanamid Company which have plants already in operation in Texas, and to which the new plant of the Celanese Corporation of America (which among other things will make met}i.anol, formal· dehyde, acetone, and acetic acid, all from natural gas) will be added during this year. AVIATION GASOLINE AND SYNTHETIC RUBBER The war has affected profoundly the operations of practically every industry, and the petroleum refiner has not escaped its impact. In fact, in this war, gasoline has largely replaced smokeles.s powder as a propellent for high explosives, and has largely replaced both the army mule and the human foot as a means of transporting supplies and man·power. No single raw material appears to be as vital to the prosecution of a modern war as gasoline.-Graham Edgar. The development of the manufacture of either aviation gasoline or synthetic rubber is a vast field within itself. Only some of the main features of these subjects can be pointed out here. In brief, the research work of the past two decades which was centered upon tht< chemistry of gasoline has aided greatly in the tremendous advances which have been made in the knowledge of the chemistry of hydro· carbons. In the early days of oil refining the production of gasoline was a simple distillation process. The gasoline produced was a mixture of liquid l).ydrocarbon com· pounds in the boiling range of gasoline. The refiner, ?owever, h_ad little control of the compounds which went m_to gasolme, and naturally these varied considei:ably with the source of the crude oil. Pennsylvania crude, for instance, had a preponderance of paraffin com· pounds; in California crude, larger proportions of naphthalene were present. . The inaug.uration of thermal cracking brought chem· 1cal convers10n processes into the refining picture, to· gether with the large production of olefin gases pre­viously noted in this article. Then, as the tec}µiical knowledge of the chemical nature of gasoline was advanced, it became feasible to alter the hydrocarbons going into the gasoline with the result that gasolines more desirable for different ultimate purposes could be made. The introduction of higher compression motors created a demand for better gasoline. The use of ethyl fluid containing lead tetraethyl was an important item in the improving of gasoline. Then came the introduction o{ catalytic cracking which gives increased yields of antiknock gasoline as well as the large quantities of olefin gases, such as ethylene, propylene, and butylenes. Catalytic cracking operations, however, did not get under way in large production until they were instituted · in the war program, in order to provide the raw ma­ terials of proper grade and in adequate amount for , both aviation fuel and synthetic rubber. · In the meantime a host of new processes were being made available. By catalytic polymerization olefin 1 gases can be combined to yield liquid products suitable , for ordinary motor fuel, and by that means tqe volume ; production of ga'soline could be increased. , By a new and revolutionary process called alkylation, r certain saturated gaseous hydrocarbons (of the paraffin : .geries) can he combined catalytically wit}). certainigaseous olefinic (unsaturated) hydrocarbons to yield a saturated product which is designated as alkylate. Alky­ 1 . late is a high octane rating product well suited as a ' blending agent to step up the octane number when mixed with high grade base stock in the production of aviation gasoline. · A common alkylation reaction combines isobutane (a 1 saturated hydrocarbon, of branched chain structure) with such olefins (unsaturated hydrocarbons) as propy­llene, butylenes, or isobutylene. The reactions in both 1 alkylation and polymerization can be so directed as to : give the maximum yield of specific hydrocarbon types; 1obviously, such technologic advances are of utmost sig­ nificance. i Alkylation requires isobutane, which is a scarce prod­1 uct. Butane, however, is plentiful. By isomerizoJion, 1 normal butane can be converted catalytically to iso­ butane. 1 Fortunately these essential processes were available I when the tremendous demand for aviation gasoline came 1as a consequence of the war. The supercharged aircraft I motor, in order to utilize its greatly increased power, requires a high-octane fuel. . The aviation gasoline program, just now getting into i large production has involved an estimated expenditure 1of 900 million dollars. A listing of aviation gasoli:Qe 1refineries now operating or which will be in operation f in 1944 shows the large place Texas occupies in this i strategic program: j Only the major steps of the recent developments 1generally known to he in actual operation in the poten­1tially enormous scope o{ petroleum chemistry have been touched upon. The vast field of hydrogenation of coal to yield lubricants and liquid motor fuel, the develop­ 1 1tnent of which was initiated by Friedrich Bergus in the middle 1920's, bas not been mentioned. There is little doubt, however, that it has been this process which has supplied Germany with a large share of its motor (uel and lubricants during World War II. Numerous important developments other than those noted in this article have been made in the United States. Among these are such processes as cycloversion, catalytic reforming, hydrofining, dehydrogenation, together with · processes for making such high-octane blending agents as hydrocodimer, cumene, triptane, neohexane and so on. Then there are the tremendous possibilities which apparently will be brought into the picture by t4e future application of the recently announced Houdry adiabatic cracking process. Nor has it been possible to consider the uses of natural gas hydrocarbons, such as obtaining low-cost hydrogen by pyrolysis for synthesizing ammonia, the conversion of methane to acetylene, the productio:Q of a series of compounds by controlled oxidation, the field of chlo­rinated hydrocarbons, or ~e promising developments being made in the production of nitroparaffins. In addition, natural gas hydrocarbons constitute an important source not only of the products noted above but also of butadiene, ethylene, ethylene glycol, formal­dehyde, acetic acid, acetone, and so one. Nor is this all: but perhaps these things can he more fully treated in a future article. The situation to date has been summarized by Graham Edgar as follows: "Accordingly, the petroleum refiner of today is approaching more and more the positi 1944<2> 1943 1943 1943(1) 1944<2> 1943 1943 MANUFACTURING All Manufacturing lndudriea___ .168,830 164,737 2.4 + 1.0 5,546,594 5,336,869 3.8 + 18.7 Food Products 8,882 8,507 4.2 +10.4 275,865 255,460 7.4 +18.6 . B.aking ,..------------------------------------------­ 3,645 3,524 3.4 + 16.5 105,687 101,033 4.4 +24.1 Carbonated Beverages ·-----------·­1,705 1,701 0.2 +26.8 22,758 23,058 + 1.3 +29.4 Confectionery ----------------------­2,293 2,309 + 0.7 +11.0 65,252 69,550 + 6.6 + 32.0 F1our Milling ·--·----·--···----------·­1,244 1,265 + 1.7 + 8.2 32,463 34,415 + 6.0 +22.7 Ice Cream ------------------------------· 6,615 6,425 2.9 + 2.2 226,926 224,860 0.9 + 17.8 Meat Packing ---------·-------·----· Textiles 5,662 5,490 3.0 -18.4 126,393 118,170 6.5 -16.6 Cotton Textile Mills ---··-·----··--·-----· 4,241 4,190 1.2 -18.4 76,339 72,991 4.4 -3.5 Men's Work Clothing ----·------------­ Forest Products 1,848 1,908 + 3.3 + 7.3 47,024 46,919 0.2 +48.6 Furniture ------------------------------­1,949 2.1 -8.9 56,600 48,343 -14.6 -15.3 Planing Mills -------------------------1,992 15,207 3.8 -6.5 294,626 242,_177 -17.8 + 2.5 Saw Mills ---------·-----·-·---15,813 947 2.5 +15.7 24,379 21,967 9.9 +34.0 Paper Boxes -----------·-----971 Printing and Publishing 2,539 2,418 4.8 + 3.2 93,131 84,192 9.6 + 18.4 Commercial Printing -----------­ 4,085 4,041 1.1 4.5 115,000 104,746 8.9 -5.1 Newspaper Publishing ----------­ Chemical Products 4,157 3,902 6.1 + 1.5 70,835 62,682 -11.5 + 20.3 Cotton Oil Mills ----------­Petroleum Refining -----------23,262 23,146 0.5 + 3.4 1,323,394 1,312,899 -0.8 +29.6 Stone and Clay Products 1,730 1,768 + 2.2 0.3 29,099 25,444 -12.6 -12.0 1,058 975 7.8 -19.7 39,337 35,098 -10.8 -19.4 Brick and Tile ------------­ Cement -----·-----------­ Iron and Steel Products Structural and Ornamental Iron __ 2,762 2,694 2.5 9.7 86,789 85,047 2.0 + 7.1 NONMANUFACTURING Crude Petroleum Production____ 26,050 26,425 + 1.4 + 5.7 1,373,523 1,394,420 + 1.5 + 34.2 Quarrying -----------------------------­ (3) (3) 4.2 -17.0 (3) (3) 5.2 -7.8 Public U tilitiea -------------------­ (3) (3) 1.3 + 3.4 (3) (3) 0.1 +17.1 Retail Trade -------------------------273,798 210,528 -23.1 + 4.8 6,225,491 5,062,326 -18.7 +23.9 Wholesale Trade ---------------------63,344 62,331 1.6 + 0.3 2,360,116 2,272,412 3.7 + 10.9 .Dyeing and Cleaning ----------------2,745 2,654 3.3 + 0.6 60,430 60,535 + 0.2 +22.0 Hotels -. ---------=---------------------------19 ,254 19,314 + 0.3 + 8.7 321,648 322,256 + 0.2 + 30.1 Power Laundries ---------------------14,076 14,101 + 0.2 2.5 246,629 240,214 2.6 +10.0 CHANGES IN EMPLOYMENT AND PAY ROLLS IN SELECTED CITIEs«> Employment Pay Rolls Employment Pay Rolls Percentage Chana:e Perccnta2e Change Percentai;te Change Percentage Chan2e Dec., 1943 Jan., 1943 Dec., 1943 Jan., 1943 Dec., 1943 Jan., 1943 Dec., 1943 Jan., 1943 to to to to to to to to Jan., 1944 Jan., 1944 Jan., 1944 Jan., 1944 Jan., 1944 Jan., 1944 Jan., 1944 Jan., 1944 Abilene --------3.1 + 23.3 1.8 + 28.0 Galveston __ 2.1 + 5.7 13.6 + 46.8 Amarillo -----1.3 9.3 + 2.8 4.3 Houston ----4.6 + 4.2 11.3 0.4 Austin 7.1 3.6 9.4 + 4.3 Port Arthur 1.0 2.1 1.0 + 23.1 Beaumont 4.8 5.3 17.4 + 3.0 San Antonio _ 11.7 2.3 5.7 + 9.4 Dallas 9.4 + 32.2 6.0 + 62.8 Sherman 3.1 7.7 9.9 + 5.9 EI Paso ----------+ 1.4 + 1.3 + 2.3 + 21.4 Waco -----9.7 + 4.0 13.1 + 3.2 Fort Worth __ 7.1 + 54.2 4.8 + 76.4 Wichita Falls_ 2.1 17.8 0.7 + 6.0 STATE -------4.9 + 13.1 8.7 + 23.2 ESTIMATED NUMBER OF EMPLOYEES IN NONAGRICULTURAL BUSINESS AND GOVERNMENT ESTABLISHMENTSm 1941 (l) 1942"' 1943(1) 1941 (l) 1912<1> 1913 January -----·-----·-----1,094,000 1,170,000 1,385,000 July --------------1,156,000 1,317,000 1,450,000(1) February ------·-------1,120,000 1,199,000 1,397,000 August __ . -------·· 1,176,000 1,352,000 1,441,000(2) March -------·----------1,120,000 1,226,000 1,415,000 September ----·--·--·-1,203,000 1,373,000 1,448,000(2) 1,222,000 1,433,000 October __________ . 1.219.000 1,384,000 1,455,000(2) April ---·-····----·----------1,114,000 May ----·---·-----·----1,120,000 1,251,000 1,458,000 November -----------1,219,000 1,389,000 1,461,000(2) June -----····--·-----------1,134,000 1,291,000 1,478,000 December -·----·--1,222,000 1,413,700 *Does not include proprietors, firm members, officers of corporations. or other principal executives. Factory cmplo)·ment exch.des also office, sales, techoical and professiona l personnel. Subject t.o revision. Not available. <'>Based on unweighted figures. Not including self-employed persons, casual workers, or domestic servants. and excl usive of military and maritime personnel. These fivures are furnished by the Bureau of Labor Statistics~ U.S. Department of Labor. Prepared from reports from represen tative Texu estab1i8hments to the Bureau of Bu!inrss Rc!earch coOperatin~ with the Bureau of Labor Stati1tic1. Due to the national emergency, publications of data for certain industries j9 being withheld uotil further nolice. BUILDING PERMITS I Jan., I944 Jan., I943 Dec., I943 POSTAL RECEIPTS Abilene _____________________$ 130,200 s 4,005 $ 7,912 Abilene -----·-------$ Amarillo --------------------­Austin ------------------­Beaumont ------------------­Big Spring --------------­Brownsville -------------Brownwood ---------·-------Childress ------------------Cleburne ------------------­Coleman -------------------­Corpus Christi -------Corsicana ---------------­Dallas ----------------------­ Del Rio ----------------Denison -----------------Denton ---------------------­El Paso --------------------Edinburg -----------------­Fort Worth --------------­Galveston ----------------Gladewater -----------­Graham ----------------------Harlingen ----------------­Houston ----------------­Jacksonville -----------------Kenedy ---------------Kerrville ----------------Longview -------·--···-------­Lubbock --------------------Lufkin --------------------McAllen ------------------­Marshall ------------------­Palestine -----------------Pampa -----------------------­Paris -------------------­Plainview -----------------­Port Arthur --------------­San Angelo ----------­San Antonio ------------­Sherman ------------------­Snyder ----------------Sweetwater --------------­Temple --------------------­Tyler --------------­Waco -----------------------­ Jan., I944 Jan., I943 Dec., I943 $ 47,614 $ 61,784 57,799 45,707 50,229 76,429 81,629 116,003 84,605 46,546 38,127 63,031 11,340 9,759 16,388 9,473 15,35111,707 22,721 27,082 43,210 3,535 16,010 5,467 5,869 4,655 7,790 5,440 3,955 5,808 61,743 47,060 94,459 10,515 8,278 42,366 492,763 420,690 634,476 6,942 5,057 9,199 9,023 8,086 16,201 12,229 10,328 14,155 92,483 91,402 148,367 4,514 3,971 5,750 193,171 188,071 292,117 46,949 47,046 67,395 4,731 4,616 5,370 3,729 2,539 4,426 13.337 10,443 19,853 340;809 300,833 490,890 5,256 28,419 6,252 2,491 2,019 7,988 4,437 3,113 6,146 14,675 11,603 18,848 33,197 27,917 45,208 7,377 6,759 8,958 8,379 6,199 9,534 10,810 8,653 14,636 7,614 7,655 10,605 10,379 9,229 15,930 19,071 18,999 30,696 6,028 5,191 7,861 26,503 21,319 42,554 20,626 18,414 32,101 243,825 222,870 360,008 11,602 11,180 17,547 2,278 2,386 3,077 7,696 7,622 10,918 15,850 11,920 24,095 29,484 22,852 44,941 46,248 43,222 72,007 Wichita Falls ----------------42,262 36,817 64,938 TOTAL ________________$2,154,017 $1,954,865 $3,109,845 NoTE: Compiled from reports of Texas chambers of commerce to the Bureau of Business Research. Year 1934-1935 1935-1936 1936-1937 1937-1938 1938-1939 1939-1940 1940-1941 1941-1942 1942-1943 1943-1944 COTTON BALANCE SHEET FOR THE U. S. AS OF FEBRUARY 1, (In Thousands of Running Bales Except as Noted) The cotton year begins August I. *Figures a.re in 500-pound bales. t Not available. Amarillo.J---------­ Austin _ /__________ Beaumont -------------­Brownsville " --"------ Brownwood _______ Coleman ------------­Corpus Christi ~----Corsicana V ------­Dallas ~--------------Denton /-------­ El Paso ...,!__________ Edinburg _____ ---------­Fort Worth ____ Galveston -------------­ Graham __L________ Harlingen -!__ _ ______ Houston •--------------­ Jacksonville ________ Kenedy ----------Kerrville --------------Longview ~--------­ Lubbock / _________ McAllen _!_________ Marshall ----------­ Midland _______ New Braunfels ______ Palestine --------- Pampa _ ______ Paris -------------­ Plainview ____ ___ Port Arthur San Antoni