Chapter CXLIV: A Tale of Two Carbides.
If one wished to be counted amongst the Industrialist cognoscenti of 1930s Britain it was necessary to acquire at least a nodding familiarity with the so-called two carbides. While not all readers may aspire to such an exalted position a similar level of knowledge will still be beneficial, the two substances were at the heart of many of the industrial and trade issues in the country and the wider Empire. We begin with Tungsten Carbide which, as it's name suggests, is a combination of Tungsten and Carbon. The intricacies of the mono-carbide grains and liquid phase sintering necessary to achieve this combination need not detain us, what is important is that resulting material was both incredibly hard (being only slight softer than Diamond) and incredibly heat resistant. These properties made it ideal for use in machine tools, the exceptionally wide range of devices used to cut, grind, drill, shear or otherwise persuade metal to take on new and more useful shapes. Despite having been discovered in the mid-1920s it had taken many years for Tungsten Carbide tooling to achieve widespread use, in no small part because it was such a leap forward compared to previous materials; it is no use having a Tungsten Carbide tool capable of cutting at great speed if the rest of the machine is not capable of the same performance. The Depression had also been something of a drag on this process as there was precious little point designing new and improved machine if customers lacked the funds or inclination to purchase them. However by the early 1930s the new machines were entering the market and prompting dramatic improvements in output and productivity.
The Auto-Lathe Department in the Alfred Herbert Company's Edgwick Factory. As one might guess an Auto-Lathe is an automatic lathe, capable of machining simple steel bars into complex shapes with no operator input beyond loading the bar and collecting the finished item, allowing a single operator to 'work' on dozens of machines simultaneously. While the basic Auto-Lathe was not a new innovation the introduction of hydraulic operation, the other great advance in machine tool technology at the time, allowed much finer control of the machinery and enabled tighter tolerances and more standardised outputs. Hydraulics were also increasingly necessary to boost the power of many machine so they could fully utilise the capabilities of a Tungsten Carbide tooling, so even fully manually operated machines benefited from this advance. The Alfred Herbert Company was a machine tool manufacturer and these particular auto-lathes were making parts for capstan lathes, a fine example of the trend of self replication seen in many British machine tools works at the time. It is likely that many of the lathes made from the parts being produced in this photo were not sold to customers but used internally to boost production; output at Edgwick would increase dramatically in the late 1930s to meet the ever growing demands of Imperial Industry for new machinery.
In the ordinary course of events this revolution in industrial efficiency would have passed by the political world unnoticed; no politician could plausibly, or even implausibly, claim credit for it and there was no crisis, real or imagined, that required grand intervention or angry speeches demanding such. Yet the subject still managed to rise to the attention of first Whitehall and then Westminster, not because of the impact the machinery had but due to the trading required to obtain the metal at the heart of the change. The British Empire had been, just about, self sufficient in Tungsten thanks to the rich deposits in Burma and the Malay States, but during the Abyssinian War the rapid rise in demand had overwhelmed those sources and forced industry to look elsewhere. Conveniently the largest miner of Tungsten Ore was China, the newest member of the Sterling Area and with a government always keen to earn more foreign currency (and local taxes) by selling raw materials to those with hard currency to offer. The various mining companies of the Empire, reassured by the Leith-Ross mission and the large British investments ongoing throughout the Pearl River delta, began looking to acquire, expand and modernise the Chinese Tungsten mines. The Chinese government was cautiously in favour of this, expanded production meant more revenue and their experiences with British American Tobacco had taught them that they tended to get more actual taxes out of British firms than Chinese ones, even if it was never quite as much as they thought they should. Naturally it was at this point that the political problems began and, despite the best efforts of the domestic mining lobby, they were concerned with the implications for foreign policy.
The Chinese government were not the only ones aware of the value of it's Tungsten, the world's other powers were all involved to various degrees. Britain may not have traditionally been a major buyer but large quantities still flowed through Hong Kong and onto the wider world, often without the shippers being put to the inconvenience of paying export taxes and mining royalties. The French were substantial purchasers, it was widely (and correctly) believed the demands of the Soviet Five Year plans exceeded the USSR's own supply and that Chinese imports made up the balance and even the US, though notionally self-sufficient domestically, had bankers and traders who worked the Chinese end of the Tungsten trade. The dominant customer was Germany which traded for over half of China's total Tungsten output, trade being the operative word as Germany preferred to barter rather than spend valuable hard currency, it being widely acknowledged that the Reichsmark was of questionable utility outside Germany. Under this German influence moves had been underway in China to centralise control of the industry, in the hope this would make the government-to-government German barters easier to organise, stamp out un-taxed mining and that presenting a united front would allow Nanjing to push up prices. Keen to avoid a disruptive fight over the matter the German state-controlled company that dealt with China, Hapro (Handelsgesellschaft für industrielle Produkte, Trading Company for Industrial Products), proposed a tri-partite agreement. A joint Anglo-Sino-German board to oversee the Chinese Tungsten trade, in the short term this would allow China to supply Britain without affecting it's valued trade with Germany (this would be achieved by squeezing it's French and Soviet exports) and beyond that it would co-ordinate expansion and 'guarantee' that future British investment would not fall under direct Chinese government control or be nationalised. In a gesture to London's concerns about overt governmental involvement it was proposed that a suitable firm, ideally the state-sponsored but notionally independent British Metal Corporation, be the British representative; BMC already had deep links with the German metals industry through it's cross-holdings in the influential Metallgesllschaft trading and refining company based out of Frankfurt. The deal would thus be between two 'private' companies, BMC and Hapro, and the Chinese government and would be modelled on the many producer/consumer cartels that proliferated in the 1920s and 30s.
South Crofty Tin Mine, Cornwall, showing the New Cook's Kitchen shaft headworks and gear. Technically the British Isles had tungsten reserves and these were generally found within tin mineralisation, so the beleaguered tin industry was quick to spot the opportunity. Intense lobbying began with the aim of securing domestic 'support' for tungsten production through loans, import tariffs, quotas and all the usual tools of protectionism. With plenty of Empire sources that could be expanded, and already entangled in a messy fight with coal mining industry, the government found it easy to ignore those demands, much as successive governments had done since the end of the Great War. The tin miners case was not helped by the divisions within the industry; most of the major Cornish mine owners also had large holdings in the Malay tin mines, those deposit being easier to work and so much more profitable. It is worth noting that South Crofty itself had been shut during the tin price slump of the early 1920s and had only re-opened due to the International Tin Control Scheme stabilising the price, the tin control scheme being quoted as one of the models for the German tri-partite Tungsten board proposal.
Such a scheme would serve Chinese interests by increasing Nanjing's control of the industry and in keeping both Germany and Britain engaged with China, the need to avoid dependence on any one foreign power being a core pillar of any Chinese policy. Germany, aware that hard currency was normally preferred to barter (if only because barter was limited by what Germany had to offer), hoped the board would head off a bidding war with Britain which they feared they might lose, but there were also deeper motives. The dream of an Anglo-German alliance was not dead in Berlin, indeed the ongoing co-operation with Britain over the civil war in Spain and the visible disintegration of the Entente Cordiale encouraged many to dream it was a real possibility, even the more hard-headed diplomats around Foreign Minister von Neuarth believed better relations and perhaps some sort of non-aggression/non-intervention pact may be possible. To this end co-operation with Britain was seen to have a strategic and diplomatic value even above the economic benefits. Naturally the diplomats in Whitehall were aware of this, the German Embassy had been assiduously promoting such an 'understanding' for many years, and could understand the logic even as they recoiled from the implications. The Foreign Office may have been concerned by the drift of British foreign policy towards Splendid Isolation (as they saw it), and was resigned to the fact that recent French actions, or lack of them, had done serious damage to any hopes of reviving the Entente, but that did not make them in any way keen on a German alliance. The various Anglo-German friendships and fellowships were at best fringe movements, between fascisms apparent failures and the perception that the Amsterdam Conference had rectified the "unfair" mistakes of Versailles those groups were declining in members and influence. However von Neuarth had pitched the idea well, not asking for governmental involvement just a nominated private firm and deliberately referencing the many other councils, schemes and boards that were working to control supply and price of raw materials, hinting that once the Tungsten board was established it could be expanded to include other nations and suppliers. The various British officials inside the Chinese government reported back on the popularity of the scheme in Nanjing, noting that a properly taxed and controlled mining industry would further bolster government finances and the currency board, so reducing the reliance on British guarantees, a conclusion which was enough to get the Treasury and Board of Trade on side. Despite all this the Cabinet still hedged, going for the formulation of 'not objecting' to BMC's involvement instead of actively approving of the scheme. It is also worth noting that firm support for increasing production from Empire sources was expressed and this translated into action, the still new Dominion of Burma in particular enthusiastically encouraging the expansion of her existing mines and the establishment of new ones. For all that the Chinese Tungsten Control Board would be in operation by the start of November 1937, just in time to set the quotas for the following year, and the facade of the British government not being involved would fool approximately no-one.
Leaving Tungsten behind we turn to the other carbide, Calcium Carbide. Where Tungsten Carbide had very few uses, vitally important though those were, Calcium Carbide was used far more widely. A fairly innocuous looking off-white powder it was used in it's raw form in steel making and a range of niche applications from mining lamps to naval flares, where it became vital was in the chemistry industry; it was the raw material used to make the important fertiliser calcium cyanamide and far more crucially acetylene. Acetylene was a vital feedstock to many chemical works, eventually finding it's way into all manner of plastics, acrylics, paints and polymers, but it was not this which made the material strategic, it was the it's use as the fuel in the oxy-acetylene blowtorch. While over-shadowed by later technologies, and indeed it's rival at the time electrical arc welding, for many years oxy-acetylene was the preferred method of welding in applications ranging from shipbuilding to construction, it's use in Britain would rise exponentially during the boilermakers strike as firms who had been unsure about welding were forced to adopt it or see their works shut. As was often the case, once the initial change had been made few managers wanted to return to the old method of riveting even when the strike was finally resolved, ensuring the 'temporary' boost to acetylene demand (and so calcium carbide) from the strike was in fact permanent. Britain lacked any working facilities for the manufacture of Calcium Carbide and depended entirely upon imports, the vast majority of which came from outside the Empire (though from within the Sterling Area) and unlike tungsten the importance of the materail was well known across Whitehall and, more surprisingly, the issue of supply was regularly discussed by Parliament. The reason for the interest was due to the method of manufacture of Calcium Carbide, essentially one placed limestone and coking coal into an arc furnace and applied a great deal of electricity until the Calcium Carbide was formed. To an MP for a depressed mining region this was an irresistible prospect, a strategically important product produced by a simple process which required coal as one of the key ingredients and needed a large amount of electricity, which would obviously come from a coal fired power station. On top of that there would be jobs for miners in the limestone quarry and the carbide works could be just the start of larger things, an entire chemical works cluster could form around the new factory to make use of the carbide and the many by-products. There was but one slight problem, you couldn't economically produce calcium carbide using coal-derived electricity as it was far too expensive, which was why British imports came from Norway which had a vast excess of cheap hydropower.
Broadly speaking the government had viewed Calcium Carbide as desirable but not essential in terms of domestic production; important, but not worth expending any taxpayer funds supporting. This was not just ideological, though that played a part, it was also a reflection of certain economic realities. Autarky was seen as incompatible with Britain's economic and financial position in the world and maintaining the standard of living enjoyed by the British people, therefore some materials were always going to be imported and some of those would be items deemed 'strategic'. Protecting said imports was the job of the Royal Navy and the Admiralty was expressing confidence that with ASDIC they had conquered the submarine menace, thus it was 'safe' to rely on cheaper foreign supplies for certain items, freeing up funds for more useful endeavours. This comforting equation had been somewhat shaken by the Abyssinian War, while the Royal Navy had indeed protected British trade from the predations of Italian submarines (even if the Admiralty was privately concerned at their failure to actually sink any enemy submarines), the Norwegian supplies had not been as reliable as hoped. More precisely the Norwegians had reliably supplied at pre-war levels but the manufacturers were disinclined to massively ramp up production to meet the increased wartime demand, doubtless concerned that they would struggle to recoup the costs of the required investments should demand return to pre-war levels. It was into this febrile atmosphere that the Caledonian Power scheme was once again proposed.
A view down the penstocks running from the Ben Nevis tunnel towards the power station and aluminium smelter in Fort William, the foundations of which can just be seen in the distance. The Lochaber Water Power Scheme had been one of the most ambitious of it's type, the water transfer tunnel through the heart of Ben Nevis was 5m in diameter and 15miles long, making it the longest water tunnel in the world at the time and for many decades after. Constructed in less than five years the scheme had been a considerable success for the British Aluminium Company and the directors were looking at further expansion, although like calcium carbide production aluminium smelters required large amounts of cheap power, tying the company to a limited range of sites if it wished to be competitive. Hoping to follow the lead of various defence contractors the firm had started discussion with the Australian government and had identified a number of possible locations across Tasmania and New South Wales which had potential. In the UK the success of Lochaber, and the fact it actually came in on budget, gave comfort to the promoters of Caledonian Power that their scheme could be delivered to the time and cost the civil engineers promised.
The scheme was developed by the British Oxygen Company (BOC) and proposed to use the vast water power potential of the Scottish highlands to produce cheap electricity which could then be used to power a carbide works, specifically the scheme envisaged damning Loch Quoich, tunnelling to Fort William and constructing a new hydropower plant and carbide works there. There was already a large aluminium works in Fort William, powered by the Lochaber hydropower scheme, so this was not a particularly innovative idea but was all the more attractive for that, it was believed the challenges and risks were political and not technical. Thanks to the unique way the British planning system worked a private members bill was required to gain the powers necessary to construct the scheme, so BOC convinced the local MPs of the worth of the project and started the process. The government was nominally supportive, the Ministry for Defence Co-ordination hoped to have one less 'strategic' material to worry about and the Treasury always supported a plan to reduce imports without requiring government funding, yet the cabinet decided to remain neutral, correctly foreseeing how bitter things would become. As feared the opposition was fierce, alongside the usual complaints any development attracts the scheme was particularly attacked by MPs from South Wales and the North East of England. This was not out of any particular care for the impact on the River Ness or desire to support the indigents of Inverness, but concern at seeing their own hopes of the carbide works coming to their constituency vanish. The political facts were that South Wales and the North East were 'Special Areas', regions that had been hit especially hard by the Depression and had still not recovered, the general economic boom not extending to a full recovery of the coal export trade. All else being equal the government would have preferred the works to be located in a 'Special Area' and technically that was possible, but of course all else was not equal as it so rarely is. BOC would build Caledonian Power at their own cost, some £3 million, and while angling for reduced rates would not require subsidy nor quota, something any other scheme would require in order to be viable. The BOC directors had also made it clear that if the scheme was knocked back they would abandon the idea and instead listen to their City advisor's proposed solution, use their financial firepower to buy Norway's A/S Odda Smeltsverk and secure their supplies by that means. The choice therefore was not South Wales, the North East or the Highlands, but the Highlands or Norway. Framed that way, as Minister for Co-ordination of Defence Macmillan did in his speech to the house, it was a choice about whether parliament wanted Britain to invest in her own industries and facilities or turn to banking and finance to solve her problems. In truth that was a false framing, even if the choice had been that stark the Caledonian Power Bill was by definition a one off piece of legislation and £3 million, as large a sum as it was, was insignificant compared to the annual spend of British companies on new plant, let alone the sums the City dealt with on a daily basis. But as an indication of what Parliament and to an extent government wanted it is instructive, they would like to favour industry over finance, they just didn't want to spend any public money while doing so, a limitation which somewhat limited their options, though from another perspective it also limited the damage they could do. The Caledonian Power Bill would eventually get royal assent in the spring of 1938 after an especially bitter committee stage and construction began shortly after, the Fort William works would produce their first batch of Calcium Carbide in May 1941 and reach full production by the summer. In a typically British coda the City banks that had advised BOC pushed ahead with their proposed deal even after BOC dropped the idea, putting together a consortium of Imperial investment funds and unit trusts to purchase Odda Smeltsverk and completing the purchase before the Caledonian Power Bill had even had it's second reading. The bankers and investors believed that they had a good few years until the Fort William works would be operational and that given the ever increasing demand there would still be substantial UK demand for imports even after the works were in full production, in both cases they were proved correct. The economic dominance of the City was not so easily broken and it would take more than one scheme or one parliamentary vote, no matter how symbolic it's supporters believed it to be, to change that.
---
Notes:
It is done! I hope you will all bask in the shade of it's industrial magnificence. I decided to dial down the excessive chemical industry details compared to my first drafts, for instance I could have included some more detail on cyanamide, or cyanamid as the Americans then knew it, but I decided the balance of convenience was in favour of not proceeding with it. That previous sentence contains one of the most niche references I have ever made, bonus points to anyone who is not Le Jones getting it without using google. In any event I kept in 'liquid phase sintering' and have high hopes about DB's reaction to reading it, if nothing else I'm fairly certain no-one else has ever used that particular phrase in any other AAR.
But onto the actual chapter, people occasionally ask about the game lurking beneath Butterfly Effect, I hope the in-game inspiration for this chapter is clear enough. To return to the discussion on dates we have been having recently these events are a good example of why they are tricky, Tungsten Carbide did take a long time to roll our and improve everyone's machine tools, not just in Britain but across the world, so there was no single date or even a year where you could say that was "when" it happened, it was an on-going process. Hapro and the German Tungsten trade are OTL, the long complex story of BMC and Metallgesllschaft is OTL (and not discussed here because it is irrelevant to the current point), however the Tungsten Tri-Partite board is not. OTL China did start centralising the Tungsten trade to better deal with Germany, but then Germany pivoted to Japan and that whole Sino-Japanese War broke out which distracted them somewhat. Here Germany is still interested in China, China is a bit more stable and Britain needs more Tungsten than OTL, so it seemed possible. Certainly there were a huge number of cartels, boards and control agreements for almost every other raw material, it was a very 1920s/30s solution.
On the bigger picture Berlin (Hitler) still likes the idea of an Anglo-German alliance so he can focus on the wars he wants to fight without worrying about blockade, so he keeps getting it pushed and London keeps having to politely refuse. However German and British interests do keep aligning (China, Spanish Civil War, not keen on communism, etc) and it is making the Foreign Office nervous, they worry other people will start assuming there is some Anglo-German understanding even when their most definitely isn't (in London anyway).
Onto Calicum Carbide, the Caledonian power scheme came around several times in OTL and was regularly knocked back. BOC did eventually get the hint and brought A/S Odda Smeltsverk in August 1937, ramping up production there and building up massive stockpiles in the UK, they could see that war was coming and it was a good thing they did. BOC did still come round again after that, but parliament voted against it again even when BOC offered to build some works in Port Talbot to buy off the Welsh vote. Here the government is a little more interventionist and a little more aware of the issues around supply, not by much but enough to speak out a little more firmly in favour of the scheme versus their fairly diffident response of OTL, and that is enough to tip what had been some fairly close votes. After all in OTL it was Inskip as MoDC speaking out and he was ineffective at best, Macmillan is both a lot wetter (in 1938 he would publish The Middle Way and argue for a mixed economy with loads of state intervention) and more effective in parliament. Not sure he could have pushed through an actual subsidy, but just allowing a mildly controversial scheme seemed possible. Also an excuse for some pictures of the Lochaber scheme which remains deeply impressive.
I decided to have the City still buying the Norwegian Smeltsverk just to remind everyone that 1930s Britain was not an industrially focused country and is not easily going to become one, it has a large industrial base of course (some of it world class, some not so much), but that is not where it shines, even if a large chunk of the country and parliament would wish otherwise.