mentary
profits to be made: these were factors mitigating the impact of higher
costs. Nevertheless, these changes in gold prices were themselves the
result of inflation, which added directly to costs, and they also
permitted further monetary expansion, which again led to changes in the
cost level. In fact, however, there have in recent years been other
complicating factors—not least the diminishing willingness to take up
'risk capital' on the part of the investor.
The
formation of Anglo American Corporation, therefore, coincided in time
with the beginning of a new era, and no small part of Ernest
Oppenheimer's contribution to South African economic life lay in his
success in finding the funds necessary for expansion, when, in the
course of time, the opening up of the Far West Rand, the Klerksdorp
field and the Orange Free State field successively called for large
supplies of capital.
The
problem of costs would, naturally, have been even more intractable, and
the future of gold-mining in South Africa even more speculative, if it
had not been for the continuous improvements in mining technique,
improvements which were, of course, in part the direct result of the
pressure of rising costs on profitability. At a very early stage in the
history of the Rand, the application of the cyanide process had saved
the industry from extinction,29 but rationalization and
improvement have been a continuous process resulting in a cumulative
decline in the ratio of numbers employed to output. Such improvements
have also affected the time factor, e.g. in shaft-sinking. The
introduction of geophysical methods of prospecting was, in its way, as
important an element of progress in the thirties of this century as the
cyanide process had been in the nineties. From the very beginning of
his connexion with the gold-niining industry Ernest Oppen-heimer was
keenly interested in the progress of technology,30 in the
first instance in connexion with what was then the centre of interest,
the advancement of mining on the Far East Rand. Anglo American
Corporation interests were at that time concentrated on a group of four
mines in that area. It was the events of the early thirties of the
century which progressively modified the situation for the gold
industry as a whole and for Anglo American Corporation. The prospects
of the gold-mining industry, from the economic point of view, were
greatly
29
One of the neglected, but classical documents, of the mining industry
is the paper by Jas. Gray and J. A. McLachlan—'A History of the
Introduction of the McArthur-Forrest Cyanide Process to the
Witwatersrand Goldfields', in 33 Journal of the Chemical, Metallurgical and Mining Society of South Africa (June, 1933, p. 375 et seq.).
80 See infra, p. 499.
