Public v. Private

Politicians and their puppets were not the only ones who eagerly watched returns from last Tuesday's elections. Vitally interested, too, were public utilitarians and their hundreds of thousands of stockholders. In more than a score of U. S. towns and cities voters were asked to decide last week whether or not they wanted municipal control of their light & power services.

Those in favor of public ownership vociferously pointed out that the Public Works Administration was willing, even eager to lend money, that service rates would be lower since the plants would not operate for profit. Those in favor of private ownership declared just as loudly that the cities, already in financial straits, could not afford to risk deficits in the utility business; that though rates might be lower, city treasuries would sharply miss the taxes now levied on privately-owned plants. After last week's voting, neither side could claim a national victory, but both had things to cheer for.

Most important outcomes:

For Public Works. Camden, N. J. already $30,000,000 in debt, voted by a substantial majority to authorize the city government to raise $10,000,000, either by bond issue or by Federal borrowing, to build a power plant. The proposal was permissive, not mandatory, and was interpreted as an unemployment relief measure. Akron, Ohio voted 23,887-to-22,258 to purchase a power plant. A second referendum will have to take place before Akron actually goes into the power & light business. In Sandusky, Ohio the issue was clear. The city decided to build a $1,400,000 light plant to be owned and operated publicly. Fleetwood, Pa. and Cicero, Ind. also voted in favor of public ownership of their power & light plants. In Bradford, Pa., Auburn, N. Y.,Defiance, Ohio, mayors were elected on public ownership platforms.

For Privateering, Salt Lake Citizens were to decide whether or not to build and operate their own plant at a cost not to exceed $18,000,000. Utah Power & Light Co. is one of the few enterprises in Salt Lake City not controlled by Mormons. Nevertheless, Mormon voters turned thumbs down on the project 2-to-1.

For the third time in four years the voters of Portsmouth, Ohio defeated a proposal to operate their own electric facilities. Youngstown, Ohio voted against a bond issue which would have provided a municipally-owned distributing system. So did San Francisco. Burlington and Bordentown, N. J., Atlanta, Ind. and Tyrone, Pa. decided against municipal operation of their lighting systems.

Well-run Cincinnati voted nay on municipal ownership for an interesting reason. The citizens there decided against buying Cincinnati Gas & Electric's plant not because they were unsympathetic to public ownership but because they plan to get their electricity from Cove Creek Dam, the Tennessee Valley Authority's proposed power plant on the Tennessee River near Knoxville. The Cincinnati Southern, municipally-owned railway, passes within 10 mi. of the proposed dam-site. Transmission lines could be cheaply strung along the right-of-way into Cincinnati where current would be distributed by a publicly-owned system.

After Birmingham. Since he got out of Harvard Law School where he was a protege of Professor Felix Frankfurter, a smooth-browed young man named David Eli Lilienthal has spent most of ten years defending the public in Illinois and Wisconsin from the ogre of privately-owned utilities. The consuming public had been consistently appreciative of Mr. Lilienthal's efforts in its behalf until last month in Birmingham, Ala.

Within three months, Tennessee Valley Authority expects to begin selling electric current generated at the Government-owned plants at Muscle Shoals to municipally-owned plants. To prepare retail outlets for TVA's power has been Mr. Lilienthal's chief job as one of TVA's three directors. Birmingham was the first city in TVA's area to vote on whether it would take over the local privately-owned light & power system and buy current from TVA at an estimated 7/10-c- per kilowatt-hour wholesale, or continue to patronize private enterprises. In the voting, privateering won, 9,696-to-6,923.

The Roosevelt Administration, committed to "democratizing" industry, did not take its Birmingham defeat lying down. The Federal Trade Commission is now investigating "excessive expenditures by private power interests" in the Birmingham referendum.

Meantime, Director Lilienthal has been busy in other parts of the TVA territory. Some 50 Southern municipalities have applied to TVA for power contracts, including Decatur, Ala., Augusta, Ga., Jackson, Tenn. Last week Director Lilienthal journeyed to Tupelo, Miss, to sign formally the first such contract. En route, he stopped off at Atlanta to make a speech on "the electrification of America."

Blandly he admitted what foes of Government-in-the-power-business have been moaning loudest about: "It is perfectly evident that we now have . . . a tremendous surplus supply of electricity, . . . A fair estimate is that 25% of the investment in power houses and transmission lines is idle and is piling up fixed charges. . . ." He further recognized that the nation's power surplusage would soon be increased by Federal and State power projects at Muscle Shoals, Cove Creek, Boulder Dam, Bonneville Dam (Ore.), Grand Coulee Dam (Wash.).

What would have to be done, said he, was to promote a tremendous increase in electrical consumption. "At the present time the average monthly use of electricity for domestic purposes in this country is about 50 k. w. h. That figure is a challenge to the electric industry and to the people of the country. It represents a parsimonious and niggardly use of a great national resource. . . ."

This file is automatically generated by a robot program, so reader's discretion is required.