Electrified Thumb

Michigan resembles a left hand turned palm downward, and its remotest part is The Thumb. One day last fortnight in the little town of Ubly farmers from the three northern counties of The Thumb--Huron, Tuscola, Sanilac--gathered for a band concert, a baseball game, a celebration grander than any county fair. Michigan's Governor Frank Murphy, a Huron County boy, was there to make a speech. But the biggest attraction in Ubly was a giant generator, whose 3,000 horsepower was ready, when the switch was pulled, to gallop over 542 miles of newly strung electric lines. After dark, many men, women, children, cows and chickens in three counties saw electric light for the first time in their lives.

The Thumb Electric Cooperative, whose members strung the lines and own them, was started almost three years ago by Farmer Frank Wilson and his neighbor, E. C. Stieg. Promoters Wilson, Stieg and their neighbors borrowed $2,000,000 for their cooperative from the Rural Electrification Administration in Washington. What Governor Murphy called the "beginning of a new social order" for The Thumb, which will eventually own 1,300 miles of REA lines, was also a milestone for REA, the most extensive and expensive project it had yet promoted.

Of the 6,800,000 farm homes in the U. S., today nearly 20% are wired for electricity. That is almost twice as many as were electrified when REA started operations in 1935. Since then REA has lent $90,000,000 to nearly 400 cooperatives, helped build some 84,000 miles of lines, which it strings at a cost not exceeding $1,000 a mile. Private utilities had been charging customers from $1,500 to $2,500 a mile for stringing lines to their doors. In 20 projects, notably The Thumb Cooperative, REA has also financed the building of generators, but other projects buy their power wholesale from private companies or municipal plants.

Most of REA's cooperators are farmers in sparsely settled districts which the nearest private power company has put in "cold storage" until they become populous enough to be served with profit. To get an REA loan, farmers usually first organize a cooperative, convince REA field inspectors that they can afford to buy enough electricity to pay for the lines. Not grants in any sense, REA loans must under present policies be liquidated within 20 years. Interest runs at the rate the Government pays on its own long-term obligations, currently 2.77%. Both REA and Electric Home and Farm Authority finance the purchase of electrical appliances, making loans not to consumers but to dealers. Only four States--New Hampshire, Massachusetts, Vermont, Rhode Island--are without at least one REA project. Leading customers are Ohio, with 7,000 miles of lines, Wisconsin (6,100 miles), Minnesota, Iowa, Indiana, Texas.

This year, with a $140,000,000 appropriation, REA hopes to triple its loans and its importance. REA's dynamo is Administrator John Michael Carmody, a Pennsylvanian who went to the New Deal as chief engineer for the Civil Works Administration, was one of the early members of the National Labor Relations Board. Thin-thatched, energetic Administrator Carmody can be tough on occasion, especially when he discovers that private utility companies have built "spite lines."

Since REA was started, private power companies have extended their lines to some 400,000 new customers (compared to some 250,000 signed up with REA). According to Mr. Carmody. private companies have got many of these new customers by throwing up lines overnight to skim the cream from projected REA cooperatives. To anyone who protests the wisdom of REA's expenditures, Mr. Carmody replies: "Did you ever try to darn socks by a kerosene lamp or milk a cow or curry a horse with an oil lantern hanging on a nearby nail?"

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