The times., 1901-04-18
PROBLEMS IN ECONOMICS
Testimony Given Before the Indus
trial Commission.
Several Witnesses Oppose the Priv
ate Ownership of Electric Light
ing Plants and Telegraph Lines
Facts Presented by f. &. Roberts.

engineer who for the past three years has
been engaged in investigating various
engineering and economic problems, testi-
fled before the Industrial Commission yes
terday concerning the relative costs of
municipal and private ownership OF cleo
trio lighting plants. Mr.. Adams stated
that he had chosen the State of Massa-
chusetts as offering the best field for such
a comparison, as a sworn statement is re-
quired from all corporations in that state.
and that in his investigation he had the
advice of the State Gas and Electric
Light Commission and access to all public
documents bearing on the subject.
In 1890 a law was passed allowing towns
or cities In the State to buy or build
electric lighting plants to be operated
under municipal control. Since that time
eighteen plants had been established in
as many towns and cities.
Mr. Adams based his comparisons on
the history of fourteen such plants es-
tablished in towns with populations from
!, 900 to 1900. The aggregate amount in
vested in these plants was SS9l,59l. In the
same number of towns and cities of about
the average population of the places IN
which municipal plants were in operation
the average price per hour for arc lamps
was a. cents and for incandescent lamps
IL cents. On these figures he based his
calculations in order to reduce to money
basis the light furnished by public plants
to the municipalities.
Mr.. Adams said that it should be borne
in mind that the municipal plants were
all in small towns where the opportuni-
ties for the sale of light and power to
individuals were limited. When, to get
a fairer basis, forty-three towns of not
over Ono nonrIa fioyl yUera faLau in which
private plants were in operation. it was
found that the return on the amount in
vested in private plants was but GA per
cent, as compared with 1913 per cent re-
turn on plants controlled by the munich
palities.
Mr.. Adams thought the figures gave
sufficient evidence that capital invested
by municipality in electric light plants
was more productive than when similarly
invested by private interests More care
full mana cement of municipal plants ac-
counted in part for the difference. There
was no tendency under municipal owner
ship to pay large dividends or to charge
high prices for lighting in order TO do SO.
A. J. Randall, of Washington, Chairman
of a committee of the Inter- atiOnal Typo
graphical Union, gave his views on the
Government ownership and control of tel
egraphs Mr.. Randall was in 1893 a dele
gate TO the Chicago convention of the
union, and one of the trainers of the pc
tition advocating the Government owner
ship and control of telegraphs. which had
100000 signers.
Mr. Randall thought that it was the
duty of the Government to furnish spe edy,
efficient and reliable service at the lowest
possible rate TO the people of the country.
Telegraph tolls were now levied so as to
pay large dividends, not only for stock
paid for in money, but on ali immense
amount of watered stock. Two-thirds of
the stock of the Western Union Telegraph
Company he asserted, was pure and un-
mixed water. In 1853, the capital stock
of the Western Union Company was $3So,-
700 The stock dividends declared between
1883 md IS66-eig4t years amounted to SlI,-
$40 I46. and stock was issued for new lines, to
the amount of 81 ,93f $50, making the capltal
stock of the company on July l, 1866, w.,
1s2, 500. In that year stock was created
to the amount of 81. 10000, making the
capital stock q year later $40, 800.
The largest dividend declared by the
company up TO 1874 was 4l4 per cent In
that one year the investors got their
money back four times. The largest
amount of stock ever divided at one time
was 10000 600. and for u period of seven
years the dividends averaged about I'D per
cent In 1874 the company bought UP its
own stock and the stock of other te!e-
graph companies and accumulated fund
OF the company Dividends declared in
other years were: 1862 q per cent; 1863, 100
per cent; 1854, 100 per cent; 1915, dividend
of 50. 600 coo; in 1881 one Of Sl5, ,0OOU9, and
another of $500, ,GO0. 1t realized over $780,
0O0.000 in twenty-five years by Its extor-
tionate charges. An investment OF $l,Wo
on Western Union stock in 1888 would have
returned up to 1879 stock dividends OF more
than $50.00 and cash dividends of Sl1.VO.
In 1890 the capital stock was $50, 800, ,00o-
now il is Sis. .0000O0-
80 ttn toto aTtN
panies of the world were under Govern
ment control. and it was instructive TO
compare the rates under such Government
control with the rates IN this country In
England the rate was u cents for twelve
words. in Germany II cents for ten words,
in Italy is cents for fifteen words, in
Switzerland 10 cents for ten words. in Bel
gium 8 cents for ten words. and In France
10 cents for ten words, while In the United
States the prevailing rate was % cents Tor
ten words.
graph Committee of the International
Typographical Union, also testified con-
corning the Government ownership OF
telegraph In the course or mis- leSti-
mony he said:
IN 1856 the Western Union Telegraph
Company practically conceded the right
of the Government to either construct
new system or to purchase its system of
telegraphic communication in the United
States. and merely asked that Congress
should permit that company to operate
for at least the term of five years, in or
der that the large capital invested IN Its
plant might not be ruthlesSly destroyed,
without adequate return to those who had
placed their earnings and savings therein.
So much has been said and written on
this subject by many of the ablest writer's
of this age, that Ii seems waste of time
and labor to lay before this Commission
any additional evidence to sustain us in
our arguments. But as a member of the
committee appointed by the International
Typograp phical Union, there is one par
ticular feature about the present system
of the Western Union Telegraph Com
pany that our committee would like to
call attention to, because ii works an in
Jury TO the members OF our organization.
Does anyone believe that if the Govern
nent had charge of the telegraph. as it
has the postOffice, such a combine as the
Associated Press would be in existence
today?
/ ..The effects may be seen in any Of our
leading cities, and especially so in the
Southern cities. Take The cities of Savau-
nah and Atlanta. in the State of Georgia
if you please, aud you viii find that there
is only one morning paper i'll each of those
cities simply because they have the As
soCiated Press monopoly to themselves.
thereby shutting out all other newspaper
enterprises, causing large numbers of our
members and the affiliated trades to be
out of employment. when, II the Govern
ment had control of the wires, and every
publisher was free to get the news at the
same ra te of cost to ali. there would be two.
if not three, newspapers. where there is only
one today We cannot have too many
newspapers. for they are public eduCa-
tors Nearly all the great dailieS OF to-
day are in the Associated Press combine.
and it is impossible to get them to oppose
it, and few politicians care to struggle
with a concern which has the power to
nIisrepresent them seven days in the
week from one end of the country to the
"a consequently 1T is DcrmittG0 to do