The times. [volume] (Washington [D.C.]) 1897-1901, 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. c. Roberts.

Alton d. Adams. of Boston, an electrical
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 %
municipal and private ownership of cleo
trio lighting plants. Mr.. Adams stated
that he had chosen the State of Massa-
chusetts offering the best field for such
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 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
1000 to q, 600 The aggregate amount in
vested in these plants was l,5sl. In the
same number of towns and cities of about
the average population of the places In
which municipal plants were I'm operation
the average price per hour for arc lamps
was Al 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
fairer basis, forty-three towns of not
over 30 900 population were taken 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 agement 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 committee of the Inter- ationaI Typo
graphical Union, gave his views on the
Government ownership and control of tel
egraphs. Mr.. Randall was in 1898 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, v hich had
100000 signers.
Mr.. Randall thought that it was the
duty of the Government to furnish sps 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 an 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 1855 the capital stock
of the Western Union Company was $685.
100. The stock dividends declared between
1853 and IS66-eigA1 years amounted to Sl1.-
$40, ll6, and stock was issued for new lines, to
the amount of 81 .93I $50. making the capital
stock of the company on July /, 1866. S2O,-
1S2, 800. In that year stock was created
capital stock a year later s4O,56S.3 800.
The largest dividend declared by the
company up to 1874 was il4 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 so, 900. and fo1 u period of seven
years the dividends averaged about lD per
cent. In lS4 the company bought up its
own stock and the stock of other tele-
graph companies and accumulated a fund
of sl5,Ooo.0 900. which 1t held in the treasury
OF the company. Dividends declared in
other years were: 1862. q per cent; 1868, 100
per cent 1854, 100 per cent 1873. dividend
of 81. 900. 600; in 1881 one of Sl5, ,oOOODp. and
another of 81, SG9. .00o 1t realized over $780,
0O0. 900 in twenty-five years by its extor-
tionate charges. An investment of $1,000
on Western Union stock in 1883 would have
returned up to 1890 stock dividends Of more
than $4,000 and cash dividends of Sloo 900.
In 1890 the capital stock was sS5, 1850, 900
now IL is Sis, 100000.
Sixty-one per cent of the telegraph COM
panies of the world were under Govern
ment control. and 1t 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 cents for ten words. and in France
10 cents for ten words. while in the United
States the prevailing rate was % cents for
ten words.
F. C. Roberts a member of the Tele-
graph ComTlittee of the International
Typographical Union, also testified con-
corning the Government ownership OF
telegraphs. In the course of his testl-
mony he said:
I'm 1866 the Western Union Telegraph
Company practically conceded the right
of the Government to either construct a
new system or to purchase its system of
teegraphic communication in the United
States. and merely asked that Congress
should permit tnat company 10 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 a 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 |
Typographical Union, there is one par |
tcular feature about the present system |
of the Western Union Telegraph Com
pany that our committee would like to |
jury to the members of our organization. |
Does anyone believe that if the Govern |
ment had charge of the telegraph, as it |
has the p0stotfice. 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 Savan- |
nah and Atlanta. in the State of Georgia, |
if you please. and you Will find that there |
is only one morning paper in each of those |
cities. simply because they have the AS |
so"iated 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, if 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 all. 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 concern which has the power to |
miSrepresent them seven days III the |
week from one end of the country to the
other, consequently 1t Is permitted to do