Santa Fe new Mexican. [volume] (Santa Fe, N.M.) 1898-1951, 1903-10-05
1t is the Cheapest as the Private
Enterprises Are Difficult to
Finance.
A SINGLE PROPOSITION
This is the Position Of a Private
Promoter Who Selects Field Of
Operations.

the resources of the West reserved for
speculation are asserting that the
work which the Government has un-
dertaken might be performed more
economically by private enterprise
The claim is utterly untenable, and for
reasons which are obvious upon the
slightest consideration.
To begin with, there is scarcely a
place where important irrigation work
may be done without acquiring GER
tain amount of private property as the
foundation. Rights of way, reservoir
sites and, sometimes, prior appropri-
ations in the water supply, must be
purchased in order to clear the way
for a comprehensive undertaking.
1t often happens that such proper
view of selling at high prices when
the time for development shall arrive.
The private promoter who has select
ed his field of operations is easily sub
ject to a "hold-up." He is dealing
with but single proposition. He
must have these privileges, or aban-
don his enterprise.
The Government is in very differ
ent situation. The irrigation law
charges the Secretary of the Interior
with the duty of investigating oppor-
tunities for reclamation in sixteen
States and erritories, in each of
which there are many chances for the
profitable expenditure of funds at his
disposal. When his experts have de-
termined what is a reasonable price
for the property needed in a given To-
cality he is in.a position to say: Take
it. or leave it." And everybody under
stands that he means business.
The declination of his proposition
means simply that his field of opera
tions will be instantly transferred
elsewhere He has nothing at stake
in the matter. If one locality does not
want the help of Uncle Sam, then
there are fifty others that do. He can,
of course, proceed by condemnation
to acquire the property and have the
case tried in community which IS
quite certain to treat him fairly, but
his strong card is the fact that the de-
mand for government aid far exceeds
the supply and that he may, therefore,
always make far better terms than
private parties could hope to do, thus
effectlng a considerable saving in the
initial cost of the work.
But this advantage is far less i'm
portant than the one which the Gov
enjoys on the financial side.
It is notoriously difficult to finance
private irrigation enterprises nova
days. 1t is never done except upon
the promise of enormous profits. Ex-
anime the average promoters pros
pectus and you will find that the prop
osition runs about something like thic:
The land is worthless without wate.
The company controls the only po
sible source of supply. When this is
developed the land will instantly be
worth from $25 to $50 per acre unir-
proved. and twice as much after i'm
orovemert. 1t will cost only $5 to $40
per acre to bring land and water to-
gether. The government price of the
and is $1.25 per acre. The difference
between the cost of land and water
and the value of these elements when
hey have been united is profit" And
he prospectus usually figures that
his will range all the way from 100
oil Irry
ng figures are still further inflated
~ the suggestion that the company
an obtain plenty OF dry land itself at
ioyornmert figures and hold it for
peculation.
But the glittering prospectus is not
ct done with the homeseeker who
orms the basis of all these cheerful
expectations. 1t will be noted that he
J to practically buy the system at
everal times what it cost, but is he
D own it afterwards? Decidedly not.
he company still owns it and collects
n annual rental for the use of the
vater to pay dividends-on what?
IN purely fictitious capitalization
1vestment except the cost of paper
nd ink.
This is the way private enterprise
uilds irrigation works in the West
md the opponents of national irri-
alton say it is cheaper than Govern
lent enterprise. Cheaper for whom?
1t is certainly not cheaper for the
Ian who wants to get home on the
Ind. Even if the glittering expecta-
ons of profit are never realized, ex-
orbitant interest must be paid for
le use of the construction fund. Men
D not send their money into new
ountries on ordinary terms. They de-
and part Of the fabulous profit
Continued on Page Five.)