The Owosso times. (Owosso, Mich.) 1897-1926, 1908-04-03
BY WALTER F. BURGESS.

i
thinking public it can be presented in
such a manner as to gain not only
their favor, but, above all, their votes.
| Personally 1 have been greatly i'm
pressed with the growth of municipal
ownership simultaneously with the in
| creased representation of the socialis-
| tic and radical elements in the various
city councils. These dreamersr and
prophets of unrest must have a text
| from which to preach to the discon-
| tented, and municipal ownership seems
| to be their choice.
There have recently appeared in
some of the semitechnical magazines
beautiful stories of the wonderful
benefits accruing to the working classes
by the municipalizing of various pub
| lie utilities in some Of the cities in
Sweden. 1t was asserted that the cleo
| trio light companies had been earning
enormous profits which now, under
municipal ownership, were staying
with the taxpayers and consumers.
Take as one of the instances the city
of Stockholm, which both owns and
operates it's electric light and gas I'M
dertakings. The electric hight under
taking commenced operations in 1892
and supplies current for both lighting
and power to private consumers, for
public lighting and to one Of the street
railroad companies. which is compelled
by the terms Of its franchise to pur-
chase current from the new munich
pal undertaking.
According to the financial statement
for Dec. 81, 1904, the department had
a total investment Of So ,462, 496 and
had set aside the sum Of $651 500 for
amortization since its organization.
The statement shows what purports
to be q profit on the fiscal year Of
$26, On the face Of this statement
Stockholm has been quoted far and
wide as possessing one Of the most
successful municipality owned electric
light plants. 1t needs but little inves-
tigation, however, to discover that this
Is only one of the instances, which are
all too common, of results being claim
ed which are absolutely fallacious as
proof of successful trading and to show
very clearly the unsound and unbusi-
nesslike methods which are too often
adopted to support the claim of munich
pal trading.
In the first place no allowance Is
made for the rental value Of buildings;
second, no city taxes are paid, and
third, no allowance whatever Is made
for depreciation. 1t will not need any
elaborate explanation to point out that
had these perfectly proper and neces-
sary charges been made, the profit
would not only have disappeared, but
q big deficit would have taken its
place. One of these items alone-the
loss of the taxes private plant would
have paid-would practically wipe out
the so called profit, as it would amount
to about $3.50 a year. In almost
every other case that l have investi
gated, these taxes would actually ex-
coed the profits claimed
If we consider the undertaking from
a development standpoint and compare
it with some American cities a ire
mendous difference is apparent. The
department did not furnish public
lighting until 1904, and today there are
but thirty-two arc lamps in the whole
city, while out Of a population OF
roughly 100000 at the end of October,
1905, there were only G,OO0 consumers.
One would naturally suppose that If
municipal ownership tended to cheap
en- or improve the service the number
of consumers would be comparatively
greater in cities supplied by municipal
plants. whereas actually it is just the
reverse.
In view Of these facts it seems to me
that. recollecting that the prices charg
ed for current in Stockholm are the
same as those charged in many cities
in the United States, and then compar-
ing the difference in wages between
the two countries, one will need to
make prolonged search to discover
what has become of those advantages
claimed for the taxpayers and con-
sumers.
Similar glowing accounts have been
published Of the municipal gas plant of
Stockholm. Gas is furnished at the
standard rate of OIL cents per 1000
feet, which is relatively higher than
the rates charged in the larger Amer
lean cities. and this Notwithstanding
the fact that the average cost of coal
in Stockholm for the last five years has
been $2.16 per ton. The balance sheet
of the gas department for the year end
ing December, 1904, furnishes another
instance of how municipal bookkeep-
ing can be made to prove almost any
thing. The sum of SAG, 300, which is
little over 1 per cent on the total valu-
alton Of the property, is all that has
been written off for maintenance and
nothing whatever has been written off
for depreciation, yet actually a profit
Of $355,474 is claimed on the years
working.
AS an instance Of the utter inability
of either state or municipality to COM
pete with a private organization, the
telephone situation in Sweden may be
taken. The telephone system through
out the country is principally in the
hands of the state. AS a matter Of fact
there Is only one large private COM
pany. which carries on business princi-
pally In Stockholm, that enters directly
into competition with It. Although the
government offers lower rates and has