Missouri Valley times. [volume] (Missouri Valley, Iowa) 1874-1931, 1908-04-16
UTILITIES IN SWEDEN

~ 1s.tJte Iu OUlOIU
Stories ci Public Ownership Sue
cesses Disproved by Facts.
There, as In Other Lanes, No Attention
is Paid to Depreciation, Rent of City
Property or Lost Taxes-Alleged
Electric Light Profits In Stockholm
Vanish When Analyzed-The Tele-
phone Situation.
by WALTER F. BURGESS.
AS theory. municipal ownership
can be painted in the most glowing
colors. and to the uneducated and un-
thinking public it can be presented in
such a manner as to gain not only
their favor. but. above all, their votes.
Personally have been greatly inn
pressed with the growth of municipal
ownership simultaneously with the in
creased representation of the socalis-
tic and radical elements in the various
city councils. These dreamers and
prophets of unrest must have Il text
from which to preach to the discon-
tented. and municipal ownership seems
to lie their choice
There have recently appeared i'm
some of the semtechnical magazines
beautiful stories of the wonderful
benefits accruing to the working classes
Inv fhn ,,r IL
lie utilities i'm some of the cities i'm
Sweden. lit was asserted that the cleo
trio light companies had been earning
enormous profits which now. under
municipal ownership We're staying
with the taxpayers and consumers.
Take as one of the instances the city
of Stockholm. which both owns and
operates its electric light and gas un-
dertakings. The electric light under
taking commenced operations i'm 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 pnl-
chase current from the new munich
pal undertaking.
AccorCin. To the financial statement
for Dec 81 1904. the department had
a total investment of S3,l622..i0t; and
had set aside the sum of SG",l.'is9 for
amortization si:lrc its organization.
The statement shows whit plrpoits
To be Il proit on the fiscal year of
SoG. l2o.3 ON the face of this statement
Stockholm has becn quoted far and
wide as possessing one of the most
successful municipality owned electric
light plants 1T needs but little inNcs-
tgatioa. llowcvcr. to discover that this
is Only one of the instances. which are
all too COMMON. of results hcin@ cl;ii.n-
proof of successful trading anil to show
VERY Clearly t,le ulsulmd and nnbrsis
neSslikr methods; which are TOO often
adopted to support the claim of munich
pal trading.
I'm the first place 10 allowance is
made for the rental valuc of buildings:
second. no city taxes are paid. and
third. no allowance whatever is made
for depreciation II will not need amy
elaborate explanation to point on. that
had these perfectly proper and neces
s;lrv charges been made. the profit
would not only have disappeared. ltut
a big deficit would have taken its
place. One of these items alone the
loss of the taNe.; IL private plant would
have paid would practically wipe out
the so called profit as it would amount
to about $4,000 Il year. In almost
every other case that have lavesti-
gated. these taxes would actually en-
coed the profits claimed
III we consider the undertaking from
development standpoint and compare
1t With some American cities IL trc-
mciheus difference is apparent. The
department did not fl"iish public
lighting until 1901, and today there are
but thirty two arc lamps in the whole
city. while ont of Il population OF
roughly 100000 ut the end OF October,
1909 there We're only G,O00 consumers
One would naturally suppose that if
municipal ownership tended TO cheap
en- or improve the service the number
of consumers would he comparatively
greater in cities supplied by municipal
plants. whereas actually III Is just the
reverse
In view of these facts it seems To me
that. l'ecollecting that the prices chary
ed for current i'm Stockholm are the
same as those charged i'm many cities
in the United States. and then compal-
s,,.r Il:
the two countries, one will need to
make Il prolonged search to discover
what has become of those advantages
claimed for the taxpayers and con
Suiners
Similar glowing accounts have been
published of the municipal gas plant of
Stockholm. Gas is furnished mt the
standard rate of OF cents per 600
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.l6 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 $4G22O, which is u
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 n profit
of S355,474 is claimed on the years
working
AS an instance of the utter inability