Evening star. [volume] (Washington, D.C.) 1854-1972, 1910-04-29

paid in to the company by its stock
= That the profits Of the business are
| out OF proportion to the actual cost of
the property. and therefore excessive.
Q. ihat our rates are exOrbitantly high,
| Whether measured by actual cost by in
herent value, or by prices elsewhere.
=. mat the Washington Gas light Com
pany Is already overcapitalized.
| D Ihat 1t Is believed to be immoral
anu lnequitable. from public point Of
view. for public service corporations to
invest and reinvest profits into better
| ment or to predicate rates upon their
value when thus In effect capitalized.
| Proponents Proposition.
| D. And finally, because 1t Is more or
less seriously claimed by the proponents
OF this proposition that even physical
assets cannot be capitalized, either d.
rectly or indirectly, by public service
corporation without an invasion Of public
rights. In other words, that capitaliza-
ton. whether true or false, so necessa-
rily involves the public equities as to
rates that Its enlargement Is against
public policy, and should be legally pro-
| hibited, although the company, in eff
| rect Is thereby denied the equal protec-
tlon or the laws guaranteed to all-the
artificial person as we'll as the natural
person-of which none may be deprived
| even by Congress itself. without Que
process OF law.
MIR: Chairman, this is the case, and this
is all there is to 1t, which we are here to
| try0a case built up, as I trust to be able
! 10 easily satisfy the committee, upon q
/ theory that Is unfOunded in fact-a doc
trine that Is unwarranted in law and ut
terly repugnant In both letter and spirit
| 10 every decision of the Supreme Court
upon the subject rendered within the la st
thirty years. Unfortunately for us, this
iact does not foreclose the controversy
to those who believe there Is vet a higher
| court, tribunal in the consciences OF
| men. that will some day proclaim a vet
| hlsner code, when socialism SITS crowned
IN the Capitol. II the fullness of time
| were ripe, 1 should not hopelessly appeaI
| even 10 socialism In such a case; but to
you. who are under bond, so to speak.
TO the Constitution as i stands l feel we
| can confidently look for the protection II
grants to all and the relief it denies to
none VINO are within their rights. 1t may
not prove amiss, therefore, for me to
anticipate, just here before going into
| tacts. as / propose to do fully later on.
the rules OF the law that l shall argue to
limit yours in the premises. They may
| De briefly summarized as follows:
! l. An established rate can only be Deem
ed excessive when it will yield more than
| of the investment
:. All public service corporations have
a right to make and distribute earnjn ps
upon the actual value of the property
empioyed In the conduct of our business,
| irrespective of its ownership-and of
course, irrespective of the face value or
par value of the securities outstanding
against it-or of their ownership
.. Inc company's franchises are prop
erty, and as such are assets upon which
1t is entitled to predicate earnings.
L. That public utilities do not have to
De lncorporated-their rights as to rates
relative to those of the public beinr
mutual and wholly independent of paper
capitalization.
Ideal Public Utilities.
.. That public utilities. il capitalized at
all. should. without exception. be ideally
capitalized-that is to say, that there
should be true coincidence and CORE
spondence between the actual capitaliza-
ton Inherent in the value of the invest
menr and the par or face value of the
securities issued against it, to the end
that every dollar in securities may rep
resent neither more nor less than 100
cents worth OF property. invariably to be
honestly assessed.
6. Betterments derived from legally
established rates belong to the company
making them. and their value may and
should be included in the appraisal Of the
property used In every case.
Z. 1t is not against public policy, as
defined by the courts, for public service
corporations to permanently invest I'M
divided profits earned under statutory
regulations and rates in extensions, bet
terments. or surplus Of any kind, or for
any purpose.
| 8. 1t is not within the power of Con-
gress to pass discriminatory laws-that is
to say. laws that in effect deny to one
person the protection granted to others
/ all persons, whether natural or artificial
! hx- ho cff-
tuition In the full use and enjoyment Of
their property and property rights.
! l should like very much, Mr.. Chairman.
to proceed Immediately to discuss these
propositions without further reference to
the determinations which are more or less,
as have already said, in the atmosphere
Of this case. did I not feel it my duty to
all whom 1t may concern, once and for
all to demonstrate, by unimpeachable
| testimony, that the company is not only
negatively innocent in the premises, but
affirmatively worthy and well qualified
| on account Of its merits to be commend
faithful steward. the peer of any and
second to none. in the full and just per-
| Torrance Of its public and civic duties.
| Now, then, let us cast aside all techni-
calities and prejudices. and look the whole
| subject sQuarely in the face to see IL we
can what there is in 1t OF truth and We
racty-or of the want of Unconscious,
subsconsciouS or unconscious.
| Ignorance Of Industry.
On the threshold OF our modest factory,
into which I am about to invite you, re-
regret to say that there Is not about any
other industry Of universal interest in this
country so much persistent ignorance as
there is In regard to the business of gas
making Considering the familiarity of
the public with the subject. Its intensely
Intimate relation to its affairs, from the
cradle to the grave-the magnitude of the
general transformation about this art is
hundred years since Murdoch startled the
, world with his truly Aladdin Tampa dis
, covery that has immeasurably contributed
, to the comfort. convenience and safety
OF mankind. 1t is not too much to say
that since the tabled Prometheus brought
fire from heaven there have been few
more benef1cent achievements. And vet II
Is impossible to escape the conviction
that there are intelligent men among
! us. otherwise reasonable responsible. and
representative citizens, who actually be-
[ lteve, judging from their attitude toward
; it, that gas making is a nefarious bust
ness, and that we have no rights which
} anybody worth talking about is bound ia
respect. This feeling may be aptly
J expressed by paraphrasing the old slogan
equally compromising and uncompromis.
. ing), Anything to beat Grant"
II sounds like an incredible thing but 1,
Is none the less true, that there are lit
orally thousands Of people throughout the
country who cannot be divorced from
their decisions upon this subject by any
amount OF argument: people who persis,
In he