The herald-advance. (Milbank, S.D.) 1890-1922, 1922-01-18
Fargo On. d. Forum.

Fargo On. d. Forum.
PERHAPS the greatest evil of state
! socialism is that it conceals costs un-
der the head of taxes, and places the
legitimate competing businessman in
an unfair light.
When the homebuilders' enterprise
was launched, the various men in the
building trades, for the most part,
frankly admitted they could not com
pete with the absurdly low estimates
furnished by the state.
Perhaps the state car build for
those figures, but we would lose mon
ey at it," they admitted.
And the purchasers rather gleeful-
y felt that they were getting the best
Of "the profiteers."
But now comes the other side OF the
story.
The estimates are shown up in thier
true light. The actual costs ran from
so to 100 per cent. above the est
mates, and uniformly higher than the
prices the private contractors would
have charged. The tax payers will be
compelled to meet losses of from ST.
600 to 81, 900 on each house construct
ed by the state.
Unfortunately the losses Of state
enterprises are not often shown up 50
plainly. Too often the taxpayers are
kept in the dark about the subsidies
they paw for publicly operated enter
prises, through the medium of taxes.
Perhaps a municipal water plant
makes up its deficit in heavy hydrant
rentals or other forms Of concealed
subsidies. Perhaps a municipal street
car line operates on a low fare, and
gets tax exemptions or other special
favors that more than offset the diff
ference between its fares and the
fares a privately owned company
would charge. Even our postofice-
the most frequently cited example Of
successful public ownership-is sub
sized with free Office buildings and a
deficit paid BY the taxpayers.
1t is seldom that we get a fair COM
parison between a s~tateowned and
private corporations in the same line
of business. Always there is the con-
cealed "joker" even if it is only ex-
emption from taxes for the state in
dustry. Seemingly we like to be fool
ed into believing that our state en-
terprises are as efficient as privately
owned enterprises.
For that reason the lesson of the
homebuilders' association should be
valuable. Perhaps it will be well
: worth the $250,OOO it will cost US.
: Here is perhaps the oldest business in
:. the world. There is nothing myster-
iOus about it. There is an unlimited
amount of accumulated experience
from which the state could benefit,
House building is no new enterprise.
: No new bookkeeping systems were
needed. There are dozens of contrac-
: tors within 200 miles Of Fargo who
do a bigger business annually than the
: homebuilders' association did, and
they have accurate cost accounting
systems.
Yet the state probably never will
know just what any one house cost,
and two wears after the work was
begun no contracts have yet been ten
dered any of the purchasers. Only
the limited size Of the enterprise kept
: the state from losing millions instead
of about s25O,O0O. 1t was the most
CHASTITY Of failures, viewed from any
angle. Nobody profited from it ex-
: cept the men who drew salaries. The
|. purchasers paid more than they would
have paid private contractors. The
state lost S250,OOO. And the private
contractors were subjected to grossly
unfair competition.
-Bargain Days, IAN. 2O-21--
II 1t Is true that Europe Is begin.
ming to ship its undesirables over here