Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1925-10-15
Hoover Takes Stand
(Continued from Page one)

we do not resist this extension, Wnat
becomes Of that fundamental Tree
dom and independence that can rise
only from local self-government
The Commerce secretary addressed
himself mainly to the question OF
local and state regulation Of public
electrical utilities.
Il want to kick to local authority"
he said, when the power rates are
unjust. II want to kick where4~the
searchlight of public opinion and
local knowledge can be brought to
bear. Far more than this. want to
live in a community which governs
itself. I do not believe the people of
our communities have yet become SO
supine or so careless of the funda-
mental advantages Of self-govern-
ment that they are ready to sur
render control of their most intimate
concerns to a paternal government
at Washington, however wise or
however powerful.
1--WE should all agree that regula-
ton of public utilities is vital. Be-
cause of the fabulous duplication OF
equipment. Of investment. Of in
creased financial instability and
operating expense with increased
cost of service to the consumer, In
volved ia a system OF unrestricted
competition, the 4S states acting IN
dependently have abandoned the no.
ton of maintaining the kind of COM
down rates and holding up service.
But when we deliberately clothe in
dustry with the security Of mon
opoly, neither the industry nor the
public any longer disputes the neces-
sity of full control or rates. profits.
service and finance by governmental
regulation.
"Second, we can agree that a revo-
luton is in progress in the electrical
industry through the scientific dis
covery of long distance transmits
sion and the sequent economies In
production and improvements. In
service to be gained by the consoli-
dalton of generation into central
plants with the same equipment pro-
viding the night lights of cities and
the day load of industries. This
revolution is as necessary as the ris-
ing sun IL we are to have cheaper
power and greater service. The re-
suit is the creation OF larger COM
ranies covering power districts
surrounding these central generation
plants.
AL LfiiS pOitl, WASH ~ ~AAA
phasize a distinction that has an i'm
portance in all conception of regula-
ton, ignorance of which has been
responsible for much misapprehen-
sion. This interconnection simply
means the sale of surplus power
from one district to another and
does not bear any more implication
of trusts and giant monopolies'
than the interchange of cars between
different railway systems.
Until lately there has been no
suggestion of Federal regulation. No
new question would arise today but
for the great revolution In the
organization of this industry. Be
cause of this revolution arguments
are now advanced for the substitu-
ton of Federal for State regulation.
There may be a watering OF
stocks in progress. But II rates be
based either upon the true value of
plant and equipment or upon actual
investment. watered capital does not
and cannot affect consumers. Our
state and municipal system of regu-
lation is steadily building UP this
basis Of regulation.
1.-THE argument Is sometimes used
that the power situation Is parallel
with the railroads, where Federal
regulation has been found necessary.
1t differs in several profound re-
spects. Power has no such inter-
state implication as transportation.
Furthermore, there has been
outrageous exaggeration Of the prob
able extent of interstate power. For
economic reasons these power dis
tricts will in but few cases reach
across state lines. The Interstate
loading of our railway transporta-
ton probably comprises 10 to so per-
cent of the total goods carried by
rail. The proportion Of interstate
movement of power will increase no
doubt. And this interstate move
ment Is of high Importance for
economy in power production.
"But interstate problems arise
only where the activities of the oper-
ating companies extend beyond state
lines. They fall into two classes,
first, where the same company is en-
gagged in generation and distribution
over a district embracing parts of
two or more states. and second,
where an operating company pur-
chases power generated in a for
eign state-the latter instance also
embracing the 1nterconnection' be-
tween districts lying in different
states. AS to the first class, it has