The producers news. [volume] (Plentywood, Mont.) 1918-1937, 1928-03-30

AUTo eAsTER
Margaret Brown, middle aged
Governess of Park Avenue, New
York, who was battered into un-
consciousness and then burned to
death by fiend.
methods of handling the capital ac-
count is tremendous. No less an au-
thority than Guy z. Trip, until his
death, chairman of the board of di-
1ectOrs of the Westinghouse Electric
and Manufacturing Company, has
said (see his book on "Superpower as
an Aid to Progress" by G. B. Put
nam Sons) that nearly four-fifths of
the cost of producing electric current
by water power is due to the capital
charges. At least fifty to sixty per
cent of the cost of producing power
with other means, such as steam or
oil, is due to the capital charges. Pub
lie ownership eliminates these charges
by the gradual amortization of the
capital account. Private power COM
panies never do so and frankly say
point alone, therefore, the private
power companies overload the charg-
es for their service from fifty to as
high as eighty per cent as compared
to the public enterprise 1t is a fun
damental and basic difference from
which the private companies have no
means of escape. 1t is an advantage
of public ownership so vital and vast
as to carry with it almost revolution
airy possibilities.
All of this is entirely aside from the
usual discussion of the over-capitali-
cation of private companies. There
is no doubt, we believe, that practical
ly all of the private corporations
sooner or later and to a greater or
less extent carry, in their capital ac-
counts, fictitious values-securities of
various kinds that represent no real
investment at ALL Every such excess
not only increases the cost of the
service to the people, but weakens the
credit of the corporations sooner or
later and lessons the stability of the
financial structure in which it occurs.
Three still remains to be considered
on this phase of the question, the rate
of interest upon the capital accounts.
1t is well known fact that the pri-
vate corporations, even the best of
them, must pay from two to three per
cent more for the money which they
borrow than public bodies have to pay.
The courts and the utility commits
sions very generally allow seven to
eight per cent upon the capital of the
private companies. The public, on the
other hand, can borrow money at from
three to four per cent. This differ
ence is also enormous in its final re-
suits. The difference is sufficient to
pay for an entire system of any OF
! all of the power companies on the con-
tinent within the next "a years. Fol-
if you will compound $50 of any sum
annually at 800 for "a years it viii
. equal the principal.
III. CONCENTRATION IN THE
POWER FIELD.
The concentration of ownership anC
control in the electric power field has
: been going on very rapidly especially
during recent years. While as YET
there has not been established a COM
: plete monopoly and control of the
7 electric power of the continent in thG
! hands of a single corporation nor in
deed in the hands of a small number
2 of corporations, the fact, remains tina
: the concentration has been very rapiC
T and is going on with increasing rapid
ity each year.
t The Electrical World which is a Nc
: Graw publication, recognized as a yer.
d conservative magazine, reviewed tn
: condition of the electric power bust
7, ness of the United States in it's Janu
0. airy LIST issue of 1927. In this reviez
e it devotes an entire section
e Changes in Utility Ownership" dur
: ing the year, and gives list of util
i ity mergers and purchases which in
u Guided 101 municipality owned plant
p that are said to have been absorbe
l. by the private power companies and
i long list covering over thousand pr
l. vate companies that, during this singl
y year, have been purchased or merge
e in one way or another into the fewe
" and larger companies. The merger
that were acquired by the Standar
Gas q Electric Company alone involv
s. 81 different enterprises including til
re Northern States Power Co. and sev
re eral of its subsidiaries, the MidweS
Sc Public Service Co. serving IL COMM
y mites in Wyoming, Montana, Sout
ct Dakota and several municipality owne
Re plants.
" The spokesman of the private pov
T. er interests of the country such :
~ Guy E. Trip, referred to above. ar
pt leading public officials such as Sc
i'd etary of Commerce Herbert Hoove
be have said at ane time or another vel
r. frankly that the inevitable trend in n
n electric power field is towards fin
er combination of relatively few ore
er super,power organizations pivate
o. owned, controlling and operating Il
10 entire electrical power system Of Il
en- continent.
lie So rapid and so serious has this te
10 dency become of recent years. tn
&C. some of the most noted statesm,
Ise and public utility experts of the cor
he try have come to believe that we >
of menaced with the greatest monono
Ely in the history of the world. For +
vs. monopoly of the electric power indr
Igs try would carry with it the cont,
he of every other industry and instit11t;
tai which depends to any degree upon :
fl use of power. This would include :
The only the domestic life of the neo,
err and the industries of the country
fl agriculture, etc.
ri Former Governor Clifford Pinch
ner of Pennsylvania, in an exhanS+;
cir study of this subject, published IL :
thy $50 page report on "Giant Powa
I'm. has this to say upon this particnl
ac- point:
,es, "Nothing like this gigantic mon,
of oily has ever appeared in the histo