Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-08-17
NEW YORK RATE CUT SEEN
OF POLITICAL SIGNIFICANCE
Electric Power Reduction Held as Herald
to Agitation for Public Owner
ship of Utilities.

The writer of this article, starting re-
Gently to make a survey of the con-
gresSional and senatorial elections
throughout the country, found that in
State after State the election Of these
national officials is complicated with
sometimes obscured by-local political
situations having to do with the cleo
ton OF governors or other local officials
in which the issue was public utilities.
The purpose Of the present article Is
to propose an inquiry whether these
| agitations about public utilities as an
issue affecting elections are not about
10 years too late; to suggest that ali
these controversies are being settled
right now by force with which poll
tics has nothing to do. The force is the
increased purchasing power of the
dollar.
Increased purchasing power of the
dollar" means the same thing as re
duced price of commodities"
In the latter form, reduced price of
commodities" the phenomenon is IA
miliar and Is universally understood
Everybody knows that everything
orally everything, on the averages
lower in price-excepting, of course,
gold. Wheat is lower, copper is lower,
| cotton, silk, coffee land is lower. In
that form, reduction In values Of goods,
everybody knows about It. But the
equivalent form, increased purchasing
power of the dollar" very few people
understood.
Few Understand Political Effect.
| AS for the effect wrought on political
questions by the increased value of the
dollar, almost the only persons under
standing it are a comparatively few
professors of political economy and a
comparatively small number Of espe-
cially able bankers and business men.
| The writer of this article has studied
much history and written q little. It
is his conviction that larger number
of political excitements can be traced
back to changes in the purchasing value
| OF the dollar than to any other one
| source. For example, know nothing
about the present excitement in India
over man named Gandhi and over
the salt tax. Knowing nothing about
It, / should be inclined to follow
"hunch" that the real fundamental
cause is the sensationally diminished
value Of the silver that composes part of
midas currency.
In the United States the increased
value Of the dollar is working Gas re-
spects public utilities not for commo-
ton, but for, so to speak, the demotion
of commotion. 1t Is working to settle
all the controversies about public utili-
ties here described.
| The politicians who strive to keep the
public utility questions alive and make
capital out Of them are, as Is usual
with politics, about five to ten years
behind the fundamental economic de-
| velopment. If the politicians shouts
succeed just now in sweeping their com
munities into public ownership, they
would be doing it at precisely the wrong
time
All these public utility questions are
! right now in process of being settled
by economic law, not by political law.
The purpose of the present article is
to show how the public utility contro
versies are being settled by the in.
creaSing value of the dollar, or, to put
1t in the equivalent form, the decreased
value of things, all things-including
public utility properties.
Courts EvaIuate Utilities.
! Public utility properties are given q
valuation, speaking roughly, by the
courts, especially the Supreme Court
of the United States. The same courts
say in effect, that the rates charged by
public utilities shall be, again speaking
roughly enough to yield per cent on
the valuations given by the courts
Consequently the whole public utility
question, wherever 1t arises. comes back
to valuation.
| The public utilities in the past, con-
tending before the courts, have insisted
that their valuation should be what it
would cost to reproduce them. The
courts have accepted their viaw.
ct was for accepting this view that
some Senator made all the cutlery
against the Supreme Court last Spr1ng
| Continued on Fourth Page