Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-06-06
MYTH or Monster2


ever since I left school, and have
never seen a trace of the Power Trust.
The reason is Simple-there is no such
thing as the Power Trust, at least IN
the field of business. But in the field
of politics-that is something else
again. More monsters than you can
count grow in that field. The pas
sionate friend of the pee-pul needs
them in his business. He creates them.
Having nothing constructive to offer,
he acts on the rule, when you have
no case abuse your opponent so ne
invents monster, defies 1t, denounces
it, raises a hue and cry after 1t. 1t
IS great game-while it lasts.
Thus writes Matthew S. Sloan. pres
ident Of the New York Edison Company.
in the current Nations Business. And at
French Lick Springs, Gov. Pinchot hits
the assembled Governors over the head
with something like this:
The power of the public utilities is
manifest in every political assembly.
from the Congress of the United States
to the smallest town meeting, and from
the government of the least political
unit to that of the largest State. In
deed, it reaches to the National Gov
eminent itself =. Beginning less than
two generations ago with nothing, the
electric industry has today total in
VeStment of approximately twelve bill
lion dollars. 1t ranks fourth or fifth
among all our industries in invested
capital In less than fifty years 10
per cent of American homes have been
wired for electricity, and the industry
of the Nation has been electrically
motored to the extent of approximately
80 per cent. Meantime. huge electric
utility systems have grown up through
nf iac
into larger units. and the merger of
control through layers of holding COM
panieS. Today . about 80 per cent
of the total electric power generated
in the United States is under the domi-
nation and control of four major in
terests. And these interests work to-
gether harmonlouSly under common
policy and toward a common end
which is the milking Of the public.
The two quotations are fairly repre-
sentative of the two points of view re-
garding a question that already has
assumed paramount Importance, not
only as political isSue-for it cannot
be dismissed merely as political issue
but as an economic issue. 1T is
great game-while it lasts" this chasing
the phantom Power Trust, according 10
N. Sloan. The statement carries the
inference that the game, some day, will
be up. 1t will BE-. But it is not very
reasonable to believe that the game will
come to an end by the publics willing
ness to grant that there is no such
thing as the Power Trust, or that the
sole function Of the Power Trust is to
assume the characteristics Of a straw
man to be set up and knocked down at
will by crusading politicians.
Mr.. Sloan seeks to divest the Power
Trust of its awesome mystery by re-
ducing its tentacles to the picture of
some three thousand electric utilities,
each of them being a rather harmless
little fellow only trying to g.. along in
the world by selling what there is a
public demand for, thus eliminating the
possibility of an artificial restriction of
output sometimes associated with Vi
cious trusts. AS for the price Of cleo
tricityr it is controlled by State or local
regulation. AS for the holding COM
panieS, there are thirty or forty large
holding company groups or systems of
electric utilities and large companies
not distinctly allied with groups. :.
Simmer them down and you will have
possibly dozen or fifteen organizations
with very large output of current"
The net operating revenue Of the cleo
trio utilities industry was, in 1880, $685.
100000, "or seven per cent on the in
Vestment." - ,-.' -
Gov. Pinchot, who labels excess profits
as graft says that in Pennsylvania
alone the electric utilities are collecting
from the people fifty millions year
over and above fair return on invest
ment; and the people of that State are
paying interest on much more than
one hundred million dollars that never
was put into the business"
Whether the politicians who raise
hue and cry after the allegedly mythical
Power Trust are merely capitalizing the
issue as a means TO their end of Cow
eminent ownership, as Mr.. Sloan Is in
clined to believe they are doing, is
neither here nor there. The point Is
the extent to which the utility interests
are capitalizing the traditional Ameri-
can belief in private ownership and
initiative for their own purposes. The
growth of vast and intricate system
Of utility holding companies may not
indicate the existence of a greedy trust.
Nor does it indicate that its formation
Is the result of purely aitruistic effort
on the part Of beneficent individuals
for the good of the pee-pul.