Evening star., 1934-12-18
Consider the Cost.

4IlOIllaS ~. MCSdTtcI, pIcciOcut VI
the Edison Electric Institute, has sub
mitted to President Roosevelt a plea
that the Government sit down with
the representatives of the electric
power industry and discuss the prob
lem Of adequate, efficient and cheap
electricity for the people. Mr.. Nc
Carter argues that more real progress
can be made in this way than through
governmental competition or strangu-
lation of the electrical industry by
the Government. And, further, he
pledges the industry to ANY co-opera-
tive effort along these lines" When
Mr.. McCarter and his associates talk
Of government competition and stran-
gulation of the electrical industry they
refer to the probable-sure. rather
results which the Governments entry
into the electrical business through
the Tennessee Valley Authority and
other Government power projects will
have upon the private power industry.
In memorial submitted by him to
the President Mr.. McCarter very
properly suggests that it would be as
well for the Government to count the
cost to the people Of the wipirg out
of the privately owned and operated
electrical industry and that this cost
be set alongside Of any possible gain
to them that might come from a
Government owned and managed elec-
trical industry. There iseinvested in
the electrical industry about $4,000
100000 and this investment is directly
made by millions Of the people. In
addition, many millions of indirect
investors among the people are found
in those who have interests in life
insurance companies, savings banks
and ether corporations which hold
power company securities. What is to
replace the savings and holdings of
these millions of people if the Govern
ment, through competition, strangles
this industry?
That is the purely concrete and
physical side of the strangulation of
the electric power industry. There
are others. Among them is the fear
Of other great industries of the coun-
try that the Government will step
in and take them over, through COM
petition in their lines of endeavor.
That kind of fear will do much to re-
tard recovery in this country. An
other side to the problem of Govern
ment ownership and control Of the
electrical industry is the possibility,
and even probability, that politics will
become dominating factor in its
management.
The sole reason advanced for Gov
ernment competition and eventual
ownership and operation of the elec-
trical industry Is to reduce the cost
of elect-scity to the consumer. Mr..
McCarter asserts that the average bill
Of the domestic consumers of elec-
tricity is So a month, less than ten
cents a day. II through Government
ownership and operation this cost
could be reduced few cents-because
the Government-operated concerns
would not have to pay taxes-would
the gain be commensurate with the
losses to millions of the people in the
event Of the wiping out of the pri-
vate electrical industry?
Mr.. McCarter and his company have
challenged the constitutionality of the
Governments T. v. A. operations.
They have obtained opinions from
eminent constitutional lawyers that
the Government is overstepping its
powers. The suggestion is made that
this question be determined through
the courts as early as possible.
Why not?
The power trust has been held UP
to the American people for years as
an evil. On the other hand, State
socialism is not exactly an ideal con-
dition from the American point of
view. Some plan for making the
trust behave without going to the
extent of Government ownership and
management of a great industry
should be found.