Evening star., 1937-01-18

has been vigor- aszszslI IlIls&& 4 -
ously oenle1 py David Lawrence.
supporters of the
Roosevelt administration that there
has been any remote thought of in
turing legitimate investments. Presl-
dent Roosevelt has publicly given such
assurance to the American people, VINO
were asked to believe that only the
public utilities which had committed
grave abuses would be punished.
But there has been revealed to the
Nation an amazing appeal by Or.
Arthur E. Morgan. chairman OF the
Tennessee Valley Authority. In some
respects it is the frankest statement
on power policy that has been made by
anybody in the controversy for the
last three years. 1t is objective. fair
minded and challenging DR.. Morgans S
tone is conciliatory and his attitude
reflects a sincere desire to bring peace
as between the Government and the
public utilities so that the war which
is costing literally billions of dollars
In pent-up demand for expansion and
extensions shall begin soon to give
work to the unemployed and business
to the suppliers of raw materials used
in such great quantities in utility con-
struction.
Bares Suspicious.
But DR.. Morgans statement dis
closes what has been suspected before
but never confirmed officially, namely
vi,Ee ~, Il HictV lion
group which wants ruthlessly to
destroy utility investments and launch
the Nation on an extensive public
ownership program. If the latter
group is right, then their logic would
some day apply equally to Government
ownership of facilities that produce
or distribute or furnish other neces-
sites of life ranging from food and
clothing to medical care.
The penetrating question of whether
the Government shall take over func-
tions now performed by private insti-
tutions and businesses or whether
there shall be cooperation between
Government and private interests with
certain measure of governmental
regulation to prevent abuses is the
central point in the controversy now
brought to head by DR.. Morgan's
statement. Here is how he phrases it S.:
"A very important decision is in
volved in the treatment of the power
issue in T. v. A. territory. Shall there
be an effort on the part of public
officials to work with the private
utility companies to remove abuses,
to insure maximum service at mini
mum cost, and to insure opportunity
for public ownership where 1t is de-
sired; or shall men who administer
public projects drift into an atti-
tude of fight to the finish against
the private power companies. which
might have natural and perhaps
inevitable consequence of disruption
of the private systems, the destruction
of legitimate investments and of eco
nomical service, and the sudden, if
unexpected. throwing of great power
systems into premature and unpre-
pared public ownership"
Wants Investments Protected.
DR.. Morgan wants fair play and says
that lin the process of transition from
private to public ownership, there
should be respect for legitimate in
vestments in the utility business"
There's the issue. On the one hand |
are those headed by Senator Norris |
of Nebraska and David Lilienthal, gen.
eral manager and one of the directors
Of the T. v. A., who want finish |
fight with the utilities, and DR.. Nor |
gan and the public ownership advo- |
Gates who want a transition and try |
out period.
But both groups inside the Roose-
velt administration envisage public |
ownership of utilities as the ultimate |
goal and the difference is on how to
accomplish the result. One would be |
a slow process of strangulation, but |
with a chance to salvage some of the
investments at fair value, while the |
other would mean ruthless destruc- |
tion as soon as such a result could be |
effected by the use of governmental |
authority and funds.
President Roosevelt is in an awk- |
ward position. He can hardly take |
sides without antagonizing some of his |
most ardent supporters and friends. |
Likewise if he keeps $4,000. .000. 900 |
industry hanging between life and !
death he retards recovery and perhaps
even starts defation.
Permits Airing Of Views.
It is my impression that the Presi- |
dent leans toward DR.. Morgan's views
or he would not have sanctioned the
issuance of a public statement by the |
chairman of the T. v. A. which out
lines so frankly the existence of a
controversy inside his own admins
tration. The rumors for several days |
have been that David Lilienthal would |
win out.
Mr.. Roosevelt has a convenient exit
II he chooses to use it. He could, of
course, place the matter before Con-
gress and let the peoples representa-
tives. who are supposed to be elected
for that purpose, decide such ques- |
tions of fundamental policy. There
are many bills pending.
The utilities are not taking sides as |
between DR.. Morgan and Mr.. Lilien-
thai for the very good reason that |
they see little difference between i'm
mediate destruction of their busi-
nesses and the huge uncertainties that |
accompany slow transition period
In which the goal Is definitely public
ownership.
Four Choices Possible.
Fortunately, however. the alterna-
tives are not just the two involved In
the debate between DR.. Morgan and
Mr. Lilienthal. There are really four
possible policies:
First, Government ownership of the
sousces of power both hydroelectric
and generating plants, existing prop
critics to be taken over at fair value
on appraisal, and the Government to
conflne the utility companies to trans