Evening star., 1938-06-03


no rights unless he gets them from
beneficent Government. Originally
the founders of the Republic thought
they had written Constitution where
by the Government was the agent and
not the master of the people. But
now the process has been reversed
and it is plainly stated on the floor
of the Senate that, because citizen
might possibly go into the courts to
make sure his property is not unfairly
confscated by the Government, the
law must be so written that he has no
' chance to 60 into court to protect his
interest at all
The specific application of this idea
Is to be found in the proposal to use
relief funds for public ownership
purposes. Notwithstanding the fact
that the Nation is crying out for eco
non1ic recovery and that a $4,000.
100000 industry stands ready to spend
money if investors, who have been
frightened by Government competi-
ton, can be reassured, the admins
tration attitude is thus outlined by
Senator Barkley:
The President took the position
Cat recent conference) that Federal
money ought not to be allocated for
the construction of public utilities
whose rates are regulated by public
authority until and unless the munic-
- ipality or other political subdivision
made in good faith an offer to pur-
chase at fair price the existing pri-
vately owned and operated plant"
Litigation Feared.
Mr.. Barkley thought at first that this
principle might be embodied in law
but then he and the other members
of the conference realized, he said,
that there might be much litigation
in the courts over the question of fair
price, its acceptance or rejection" and
hence 1t was decided better to ask
Congress to omit any restriction in
the law and let the President do the
deciding.
AS matter of fact, in practice this
means that somebody in the Public
Works Administration. working in con-
junction with the Tennessee Valley
Authority or some other public owner
ship advocates. would decide what is or
is not q fair price" No provision
would be made by law for a full and
fair hearing and the citizen would
be deprived Of any redress II the mu-
nicipality offered what it thought was
fair" price and some bureaucrat
in the P. w. A. agreed that the offer
was fair enough.
In other words, the fear that the
courts might decide to interpret fair
price" in conformity with established
>principles of what is a proper basis
for valuation led to the decision not
to allow the citizen any opportunity
at all to protect his property, If Mr..
Roosevelt is kind, the citizen might
get fair deal. II the President,
meaning, Of course, through his subor-
dinates, refuses to listen to the pleas
Of the private company, the private
company and its investors can be put
out of business by the building of a
competing plant. This is the New
Deals conception of justice-namely.
that anything the New Deal decides
Is in its own Judgment necessarily
fair
Distribution Facilities Are Key.
Now it so happens that every utility
system is divided into three parts
generation, transmission and distribu-
ton. The local distribution facilities
amount to about 35 per cent of the
investment, as rule, so that utility
system which is compelled to let go
Of its distribution facilities under
threat Of competing city system is
then left with IS per cent of its in
vestment unpurchased. The proper
and fair course would be for the Fed
eral Government, If 1t does embark
on public ownership policy, to in
sist that the cities. when given Fed
eral funds, should pay a fair propor-
tion of the cost of the generating and
transmission end of the business. For
utility system with no market of
customers cannot do much with its
generating and transmission facilities.
So we have situation in which an
attempt to write into the law that
existing properties shall not be con-
fiscated except after "a full and fair
hearing" has been disapproved by the
President himself, who wants the