Evening star., 1938-01-24
The Power Problem.

The Power Problem.
1t is almost foresone conclusion that
the decision of the three Judge Federal
Court IN Chattanooga, Tenn, upholding
tne power program of the Tennessee
Valley Authority will be affirmed by the
supreme Court. In its first T. v. A. de-
cision two years ago, the high court
ruled that the Government could sell
power at Wilson Dam on the theory that
Its generation was incidental to the con-
stitutional purposes of improving naviga-
hon' controlling floods and providing
Tor the national defense. That decision.
however. contained the plain implication
that the court might set its face against
any extension OF the authority granted
T. v. A.
But with the addition of two liberal
Justices. the picture will be changed
when the court meets to consider the
present case. Even If Justice Cardozo
Is Ill and unable to participate, the most
the power companies can hope for is the
support OF the four of the remaining
eight members Of the court, and should
the justices be evenly divided the opinion
Of the lower court would become the law
Of the land.
In such situation, no constructive
purpose can be served by berating the
administration for having maneuvered
the private power companies into their
present unhappy position. 1t is per-
fectly clear that there is no future for
them in localities in which they must
compete now or in the years to come
with the Government. This state of
affairs has been brought about by the
Government through the employment of
methods Of competition which. although
legal, are unfair in an economic sense.
and which the private power concerns
cannot possibly meet. The thousands of
men and women who have invested in
the securities of the private utilities
anected will view the action of the Gov
ernment as one of dubious morality. to
say the least. but it is an ACCOMPLISHED
fact. That being 20, the interests of all
concerned can now be served best by fol-
lowing two courses Of action.
The first step is to salvage all that can
be recovered of the investment in the
private utilities. Some utility leaders.
the Governors of Tennessee and Ala
bama and President Roosevelt already
have begun consideration Of plans for
the purchase by the Government of some
or all Of the property of the utilities.
1t is not to be expected that the New
Deal will be generously disposed toward
the men who head the private utilities,
but at the same time the administration
cannot be blind to the interests of the
host OF small investors now facing a
loss. 1t Is certain that the latter will
suffer to some extent, but the Govern
ment, having broken the utility struc-
ture. must now assume the obligation of
minimizing the injury to those who
might we'll be called the innocent VIC
tins Of what has been a long and bitter
struggle
The second prospect is one which in
the years to come may outweigh all pres
ent considerations. The Federal power
program has been given legal sanction
on the theory that it is incidental to such
important functions as improvement of
navigation and flood control, type of
development that only the Government
could be expected to undertake. The
public has a right to assume that this
administration and those that follow it
will apply themselves industriously to the
task OF opening our hitherto impossible
rivers to the flow Of commerce and curb
Ing the great floods that have taken
such an appalling toll of life and prop
erty IN the past. The administration
mas assumed an obligation to bring about
these improvements, and failure to do
80 would come as a harsh disappoint-
ment to those citizens who have refused
to believe that the New Deals professed
devotion to flood control and improve
ment of navigation was a sham to cover
Its power program.