Evening star., 1939-02-17

trlC power con- ##
struction with
out fear of Gov n,,,
ernment impair
ment of their investments? Was
the settlement between Wendell
Willkie, president of the Common
wealth & Southern, step leading
to a truce, or was 1t merely an
episode in an intermittent war?
These questions have not been
clearly answered as yet from any
official source, but Congress can
answer them any day now by it's
attitude toward the furnishing Of
further Federal funds to continue
the competition between Govern
ment ownership and private owner
ship.
So far as the T. V. A. is con-
eerned, the acquisition by purchase
Of the properties of certain private
power companies within its mar
keting area merely means that the
present administration now will
have sizable region in which to
apply its "yardstick" policies. The
President, for example, said the
other day that acquisition of the
Commonwealth & Southerns prop
critics would mean a reduction of
electric light and power rates of
somewhere between 20 and 80 per
cent to consumers within the areas
affected. If this percentage of
benefit should materialize for con-
sumers in the South, it will be i'm
portant to know whether this is
being achieved at the expense of
Northern taxpayers, or whether it
is substantial economy brought
about through the supposedly
greater efficiency of governmental
operation.
Bookkeeping a Factor.
The truth is there is considerable
room for difference of opinion as to
the bookkeeping side of the T. v. A..
venture. If much of the expense Is
charged to navigation" and if i'm
munity from taxation for its prop
critics by Federal and State authori-
ties is taken into consideration, then
the Government certainly can sell
power more cheaplyst than can pri-
vate companies. If state socialism
is introduced on wide scale, there
Is every reason to believe that food
and other necessities of life could
also be produced more cheaply, be-
cause the Government can borrow
money more cheaply than can pri-
vate companies, and likewise, the
Government does not have to pay
taxes on any of its enterprises.
The taxpayer, of course, pays the
difference in the end, but this has
long been a matter of controversy
and the whole purpose of the yard
stick" program was to get at the
facts about electric power rates so
that the country could be intelli-
gently informed on an issue of long
standing. Now, therefore, the T. v.
A. has an area within which it can
apply "yardstick" rates. There are
q few private companies still to be
acquired in the T. v. A. domain, but
all told, they do not amount to more
than about $20,000000. So, for all
practical purposes, the T. V. A. now
has free hand and accurate costs
can be determined.
Investors would feel better about
the future If they were to be as
sured that the Federal Government
would restrict its operations to the
T. V. A. territory, or at least would
delay formulation of policy till all
the facts on T. v. AS operations
could be thoroughly canvassed by
congressional committees in the next
two or three years.
More Competition Authorized.
But the threat of continued Gov
eminent competition has arisen in
connection with the dam at Gilberts-
vile, KY, for which about 5000 900
was appropriated before the pres
ent session Of Congress. The House
the other day declined to furnish
the SlOO 100000 requested for further
construction, and Senator Barklev of
Kentucky already has begun a fight
IN the Senate to restore the item to
the current appropriation bill. If
the Gilbertsville dam should be con-
structed, it means the extension of
governmental power operations, not
only into the State of Kentucky but
into Southeastern Missouri, South
western Ohio, two thirds of Indiana
and the lower half of Illinois. It
means power controversies for such
cities as st. Louis, Louisville, In
dianapolis, all of which would be
within transmission distance.
What will be the effect on owners
Of the securities invested in these
properties If the battle which has
Just been waged against private
company investments in the T. v. A,
area now is carried further north?
And will owners Of funds for in
vestment feel disposed to supply the
$1,O00,000,O00 of new equity and
credit money about to be sought by
private companies in various parts
OF the country, if the Government
competition is to go on uninter-
ruptedly?
war" Delays Normal Expansion.
These are the practical questions
which are being raised in Congress
and they relate to future orders for
iron and steel, copper and machin-
cry used in the building of more pri-
vate power plants or in the extension
Of transmission and distribution
facilities. There is on the whole a
shortage of power facilities. Normal
expansion has been delayed by the
power controversy here. The only
question is whether the Government
shall do the building and permit
certain areas to be subsidized with
low rates while the taxpayers make