Montana labor news., 1944-04-13
POWER
HEARING NOW
In THIRD WEEK

By ]. J. o'C0NNELL
The joint hearing of the Fedora.
Power Commission and the Montana
Public Service Commission, now being
conducted in the courtroom Of the pos.
office building in Butte, on an order Il
show cause issued by the federal body tC
the Montana Power Company, why $751;
100000 of watered stock should not be
squeezed out of its cost Of plant as listet
in its accounting procedure, filed with
both of the utility commissions, is nov
completing the third week of testimony
The Montana Power Company is still
putting its case before Trial Examiner
Edward B. Marsh of the federal commits
sion, and the members of the Montana
board as well as a representative of the
Idaho public utility board. Mr.. Kelley
has been testifying to the transaction
which took place in late 1912 and early
1918, in which the Montana Power Com
pany was created, after consolidation oil
the interests of John D. Ryan and his
associates with the Butte Electric Power
Company, Of which Ryan was also the
directing genius. The company is at
tempting to show that these dealings
were above board, genuine, and at arms
length as required by the Public Utility
Holding Act of 1885, under which the
proceeding has been brought. The Fed.
eral Power Commission counsel, which
includes Reuben Goldberg and Howard
W~ahrenbrock, a young but able lawyer
has succeeded in showing that the deal
ings were actually financial manipula-
tons, by which Ryan as the directihl
genius of both the Great Falls and tht
Butte interests inflated the common
stock of both Of these corporations, anC
then added this manipulated write-upi
into an inflated common stock of The
Montana Power Company, which he ther
created. The power commission in it,
cross examination actually shows tina.
Mr.. Ryan was on both sides of the table
while the so-ealled bargaining was COINS
on. and merely transferred holdings from
one Of his raaaets to the other.
The Montana Public Service Commits
sion thus far has not taken any import.
ant part in the hearing. Observers have
pointed out that on ethical ground,
Chairman Middleton of the Montana
board. and an announced candidate foi
Governor, should have disqualified him
self, in view Of the presence Of his SON
in-law, Kendrick Smith, as one of the
Montana Power Company counsel.
ACM Press COnfuses
The Anaconda Company press ha.
printed nearly a million words on the
proceedings, but have yet to tell any Of
the actual news and facts Of the hearing
They have engaged in %idolatrous praise
of their own chairman of the board Of
directors; have steamed effulsively Oh
the great value of electricity to Montana.
and the great vision and foresight OF
John D. Ryan, and have harped on the
honor and respect in which the state
and community hold Ryan and Kelley
but have not yet said one word about
the financial manipulations and the in
flated writeups these men placed in the
cost of plant of the Montana Power Com
pany, by which they mulcted millions Of
dollars from the people of Montana.
The hearing going on in Butte today
against the Montana Power Company
was really started by our own late Sena-
tor Thomas ]. Walsh, who introduced a
resolution in the United States Senate
to investigate the power trust in the
United States. The resolution was
passed and the Federal Trade Commits
sion authorized to make the investiga-
ton, which began in 1927 and continued
until 1882. This expose of the power
trust brought to light the incredible
Vaccinations and inflated writeups of
these utilities, and showed that there was
more than one billion and half dollars
of watered stock in these electric COM
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