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1932 › Franklin D. Roosevelt (Democratic) › Public ownership of electric power
Public development of hydro-electric power on the St. Lawrence model, with national control of interstate transmission
pledge_forwardspecific_pledgecandidate_directevidence A Energy & PowerInfrastructure & Public Works similar solutions · similar reasoning
Solution
Where the public owns a power site, a public authority builds and permanently owns the dams and powerhouses; transmission and distribution are offered first to private capital at a price built from plant amortization plus a reasonable return on actual investment; if private capital refuses those terms, government transmits and distributes itself. Interstate transmission to be placed under national control.
Rationale
Public-utility regulation is centuries-old common law (adequate service, reasonable price on actual cash invested). Holding-company mergers inflated capital so rates yield returns on water, not investment; householders and farmers pay far too much for electricity. Interstate power cannot be controlled by states alone.
Statements (8)
I insisted that the actual dam or dams and the actual power houses should be constructed by a public authority and always remain in the physical possession of that public authority.
if Government is not able to find private individuals or corporations willing to do this, then Government must step in and do it itself.
where a public service like the transmission of electricity passes beyond State lines and becomes interstate in its actual operation, in such a case the control cannot effectively be maintained by States alone, or through agreements between neighboring States. That problem is national in its scope and can be solved only by the firm establishment of national control.
The conservation, development, and use of the nation's water power in the public interest.
I do not hold with those who advocate Government ownership or Government operation of all utilities. I state to you categorically that as a broad general rule the development of utilities should remain, with certain exceptions, a function for private initiative and private capital.
Explicit limit on the position.
That where a community -- a city or county or a district is not satisfied with the service rendered or the rates charged by the private utility, it has the undeniable basic right, as one of its functions of Government, one of its functions of home rule, to set up, after a fair referendum to its voters has been had, its own governmentally owned and operated service.
State owned or Federal owned power sites can and should and must properly be developed by Government itself.
Each one of these, in each of the four quarters of the United States, will be forever a national yardstick to prevent extortion against the public and to encourage the wider use of that servant of the people -- electric power.
Follow-through
kept
The TVA (May 18, 1933) went beyond the St. Lawrence model: a federal corporation generating, transmitting and selling power as a 'yardstick,' plus Bonneville and Grand Coulee on the Columbia and the REA (1935). The St. Lawrence seaway-power treaty itself was rejected by the Senate in March 1934.
Mechanisms
| Date | Type | Name | Effect | Consistent? | Source |
|---|---|---|---|---|---|
| 1933-04-10 | message | Message suggesting the Tennessee Valley Authority | I, therefore, suggest to the Congress legislation to create a Tennessee Valley Authority, a corporation clothed with the power of Government but possessed of the flexibility and initiative of a private enterprise. | yes | Message to Congress Suggesting the Tennessee Valley Authority |
| 1933-05-18 | statute | Tennessee Valley Authority Act | Second, I have requested the Congress and have secured action upon a proposal to put the great properties owned by our Government at Muscle Shoals to work after long years of wasteful inaction, and with this a broad plan for the improvement of a vast area in the Tennessee Valley. | yes | Second Fireside Chat |
Obstruction
congress The St. Lawrence treaty (signed by Hoover July 1932) failed in the Senate, 46–42, on March 14, 1934.
Assessments
Federal dams in the Northwest and the TVA delivered public power on a scale the campaign only sketched.
Huge dams--Grand Coulee and Bonneville--transformed the economy of the Pacific Northwest. Still more important was the Tennessee Valley Authority (TVA).
Reception (1)
Roosevelt is prepared to put the federal government into the power business, and his Senate supporters are pledged to it.
The Democratic candidate has declared that under the same conditions which may make local action of this character desirable, he is prepared to put the Federal Government into the power business.
Other positions on this issue
- The next federal hydro-electric development will be on the Columbia River — Franklin D. Roosevelt, 1932 specific_pledge
- Federal regulation of interstate power; opposition to government operation of the power business — Herbert Hoover, 1932 specific_pledge
- Cheaper electricity and rural electrification by the 'yardstick' method — Franklin D. Roosevelt, 1936 directional_stance
1932-fdr-public-power-st-lawrence-model · created by claude-fable-5-1 · review: unreviewed