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Chicago real estate. Well, now I know that that real estate is not worth any more today than it was some years ago, twelve or fifteen years ago. I know that I paid $100 for general taxes on that. Now I have been figuring up, putting that all over the city, and I am sure there must be enough money in the treasury of this city right now so that we can at once buy all these public utilities. It will not be a question of three cent fare, it will not be a question of anything except just paying the men who operate the cars and trolley lines, and I think we can travel down town at about, well, two cents apiece, and I am sure that ali of us are in favor of municipal ownership on that basis. (Laughter.) And I am sure that anyone who has tried to ride dowa town from here at any reasonable time in the day when men go down to work, would say that on general principles he is an anarchist, he is a socialist, he is anything, only just stop this system of crowding cars, taking our money and giving us torment. I thank you. (Laughter and applause.)
MR. ORENDORFF: If I had any doubt upon this question before, I am thoroughly convinced now that as a means to an en] we ought to have in this country, in many instances, at least, municipal ownership. As a general proposition, in many localities the control of these utilities is perhaps all that at present seems necessary. The end to which we ought to look is to secure good service at a fair compensation. When that is accomplished about all of the expected results accrue. It is the abuse of corporate privileges that has raised, very largely, this question to a practical one. I don't see that any argument that has been made against government ownership as has been suggested would not equally apply to the government control and ownership of the mail service of the United States. That is a practical operation of government ownership. The suggestion here that the people's officers are so corrupt that they can not be safely trusted with the management of these municipal utilities and enterprises, it seems to me, does not lie especially in the mouths of these private corporations operating utilities, for it is a well
known fact that the corruption that exists in our cities, in our municipalities, is the direct result of the bribery and corruption of these corporations. (Applause.)
A VOICE: Hit him again.
MR. ORENDORFF: It seems to me, gentlemen, that the main argument against municipal ownership as suggested here today and as usually suggested is the doubt of the competency of the people for self-government. If the people of this country can not regulate and control their own affairs, if they can not be trusted with the operation of these municipal utilities, the argument suggested is that it is because the corruption surrounds the people and that they are represented by corrupt agencies. I believe that to be a libel upon free government in this country. (Applause.) I do not wish to enter farther into the discussion of this matter. I believe that philosophically municipal ownership is right; I believe that as a practical question it is right, and I believe that with the introduction of municipal ownership in this country many of the wrongs that are complained of will pass away and that the American people have the ability, have the enterprise, have the courage to operate and control their own business better than any corporation can do it for them. (Applause.)
MR. BRADLEY: That is it.
MR. RICE, of Peoria: I can not tell on which side some of the speakers are. I will tell you in the start that I am on both sides. (Laughter.) I am in favor of municipal ownership because the utilities are public and are unavoidably monopolies. The City must own the streets and it ought to own all of the improvements that are put in them.
It is impossible to control the rates to be paid for the use of a public utility by competition. It is the next thing to a crine to have two or three telephone systems in the same city; there ought to be but one. (Applause.) The price must be controlled in some way and I will suggest to you how I think it may be done. The city, for example, ought to own the water
works in the city and then those water works should be controlled by private management. The people who subscribe and pay for the water ought to control the management of the works. How can this be brought about?
We all know that if we wish to have a business managed economically we should let those manage it who furnish the money that pays the expenses. We also know that satisfactory service is best secured by giving those who are to be served power to select and controi those who do the work. My suggestion is that a private corporation be organized, not for pecuniary profit but for the purpose of managing the works. Let every man who puts water in his buildings have one vote in the election of a Board of Directors to be chosen to manage those works. He would be inclined to select a Board of Directors who would give economical management and who would furnish good water and his vote would not be killed by the votes of others who have no financial or other interest in the enterprise.
The new plan now proposed is to let the City lease or rent out the works they own, just as a man who owns a farm that he does not know how to cultivate himself or does not have time to work, rents it to a farmer and lets him cultivate it. The city in its lease or franchise could fix whatever rental it chose. It ought to fix a rental that would pay a reasonable interest on the cost of the works and establish a reasonable sinking fund to replace them when worn out and it should ask
The city ought not to make money out of the water consumers to run other branches of City Government. The lease to the managing company should require it to levy such a water rate as would pay the rental to the city, pay the running expenses of the company, and pay the members of the Board of Directors a reasonable conpensation for their services, which amount should be specified in the lease. If the city wishes a little royalty for its own use besides interest on the money it has invested, let it require the company to furnish water for the municipality itself free of charge. The same plan can be
applied to the Electric Light Works, Gas Works, Heating Works and Telephone Systems.
Every individual, company, association or corporation doing business ought to have some one above it to decide questions between it and its customers. In case of a city managing its own water works, if it did not treat the water takers fairly and equitably, what remedy would the customer have? Experience says he practically has none. On the other hand, under the plan I suggest, the treatment to be given by the managing company to its customers would be governed by the lease or franchise or whatever the contract may be called between the city and that company. That lease would contain all the necessary provisions to protect the customer and the city and to prevent the payment of extravagant fees to the directors, and such other details as the wisdom of the company and the City Council might suggest. If the conditions in the lease were not complied with, it would be an easy matter to terminate it at any time by an action in forcible detainer for a breach of covenant. If the lease were terminated in any manner, the whole water works and their belongings would come back to the city in a few days, and there would be no complicated litigation about valuable property or franchises. The city would take back the entire assets of the company and would be required to pay its unpaid debts. Neither the city nor the water takers would have anything to complain of in this, for if the company had not been levying a rate high enough to pay its current expenses and the rental to the city, the city, on assuming control, would raise the required money by increasing the water rental. The city would lose nothing and the water customers would only be paying in this additional tax, the money they ought to have paid while their board managed the business.
The objection to municipal ownership with municipal management is ihat it leads to extravagance and the corruption of municipal politics.
The objection to private ownership with private manage
ment for private profit, is that it offers an apparently irresistible temptation to collect from the citizens higher rates than they ought to pay, in order to enable the company to pay dividends on the assumed value of franchises obtained from the city for nothing through fraud; and besides, all kinds of public officers are frequently tempted beyond their power of resistance by companies seeking franchises for private profit. Under either of those old plans enormous fortunes have been corruptly made.
Under the plan I suggest there will be no opportunity for anything of that kind; no one could make a great fortune; as no one has any stock in the company on which large dividends must be declared, no one would have any inducement to bribe the City Council. If a contract were made unreasonably favorable to the company, all the money made in that.way would go back to the customers by the reduction of the necessary rate. Besides there would be no money anywhere available by which officers might be corrupted.
The lease shouid provide that all water takers should have th? water at the same rate per gallon, whether they take much or little, therefore every man who subscribes for water should be given one vote in the election of directors and no more.
This plan would take the management of the water works out of politics and I have never been able to think of anything else that wouldi. Under this plan the works will be run economically, and there would be little or no inducement for fraud. This is plainly a combination of public ownership with private managernent for the benefit of customers. This is the reason I said in the beginning that I was on both sides of this question, favoring as I do municipal ownership with this kind of private management. (Applause.)
PRESIDENT PAGE: If there are no further suggestions, I will ask Mr. Darrow if he has anything further to say.
(Calls for Mr. Darrow.)
MR. DARROW: There is only a word or two that I would suggest. I guess we have all given our views, and I suppose we