September 19, 1935

Editorial from "Nation's Business" (Sept.) used as Prologue to X Club Paper.

Who are the friends of the people?

After the Battle of Waterloo, Napoleon fled to Paris and remained there a few hours. In the street below the crowds cheered his name. In amazement Napoleon turned to those beside him: "Why do they cheer me?" he cried. "What have I done for them? I found them poor - I leave them poor."

That, too, is the tragic epitaph of all the demagogues. In their self-seeking they promise everything and leave the people to pay the price for such promises. The people pay in disillusionment, in blasted hopes, in high taxes, and in the evils of patent-medicine economics.

What a striking contrast between the record of the demagogues and the record of business! Business does not "find the people poor and leave them poor."

Westinghouse finds the people in darkenss and leaves them in light.

American radiator finds them cold and leaves them warm.

International Harvester finds them bending their backs over sickle and hoe and leaves them riding triumphantly over conquered fields.

Standard Oil and Henry Ford find them schackled to their front porches and make them masters of time and space, citizens of a larger world.

Wherever new comforts and conveniences have been made available to the people, wherever new services have been organized and established there the humane and civilizing usefulness of business is demonstrated.

Business is a real friend of the people.

It is high time, in these days of careless thinking and reckless action, that some one stand up and tell the people who are their real friends.

(I remained seated however, and told them for about an hour; then they "told me" for nearly three hours.)

Notes on the discussion. (Remarks in parenthensis are mine)

Dr. Paisly

Agrees on eliminating government from competitive fields. Sees danger to medical profession if idea of regimentation extends there - greatest work done through individual iniative. Government operation of railroads during war demonstrates inefficiency of political management.


Skeptic of both government and business - not much faith in either. (After meeting I emphasized ethical standards of Utilities taken as a whole, as compared with fly-by-night responsibility of politician.) Private enterprise wasted forests, and oil resources. Government should regulate. (I agreed) Great wealth of this country due more to abundance of natural resources than to type of government. (Conceded some such influence, but felt freedom of individual enterprise greater.) The naturalist objected to term "natural operation of economic forces" - nothing "natural" about economics; is man-made. (Conceded his point of definition, but not the point that artificial stimuli usually fail in the long run)

M. Clausen

Propaganda by the ton has so swamped editors that they are suspicious of their friends, almost. Thinks "Business, the friend" idea is putting it pretty strong, as long as the profit motive dominates. (The idealist is always cropping up in this fellow) Even my title suggests Government vs Utilities, whereas they are both indispensable to the same picture of national welfare. Why cannot antagonism be replaced by coordination? Aha!) TVA experiment is evidence that country is not inert - not in a rut. (Went a long way that time to find some good in the bad) Utilities have scarcely reached the zenith of perfection. (As the speaker would have us believe) Cannot understand why there is any fear of a TVA, unless there is a skeleton in the closet. (Huston told later of the close call on Midwest being taken from Keokuk by cheap TVA power - freight being the determining factor) (I asked if the fear of unjust competition was legitimate)

Dr Curl

Hinted that the "heat of own interests" a serious evidence of bias. (But he told Ade after meeting that this was the first time he had heard the Utility side) Thought stress heretofore has been on capital and labor, neglecting management. Now attention is directed more that way. Worried about inconsistencies in rates as he has moved around country. (Will set him straight on relative costs of distribution some time) Aggravated by policy of utilities to remain non-committal in a controversy - officials have a way of remaining silent and letting people stew in their grievences. Has it in for the high-salaried officials. Has heard disconcerting rumors of M.R.P. capitalization. Thinks business ethics should be elevated to professional standards.

G. Berryhill

Country great by accident of events. These "mild" experiments are evidence of changing times. (could change backwards) Saw nothing damaging in newspaper accounts of congressional action. (In common with 99% of the people) Has heard some nasty things about subsidiary companies supplying materials at higher prices than open market, to bolster rates. Doesn't think any industry is qualified to judge its own merits. Utilities are only prosperous because they are non-competitive.

J. Elder

How about Hopson and Insull. (Exceptions overemphasized) Business success is not a blessing from above - the utilities have taken advantage of their opportunities and have made a good job of it. Government incapable of competing fairly with anyone.

G. Cale

TVA propaganda intended to win votes, and not sell power. No compromise on government in business - all or none. Exploitation of natural resources not entirely chargable to private enterprise; it was all used. And paper companies, for instance, are constantly reforesting for a continuous supply of pulp wood. This is an age of professional demagogues. Columbus was like the New Deal: he started going he knew not where, didn't know how long it took to get there, when he got there he didn't know where he was, and when he got back he didn't know where he had been - and he did it all on borrowed money.

H. Taylor

Recalled the Associated Gas and Electric incident coming out at the time of the threatened cancellation of "Quoddy". Ingrown prejudice against all utilities, including water and telephone, because people like to dicker, and don't like to "pay or I'll shut you off." Strong for individual enterprise.

A. Stolwyck

(Here's a strong Utility man: although he promised to give me the other side tomorrow, which he hasn't done) There is no compromise on these issues. Matter of bread and butter, not theory. Utilities too conservative - should have popularized their position more. Government adding daily to its stock of white elephants. Cannot compare subsidized Canadian rates with Detroit, or Fort Wayne and Keokuk. (Someone had questioned these) Mentioned large blocks of cheap power making local plants possible. Private iniative put dam here. (And congress raised cain about it in 1917) Capitalization of MRP very reasonable in view of promotional difficulties. Rates depend on quantity used.

(Fatigue limited rebuttals)

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