Soon-to-be-president a PUF Author
When Franklin Delano Roosevelt wrote an article for Public Utilities Fortnightly, in June 1931, he was governor of the state of New York and a strong contender for the Democratic nomination for the 1932 presidential election. What drove FDR to write the two-page article?
The PUF editors asked the soon-to-be-president:
"... whether or not it will be possible for a privately owned public utility company to earn a reasonable return on its investment in New York, notwithstanding the enactment of all of the so-called progressive proposals?"
The question reflected a pressing concern at the time that progressive Democrats would:
"... secure ultimately the whole field of public utility service for governmentally owned plants."
"... one of the most important causes, if not the prime cause, of the present dissatisfaction with public regulation and the criticism which one hears so generally is the attempt by those in control of utilities to obtain, not merely a fair return upon prudent unimpaired investment, but profits in excess of such an amount."
At that time, electric rates were as high as a dollar per kilowatt-hour, in today's terms, increasing the electric bills of those with electric utility service and limiting those who could afford to begin service.
The Public Utility Holding Company Act of 1935 was still in the future. Utility holding companies were unregulated and abuses took place including excessive profits.
FDR's article had this timeless statement:
"I am firmly convinced that a proper system of public regulation wisely administered will not endanger prudent unimpaired investment in public utilities, provided the management is efficient and constructive. Indeed, investors ought to desire and work for efficient regulation."
The author is better remembered as the only four-term president of the United States and the nation's leader during the Great Depression and World War II.
Starting with the February issue, Public Utilities Fortnightly will include retrospectives, looking back at the colorful history of the electric and gas utilities industry as documented in the pages of PUF since 1929.
Steve Mitnick, Editor-in-Chief, Public Utilities Fortnightly
E-mail me: email@example.com