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required. This conclusion in the home of the largest municipal lighting plant in the United States proves that municipal ownership is not dear as an ideal to the heart of the American citizen. He looks upon it merely as a means to an end and accepts it only when it appears to be the only means readily available. A brief statement of the Chicago issues and campaign will be found in the last paragraph of this report.

Third-But when the issue to be voted upon is a question of public service and an intelligent vote is desired, the individual voter must be reached by presentations of fact and argument that apply to his individual case.

It is not sufficient to present an academic discussion of the question in the editorial columns of newspapers. It is not sufficient to distribute general statements of the issue by mail to the registered voters. It is not even sufficient to hold local or district meetings to discuss the issue. The object must be analyzed and its relations to each class (however small) of the voting citizenship clearly defined; and that part of the analysis that applies to the case of each voter must be got into the hands and into the mind of that voter.

The foregoing programme is a large one. Nevertheless, it is the only programme that leads to success. It is not a new programme. It has already been followed to the letter, and with success. The denunciation of corporations by professional politicians and agitators, by devotees of the socialistic cult, and by well-meaning students of social conditions, has never ceased and has in recent years become so voluminous and so able as to have an effect on the mind of every citizen. The general reader of press and magazine articles and the listener to socialistic addresses from platform or pulpit do not always accept what they are told as gospel, but do always receive the impression that where there is so much smoke there must be some fire. And the individual who finds it hard to make a living is quick to accept a theory that charges to corporate greed the origin of his evil circumstances. When, to voters prejudiced by such impressions and beliefs, a scheme of public ownership is proposed, with promises of reduced cost of service, reduced taxes, and plenty of jobs for deserving citizens, it takes a strong showing of personal advantage to secure votes against the proposal. The printed matter used in the London campaign is an excellent illustration of such personal argument. The references to increased rentals due to increased taxes on household premises; to idleness of workmen because former employers had been taxed out of the municipality; to lost trade and bad debts of small shopkeepers because their customers, being idle, had no means wherewith to buy or pay,—these were lessons that found apt scholars. In Chicago the object lessons of bad street-railway service getting daily worse while politicians debated "immediate municipal ownership," and districts without service because capital declined to make investments subject to summary confiscation,—these lessons reached every voter. In an earlier successful campaign against municipal ownership—that in Cleveland in 1902 against the proposal to engage the city in the electric-light businesseffective work was done by showing foreign-born voters, by circulars printed in their mother tongue, that the taxes on their much-prized homesteads would be increased in order to reduce the cost of something that to their frugal minds appeared to be a luxury.

The Chicago "Immediate Municipal Ownership" campaign, although electric lighting was not the direct issue, is of such value as an illustration of the present temper of the public that we think it well to present a brief statement of its issue and history as a conclusion to this report.

In Chicago events would indicate that the crest of the wave or craze for municipal ownership has been passed, and that this crest occurred with the nomination of Mr. Edward F. Dunne for mayor of Chicago, in the spring of 1905, on an immediate municipal ownership platform; also with the passing on the part of the legislature of the state of Illinois of a bill providing for the issuance of certificates known as Mueller certificates, proceeds from the sale of which were to be used by the city of Chicago in the purchase of street railroads and equipment for a municipal traction system. At that time the long period of discussion and legal fighting that attended the closing years of the principal franchises of the street railway companies had culminated in the failure of the traction corporations to come to any terms with the city in the matter of extension of rights and in the actual termination of said principal franchises. During this period of suspense and agitation the street-railway properties had been allowed to run down and the equipment and service had becomé, to say the least, extremely unsatisfactory. This was no more than might naturally have been expected, as the owners of the traction securities could hardly be blamed for declining to put up more money and authorize heavy expenditures for improvements when the leaders of large bodies of people were openly advocating the practical confiscation of their property.

A long-suffering public, not well informed and not having had an opportunity to thoroughly masticate the subject, was anxious to support anything that seemed to promise the quickest amelioration of the existing conditions, and Mr. Dunne, backed by a good record as a judge and promising immediate municipal ownership with greatly improved service, was elected by a majority of approximately 40,000 votes. A few months, however, satisfied the most unthinking of the people that not only was it impossible to institute municipal ownership immediately, even if authority and means had been immediately available, but that the legal rights of the traction companies must be settled, in the courts if necessary, whether the people wished it or not; the issuing of Mueller certificates for the purchase of the roads must be submitted to the people at a regular election, and, furthermore, these voters had begun to realize that perhaps municipal ownership was, after all, not what they wanted.

A year passed, and the questions above were submitted to the people. The right to issue Mueller certificates was given by so slender a majority that it was looked upon by those opposed to municipal ownership as a practical defeat of the scheme, and the proposition to permit the municipality to operate the roads was decisively lost. A short period of education followed, and a committee of the city council appointed to confer with the railroads, and if possible submit some plan for the solving of the problem, finally gave evidence that there seemed to be a common ground on which the people and the street railways could come together. This took form in an ordinance which established a value upon the properties of the street railways, promised them reasonable franchises and an opportunity to obtain a fair return on the new capital to be invested, insured the city very fair compensation in exchange for the franchises, and arranged a plan by which the service should be promptly improved and the city should have proper control of the action of the companies. This ordinance was introduced and passed by a large majority of the city council. It, however, did not meet with the approval of Mayor Dunne, who vetoed it, and it was thereupon passed over the mayor's veto. Then the municipal ownership party secured within the time limit a sufficient number of signatures to require its submission to the vote of the people. The approval of the ordinance was the principal plank in the platform of the Republican candidate and the contest aroused the interest of the people. The action of the city council in passing the ordinance was indorsed by a majority of 33,000 and the Republican candidate was, while running somewhat behind the vote on the traction ordinance, elected by a majority of 13,000 votes, the first Republican mayor to be elected by the people within a period of nearly twenty years.

One can only speculate as to the exact analysis of this vote, but the general feeling is that, in view of the democratic tendency of the city and the strength of the Democratic organization, it represented very much more of a revulsion of feeling on the part of the general public in the matter of municipal ownership than the figures would indicate. In other words, that an overwhelming percentage of the right-thinking and intelligent element of the community, which represents the balance of power, had after mature consideration come to the conclusion that private ownership, under proper conditions as to regulation, would be very much more satisfactory to the public and to the general interests of the municipality and its citizens than would municipal ownership

As to the Mueller certificates, there has, since their authorization by legislative enactment and by the indorsement of the people, been much speculation as to their legality, and also, in financial circles, as to the city's ability to put them out on any warrantable basis or so to invest the city with any substantial amount of the face value that they represent, but this speculation has been brought to an abrupt close by action of the Supreme Court of Illinois, in a decision handed down in April, 1907, holding that most of the essential features of the act are illegal and indicating that, while there may be a possibility of curing them, it can not be done in a way that will leave the law effective for the purpose intended. In fact, the decision is sweeping and is looked upon by all intelligent people as an absolute deathblow to the city's ambition to sometime own the street railways.

Respectfully submitted,

SALex Dow, Chairman, Sub-committee

SAMUEL INSULL.

REPORT OF SUB-COMMITTEE ON PUBLIC

REGULATION AND CONTROL

To the Committee on Public Policy, National Electric Light Asso

ciation:

The report of the secretary of the Committee on Public Policy in reference to measures introduced in the various state legislatures that have been in session this winter, indicates that there has been a variety of measures introduced in almost all of these legislative bodies affecting public-service corporations.

This proposed legislation, where unfriendly, is not solely the result of antagonism to the municipal public-utility companies, but is undoubtedly prompted in no slight degree by the agitation for a more strict control and regulation of the steam railroads.

The movement is a natural one in itself. Regulation by force of competition, potential or actual, has been the policy of all states from the time public utilities were first developed to the present day. This method of regulation required secrecy of accounting on the part of public-utility corporations. No corporation could justly be required to expose its accounts to a competitor. This condition prevented the public from obtaining accurate knowledge of facts necessary to the formation of an intelligent public opinion.

To secure relief and immunity from the evils of regulation by competition, public opinion has been led to demand a policy of state regulation or of municipal ownership. State regulation, if it is to be intelligent, must have the means of securing an accurate knowledge of facts. This requires the substitution of public accounting for secrecy of accounting. This change requires the abandonment of the policy of competition. Publicutility corporations must be given protection in their business in consideration of their giving full information to the public regarding their accounts.

In view of these facts, the wise course would seem to consist, not in an attempt to stem the tide of public opinion, but rather in seeking to evolve and define that method of public supervision and measure of control which will permit of the attainment

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