Evening Star Newspaper, October 22, 1935, Page 10

BENEFITSOFR.EA Adrinistrator Sees Bright Future for Rural Elec- trification Plans. Describing rural electrification as & potent influence in the entire pic- ture of industrial stimulation and rural rehabilitation, Morris L. Cooke, head of the Rural Electrification Ad- ministration, last night predicted that 1936 will be a year in which “rural line electrification will exceed even the most prosperous years of the industry.” Mr. Cooke spoke last night on the National Radio Forum, sponsored by ‘The Evening Star and broadcast over a National Broadcasting Co. net- work. Administration Staff Small. The administration itself, Mr. Cooke explained, is a comparatively small unit with fewer than 200 names on its pay roll, depending largely on! the initiative of farm groups to spread the activities of the program. To this end, he said, “R. E. A. is trying | to bring electric power to the great- est possible number of farms. It is strongly urging that in the construc- tion of rural lines entire areas be served, thus taking the skimmed milk with the cream—a policy that many utilities have, in the past, been re- luctant to follow.” Potential projects in 40 States are now docketed with the administra- tion, he said, and “right now, loan contracts are awaiting signature on 11 rural electrification projects in seven different States.” The whole program, the adminis< trator continued, is aimed at aban- doning policies and practices which are outworn and substituting plans for utilization of improved rate sys- tems, modern appliances and most efficient principles. | Text of Address, | ‘The text ‘of Mr. Cooke's address follows: ‘ In order that you may have a better understanding of the aims| and objectives of the Government | rural electrification program, let me explain why it appeared necessary to take some action to change the rate of progress of rural electrification in this country. About half a century ago the French movelist Emile Zola wrote: “The day will come when electricity will be for everyone as the waters of the rivers and the wind of heaven.| It should not merely be supplied, but | lavished, that men may use it at their will as the air they breathe.” And the late Charles P Steinmetz, one of our greatest authorities on electricity, foretold the time when electricity will be so plentiful that, for retail use, it would not pay to meter it. In many of our industries, and in many modern city homes, the day foretold by Zola seems to be ap- proaching. In some foreign countrics | [ | and in the early stages of the re- MORRIS L. COOKE, THE EVENING STAR, WASHINGTO electricity has been made available | chises as widely as possible while ex- | | to almost every resident, urban er rural. But when we survey the| situation in our own great Nation we find that only a little over 10 per cent of the farms in the United States have been electrified, although | the electric light and power industry recently celebrated its fiftieth anni- versary. During the depression years covery the business of extending rural lines had come almost to a standstill As a matter of fact, the number of unelectrified farms actually increased by more than 350,000 in the five-year period 1930 to 1934, because in that period new farms were added faster than electrification was extended to farms. Charges Prohibitive, Many factors delayed the extension of rural electrification. To overcome them a strong national effort was required. Among these hampering conditions were charges for energy in rural areas that were prohibitive and out of line with charges to urban consumers. Then, too, burdensome | conditions were imposed upon the ex- | tension of rural lines which penalized the hard - pressed farmer and dis- | couraged his efforts to become a cus- tomer. And then there was the lack of facilities to finance home and farm electrical equipment which was needed if rural consumption was to increase and the benefits of real rural electrification were to be available to the farmers. In addition, some util- ities that desired to extend rural lines were unable to borrow money pri- vately on reasonable terms. When to all this was added the inertia of many units of the utility industry. their traditional policy of extending their monopolistic fran-! | verse conditions, utility construction | prove the living conditions of our | ing to the farmer as many as possible | city—without which, indeed, life in tending their services only to those areas which were most profitable, the outlook for rural electrification was indeed unpromising. Because of these and other ad- shrank from approximately $920,000,- 000 in 1930 to $100,000,000 in 1934. | ‘This threw out of employment and on to the relief rolls a vast reservoir of skilled labor which was anxious to return to its old tasks. Those manu- facturing industries whose products are required for rural line extensions were, for the most part, working only | part time. Running Water Scarce. You can well imagine that such conditions were of particular interest to an administration pledged to im- rural areas and interested in extend- | of the benefits of urban life. One | of the many modern conveniences which we take for granted in the our cities would be lmpossible—is‘ running water. Yet we found the| percentage of farmhouses with mn-“ ning water was almost identical with | the ratio having electricity. That is not a coincidence, for electric power is the most satisfactory method of providing running water on the farm. About 60 per cent of our farms have automobiles, and over a third of them have telephones. In every area where electricity has been made available to them, the farmers have demonstrated not only ability out ardent willingness to utilize it. It is certainy not a fact that only one farmer in ten wants electric power. Such, then, were the conditions exist- ...but, after all is said and done, it’s the cigarette it- self that counts ««. the question does it suit you? | electrification program. ing when the Government launched its rural electrification program. ‘The Congress took the first step in this when it earmarked $100,000,000 of the work-relief funds to be used in increasing the degree of rural electrification in this country. President Roosevelt last May created the Rural Electrification Administra- tion to put that money to work and to supervise a program to bring about greater utilization of electric energy in rural areas. Loans Made at 3 Per Cent. R. E. A. is trying to bring electric power to the greatest possible number of farms in the shortest possible time. It is strongly urging that in the con- struction of rural lines entire areas be served, thus taking “the skimmed milk with the cream”—a policy that many utilities have, in the past, been reluctant to follow. Loans at an interest rate of 3 per cent to be amortized over a period of 20 years are to be made to the public as well as private bodies on approved self-liquidating projects. No grants will be given, Normally the construction of 25 or more miles of rural lines where cus- tomers average three or more to a mile will be considered a project. Construction cost would be approxi- mately $1,000 per mile, and there should be a prospect of building up consumption of current to exceed an average of 100 kilowatt hours monthly per customer. In order to achieve these objectives, new and inexpensive standards of rural line construction, lower rates |and a new type of service contract, free from the burdensome conditions heretofore prevailing, must be estab- lished. Rural lines must be “tailored” to the farmers’ needs and the use of expensive urban construction elim- inated. In conjunction with the ap- proval of projects, R. E. A. is insisting that rate schedules be adopted whici will encourage the generous use of electricity. A special effort is being directed toward breaking down anti- quated systems of high minimum monthly charges and of requiring con- sumer cash contributions before lines | are extended. R. E. A. to Fix Wages. At least 25 per cent of the money lent is to be expended for labor under ! each particular project carried on by & public body, and preference in the employment of workers will be given | to persons from public relief rolis. Wages will be determined by R. E. A,, | but in accordance with local wage conditions. R. E. A. has sought to find the best method by which all interested agencies might co-operate in the rural In this effort agencies of all types have been con- sulted. At the outset R. E. A. called | | conferences of the private utilities, the municipal utilities and co-operat- Ives. These took the form of round- table discussions, in which R. E. A participated. There was a mutual exchange of points of view, resulting in a much more efficient approach to the problem on the part of all. Liaison has been established with all Government departments and agencies which have an interest in the farmers’ welfare or the electric industry. State agencies, such as the public service commissions, State D. C, TUESDAY, OCTOBER 22, 193 rural electricfication authorities and the State departments of agriculture, have been consulted. Splendid co- operation has developed between R. E. A, and national farmers’ asso- ciations, such as the American Farm Bureau Federation, the National Grange, and the Farmers’ Union. Almost daily we are receiving reports from private companies containing their 1935-36 line construction pro- grams accompanied in some instances by revised rate schedules and rules for extending lines. Initiatory Work Necessary. ‘The lethargy in which rural elec- trification has rested up to the pres- ent makes it necessary for R. E. A. to undertake extensive initiatory work before the rural electrification pro- gram can attain its fullest develop- ment. To that end, we have prepared and distributed small printed pamphlets announcing and explaining the Gov- ernment rural electrification program. We are distributing a monthly bulle- tin, to serve as a central clearing house for information on all rural electrification activities. Federal, State and private. Through the medium of that bulletin and other- wise, we are collecting statistics of rural electrification and effecting an interchange of plans, progress and technical developments. There has been an extreme derth of accurate statistical information on rural elec- trification. For example, even now we have no way of telling precisely how many miles of rural lines there are in this country, and even as to the number of farms receiving elec- tric service there is a marked differ- ence in the statistics issued by rec- | ognized authoritles. | “This information service has pro- gressed quietly, without any fanfare of trumpets nor beating of drums. It has consisted largely of keeping those who are, or who may become leaders and active participants in our program currently informed of our activities, and seeing that pertinent information from one part of the | country is called to the attention of interested persons in other sections. Direct Contacts Needed. ‘To be effective, an information serv- ice must be supplemented by more | direct contacts. Hearty co-operation has been assured by the private util- ity industry. The co-operative mov ment, already well established as an aid to the farmer in both produc- tion and consumption, 1s anxious to play a significant part in the R. E. A. program and has requested contacts by R. E. A. representatives. To these, | as to all other enterprises participat- | ing, we make available, in an ad- | visory capacity, our legal and en- | gineering services, R E. A engineers have drawn up standard specifications for a type i of line construction most suitable to | rural needs. These standards are ! now in the hands of national authori- ties in electrical engineering for final checking. The effect of such a serv- ice is to reduce costs to a minimum consistent with satisfactory opera- | tion; this in turn means a lower | cost of electricity to the consumer. Model by-laws and standard forms | for incorporation suitable for electric ‘co-operan\'es have been prepared. | Co-operatives in many areas have already done a thorough job of or- ganizing farmers who are asking for rural electrification, and they have submitted many applications for loans. Electric co-operatives which have been operating fcr years almost unknown to the industry at large are preparing to expand their activities, Special Units Created. Certain national farmers' associa- tions—the American Farm Bureau Federation and the National Grange, among others—have created special sections and committees to aid the farmer in procuring electric service. Parc of the activity of these national associations is being carried on in conjunction with State Departments of agriculture. State agricultural col- leges are continuing and in some cases expanding their activities re- lating to rural electrification. Despite the inertia which has beset the rural electrification situation, R. E. A. has already docketed potential projects from 46 States. While some of these may not now, or even after amer.dment, satisfy the several re- quirements lald down by the Presi- dent, many of them undoubtedly will. And where a project proves too weak there is always the possibility of com- bining it with another and stronger one, Many of the projects which were sub- mitted early have met our ehgineer- | ing, legal and economic tests. Right | now, loan contracts are awaiting sig- | nature on 11 rural electrification proj- ects in seven different States. Action on many more projects is rapidly ap- | proaching completion, and loan con- | tracts for them will probably be com- pleted soon. The Rural Electrification Adminis- tration itself is a small, intimate group | of specialists and near-specialists. | There are only about 200 names on our pay roll. We depend very largely | on the initiative of farm leaders to organize projects, to make vocal the | demand of farmers in their communi- | ties for electricity. We are all lo- cated here in Washington, and in our few short months of life we have kept pretty busy. Rural Rates Reduced. In the meantime, in response to the stimulus given by the Government program, thousands of miles of rural lines are being built throughout the country with private financing. Power companies have reduced their rural | rates and liberalized their rural ex- tension terms, and utility commissions have revised their regulations to con- form with the new spirit evident | | everywhere. 1 This burst of speed in rural line con- | struction is highly gratifying in itself, | and especially so when compared with the activity in this field prior to 1935. The number of new rural customers to be added in the State of New York | alone as a result of the program re- Icenlly announced by private utilities |in that State may easily exceed the increase for the entire country in the year 1934 | When it 1s considered that in spite | of the fact that the most profitable customers have already been connect- ed by utility companies, the number of new lines constructed in 1935 will, in all probability, exceed by several | times the construction of 1934, and that definite evidence points to 1936 as the year in which rural line con- | | struction will exceed even the most prosperous years of the industry, the Federal Government may be confident r ow, when it comes fo a cigarette that will suit you...you want to think whether it’'s mild, you want to think about the taste That Chesterfields are milder and taste better is no accident . . . The farmer who grows the tobacco, the ware- houseman who sells it at auction to the highest bidder, every man who knows about leaf tobacco will tell you that it takes mild, ripe tobaccos to make a good cigarette. In making Chesterfields we use mild ripe home- grown and Turkish tobaccos. A that its rural electrification activity is one of the really substantial contribu- tions to the agricultural welfare of the Nation. Fresh Viewpoint Needed. The Government rural electrifica- tion program is based entirely on the principle that the time has come to abandon practices generally admitted to be outworn and to adopt forward- looking policies made possible by the favorable 1935 conditions. What we need in this program, as in any other new activity, is the inquiring mind and | a fresh and untrammeled point of | view. It would be a capital blunder to spend millions of dollars for rural | electrification using standards which | have produced such unsatisfactory re- sults in the past, and leave America as it is today, a backward country in furnishing its rural population with the comforts and necessities of elec- trical power. ‘We believe that the electricity from the lines should be sold under en- tirely different conditions than are now customary in rural areas. For example, we feel that any sort of service charge which does not ir- clude some current should be avoided in billing farm customers. Room and area charges are not suitable to or- dinary farm service and are out of date, We recommend a simple system of block rates, with a promotional rare | schedule. Higher use is induced oy having the price per kilowatt hour drop sharply in the second and fol- lowing blocks of the schedule. ‘The minimum monthly bill for the rural customer should not exceed $3 or $350, and this sum should include enough current—40 or 50 kilowatt hours—for ordinary lighting and minor household appliances Customer contracts for rural serv- ice which provide for a monthly mini- mum guarantee should have a defi- nite termination for such guarantees, normally in about three years. Contracts Often Obscure, In areas where farms average be- tween three and four to the mile, rural extensions should normally ve buiit without customer contributions The rules governing extensions should pbe phrased s» the prospective cus- tomer can understand them without an interpreter. Some contracts in the past haven't been understood even by the companies themselves, I think. Such prmciples as these, we [eel, must be adopted before satisiactory progress is made in rural electrifica- tion in this country. ‘The most important requirement of present and future rural electrifica- tion in the United States is plan- ning. We must have a great na- tional plan which is the sum of many smaller local plans. Each group con- cerned with rural electrification must have its own plan, and each of these must be co-ordinated into an in grated whole. These plans may ver; well be in the form of quotas. sel allotted goals reasonaby capable of attainment. There must be a quota for all of rural America. and a quota for each State, and a quota for each county, each community. Each appliance maker must have & quota, each public and private utility organization must determine its share in the rural electrification > program. Private utilities now oper- ating in rural territories should as a Tule at least double the number of rural customers that serve and more than double the amount of current s0ld. Let me repeat that and em- phasize it: The total kilowatt-hours of electricity consumed in the homes and on the farms of the United States can and will be doubled in the next few years, Naturally, even the attainment of that quota will be only the firsy step in our long-range plan. But right now we are concerned with a conditon that amounts to an emer. gency. We have two things to do, as I see it. We have to prepare a sound, forward-looking program lead- ing ultimately to very general rural electrification and we have to et that program started and a lot of progress made in the months and years just ahead. Benefits to Country, The benefits to the country as a whole from the acceleration of this program are, first, the direct em- ployment in the construction of lines of thousands of men now on reliet rolls, and, second, the stimulation of the copper, glass and lumber industry and electrical equipment fabricators with resulting increases in employ ment, pay rolls and profits. Additional benfits will arise from the stimulation given industrial re- covery by the increased demand for electrical appliances and plumbing equipment which rural electrification makes it possible for the farmer to use, It is impossible to overestimate the true significance of rural electrifica- uon in the stabilization of farm life | and the reconstruction of agriculture., | The use of electricity for the pump- ing of irrigation water and its re lation to soil erosion make rural elec- | trification an indispensable factor in the new era of agriculture. Electricity will remove the drudgery from farm life, and the cultural benefts that arise from its abundant use will lift the plane of the farmers standard of living. This will help to stabilize our rural population and keep our best young people on the farm The program under way promised results satisfactory, not only to the Federal Government and to farm | communities, but to the power coma | panies as well. The R. E. A. has | diligently cultivated friendly rural organizations, equipment manufac- turers, co-operatives, municipalities, privately owned utilities—and it is to the united exertions of these groups that credit will be due for the success of its program In this period of stress and shifte ing standards in American life one inaster problem stands out. This is tural rehabilitation. But of course the problem can be made to sound | more simple than it really is. In any plan for rehabilitating American agriculture one must include the sale vation of our soils from erosion, the building up of farm incomes and a general improvement in the levels of living to the end that the gap which new exists between urban and coun- try life may be closed. And in any such planning for the economic and cultural betterment of life in rural America, electrification must play an increasingly important part. .. for mildness .. for better taste