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Senator BROOKHART. It seems to me that both physically and legally that was interstate commerce.

Lieutenant Colonel TYLER. I do not see how there can be any question about that.

Senator BROOKHART. Well, if we would count all those plants in, that would increase your percentage very greatly?

Lieutenant colonel TYLER. Yes, but those other plants are not plants over which the Federal Government has any authority through its ownership of the sites or anything of that kind.

Senator BROOKHART. Well, when they go into interstate commerce it is a different thing.

Lieutenant Colonel TYLER. Then I think the Government would have the right to go out and find out what is invested there and set up a rate base. But my theory is that that is not a proper assignment to the bodies that control the water-power sites. That that is just a case of leasing some water.

Senator BROOKHART. It seems to me that the commission with a bureau or employees under it could perform these duties of valuation that you talk about, the same as the Interstate Commerce Commission does. They send out their accountants and investigators and they report back to the commission. It seems to me that any commission could do it that way, and it would be awkward to divide it into two commissions.

Lieutenant Colonel TYLER. I do not think it would be.
Senator BROOKHART. One would be subsidiary to the other.

Lieutenant Colonel TYLER. We have got to figure what the purpose is. The purpose is on these federally controlled water-power sites to lease them or license them under such terms as Congress sets up, and it is an engineering problem almost entirely.

Senator BROOKHART. When they are licensing they get quite a lot of information that is very important in determining the rates afterwards, and if the same commission is doing it all that will not be lost.

Lieutenant Colonel TYLER. Well, if the same commission can do the valuation work and all that. But the same commission that handles the whole power business throughout the country can not go into this question and make these leases for these sites without running into direct conflict with the departments which control the sites and must continue to control them in the interests of the major purpose for which they were secured.

Senator BROOKHART. Well I should not say that it was a conflict for one department of the Government to have business with another department of the Government. That is not a conflict.

Lieutenant Colonel TYLER. Not to have business; no, sir. But my thought is, if I may continue, sir, that the War Department is charged with certain specific duties by Congress with respect to navigable waterways.

The CHAIRMAN. Do you mind my interrupting at that point? I think the committee gets your point very well. I was wondering if something along this line would meet your views so as not to separate the responsibility from the administration. That we have an assistant secretary from each department who would give his whole time to this commission, and be appointed by the President, and

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subject to confirmation by the Senate, rather than to have the responsibility upon the Secretary?

Lieutenant Colonel TYLER. I think that would be very satisfactory, sir.

The CHAIRMAN. And then we would have full time commissioners responsible to the departments and the administration?

Lieutenant Colonel TYLER. Yes, sir.

The CHAIRMAN. And it would overcome some of the difficulties which you have enumerated and some of the suspicion that the administration is trying to unload this power problem on to an independent body.

Senator PITTMAN. They would constitute a board.

The CHAIRMAN. Yes; that the three Assistant Secretaries constitute a full-time board. Are there any other questions?

Senator BROOKHART. No.

The CHAIRMAN. We will adjourn until 10 o'clock to-morrow morning, to hear Mr. Merrill.

(Whereupon, at 12.10 p. m., an adjournment was taken until 10 o'clock a. m. the next day, Wednesday, February 26, 1930.)

INVESTIGATION OF FEDERAL REGULATION OF POWER

WEDNESDAY, FEBRUARY 26, 1930

UNITED STATES SENATE,
COMMITTEE ON INTERSTATE COMMERCE,

Washington, D. C. The committee met at 10 o'clock a. m., pursuant to adjournment on yesterday, in Room 416, Senate Office Building, Senator James Couzens presiding.

Present: Senators Couzens (chairman), Pine, Brookhart, Glenn, Kean, Hastings, Pittman, Dill, Wheeler, and Tydings.

Present also: William C. Green, special counsel to the committee.

The CHAIRMAN. The committee will be in order. Mr. Merrill, will you come around and be sworn?

Mr. MERRILL. Certainly.

The CHAIRMAN. You do solemnly swear that the testimony you will now give before this committee in the hearing now pending before it, will be the truth, the whole truth, and nothing but the truth, so help you God.

Mr. MERRILL. I do.

TESTIMONY OF 0. C. MERRILL, CHAIRMAN OF THE AMERICAN

COMMITTEE OF THE WORLD POWER CONFERENCE, 917 FIFTEENTH STREET, NW., WASHINGTON, D. C.

(The witness was duly sworn by the chairman of the committee.)

The CHAIRMAN. Mr. Merrill, I wish you would give, for the purpose of the record, your full name, your occupation at the present time, and what you have done in the past few years. .

Mr. MERRILL. I am at present chairman of the American committee of the World Power Conference.

Senator WHEELER. What is that organization?

Mr. MERRILL. It is an international organization made up of representatives of 50 different countries, which international organization has as its purpose the promotion of power development throughout the world, more particularly in the less developed countries, industrially speaking; the international exchange of information, data, and so forth; interchange of experience in operation for general cooperative benefit.

Senator WHEELER. How is it financed?

Mr. MERRILL. It is financed in the United States by the dues of its individual members, and by the support of certain corporations that are interested in the international aspects of power and trade.

Senator WHEELER. Who are they, I mean in the United States?

Mr. MERRILL. In the United States there are the National Electric Light Association, and-Senator WHEELER (interposing). What do they contribute to it?

Mr. MERRILL. They at the present time have guaranteed the financing of it pending

Senator WHEELER (interposing). They have guaranteed what?

Mr. MERRILL. The financing of the American committee for a period of five years, pending the distribution of the cost among the various interested groups, which will be the foreign power organizations or those organizations in the United States engaged in foreign power development and distribution, foreign banking institutions, industrial organizations for export, like the General Electric Co., the Westinghouse Electric & Manufacturing Co., the United States Steel Corporation, and those groups in the United States that are interested in improving industrial conditions abroad from a trade standpoint.

Senator WHEELER. How about Electric Bond & Share Co.?
Mr. MERRILL. And Electric Bond & Share.
The CHAIRMAN. What is your salary?
Mr. MERRILL. It is $15,000 a year.

The CHAIRMAN. What were you getting when you left the Federal Power Commission?

Mr. MERRILL. I had been getting for two weeks before I left, I believe, $8,000 a year.

Senator WHEELER. And prior to that time what had you been receiving from the Federal Power Commission?

Mr. MERRILL. I had been getting for the last two years I think $7,500 per year, and prior to that time I had been receiving less than my assistants in the commission had received for years.

Senator PINE. I do not believe that you have given the com-mittee reporter your full name and address.

Mr. MERRILL. My name is 0. C. Merrill, and my address is 917 Fifteenth Street NW., Washington, D. C.

The CHAIRMAN. Will you tell us your experience before you were employed by the Federal Power Commssion?

Mr. MERRILL. I was for 11 years, from 1909 to 1920, in the United States Forest Service. From 1913 to 1920 was chief engineer located in Washington, and had handled for the Department of Agriculture in the Forest Service all of their water-power problems.

The Chairman. Who recommended you for the position of executive secretary of the Federal Power Commission?

Mr. MERRILL. Secretary Houston, and the cheif of the United States Forest Service. I had met and knew personally Secretary Baker before I went over there.

Senator WHEELER. What are your duties now?

Mr. MERRILL. My duties are to arrange for international meetings to be held in Berlin in June of next year at which economic problems of power development and distribution are to be discussed. In addition to that it is the intention to develop international exchange information service between the various national committees, and also to act as a research agency for those interests in the United States which are engaged in these international activities.

Senator WHEELER. What do you mean by research agency?

Mr. MERRILL. Information about power development abroad, about financial conditions abroad, and so forth. That is, what we will do will be to supplement perhaps in a more detailed mannerwhat the United States Department of Commerce does for American business in general.

Senator WHEELER. Does not the Department of Commerce look after these power interests abroad?

Mr. MERRILL. They have no means of getting information out.

Senator WHEELER. What kind of information, for instance, do you get abroad?

Mr. MERRILL. We will get information about power development. We will get information concerning the situation in power development in some of these countries; what the possibilities are there for United States trade; what the possibilities are there for American investment.

Senator WHEELER. Do you mean for the power interests?

Mr. MERRILL. Yes, sir; and not necessarily the power interests, but for whatever financial groups are engaged in investing abroad.

Senator WHEELER. For instance, could you give us an illustration of it?

Mr. MERRILL. Well, I can hardly do that because the group was only organized in July and we have not yet been able to develop that work, because all of the time since I have been there, from the 1st of July, 1929, has been taken up in preparing for attendance on the meetings to be held in Tokyo in November and in Berlin in June. But that is the general intent. It is confined strictly to the international field, and has nothing whatever to do with the domestic field.

Senator WHEELER. You do not do any lobbying here for them? Mr. MERRILL. No, sir; not a bit.

Senator DILL. Did I understand that back of this organization is the purpose to have an international power merger?

Mr. MERRILL. Oh, no; absolutely not.

Senator Dill. Well, you have international mergers in other things, and they talk about an international bank. I wondered if back of this proposition there is not the purpose of an international power merger.

Mr. MERRILL. There could not very well be anything of that sort, because even though those in the United States might wish to do such a thing, they are only 1 of 50 in the international organization.

Senator Dill. I am not saying that the men interested in power development in the United States alone want that, but that the whole power movement of the world seems to be along that line. What about that?

Mr. MERRILL. Well, I do not know what the future may bring about in that respect. But there has not been the slightest intimation on the part of anybody so far as I have heard or seen to proceed

in that way,

Senator WHEELER. Is it not a fact that those engaged in the development of power in this country have found it an extremely profitable field?

Mr. MERRILL. Do you mean in foreign countries?
Senator WHEELER. No; in this country.
Mr. MERRILL. Oh, yes, I think so.

Senator WHEELER. It has been so much more profitable than they ever dreamed of that now they are looking to see what developments can be carried on in foreign countries with profit; is not that it?

Mr. MERRILL. Well, there is a great deal of that being done already.

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