In the second wave of New Deal legislation in the spring of 1935 – historians often refer to the period as the “Second New Deal” – Congress passed a massive omnibus bill – The Emergency Relief Appropriations Act. In a move that would be political poison today, Congress granted vast discretionary power under the Emergency Act to the president and Franklin Roosevelt got busy. With the stroke of a pen Roosevelt allocated millions to construct dams, build airports, bridges and tunnels.
Among the raft of Executive Orders signed by Roosevelt, and permitted under the Emergency Act, was the creation of the Rural Electrification Administration (REA). As Stanford University historian David Kennedy has written, “when REA began its work, fewer than two farms in ten had electricity; a little more than a decade later, thanks to lost-cost REA loans that built generating plants and strung power lines down country lanes and across field and pasture, nine out of ten did.”
Before the REA’s low-interest loans changed the landscape, as Morris Cooke the first REA Administrator said, the typical American farmer was in an impossible situation. “In addition to paying for the energy he used,” Morris wrote, “the farmer was expected to advance to the power company most or all of the costs of construction. Since utility company ideas as to what constituted sound rural lines have been rather fancy, such costs were prohibitive for most farmers.”
One of the great and enduring myths of the American West, as the great writer Wallace Stegner liked to remind us, is the myth that the West was built by rugged individuals. Nonsense, Stegner said. The West was built by the federal government and there are few better examples of how an enlightened government changed the landscape and life of millions of Americans than the REA. This fascinating and still immensely important story, fundamentally a political story about the good government can do, is told with engaging flair and real insight in Ted Case’s fine recent book Power Plays.
Case, the executive director of the Oregon Rural Electric Cooperative Association, argues that preserving the public institutions and the public good that the REA ushered in during Roosevelt’s day has required nearly 80 years of constant hand-to-hand combat with a variety of political forces, often including hostile presidents. The battle has been worth it, since it is not an overstatement to say that the region’s cooperative utilities, and the Bonneville Power Administration (BPA) that serves them with power and transmission, really have built the Northwest.
As debates rage in Washington over the scope and role of government, it’s worth remembering that during some of the nation’s darkest days of Great Depression, presidential candidate Roosevelt came to Portland, Oregon in 1932 and made an eloquent argument for a government devoted to the “larger interests of the many.” The occasion was a campaign speech – billed in the day as a major policy address on public utilities and hydropower development – that turned out to be one of FDR’s most important policy pronouncements during his history making campaign against Herbert Hoover.
“As I see it, the object of Government is the welfare of the people,” FDR said during his Portland speech. “The liberty of people to carry on their business should not be abridged unless the larger interests of the many are concerned. When the interests of the many are concerned, the interests of the few must yield. It is the purpose of the Government to see not only that the legitimate interests of the few are protected but that the welfare and rights of the many are conserved…This, I take it, is sound Government — not politics. Those are the essential basic conditions under which Government can be of service.”
During his Portland speech Roosevelt pledged to develop the hydro resources of the Columbia River, proposed vast new regulation of private utilities and foreshadowed the creation of what became the REA, the agency that, as David Kennedy says, “brought cheap power to the countryside, mostly by midwifing the emergence of hundreds of nonprofit, publicly owned electrical cooperatives.”
The reason many Americans in 1932 lacked access to adequate or any electricity, Roosevelt said, is “that many selfish interests in control of light and power industries have not been sufficiently far-sighted to establish rates low enough to encourage widespread public use.” He might also have said that many private utilities in the 1920′s and early 1930′s were content to operate highly profitable businesses in relatively easy to serve urban areas and were simply unwilling to make the effort and expend the resources to deliver power to smaller communities and farmers.
It’s difficult to imagine today, when without thinking we enter a dark room and flip the switch, how long it would have taken to get affordable electricity to rural Northwest and its farms had Roosevelt not followed through on his powerful Portland speech on power. Imagine the Pacific Northwest without the power of the federal dams that FDR promised in1932 in Portland – and I know they have become controversial – or the legacy of public power. The region’s great public utilities have played their part in the region’s development for sure, but they often have a fundamentally different mission from public power, including the need to generate a rate of return on investments, while answering to shareholders and investors.
It is a re-occurring feature of American democracy that we debate and debate again the reach and responsibility of government. We are stuck in a particularly dysfunctional period of that debate right now. Almost always in our history these periodic debates have been resolved, to the extent they are ever fully resolved, in favor of what Roosevelt long ago called “the welfare of the people.”
In the last years of his life, as Ted Case points out in his political history of how cooperative utilities remade rural America, Lyndon Johnson remarked that “of all the things I have ever done, nothing has given me as much satisfaction as bringing power to the Hill Country of Texas. Today in my home county,” LBJ said, “we have full grown men who have never seen a kerosene lamp except possibly in a movie – and that is all to the good.”
Rugged individuals make for good movies, but aggressive action by a federal government devoted to the greatest good for the greatest number helped turned on the lights in much of the Pacific Northwest. The story Ted Case tells in his book Power Plays is a reminder of what truly enlightened public policy once looked like.