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Show PINCHOT ON FORD'S OFFER TO BUY MUSCLE SHOALS In a personal letter to tho editor of The Republican, under date of August 25, 1021, Hon. Gilford Pin- chot, chief forester under President Roosevelt, and a warm friend of the Colonel, gives his views on the offer of Henry Ford to purchase the government gov-ernment property a,t Muscle Shoals. The letter follows: The recent offer of Mr. Henry Ford to take over government property at Musclo Shoals on tho Tennessee, river Is so Important that I take the liberty lib-erty of laying certain essential tacts before you. "Tho first part of the Ford offer Is to lease the Wilson Dam and Dam Number 3 for 100 years, with indefinite indef-inite renewals, provided the govern ment will complete them and install machinery to produce 850,000 horse power. Mr. Ford offers to pay 6 per cent on the 28 million dollars which he estimates will bo neercarv to complete this ork, oi 3-4-10 per cent on 48 million dollars, Mr. Ford's own cstlmnto of tho wholo i;ovcrnuient Investment In dams, locks and power houses. Even If wo add all other annual payments (the no-called amortization payments, and payments for the repair, maintenance and operation of dams, gates and cks) the total would bo equivalent to Interest at the rate of only 3-6-10 per cent. Mr. Ford otfeis uhin to give the government 300 horsepower to operate tho locks. PleaBO noto that for the water-power water-power Itself Mr. Ford would pay nothing, and that he would be free from all taxes on tho property. Other Oth-er lessons of water power rights from the government not onl) bear tho total cost of building their own dams and powerhouses and pay taxes tax-es on them but they also pay for tho water power in addition. The Ford offer Is like offerlnlg a man 3-6-10 per cent on the cost of his factory as rent and then ncking him to throw In a coal mine to supplv fuel for tho engines for nothing. There Is no allowanco for depreciation, depre-ciation, nnd tho government would bffjond question have to pay the cost 'if injury to tho dams or locks from floods or other causes. Moieover, there, is nothling In tho offor to Indicate In-dicate that thQ government, In order to protect Its own property, would not have to bear tho exponso of replacing re-placing enormously cosly ninchlnery when it had been worn out In Mr. Ford's service. The second part of tho Tord offer Is to buo Nltrato Plant Number 1, which cost tho government In round numbers 13 million dollars. Nitrate Plant Number 2 which cost tho government gov-ernment In round numbers 70 million mil-lion dollars, and other property which brings the total cost to 8C million dollars, and to pay 5 million dollars for it all. Tho proport for which fhlB' offer Is mado incudes steam machinery to produce 160,000 horsepower, which alono Is worth fai moro than Mr. Ford's offer for tho whole. In addition tho government Is to buy from tho Alabarila Power Company tho land upon which certain cer-tain of tho foregoing structures wero bulk and to turn that over to Mr. Ford also. In roturn for tho lease, for tho purchasod proporly, and for tho wat-erpower wat-erpower without chargo Mr. Ford offers of-fers in addition to tho payment mentioned men-tioned above to do throe principal things' First To maintain Nltrato Plant N .jber 2 ready to bo operated In tlmo of war for the production of explosives," and In the event of war to turn it over to tho government for that purpose Second to operate Nitrate Plant Number 2 to approximate present ca- paclty In tho production of nitrogen! and 'Othei fertilizer compounds,"! end In this business to limit his net profit from the manufacture and sale of fertilizer products to eight per cent. Third, tho offer as written suggests sug-gests producing, but contains no direct di-rect proposal to produce, fertiliser for the benefit of American farmers. That could of course bo corrected In the float contract, for I have no. doubt that Mr. Ford desires to make fertilizer at a total not profit of eight per cent. Nitrate Plant Number 2, hcweer la not adapted to making fertilizer, but only onnlmld, one ofi sovernl materials used for the pro- ductlon of fertilizer, nnd not ono of tho best at that. The fart Is that the Ford offor Is no inai"h a fertilizer proposition. It Is seven parts waterpowor to one part fertilizer, even if tho fertilizer part should work out. For. It Nltrato Plant Number 2 wero to bo permanently perman-ently employed in tho manufacture of fertilizer It would consumo but 100 thousand horsepower out of tho 850,000 Installation. This Is the heart of tho whole matter. As a waterpowor proposition, tho Ford offer fs In evefy important point directly contrary to the Roosevelt Roose-velt yaterpower policy, which after 15 years of struggle was flnall enacted en-acted Into law last year. Tho Roosevelt policy provides that all waterpower leases shall bo limited lim-ited to fifty jears. The Ford offer asks for 100 years with Indefinite renewals. The Roosevelt policy provides for return of tho government works at the end of fifty years. The Ford offer provides tor Indefinite private possession of tho government works. The Roosevelt policy provides for regulation of tho price to tho power consumer. Tho Ford offer, so far as the United States Is concerned, provides no check on what the power pow-er consumer must pay. Tho Roosevelt policy provides that rubllc waterpower taken for profit shall inako a return to tho public. The Ford offer asks for many hundred hun-dred thousand horsepower for nothing. noth-ing. Tlie amount of power Mr. Ford could develop under his offor, Is gi eater by half than all that Is now being developed at Niagara Falls. If Mr Foid wore to pay for it at tho rates charged by the government to other companies that build their own works, as Mr. Ford would not, It would coMt him about 150 thousand dollars a year. Reyond question Nltrato Plant Numbor 2 ought to bo maintained In condition for producing cxplos'vci '.n case of war. Most certainly It JUgUt tn bo used for making fertilizer tor American farmers. Tho wisdom of o eloping tho waterpowor on the Ttrnesseo and Its tributaries Is be-Mild be-Mild question. Dut all theso Uilni',9 eon be dono with fairness to the public. pub-lic. 1 do not bollvo that Mr. Ford's otter should bo summarily tojecled l do boliovo tha it srould bo i hanged: First, to mn it f'. th Itnoicvclt wmcrpower cis.?t7V.m policy mw tin law of tho land; Second, to niako It pay for tho pro-pf pro-pf ty of the peiplc something ap-pu ap-pu aching wb.U iniu properly Is re- i Uv worth; an ! Third, to mi: iv what 1 offers to tl farmers -s'oa beyo-id flnuht. ii Is said I t certain Wall Mrcct magnates who hato Mr Ford aro anxious that his offer should bo rejected. re-jected. Whnt theso men think 'about Mr Ford and his offer is surely no reason for giving him public proper-t proper-t of enormous valuo for a consideration consider-ation wholly Inadcquato and on terms utterly unfair to tho public. I should bo glad to seo Mr. Ford make monoy.nnd plenty of money, out of taking over the property of tho peoplo as ho proposed to do, but not such perpetual and gigantic profits as his offer would assure. It Is fair to consider thep ubllc also, and to remember that all tho annual payments pay-ments Mr. Ford offers to mako would amount to ono-thlrd of tho yearly taxation necessary to meet the Interest Inter-est chnrgo (nt tho Liberty Loan rate of 4 1-4 per cont) on tho goorn-ment's goorn-ment's not Invotsment In the pro-porb) pro-porb) ho proposed to tako ovor, and that he would get the wntei powci for nothing. If you caro to put this statoment hoforo your rcndcrs.by nil means do so, but not boforo Monday morning, August 29th. Sincerely jours, GIFFORD PINCHOT |