ARGUMENT 
 
 OF 
 
 EVERETT W. BURDETT, ESQ., 
 
 ATTORNEY OF THE 
 
 MASSACHUSETTS ELECTEIC LIGHTING ASSOCIATION, 
 
 1 1 <• f A f V 
 
 ' nWrn 
 
 AGAINST 
 
 THE PROPOSED BILL TO ENABLE CITIES AND 
 TOWNS TO OWN AND OPERATE GAS AND 
 ELECTRIC LIGHT PLANTS FOR MUNICIPAL 
 AND COMMERCIAL PURPOSES. 
 
 COMMITTEE ON MANUFACTURES, 
 
 MARCH 23 and 24, 1891. 
 
 BOSTON: 
 
 Press of Rockwell and Churchill. 
 1891. 
 
Committee on Manufactures 
 
 1891 . 
 
 Messrs. James W. McDonald 
 Aaron Low . 
 
 H. Torrey Cady . 
 
 Of the Senate 
 
 Michael J. Murray 
 
 
 
 Fitchburg. 
 
 Charles H. Baker 
 
 
 
 Lynn. 
 
 Eugene M. Mori arty 
 
 
 
 . Worcester. 
 
 John W. Fairbanks 
 
 
 
 . Westborough. 
 
 Clarence G. Coburn 
 
 
 
 . Lowell. 
 
 Daniel R. Child . 
 
 
 
 . Swanzey. 
 
 George K. Knowlton . 
 
 
 
 . Hamilton. 
 
 John Golding 
 
 
 
 . Boston. 
 
 Middlesex. 
 
 Essex. 
 
 Berkshire. 
 
 Of the House 
 
CLOSING ARGUMENT OF E. W. BURDETT, ESQ. 
 
 Mr. Chairman and Gentlemen, — I fully appreciate the 
 patience, courtesy, and fairness which this committee has ex¬ 
 hibited towards both sides throughout this investigation. The 
 hearings have been extended, not to say tedious. We come now 
 to a portion of the proceedings which, in some view, may be 
 unnecessary, and therefore all the more tedious. But inasmuch 
 as it is always the rule of judicial tribunals that a jury shall not 
 decide a case until after all the evidence is in and the arguments 
 of counsel have been heard, 1 assume that this tribunal, not less 
 than a jury, is open to whatever is said in candor and fairness 
 upon the propositions which are involved. 
 
 The Proposed Legislation. 
 
 What are the propositions involved? What is the nature of the 
 legislation which it is desired to engraft upon the statute books of 
 Massachusetts? In a word, it may be stated as a proposition to 
 allow any city or town in the Commonwealth, under general 
 legislative permission, without reference to any of the special cir¬ 
 cumstances of the case, to engage in a commercial business, — 
 the business of manufacturing, distributing, and selling gas and 
 electricity. The scope of the proposition is so broad as to allow 
 any city or town in the Commonwealth, whatever may be the local 
 conditions, to supply those two commodities for a triple use; 
 namely, for lighting, heating, and power. Two of these uses 
 are to-day of great consequence. The electric light is used, as 
 we all know, to a very extensive degree. The generation and 
 transmission of electric power has also come to be one of the, 
 most important industries in our more thickly settled communities, 
 and is growing with a rapidity which no one appreciates except 
 those in actual contact with the business. The subject of supply¬ 
 ing heat by electricity is, so far as I know, as yet undeveloped. 
 But for the important and immediate objects of supplying light 
 and power, it is proposed to enable all or any of the municipali¬ 
 ties of the Commonwealth to furnish either gas or electricity. 
 Not only so; the ambitious bill which is before you, and the only 
 
4 
 
 one which is under consideration for the present, proposes to allow 
 cities and towns not only to supply themselves and their inhabi¬ 
 tants with these products for the purposes named, but also to 
 supply any adjoining city or town and the inhabitants thereof 
 with the same things for the same purposes. The scope of 
 this legislation will be found in sections 1 and 8 of the proposed 
 law, constituting, as I think I can fairly and soberly say, one of 
 the most sweeping, one of the most dangerous, and one of the 
 most extraordinary suggestions of legislation which could be 
 embodied in a single bill. Under its provisions, in Boston, for 
 example, the municipal “ manager of gas and electricity” might 
 have the entire control of the manufacture, distribution, and sale 
 of all the gas and of all the electricity which might be required 
 for light, heat, or power, not only in the city of Boston and to its 
 inhabitants, but in no less than six adjoining cities and ten 
 adjoining towns and to the inhabitants thereof—in all, nearly one 
 million people. To say that that is a serious proposition, goes 
 without saying. To say that it is a proposition which should not 
 be accepted without the most plenary proof of its advisability, 
 goes without saying. It is a step, either for good or bad, fraught 
 with the most momentous consequences. 
 
 The Remonstrants. 
 
 Who remonstrate against this legislation? In the first place, 
 let me refer to the remonstrants whom I have the honor to repre¬ 
 sent, — the electric lighting companies. There are in active 
 business to-day iu Massachusetts sixty-one companies engaged 
 exclusively in the manufacture and sale of electric light and 
 power. Invested in those companies is capital to the extent of 
 $5,452,025, contributed by 2,30 > stockholders. 
 
 All this investment is in the stock of the corporations. There 
 is also invested in the bonds of these companies, by other per¬ 
 sons than the 2,300 I have referred to, $2,082,944; making a 
 total investment in the stock and bonds of companies exclusively 
 engaged in the electric light and power business in Massachusetts 
 of $7,534,969. The estimated value of the electric lighting de¬ 
 partments of gas companies, a list of which may be found on pages 
 42 and 43 of the last report of the Gas and Electric Light Com¬ 
 missioners, is $1,193,538. This sum increases our total to 
 $8,728,507. But that is not all. I add to those figures the sum 
 of $305,000, the amount of the capital invested iu two cor- 
 
 « 
 
o 
 
 porations under lease to another, which are not included in the 
 returns of the latter, and which do not themselves make returns. 
 They either have been or are about to be purchased by the 
 company to which they have heretofore been leased. Adding 
 their capital and bonds to the figures above given from the report 
 of the Gas and Electric Light Commissioners, we have a total 
 investment in the electric lighting and power business of Massa¬ 
 chusetts, on the 30th day of June, 1890, of $9,033,507. 
 
 There should be added to the 2.300 electric-light stockholders the 
 number of stockholders in gas-light corporations in the Common¬ 
 wealth, amounting to 4,725, making a total of 7,025 people whose 
 investments are directly touched by the legislation which is pro¬ 
 posed. Nor do these numbers include the employees of the 
 companies, who are quite a considerable number. It is esti¬ 
 mated that throughout the United States the number of persons 
 employed by electric-lighting companies is upwards of 300,000. 
 
 General Collins. — About 3,000 in Boston alone? 
 
 Mr. Burdett. — I think it is correct that in Boston alone there 
 are about 3,000 persons directly dependent, as wage-earners, upon 
 the electric light and gas industries. In this same connection 
 I ought also to refer to another fact, which is important, — 
 that there are a number of other industries more or less directly 
 dependent for their prosperity and success upon the electric¬ 
 lighting industry. Take the case of the steam-engine. Ten 
 years ago, when electric lighting started, a steam-engine fit for 
 the purpose was unknown. It has been because of the demand 
 of electric-lighting companies for engines decidedly superior to 
 those which used to be considered good enough for other purposes 
 that the steam-eugine has received its wonderful development of 
 the last ten years. Then take the manufacture of carbons, which 
 are used exclusively in electric lighting. It gives employment to 
 a great many people and puts in circulation a great deal of money. 
 Take also the increased consumption of copper, iron, coal, and 
 other supplies, arising out of the demands of the electric-lighting 
 industry, and the aggregate addition to the business of the coun¬ 
 try is very large. 
 
 The passage of the legislation contemplated would inevitably 
 impair existing investments in all these lines of business, and 
 would retard if not prevent their future development. 
 
 I was much struck, Mr. Chairman and gentlemen, with the 
 statement of Mr. Batchelder, the treasurer of the Salem Electric 
 
6 
 
 Lighting Company, — the company which on the whole seems to 
 have been more successful, according to the returns, than any other 
 corporation of its character in the Commonwealth. He said, “ We 
 have paid dividends, and we are very proud of it. Our dividends 
 have amounted, on the average, from the time we started, to seven 
 per cent. But in order to get an average of seven per cent., upon 
 one occasion we divided a surplus which had been accumulating 
 for seven or eight years. ,r So far from being ashamed of the fact 
 that he and other business men in Salem had put their money into 
 this local enterprise, which would tend for the good of the com¬ 
 munity in which it existed, he was proud of it. So far from 
 apologizing for his opposition to this bill, he said that he thought 
 he had the right to demand protection for the local capital in¬ 
 vested in this enterprise, which is contributing its due propor¬ 
 tion towards sustaining the public burdens. If that be true of 
 an electric-lighting company in Salem, why is it not true of all the 
 electric-lighting companies in Massachusetts? Why have I 
 not the light to say that the $9,000,000 directly invested in this 
 business within the last ten years, contributing its due proportion 
 to the public treasury, should have the right to look to you for 
 protection instead of anticipating hostile action at your hands? 
 
 Now, mind you, Mr. Chairman, if it were true that, notwith¬ 
 standing what I have said, these corporations had abused 
 the privileges which the communities had given them ; if they; 
 had not given a fair equivalent for the money paid them ; if 
 they could be justly characterized as grasping monopolies, not 
 entitled to the reasonable consideration of reasonable men, — 
 much of the force of what I have to say would be broken. 
 But what is the fact about it? Look, in the first place, into 
 your own towns and cities, — and I make the statement at 
 large, without having in mind any particular town or city, — 
 and answer yourselves the question, whether or not the electric¬ 
 lighting companies in your towns or cities are not managed, officered, 
 and owned by the best citizens among youY constituents. Where 
 have you heard of scandals in the administration of electric-light 
 plants in Massachusetts? Where have you heard anything defi¬ 
 nite to justify the cry of corruption on the part of these corpora¬ 
 tions? What man can put his finger upon one scintilla of proof 
 of that outrageous charge? Not one. These companies have, 
 you will admit, performed a public service for the Commonwealth 
 at large, and for the different cities and towns in which they 
 
7 
 
 / 
 
 exist; they have introduced a new and powerful illuminant to your 
 streets ; they have added comfort to your homes ; they have made 
 it easier for you to do business; they have, in a sensible degree, 
 been instrumental in the prevention of crime ; they have appreci¬ 
 ably increased the taxable valuation of your property; they have 
 made every town and city in which they burn, more desirable as 
 a place of residence, and more advantageous as a place of busi¬ 
 ness. They have not been monopolists in any sense of the word. 
 What is a monopoly ? Is it not the enjoyment of some privilege 
 from which others are excluded, and, in the popular seuse, from 
 which undue profits and advantages are derived ? I think that is 
 a fair statement of it. Does that definition apply in any sense to 
 the electric-lighting companies in Massachusetts? Have not any 
 three of us the right to organize a company under the general law? 
 and having organized that company, have we auy privileges which 
 do not equally belong to any other three citizens of the Common¬ 
 wealth? And what would be our return, in case we did? What 
 has been the return to the public-spirited citizens who have 
 heretofore put their money into this enterprise? Let us see. 
 They have advanced the interests of the Commonwealth at large, 
 and of the particular cities and towns in which they are estab¬ 
 lished, vastly more than they have advanced their own. And for 
 what return? 
 
 Profits and Dividends. 
 
 Out of the sixty-one companies in active business in Massachu¬ 
 setts on the 30th day of June, 1890, only twenty-two of them 
 succeeded in paying any dividends for the preceding year. Out 
 of the fifty-six companies in active operation the year before, 
 only fifteen succeeded in paying any dividends. 
 
 The average rate of dividends paid by the twenty-two companies 
 out of the sixty-one in business last year was 4.86 per cent, 
 for each company. The other two-thirds of the companies paid 
 no dividend at all. That dividend, when divided between all 
 the companies in active operation, would amount to only If 
 per cent, for each company. But it may be said that that is 
 not a fair statement of the matter, and that we ought to 
 ascertain the rate of dividend upon the whole amount of capital 
 employed. Very well; let us do so. The total amount paid 
 in dividends equalled only 2.8 per cent, on the total amount of 
 the capital actually invested. 
 
8 
 
 But, it may be said, or intimated, or insinuated, that the com¬ 
 panies are keeping back a portion of their profits. In answer to 
 that, I will say, that if an electric-lighting compan}* does not keep 
 back a portion of its profits, but pays them all out in dividends, it 
 is violating the first principles of business. No man would have 
 the hardihood to stand before this committee, after listening to the 
 evidence which has been brought out here, and say that the amount 
 to lay by for contingencies, depreciation, surplus, and the exigencies 
 of the business, ought not to be very considerable; and you would 
 say, I feel sure, that if the companies earned ten per cent, they 
 would not be justified in declaring more than six per cent. ; that, 
 at least, four per cent, ought to be retained for depreciation, dam¬ 
 ages, contingencies, and other expenses of that character. If } t ou 
 will take the report of the Gas and Electric Light Commissioners 
 to which I have referred (the last report which has been pub¬ 
 lished, full of exact and complete figures), you will find that 
 the total amount earned, that is, the total net profits of the electric¬ 
 lighting companies in Massachusetts, up to the 30th day of 
 June, 1890, amounted to only 0.3 per cent, upon the entire amount 
 of capital actually invested. Very wisely, very properly, very 
 necessarily they have retained a portion of the net earnings for 
 the purpose of meeting the contingencies to which I have referred, 
 — not enough, but as much as has been possible under existing 
 conditions. 
 
 There has been one very unjust thing said in the public press 
 during the time that these hearings have been in progress ; so 
 unjust that I ought to call attention to it, because it has had a 
 wider circulation than anything that has yet been said. It reads 
 as follows: — 
 
 “ E. W. Burdett, attorney for the electric companies, saj’s that 
 they are just able to make both ends meet, and does not want 
 towns on that account to go into the business. For such feeble 
 concerns they manage to pay large dividends and support a large 
 lobby about the State House. The baby plea will hardly* be 
 accepted. The “Journal” to-day declares against municipal 
 ownership.” 
 
 There is just one grain of truth in that bushel of chaff, and 
 that is that the “ Boston Journal ” had that day declared against 
 municipal ownership. But I did not know of it until I read it in this 
 paper. I had not said that the companies are just able to make 
 both ends meet; I said that that had been the case up to this time. 
 
9 
 
 These companies are now beginning to pay dividends upon the 
 capital invested. The statement that “ for such feeble concerns 
 thej T manage to pay large dividends and support a large lobby about 
 the State House,” ought to be characterized in the severest terms. 
 That they do not pay large dividends is shown by the report of 
 the Gas and Electric Light Commissioners, made up of sworn 
 figures, to which I have already referred ; and that they maintain 
 a lobby, large or small, at the State House, or that they ever have, 
 is absolutely false. 
 
 Mr. Fairbanks. — Mr. Burdett, if you please, where was that 
 printed ? 
 
 Mr. Burdett. —I do not like, unless it is really required, to 
 give the name of the paper. The item is discreditable to it, and 
 unless you insist I would rather not name it. I should like to 
 bury that statement. But I will give it to you, and will be perfectly 
 willing to do so, if you want it, any of you. Everybody has 
 seen it in the public press of Boston. 
 
 The Chairman. — It is a Boston paper, is it? 
 
 Mr. Burdett. — Yes, sir. 
 
 Objections. 
 
 Now, Mr. Chairman, why do these corporations object to the 
 policy which I have indicated? I will not now stop to state the 
 public objections ; I may have occasion to do so later on ; but for 
 the present I will confine myself to the inquiry, Why do these pri¬ 
 vate corporations object? What is there in this legislation that is 
 necessarily or probably injurious to their interests? It is because 
 this legislation, if passed, will, as surely as the sun rises, impair 
 and very largely destroy their investments. You may think that 
 a strong statement; it is true nevertheless. Why are these cor¬ 
 porations up here at the State House, represented by the officers 
 of their association and by counsel, if they do not appreciate the 
 vital importance of the issues which are pending? They are 
 the best judges of what the probable effect upon their, busi¬ 
 ness would be, and their action is sufficient demonstration of 
 what they believe it would be. Let me give you, however, some 
 reasons for the statement that it would impair and perhaps 
 destroy the investments of private capital which have been made. 
 
 In the first place, it would absolutely wipe out all opportunity to 
 do public lighting. A city or town going into this business would light 
 its streets and public buildings, as a matter of course. That would 
 
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 10 
 
 deprive many of the local companies of a portion of their revenue 
 without which it would be impossible for them to prosecute their 
 business to any advantage whatever. In the second place, towns and 
 cities not being corporations organized for purposes of profit, could, 
 if they saw fit, compete for private lighting without much, if any, 
 reference to the cost of production. They could thus not only de¬ 
 prive the corporations of a large portion of their revenue, but 
 could cripple them in the prosecution of other branches of their 
 business. Under such circumstances, it would be impossible for 
 the company to compete with any satisfaction. In the third place, 
 think of the idea of a private corporation competing with a munic¬ 
 ipal corporation, when the former is wholly dependent upon the 
 latter for its rights in the public streets. Not only must the cor¬ 
 poration obtain its locations for poles and wires, and its permits 
 for digging up the streets, by the leave of the public bodies who 
 are, under the proposed legislation, to be allowed to prosecute the 
 same business in competition ; but there are pending before this 
 Legislature to-day numerous propositions to further enlarge the 
 powers of municipalities in the matter of their control of the 
 rights and privileges of these private companies. In the fourth 
 place, the existence or the possibility of such unfair conditions 
 would discourage enterprise and drive capital out of the business. 
 No man of business sense would for a moment think of investing 
 his money in a private lighting plant run in competition with a 
 town or city in which it existed. Not only that, but no man who 
 had stock in such a corporation but would get rid of it upon any 
 terms procurable. 
 
 But, finally, and perhaps more important than anything else, is 
 the outrageous power of municipal confiscation which is embodied in 
 the bill before you, — embodied in the bill which was under consid¬ 
 eration last year, and embodied in every bill presented by the “ na¬ 
 tionalists.” They care nothing for invested capital. When people 
 get capital to invest, they ordinarily cease to be 44 nationalists.” I 
 refer especially to sections 13, 14, and 15 of the bill pending before 
 you, which practically legalize spoliation. The onty redeeming feat¬ 
 ure of a municipal ownership bill would be a fair and reasonable pro¬ 
 vision for the purchase of existing private plants. I do not mean 
 to say that that would remove all objection. Far from it. I do 
 not mean to say that that would constitute a reason why the 
 legislation could in fairness be passed ; but I sa}’ it would be the 
 only redeeming feature in an otherwise absolutely objection- 
 
11 
 
 able proposition. The bill which was first passed by the House 
 of last year was idenlical in terms with that submitted by the 
 nationalists to the committee and unanimously rejected by the 
 committee. It contained no provision whatever for the purchase 
 of existing plants by the municipalities availing themselves of the 
 provisions of the act. This feature was so manifestly unjust and 
 oppressive, practically legalizing spoliation, that an amendment 
 was adopted which in some measure met that objection. It will 
 be found in House Document No. 550 of last year. It was as 
 follows : — 
 
 Section 13. If in any city or town there exists at the time of the 
 passage of this act, gas or electric light plants, owned and operated by 
 persons or corporations acting under the laws of this Commonwealth, 
 such plants shall be purchased by said cities and towns, in the manner 
 provided in this section, before such cities and towns establish a sys¬ 
 tem of lighting under this act. The price to be paid therefor shall be 
 the actual cash value of the property owned by said persons or corpora¬ 
 tions, and no privileges, rights, or immunities theretofore given to said 
 persons or corporations by said cities or towns or by the laws of the 
 Commonwealth shall be deemed to be the property of said persons or 
 corporations within the meaning of this section. The value of said 
 existing plants for this purpose shall be fixed by a board of three 
 persons, one to be chosen by the person or corporation owning such 
 plants, one by the city or town in interest, and one by the two thus 
 selected. Their decision shall be final when accepted by said city or 
 town. No town or city shall establish a gas or electric light plant 
 under the provisions of this act until it shall have acquired under the 
 provisions of this section such plant as shall exist in such city or town 
 at the time of the passage of this act.. 
 
 It will be seen that this amendment contained some elements 
 of fairness. The price to be paid for the local plant was “the 
 actual cash value of the property,” without any allowance for 
 “ privileges, rights, or immunities” received from the city or town 
 or from the Commonwealth, and the valuation was to be arrived at 
 by an impartial appraisal. 
 
 This amendment constituted the only redeeming feature of the 
 bill, but was almost immediately stricken out, and sections 13, 14, 
 and 15; as they stand in the bill before you (House Document 
 573 of 1890), were substituted therefor. These new sections, 
 instead of remedying the unjust and spoliative character of the 
 nationalists’ bill, aggravated its objectionable features and made 
 
< 
 
 12 
 
 them worse than before. The\ T involve so momentous an issue to 
 the corporations which I represent that you will pardon me in a 
 brief analysis of them. 
 
 In the first place, the plants to be purchased by the cities or 
 towns availing themselves of the provisions of the act are con¬ 
 fined by section 13 to those existing at the time of the first vote of 
 the said city or town looking to municipal ownership. This would 
 necessitate the local company standing still until the matter was 
 again voted upon in the following year. Whatever additions or 
 improvements were made after the first vote and before the final 
 taking by the town or city could not be sold under the provisions 
 of the act. On the other hand, if the final vote of the city or town as 
 to going into the business should be adverse to the first, the com¬ 
 pany would have been handicapped and impeded in the prosecu¬ 
 tion and extension of its business without any compensation 
 therefor. It would be difficult to frame a law more discouraging 
 to business enterprise or more hindering to legitimate industry. 
 
 But the most oppressive feature of section 13 is the provision 
 that the city or town shall purchase “only such property as by 
 reason of its being real estate or attached to real estate cannot be 
 removed and be available elsewhere without material loss, injury, 
 or expense.” This would not include wires, lamps, and fixtures 
 (the most expensive part of the equipment of an electric-light 
 company) or the dynamo-electric machines, which are movable, 
 — in fact, nothing but the company’s land, buildings, poles, set 
 boilers, and such other items (if any) as are “ attached to real 
 estate.” Under this provision the company would be obliged to sell 
 one part of its plant, and thereby ruin the value of the other part. 
 No provision is made in the bill for the cost of taking down the 
 wires, lamps, and fixtures and removing the electrical machines, 
 which, when so taken down and removed, would be second-hand. 
 In the absence of any further opportunity to use them, they 
 would be little less than junk in the hands of their owners. 
 This feature of the bill is unqualifiedly and outrageously bad. 
 The bill might as well be left as drawn by the nationalists, with¬ 
 out any provision to prevent the destruction of the value of exist¬ 
 ing plants, as to put in such a partial, one-sided, and unjust 
 provision as that referred to. It would, in practice, amount to 
 little less than confiscation. 
 
 Contrast with this feature of the bill the provisions of the 
 municipal water act in our statutes (Pub. Stats., ch. 27, 
 
 ( 
 
13 
 
 sect. 27) permitting a municipality to purchase from a private 
 water company “ its whole water rights, estates, franchises, and 
 privileges, and thereby become entitled to all the rights and 
 privileges and subject to all the duties and liabilities of said 
 corporation.” 
 
 In the third place, section 13 gives the city or town the option 
 to purchase the local company’s gas plant or its electric plant, 
 according as the city or town has decided to go into the gas or 
 electric light business. In other words, a company engaged in 
 furnishing both gas and electricity (as many companies are) 
 would practically be compelled to split its business in two, re¬ 
 taining only that portion which the municipality does not elect to 
 take. With a considerable part of the -property formerly in use 
 by it rendered second-hand and incapable of use except elsewhere, 
 and with its business split in two, such a company would find it 
 difficult, if not impossible, to ward off bankruptcy. 
 
 Have the gas and electric companies of Massachusetts done 
 anything to deserve such treatment at the hands of the Legisla¬ 
 ture? On the contrary, they have established a new and useful 
 industry, requiring the investment of millions of money, and the 
 employment of thousands of men ; and, by so doing, have contrib¬ 
 uted both to the comfort and luxury of life, and to the prosperity 
 of the communities in which they do business. 
 
 Contrast with this provision that of the English electric-lighting 
 act of 1882, as amended by the Act of 1888, which provides that 
 if, upon the expiration of the forty-two years in which the corpora¬ 
 tion has the right to prosecute its business undisturbed by the mu¬ 
 nicipality, the latter elects to purchase it, it must purchase all the 
 property of the company within its territorial limits, and in case 
 it does not purchase that part, if any, which lies outside its limits, 
 it must pay for “ any loss occasioned by severance.” 
 
 Sections 14 and 15 merely relate to the details of carrying out 
 the provisions of section 13; unless the provisions of the latter 
 portion of section 14, which are very awkwardly expressed, are 
 held to mean that the purchasing city or town has the further 
 option to purchase any part or parts of existing plants in addition 
 to the portion designated section 13. 
 
 Without further comment on m 3 ' part, I think that the inequi¬ 
 table, unfair, and unbusiness-like character of the propositions 
 involved in these sections will be at once appreciated by the com¬ 
 mittee. I cannot believe that a single one of you is so unfair as to 
 
14 
 
 desire to put upon the statute book a law which will operate as I 
 have indicated this would do. 
 
 In contrast to the proposed legislation I ask you to look at the 
 provisions of our statutes enabling towns to buy water plants, to 
 which I have already called attention. It contains no such out¬ 
 rageous provision as that to which I have just referred. It 
 provides that a town “ may, for the purpose of supplying water 
 to its inhabitants, purchase of any municipal or other corporation, 
 the right to take water from an}' of its sources of supply, or from 
 pipes leading therefrom ; or may purchase its whole water rights, 
 estates, franchises, and privileges, and thereby become entitled to 
 all the rights and privileges and subject to all the duties and 
 liabilities of said corporation ; or may make a contract therewith 
 for a supply of water.” 
 
 Ever since the formation of the constitution of our State water 
 companies have been organized here and there. These water 
 acts, if I remember rightly, date back to 1794 or 179G, — cer¬ 
 tainly quite a number were passed before the beginning of this 
 century. From that time down they have been increasing in 
 number, until, finally, within the last ten or twenty years, the 
 number has grown to be enormous. There have been, in the last 
 twenty-five or thirty years, a great many acts passed, enabling 
 cities and towns to own and operate water plants. But as old as 
 that subject is, there has never yet been put upon the statute book 
 a general law permitting towns and cities to enter upon the supply 
 of water to its inhabitants, except as just stated. The Legislature 
 has required every town and city desiring to do so to make special 
 application, and show special reasons why the application should be 
 granted, except that it has allowed them, without special legislative 
 permission, to purchase existing private water plants. That is 
 the only way, to-day, by which a town can go into the supply of 
 water where a private company already exists. And I remember 
 very well that Mr. Russell, the present Governor of the Common¬ 
 wealth, in his argument before this committee two years ago, said 
 that, so far as his investigations went, there had never been a 
 case where a city or town had been allowed to go into the water 
 business where private capital was already invested. I have not 
 had an opportunity to investigate that myself, but I take the 
 statement from Mr. Russell’s printed argument. 
 
 Now, in England, they have an electric-light law, passed in 
 1882 and amended in 1888. I understand it to have been drawn 
 
15 
 
 by, or under the direction of, Mr. John Chamberlain, an English 
 statesman who is said to have no partiality for private corpora¬ 
 tions. I am informed that, at the time the act was passed, he was 
 president of the Board of Trade. This act will be found in 45 & 
 46 Victoria, chapter 56, section 27 (1882), amended by 51 & 52 
 Victoria, chapter 12, section 2 (1888). What do these acts 
 provide? Acts drawn as carefully as such acts are drawn in 
 England are well worth our careful consideration. In the first 
 place, they do not allow a city or town in which a private 
 plant is established to act upon the question of its purchase until 
 after the local company has had forty-two years’ opportunity to 
 get its money out of the enterprise. the law of 1882 it was 
 twenty-one years, but by the law of 1888 it was made forty-two 
 years. And if the town fails to vote to purchase, within six 
 months after the expiration of the forty-two years, it must wait 
 ten years longer before it can again avail itself of the right to 
 purchase. This gives some security to capital, aud encourages 
 its investment. 
 
 If the municipality buys, what must it buy? It must buy all 
 the plant and property within the town or city, at “ their fair 
 market value at the time of the purchase, due regard being had to 
 the nature and then condition of such buildings, works, materials, 
 and plant, and to the state of repair thereof, and to the circum¬ 
 stance that they are in such a position as to be ready for immediate 
 working, and to the suitability of the same to the purposes of the 
 undertaking, and, where a part only of the undertaking is pur¬ 
 chased [that is, where the city or town does not purchase that part 
 of the property which lies without its limits], to any loss occasioned 
 by severance; but without any addition in respect of compulsory 
 purchase or of good-will, or of an} r profits which may or might 
 have been or be made from the undertaking, or of any similar con¬ 
 siderations.” That is. a fair and reasonable provision. In case of 
 disagreement, the appraisal is to be made by arbitration. 
 
 People who are willing to invest their money in this enterprise 
 in Massachusetts ought to have some assurance that, for at least a 
 few years, they will not be obstructed in their business and will 
 not be liable to municipal interference. That would be a valuable 
 safeguard, and it is one which the companies might reasonably 
 ask the Legislature to grant them. 
 
 So much, in brief, for the private objections. Now for some of 
 
16 
 
 I 
 
 the objections of a public nature. You must consider both. You 
 have, I think, no more right to disregard one than the other. 
 
 Public Objections. 
 
 I will not attempt to state all of the objections which can be 
 raised to the proposed legislation from the stand-point of public 
 policy, but only a few of them. 
 
 You have had before you private citizens, as respectable and re¬ 
 sponsible as any in the communities from which they come, who, with 
 entire disinterestedness, have stated their objections as citizens. 
 From Peabody you had two presidents of national banks, one pres¬ 
 ident of a savings bank, one lawyer, one merchant, and one minis¬ 
 ter. From Boston, I understand, you had Mr. Cotting the other 
 day, as conservative an investor and custodian of property as the 
 city of Boston contains. He put it right. I read his testimony 
 this morning. No matter how the questions were put to him, he 
 had the fundamental idea all the way through, that the distinction 
 between water on the one hand, and gas and electric light on the 
 other, was the distinction between a natural article, necessary for 
 everybody, and a manufactured article of commerce. I will have 
 occasion to refer a little later on to this distinction — the dif¬ 
 ference between the municipal distribution to citizens of that which 
 public necessity requires for the health of the community at large, 
 and the prosecution of the business of manufacturing and selling 
 an article of commerce, which is at most a convenience and is 
 usually a luxury. 
 
 The municipal supply of water is within the proper scope of 
 municipal administration ; but the commercial supply of gas and 
 electric light revolutionizes all our ideas of the true functions of 
 town or city governments in Massachusetts. 
 
 In this connection I have a right to refer, I think, to a state¬ 
 ment by a gentleman who, though now removed from private 
 practice, would not utter as an attorney views of public questions 
 which he did not entertain as an individual. A little less than 
 two years ago, before this same committee, when the various prop¬ 
 ositions for municipal ownership of lighting industries had been 
 fairly stated, Hon. Wm. E. Russell said: “ The matter now fairly 
 before the committee involves a most serious question of public 
 polhty, namely, whether it is wise, necessary, and safe to reverse 
 the policy that has governed towns and cities in this Common¬ 
 wealth for two hundred and fifty years, and allow them to go 
 
 ( 
 
17 
 
 into these enterprises with all the hazards, risks, and liabilities 
 that attend the investment of money in private industry?” There 
 is as succinct a statement of the question before you as could well 
 be made. 
 
 The lawj’ers on the committee, periiaps, more than the laymen, 
 will attach great importance to what our judiciary have pointed 
 out as the proper province of town and city governments in 
 Massachusetts; and I would like to call the attention of such to 
 the utterance of Mr. Justice Wilde, in 11 Pick., 399, in which 
 he expressed the views of the Supreme Court of Massachusetts 
 as at that time constituted. Speaking of the limitation upon the 
 powers of town governments he said : — 
 
 “ This limitation upon the power and authority of towns to 
 enter into contracts and stipulations is a wise and salutary provi¬ 
 sion of law, not only as it protects the i ights and interests of the 
 minority of the legal voters, but as it may not unfrequently prove 
 beneficial to the interests of the majority, who may be hurried into 
 rash and unprofitable speculations by some popular and delusive 
 excitement, to the influence of which even wise and considerate 
 men are sometime liable.” 
 
 What apter language could be used to characterize the present 
 situation? 
 
 Chief Justice Shaw said something which is worth repeating in 
 this connection, in a case reported in 23 Pick., 75. Referring to 
 the individual liability of every citizen for the debts of the munic¬ 
 ipality in which he lives, he says: — 
 
 “It is obvious, therefore, that if this liability were to extend to 
 unlimited and indefinite objects, the citizen, b} r being a member of 
 a corporation, might be deprived of his most valuable personal 
 rights and liberties. The security against this danger is in a 
 steady adherence to the principle stated, that corporations can 
 only exercise their powers over their respective members for the 
 accomplishment of limited and well-defined objects.” 
 
 Let me refer again to the argument of the gentleman whom I 
 first quoted. He read with entire approval the following extract 
 from the great work of Judge Dillon on Municipal Corpora¬ 
 tions : — 
 
 fct To clothe them with powers to accomplish purposes which 
 can better be left to private enterprise, is unwise. Their chief 
 function should be to regulate and govern. To invest them with 
 the powers of individuals or private corporations, for objects not 
 
18 
 
 pertaining to municipal rule, is to pervert the institution from its 
 legitimate ends, and to require of it duties it is not adapted satis¬ 
 factorily to execute.” 
 
 And after further consideration, Mr Russell expressed his con¬ 
 clusions in words so apt and eloquent that it is a delight to quote 
 them. He said : — 
 
 “ I am one of those who believe that it is the duty of govern¬ 
 ment not to crush out individual enterprise and energy, but to aid 
 it. I believe in the principle of government helping men to make 
 the most of themselves, and industries to make the most of them¬ 
 selves, but not in a paternal government to which we must all 
 look for leave to act or think or speak. And I believe on that 
 principle it is of doubtful expediency for a State or a government 
 to undertake to control in this way private enterprises.” 
 
 And I do not think that there is a thing inconsistent with that 
 statement in his inaugural address as Governor to the present 
 Legislature. Referring to the enlargement of the powers of 
 cities and towns, he says he thinks that such enlargement 
 may be made to advantage, and then adds: “I therefore 
 commend to your consideration the subject of enlarging their 
 powers by general laws, especially in matters of taxation, 
 franchises, municipal control of municipal work, and ownership 
 of the instrumentalities for its performance.” This statement 
 may perhaps bear the construction that towns and cities may 
 be safely allowed to light their own streets and public build¬ 
 ings, but it is entirely consistent with its author’s former uncom¬ 
 promising opposition to allowing municipalities to go into the 
 business of manufacturing gas and electricity for sale for com¬ 
 mercial purposes. 
 
 The position of our Supreme Court upon this question must not 
 be misunderstood. Last year the House asked the opinion of the 
 Court as to the constitutional power of the Legislature to pass laws 
 enabling cities and towns to manufacture gas and electricity, first, 
 for their own use, and, second, for sale to private customers. 
 After consideration the Court concludes as to the first question, as 
 follows : — 
 
 41 As a question of constitutional power , we cannot distinguish the 
 right to authorize cities and towns to buy gas or electricity for their 
 use, from the right to authorize them to manufacture it for their 
 use. We therefore answer the first question in the affirma¬ 
 tive.” 
 
 < 
 
19 
 
 The question of the Legislature’s constitutional power was the 
 only question with which they had to deal, and they found in the 
 constitution what they deemed to be sufficient authority to enable 
 the Legislature to act, if it saw fit to do so. 
 
 Upon the second question, they found, as they say, more diffi¬ 
 culty. They finally, however, reached the following conclu¬ 
 sion : — 
 
 “ If the Legislature is of opinion that the common convenience 
 and welfare of the inhabitants of cities or towns will be promoted 
 by conferring upon the municipalities the power of manufacturing 
 and distributing gas or electricity for the purpose of furnishing 
 light to their inhabitants, we think that the Legislature can confer 
 the power. We therefore answer the second question in the 
 affirmative.” 
 
 I call attention to this opinion of the justices for the purpose of 
 disabusing your minds of any impression that it contains in it 
 anything in the nature of justification of the legislation except 
 upon constitutional grounds. 
 
 I would be considered entirely lacking in a proper view of the 
 appropriate scope of an argument upon this subject, if I did not 
 refer to the analogy which is so often claimed to exist, that is, the 
 alleged analogy of water-supply. 
 
 The Analogy of Water-Supply. 
 
 There are various other analogies, such as street-building, 
 sewer-building, maintaining public schools, and so forth, which I 
 find, according to the stenographer’s notes, were referred to at the 
 last hearing. But they are all easily distinguishable from the 
 present proposed legislation. I will not discuss them, because I 
 have not time. I discussed them fully last year, and can furnish 
 a copy of my argument to anybody who may be interested in that 
 branch of the discussion. The foundations upon which those 
 powers rest are wholly different from those which underlie the 
 legislation which is now proposed. 
 
 The analog}’ of water is admitted to be the most favorable 
 analogy for the other side. It is the analogy that is always urged. 
 If it does not hold, then, confessedly, none of the others hold. 
 There are numerous natural differences, to which I will merely 
 refer. Water is a natural product; gas aud electricity are not. 
 Water is generally taken from great ponds, so called, where every 
 citizen has a right to go with his bucket and carry away as much 
 
20 
 
 water as he pleases. The supply of water is merely the distribu¬ 
 tion of a natural commodit}', which has none of the ear-marks of 
 a manufactured product. It does not partake in any measure of 
 the subtle and peculiar nature of gas or electricity. But passing 
 these natural differences* let us come to the essential differences. 
 
 In the first place, the supply of water is indispensable to the 
 performance of certain strictly municipal functions ; for example, 
 the extinguishment of fires. That has been held by our Courts to 
 be a function which cities and towns are under obligation to 
 perform. But, on the contrary, our Supreme Court has held, 
 and that decision has never been overruled or questioned, that 
 there is no legal obligation upon a city or town to light its streets. 
 There is, therefore, no analogy between the furnishing of water in 
 the performance of certain indispensable municipal functions, and 
 the furnishing of gas or electricity, which cities and towns are 
 under no obligation to furnish, even to travellers upon their high¬ 
 ways. 
 
 In the second place, to supply water to every individual of a 
 town or city is in itself the performance of a public function 
 which can be performed in no other way. The necessity of every 
 citizen to have pure water in abundance is such that a city or 
 town that failed to furnish it to him at reasonable rates and in the 
 best possible manner would fail in the performance of one of the 
 most essential functions of civil government. 
 
 In the third place, the supply of water almost always necessa¬ 
 rily involves the exercise of the right of eminent domain. This is 
 a very important distinction, which is indicated in the opinion of 
 the justices, to which reference has been made. A water com¬ 
 pany, in order to get to its customers from its reservoirs or 
 sources of supply, must almost always go through private land, 
 and must therefore almost necessarily exercise the right of emi¬ 
 nent domain,—the highest right enjoyed, under our form of gov¬ 
 ernment, by sovereignty itself, except the right to tax, to which it 
 is analogous. For that reason, water is more properly supplied 
 by towns and cities, because it is more proper that towns and 
 cities should exercise this great right of eminent domain than 
 that private corporations should do so. 
 
 The fourth distinction is also one hinted at in the opinion of the 
 justices. It is, that a supply of pure water can sometimes be 
 furnished in no other way than by the exercise of public rights; 
 whereas, everything goes to show that no man in this Common- 
 
21 
 
 wealth, and no community in this Commonwealth, needs to go 
 without lights if willing to pay for them. 
 
 But to come to the gist of the matter and to the main differ¬ 
 ence : water is indispensable to the health and welfare of the com - 
 rnunity at large. An}" city or town which does not see to it that a 
 supply of pure water is furnished to its inhabitants, has failed, as 
 I have said, in the performance of one of the first functions of 
 civil government. Artificial light is not essential to the health or 
 to the life of the members of the community. It is at best a con¬ 
 venience, ordinarily a luxury, never ail absolute necessity. 
 
 So that if any man will candidly and judicially examine into the 
 foundations of the right of a municipality to supply itself with 
 water, and compare those foundations with those which must 
 underlie the right to supply artificial light, he cannot fail to come 
 to the conclusion that no analogy exists between them. There is 
 a fundamental difference between supplying an absolute necessity 
 in the performance of a public function, and the voluntary manu¬ 
 facture and sale of an article of commerce. 
 
 The analogy runs the other way. The analogy from electric 
 lights and gas is to street railroads, telephones, express companies, 
 cab service, union depots, hotels, the manufacture of boots, shoes, 
 or blankets, the sale of groceries, and the like. 
 
 Massachusetts has never heretofore permitted its cities and 
 towns to indulge in any business speculations or manufacturing en¬ 
 terprises. The nearest she has ever come to committing that mis¬ 
 take was in permitting its towns and cities to give aid to railroad 
 enterprises, — and what was the result? The State of Massachu¬ 
 setts invested $18,000,000 in the Troy & Greenfield Railroad, and 
 it got out only about $6,000,000, losing two-thirds of its invest¬ 
 ment. Fifteen towns, I think, in the western part of the State, 
 which invested to the limit of their ability, lost every cent they 
 put in after the Commonwealth foreclosed its mortgage; and they 
 have been down here, I believe, in past years, to ask remuneration 
 . from the State for the loss of their investments. More than one- 
 half of the gross State debt of Massachusetts to-day arises out of 
 two railroad loans, — one to the Troy & Greenfield Railroad, and 
 the other to the Boston, Hartford, & Erie. 
 
 The same result has attended the granting of municipal aid to 
 private business enterprises elsewhere, to say nothing of munic¬ 
 ipal ownership and management. The history of Bath, Me., is 
 so melancholy in this respect that I cannot refrain from making 
 
22 
 
 special reference to it. Suffering for the commonest municipal 
 necessities, with everything at loose ends and out of repair, they 
 yet for years taxed themselves $25 on a thousand on a high valua¬ 
 tion in order to meet the interest on defaulted railroad bonds. 
 The State of Maine made the mistake of permitting Bath and 
 other towns of that Commonwealth to aid the Knox & Lincoln 
 Railroad. The result has been many years of financial embarrass¬ 
 ment and distress. The report of a special committee appointed 
 to attempt to fund Bath’s railroad debt pronounced it “a terrible 
 burden,” and referred to the city’s participation in the enterprises 
 as “ fourteen years of bitter experience.” These cities and towns 
 had every reason to believe that the Knox & Lincoln Railroad, by 
 connecting them together and putting them in easy communication 
 with other places, would prove to be a genuine boon to the munic¬ 
 ipalities and to the business interests located in them. On the 
 contrary, it has been an utter failure, and has resulted in imposing 
 a grievous burden of municipal indebtedness, from which they 
 have not been able to free themselves. Some of the towns were 
 at last driven to attempt repudiation. 
 
 This has been the history' of this sort of thing in all analogous 
 cases throughout the country. If the lawyers on the committee 
 will read Judge Dillon’s statement of the result of this kind of 
 legislation in other States, the^v will be struck and surprised with 
 the uniformly disastrous results which have accompanied it. He 
 says that “ it cannot be denied that this species of legislation has 
 been exceedingly mischievous in its results.” In summing up the re¬ 
 sults of municipal aid to such corporations, he says: “Regarded 
 in the light of its effects, there is little hesitation in affirming that 
 this invention to aid the enterprises of private corporations has 
 proved itself baneful in the last degree.” 
 
 I have here a citation from another authority (Cook on Stock 
 and Stockholders, section 92), where the unchecked exercise of 
 this power of municipalities to aid enterprises of a private charac¬ 
 ter is said to have entailed such a burden of taxation that in many 
 States it has been found necessary to prohibit it by constitutional 
 prohibition. He says : — 
 
 “ In many States are found constitutional prohibitions rendering 
 it unlawful for municipal corporations to make subscriptions or 
 lend their credit to any incorporated company or enterprise not 
 strictly and exclusively governmental in its nature and constitu¬ 
 tion. This is the case in Pennsylvania, Ohio, Illinois, New York, 
 
23 
 
 Indiana, Missouri, Mississippi, and in some other States. In gen¬ 
 eral, it will be found that these constitutional provisions prohibit 
 in terms any subscriptions or lending of credit b\ T any municipality 
 in the State or by the State itself to any company, association, or 
 corporation whatsoever.” 
 
 If it be said that municipal aid to railroad corporations is not 
 the same thing as municipal operation of electric light and gas 
 plants, it will be admitted ; but it bears close analogy to them, and 
 the dangers are the same in both cases. Among these dangers 
 is the creation of further municipal indebtedness. 
 
 Increase of Municipal Indebtedness. 
 
 Section 3 of the act which you have before 3 ’ou contem¬ 
 plates the issue of bonds, to run for a term not exceeding 
 twenty years, at not more than five per cent. The aggregate 
 amount of such bonds may equal five per cent, of the total 
 valuation of the property of the municipality, and the indebted¬ 
 ness thereby created is not to be included in the limitation of 
 indebtedness of the city or town. Let me read again from Judge 
 Dillon. Speaking of municipal indebtedness, he says (sections 
 154 and 155) : — 
 
 “It is estimated that the indebtedness of municipal and public 
 corporations in this country has already reached the enormous sum 
 of $1,000,000,000, and it is constantly increasing. A large por¬ 
 tion of this indebtedness is evidenced by negotiable bonds which 
 are held by thousands of persons at home and abroad as an invest¬ 
 ment. These bonds have been issued for a great variety of pur¬ 
 poses, such as the erection of public buildings, the making of 
 municipal improvements, and in payment of subscriptions for the 
 stock of railway corporations, or as donations to aid them in the 
 construction of their roads located in or near the municipality or 
 public corporation thus extending its assistance. 
 
 “ The power conferred upon municipal and public corporations 
 to issue commercial securities for such purposes is of compara¬ 
 tively recent origin, and it has undeniably been attended with very 
 serious, and it is, perhaps, not too strong a statement to add, dis¬ 
 astrous, consequences. One of these is the stimulus which the long 
 credit commonly provided for effectually supplies to over-indebted¬ 
 ness. The bonds usually fix a time, twenty or thirty years distant, 
 for payment of the principal. Those who vote the debt and the 
 councils or bodies which create it and issue the bonds, do so with- 
 
24 
 
 out much hesitation, as the burden is expected to fall principally 
 on posterity. A learned justice of the Supreme Court of the 
 United States has very aptly described the effect witnessed as a 
 mania for running in debt for public improvements. It has else¬ 
 where been characterized as an epidemic insanity inducing extrava¬ 
 gant corporate subscriptions to public works.” 
 
 No matter what may be the constitutional foundations for this 
 power, the result of the application of it has been nothing but dis¬ 
 aster wherever the experiment has been tried. 
 
 This great mountain of municipal indebtedness is not confined 
 to the newer, and therefore presumably more improvident, portions 
 of our country. In Massachusetts the municipal indebtedness 
 amounted, in 1888, to upwards of $96,000,000, and to-day it 
 probably constitutes one-tenth of the entire municipal indebtedness 
 of the United States. I read from a pamphlet prepared by Mr. A. 
 D. Chandler, in 1889, called “ Municipal Control of Commercial 
 Lighting. Nationalism Analyzed,” which is a mine of information 
 upon this subject. 
 
 General Collins. — The municipal indebtedness of Massachu¬ 
 setts has since that time increased about $12,000,000. 
 
 Mr. Burdett. —In Massachusetts. And that will bring it up 
 to— 
 
 General Collins. — $108,000,000. 
 
 Mr. Burdett. —Mr. Chandler says, “No State in the Union 
 is believed to have so large a debt as Massachusetts ; namely, 
 $28,851,619. And the city and town indebtedness of no State in 
 the Union is so large in proportion to its population as that of 
 Massachusetts; namely, $96,756,916. Here is a total public in¬ 
 debtedness of $125,608,535. The adoption of the nationalist 
 theory would point the way to an enormous increase of this indebted¬ 
 ness. The absorption or duplication of the lighting plants alone 
 would require over $20,000,000.” In that case we would have a mu¬ 
 nicipal indebtedness in Massachusetts of $128,000,000; decidedly 
 more than ten per cent, of the entire municipal indebtedness of the 
 United States. It was true at the time this pamphlet was written 
 that out of 351 municipalities in Massachusetts ten had an indebt¬ 
 edness of from seven per cent, to nine and one-half per cent, 
 on their valuation. Danvers’ indebtedness at that time was 
 seven per cent, of its valuation; and while the ratio of increase in 
 Danvers’ valuation for 1888 over 1887 was only two and one-half 
 per cent., the ratio of increase of its total liabilities for the same 
 
25 
 
 period was fourteen per cent. I have not had an opportunity to 
 bring these figures down to the present date, but I state them as 
 of the time employed by Mr. Chandler. 
 
 Corruption of the Public Service. 
 
 The necessary enlargement and the almost inevitable corruption 
 of the public service which would follow the passage of acts such 
 as we have under consideration is in and of itself, to the minds of 
 conservant thinkers, a sufficient objection to the legislation. The 
 question is, do we want to increase or decrease the official classes 
 in the United States? Do we want to have, as in Germany and 
 France, and other continental countries, about every third man 
 dressed in uniform of some description, belonging to either the 
 civil or the military department of the public service? or do we 
 want to have things left more as we have had them in the past, with 
 the people governed as little as possible, and paying for as small a 
 civil list as possible ? The difficulty about this proposed legislation 
 is that it is starting us in exactly the wrong direction. Up to this 
 time we have been fleeing from centralization, fleeing from the 
 increased power of government; and yet here is a serious proposi¬ 
 tion to turn around and go in just the opposite direction. Why, 
 Mr. Chairman, is it not beyond dispute that we are what we are 
 to-day as a people, and our industries are what they are to-day as 
 industries, because we have, from the foundation of our govern¬ 
 ment, practised precisely the opposite theories from those em¬ 
 bodied in this bill? We have practised upon the idea that the 
 more we encouraged individual enterprise, the better; the more 
 inducements we gave for the investment of private capital, the bet¬ 
 ter ; the less we had to do with government, the better. And our 
 policy has wisely gone so far as to encourage the investment of 
 private capital in corporate form, so that it may be more effec¬ 
 tively employed. But we are now asked to take the first step 
 toward surrendering the idea of individual enterprise, and giving 
 over our industries to be managed by public officers. Let them 
 light our streets and supply our power ; then let them run our street 
 railroads, and absorb our telephones and telegraphs ; let them grad¬ 
 ually come into the management and control of all our quasi-public 
 enterprises, and we shall have arrived at the goal of nationalism. 
 What is “ nationalism”? I understand it to be a theory of gov¬ 
 ernment which delegates as much as possible to the government, 
 and leaves as little as possible to the individual — a theory whibh 
 
26 
 
 is thoroughly undemocratic, unrepublican, and unAmerican. 
 And there is no disguise of the programme. Pending before 
 this very committee there are petitions for the enactment of 
 a law to allow cities and towns to make light, and to en¬ 
 gage in all other la>rful business that the citizens of such cities- 
 and towns may desire to enter into. There is a petition 
 now pending before the Committee on Labor for a State loan of 
 three million dollars to cities and towns to enable them to build 
 homes for the people, similar to State loans to railroad corpora¬ 
 tions to build their railroads. Before the Committee on Cities the 
 44 Nationalists’ League,” which I presume is a part of the same 
 organization which is conducting the petitioner’s case before your 
 committee, have a petition pending as to permitting cities to erect 
 dwelling-houses, and to let them at a rental. The absorbing of the 
 telephone and telegraph lines, the running of the street railroads, 
 the management of the express service, the ownership of union 
 depots, and so on and so forth, are but successive steps in the same 
 direction—in the direction of the surrender of individualism, and 
 in the adoption of the idea of paternalism. But was it not, Mr. 
 Chairman and gentleman, because our fathers objected to paternal 
 forms of government, that they left their homes and crossed the 
 sea, to establish here new forms of government, to inaugurate new 
 industries, and to lay the foundation of a success more glorious 
 than was possible under the old conditions? 
 
 (Adjourned to Tuesday, March 24.) 
 
 Tuesday, March 24, 1891. 
 
 Upon the reassembling of the committee, Mr. Burdett pro¬ 
 ceeded as follows : — 
 
 Mr. Chairman and Gentlemen, — At your session yesterday I 
 had the privilege of advancing, in behalf of the electric-light 
 companies, such reasons against this legislation as seemed to me 
 pertinent, and 1 practically closed the consideration of all points 
 that I desired to treat upon, with one exception,—the question 
 of economy, involving the question of electric-lighting prices. I 
 referred to the character of the legislation, to its broad and 
 sweeping provisions, to the revolutionary idea contained in those 
 portions of it which look to the embarking of the towns and cities 
 of the Commonwealth in hazardous manufacturing enterprises. I 
 next referred to the remonstrants, to their number and character, to 
 the history of their business, and to the nature of their objections. 
 
27 
 
 In considering the public objections to the pending bill, I 
 insisted that it was contrary to our theories of town and city 
 government; that there was no valid analogy between any 
 employment now undertaken by municipalities and the manu¬ 
 facture and sale of gas or electricit}’, but that the analogy ran 
 directly the other way, — from gas and electric lighting to electric 
 railroads, electric telephones, electric telegraphs, and other indus¬ 
 tries of a quasi-public character. 
 
 In connection with the provision of the bill for the issue of 
 bonds to pay for municipal plants to be established under it, I 
 called your attention to the increase of municipal indebtedness 
 which it would necessitate. I pointed out in this connection that 
 municipal aid to railroads, which is the closest analogy of any¬ 
 thing we have, has resulted uniformly and universally in financial 
 disaster and public corruption. 
 
 When the hearing closed yesterday, I was discussing the effect 
 of the necessary enlargement and the almost inevitable corruption 
 of the public service, which would follow this legislation. I need 
 add nothing to what I have already said upon that point, except 
 to quote from the great work on “ Liberty ” by John Stuart 
 Mill, in which, referring to the abuse of the powers of government 
 and the source from which it arises, that writer says: — 
 
 “ The mischief begins when, instead of calling forth the activity 
 and powers of individuals and bodies, it substitutes its own activity 
 for theirs.” 
 
 No Economic Advantages. 
 
 The only excuse for the proposition which is before you is the 
 claim that the public purse will be benefited by its adoption. No 
 sober-minded citizen of Massachusetts can fail to recognize and 
 admit the objections to the scheme. Nobody but a “ nationalist ” 
 would for a moment pretend that this legislation was not sur¬ 
 rounded with the gravest difficulties and uncertainties. But it is 
 claimed that towns and cities can get their lights cheaper under 
 municipal ownership than they can under private ownership. But 
 it is not true. And if anything has been proved before you in these 
 hearings, that has been proved. Even if it were true, it would make 
 no difference to one entertaining my views on the public questions 
 which are involved. According to my way of looking at the sub¬ 
 ject, the opportunity for a city or town to make or save a few 
 dollars, more or less, ought not to induce us to inaugurate a 
 
23 
 
 dangerous experiment and revolutionize all our theories and 
 ideas of town and city government. But municipal lighting 
 is not cheaper than private lighting. In the first place, a 
 city or town cannot produce anything cheaper than private 
 capital can produce it. If that be so, the municipalities in 
 Massachusetts have received their lights up to this time at a fair 
 price, unless the corporations have made a large and undue profit 
 out of furnishing them. But that they have not received very 
 much advance over the cost of production, appears from the undis¬ 
 puted figures as to their dividends and earnings which I have 
 given you. But I need not rest my case upon that proposition, 
 however sound it may be. I can afford to enter upon a careful 
 study of the figures which experience has furnished us. 
 
 The community has been misinformed, misled, miseducated from 
 the beginning until now upon this question of electric-lighting 
 prices. But the time has now come when we are beginning to get 
 at some of the facts in the case. Why, think of what has been 
 placed before this committee by the other side, as affirmative evi¬ 
 dence, to show that electric lights can be produced cheaper by a 
 municipality than they can by a private corporation ! A lot of 
 extracts (not at the time, by the way, credited to their source) 
 read from a book four years old, which the author has since repu¬ 
 diated. There is the beginning and the end of all the testimony 
 which has been submitted upon the general question of the economy 
 of the municipal production of electric lights. The man who wrote 
 that book, said in Chicago, two years ago, according to the testi¬ 
 mony before you : — 
 
 “ I have closely studied the workings of almost ever 3 T city plant, 
 and, with but one or two exceptions, I would not now commend 
 their operation. The officials of the smaller towns where munic¬ 
 ipal plants have been installed show an amount of crude ignorance 
 of the subject that is truly appalling.” 
 
 That is all I have to say about the extracts from Mr. Whipple’s 
 book, which have been put in here in lieu of testimon}'. I have 
 something more serious to do than to fire shots at a ghost like 
 that. What did we do? We produced two witnesses who 
 knew what they were talking about, — Mr. Francisco and Mr. 
 Gilbert. When Mr. Francisco had finished his testimony you 
 must have been impressed with the fact that for the first time 
 since these hearings began you had heard some real testimony, 
 and had begun to get at some real facts as to the cost of the 
 
29 
 
 operation of the municipal plants which now exist. Our friends 
 on the other side, recognizing the force of it, and knowing that if it 
 stood uncontradicted their claim to econom}' was gone, sent a gen¬ 
 tleman up to Rutland to see what he could find out. He found 
 nothing whatever to temper the force of Mr. Francisco’s testi¬ 
 mony. We would gladly have given him the facts if he had asked 
 for them. But we did not deem them at all material to this 
 inquiry. They amount simply to this, that a ruinous competition 
 is going on in Rutland, and that Mr. Francisco’s company is fur¬ 
 nishing lights at much less than the cost of production, and is 
 determined to furnish them for nothing, if necessary, rather than 
 to be driven out of the field by unfair means. 
 
 I shall not attempt to go over Mr. Francisco’s testimony in de¬ 
 tail. He took up every case that was cited on the other side, and 
 showed what the actual cost has been to produce electric lights 
 under municipal ownership in the various places. After disposing 
 of all the places to which attention had been called upon the other 
 side, he took up other prominent instances, like Chicago, III., 
 Easton, Pa., Xenia, O., and other places. Unfortunately, Mr. 
 Gilbert had not at that time worked out this “ table with unit,” so 
 called, which furnishes us such an exact measurement of the amount 
 of light obtained in different places for the same amount of money. 
 If that had been done, we could have applied it to the places 
 named by Mr. Francisco, by eliciting the particular facts necessary 
 for its application. But in a few places the application can be 
 made. Let us take, for example, the first place that was named 
 upon the other side — Ba}' City, Mich. Let us see if w r e can get 
 at the facts. The lights in that city burn 2,421 hours per year, at 
 a cost of $93.20 per lamp, or at the rate of 3.85 cents per lamp 
 per hour. Dividing the nominal candle-power of the lights by the 
 price per hour, we obtain, as the amount of light, measured in 
 nominal candle-power, obtained in one hour for one cent, five hun¬ 
 dred and nineteen. Compare this result with that obtained in 
 Boston, one of the most expensive places in the United States 
 in which to furnish electric lights, for the various reasons given 
 by Mr. Gilbert. In Boston coal costs the company $3.89 
 a ton and upwards. In Bay Cit} T , the city buys all the shav¬ 
 ings needed to run their steam plant for a year for $1,200; 
 while coal formerly cost them more than twice that sum. And 
 yet, notwithstanding the differences in favor of Bay City, she 
 gets only 519 candle-power per hour for one cent, while Boston 
 
30 
 
 gets, under contract at forty cents per light, 540 candle-power per 
 hour for one cent. 
 
 Now, take Lewiston, for example. That is a municipal plant 
 run by water-power. Without stopping to examine the figures, 
 let me refer to a portion of Mr. Francisco's statement, which fur¬ 
 nishes an excellent illustration of how the figures about the cost 
 of the operation of municipal plants are frequently arrived at. He 
 says : — 
 
 ‘‘Another feature of Lewiston is, that in the itemized account 
 [of operating expenses] there are fifty or more different expendi¬ 
 tures, ranging from fifty cents to $2,584, and yet there is no men¬ 
 tion made of any description of five items that go to make up a 
 considerable proportion of the cost of lighting in well-regulated 
 companies; namely, power, interest on cost of plant, insurance, 
 taxes, or depreciation. That does not appear in any form there 
 among those items.” 
 
 Just think of it! Think of people giving out figures as the cost 
 of production and omitting therefrom the items of power, 
 interest, insurance, taxes, and depreciation ! 
 
 That they have no necessary surplus machinery appears from * 
 the last report of the superintendent, in which, after speaking of 
 the necessity of enlarging the station, he says : “ But whether the 
 station is enlarged or not, we need an extra dynamo to use in case 
 of accident, which is liable to happen at any moment, leaving part 
 of the city in darkness.” 
 
 The superintendent says in another part of his report: “In 
 fact, the whole plant, poles, wires, lamps, and dynamos, will need 
 reconstruction before the end of two years.” 
 
 And that plant has only been in operation for about three years 
 now 1 
 
 Take the case of Hannibal, Mo., as another illustration. 
 Street lights, according to Mr. Francisco’s figures, cost $101, and 
 private lights $91.71. Owing to a lack of necessary surplus ap¬ 
 paratus, the streets were left in darkness upon five occasions, — 
 three times by the lightning, and twice by the burning out of 
 armatures. The mayor characterized the burning out of the 
 armatures as an accident happening through ignorance and care¬ 
 lessness. For how long the loss of service was continued upon 
 any of these occasions we are not informed. Such service 
 would not be tolerated in the case of a company supplying lights 
 by contract. 
 
31 
 
 Now, what are the facts about Chicago, where we are asked to 
 believe that the public lights cost the city only nineteen cents? 
 The fact is, that they cost about thirty-five cents, as Mr. 
 Francisco’s figures proved conclusively. Coal costs only $1.33 
 a ton in Chicago, as against $3.89 and upwards in Boston. Upon 
 the Chicago superintendent’s own figures, with the addition of 
 the items of water tax, interest on investment, loss of taxes, 
 insurance, depreciation at five per cent, salaries and office-rent, 
 the cost amounts to 34.9 cents per light per night. The city 
 superintendent of the electric lights in Chicago frankly states, 
 whenever asked, and has so stated in several communications 
 which are public property, that in the figures given out from 
 Chicago there are never included the items above named, or oil, 
 waste, repairs, or like charges. 
 
 How about Topeka? The gentleman who has conducted the 
 case of the petitioners saw fit to read about six lines of a 
 letter from the Mayor of Topeka, not informing us that he was 
 omitting about six times as much. That was his idea of 
 fairness, I suppose. We did not know the fact until Mr. Fran¬ 
 cisco came here and told us of it. Under date of Feb. 12, 
 1890, the Mayor of Topeka, referring to the municipal electric-light 
 plant, said, We think we have got rather a bad bargain. 
 
 Our lights so far have been very unsatisfactory. My own opinion 
 of the matter is that it would, no doubt, be much cheaper in the 
 end for the city to have contracted with some of our electric-light 
 companies here to furnish the city with its lights at so much per 
 light per month. We would then have known, at least, just what 
 they* cost.” He concludes by saying, “ We have found ours a 
 very expensive luxury, and there are so many expenses coming 
 up that we cannot foresee.” 
 
 Now, let me take a final and very striking instance, which fur¬ 
 nishes a comparison which is perfectly fair in every respect, — 
 the cities of Marietta, O., and Parkersburg, W. Va. They are 
 situated about twelve miles apart, on opposite sides of the Ohio 
 river. They, undoubtedly, obtain coal at substantially if not 
 exactly the same price, and all the local conditions are the same ; 
 they get the same light, the same kind of light, as I understand 
 the testimony’. In the case of Marietta, where there is a munici¬ 
 pal plant, the light costs at the rate of 4.5 cents per hour; in the 
 case of Parkersburg, where the light is furnished by a private 
 corporation, it costs them only 2.6 cents per hour. 
 
32 
 
 I now come to the consideration of the testimony of Mr. Gilbert, 
 another man who, as everybody will concede, knows what he is 
 talking about when he is dealing with electric-lighting matters. 
 He made himself thoroughly conversant with the facts and figures 
 as to the municipal plants in Bangor, Me., and Danvers, Mass., 
 because these are both near at hand, and are both advertised far 
 and wide throughout the country as shining illustrations of the 
 success of municipal control. 
 
 Bangor. 
 
 In the case of Bangor it is claimed that the city lights are pro¬ 
 duced at a cost of twelve and three-fourths cents per light per 
 night. Now, what is the fact about it? Upon their own figures, 
 corrected as I shall indicate, the cost of producing their lights by 
 water-power is 24.6 cents per light per night; and, when reduced 
 to a steam basis, the cost is 40.14 cents per light per night. As 
 to the character of the service there, you have had some evidence. 
 My information is that it is very poor. But whatever the service 
 is, the cost is not 12f cents, but 24.6 cents by the use of water¬ 
 power, and 40.14 cents on a steam-power basis. In arriving at 
 these results, Mr. Gilbert did not take into his calculation anything 
 for surplus apparatus, which ought to be from 10 to 20 per cent., 
 according to all the testimony you have before you, nor make any 
 allowance for damages, either to persons or property, or in patent 
 litigation, nor reckon in anything for the use of water-power, 
 although the water department of the city of Bangor charges 
 every other department large sums for water; nor did he reckon 
 any interest on any portion of the water plant or upon the build¬ 
 ing, or anything for rental, either of power or of the premises. 
 He simply added interest on the investment, at the same rate they 
 pay on their city bonds, loss of taxes at the city rate, depreciation 
 at five per cent., and a very small item for insurance, with the 
 result which I have stated. 
 
 Danvers. 
 
 Now we come to the case of Danvers, the model near at hand 
 which is held up before us. This plant has been run by the mu¬ 
 nicipality for several years, not only for their own convenience, 
 but for the purpose of demonstrating to Massachusetts and to the 
 world that a municipality can produce its lights cheaper than a 
 
33 
 
 private corporation. Everything is favorable for their experiment. 
 They have no $110 poles, such as we have to have here in Bos¬ 
 ton ; and no $350 roof structures to build and maintain. They 
 use poles and trees in the public streets without limit and without 
 price, and have otherwise prosecuted their business under the most 
 favorable conditions. If Danvers fails, their whole case fails. 
 Now, how can we get at the facts of the case ? In the first place, we 
 must find some common unit of measurement, some yardstick that 
 will measure just so much and no more wherever it is used. And 
 we have found it. I refer to this little u table with unit,” which 
 has been prepared by Mr. Gilbert. It should be thoroughly under¬ 
 stood by every member of your committee. It is made up by 
 taking the yearly cost of a lamp, which, of course, can be readily 
 arrived at, and dividing that cost by the number of hours it burns 
 during the year. That gives us the cost per hour of each light. 
 Then, dividing the nominal candle-power of the light by the cost 
 per hour, we get the amount of light, measured in candle-power, 
 that can be obtained in one hour for one cent. Suppose, for 
 example, that the nominal candle-power of your lamp is 2,000, 
 and that it costs you four cents per hour, you would be getting 
 for one cent, for the same length of time, 2,000 divided by 4, or 
 500. That is mathematically exact, and is fair for everybody. 
 
 I take pleasure in handing to the committee copies of the 
 “ table with unit,” which I refer to. 
 
 (Mr. Burdett at this point submitted copies of the following 
 table.) 
 
34 
 
 Table with Unit. 
 
 Burning Every 
 Night in the 
 Year. 
 
 Total 
 Hours 
 Burned 
 per Year. 
 
 Average 
 Hours 
 Burned 
 per Night. 
 
 Nominal 
 
 Candle- 
 
 Power. 
 
 Price 
 
 per 
 
 Year. 
 
 Price. 
 
 per 
 
 Night 
 
 Price 
 
 per 
 
 Hour. 
 
 Candle-Power 
 furnished per 
 Hour for One 
 Cent. 
 
 All Night, 
 
 3,939 
 
 10 h. 48 m. 
 
 2,000 
 
 $219 00 
 
 .60 
 
 
 3594 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 219 00 
 
 .60 
 
 
 2154 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 200 75 
 
 .55 
 
 
 3921 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 200 75 
 
 .55 
 
 
 235g 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 182 50 
 
 .50 
 
 •o*4 
 
 4324 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 182 50 
 
 .50 
 
 •o*4 
 
 2594 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 164 25 
 
 .45 
 
 •o*4 
 
 4794 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 164 25 
 
 .45 
 
 .044 
 
 287| 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 146 00 
 
 .40 
 
 .03 io 
 
 5404 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 146 00 
 
 .40 
 
 •03 h 
 
 3244 
 
 Dusk to 1 A.M. 
 
 2,490 
 
 6 h. 49 m. 
 
 2,000 
 
 127 75 
 
 .35 
 
 •05| 
 
 389-4 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 127 75 
 
 .35 
 
 •05g 
 
 234 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 109 50 
 
 .30 
 
 .04|- 
 
 4544 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 | 109 50 
 
 .30 
 
 • 04 f 
 
 272| 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 91 25 
 
 .25 
 
 .03| 
 
 5454 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 91 25 
 
 .25 
 
 •03f 
 
 3274 
 
 Dusk to 12 M. 
 
 2,125 
 
 5 h. 49 m. 
 
 2,000 
 
 127 75 
 
 .35 
 
 .06 
 
 3334 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 127 75 
 
 .35 
 
 .06 
 
 200 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 109 50 
 
 .30 
 
 .051 
 
 387 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 109 50 
 
 .30 
 
 .051 
 
 2324 
 
 do. 
 
 do. 
 
 do. 
 
 2,000 
 
 91 25 
 
 .25 
 
 •°¥o 
 
 465 
 
 do. 
 
 do. 
 
 do. 
 
 1,200 
 
 91 25 
 
 .25 
 
 •°¥o 
 
 279 
 
 *Danvers, Mass. 
 
 1,339 
 
 4 h. 51 m. 
 
 1,200 
 
 $69 521 
 
 .271 
 
 4 
 
 .05| 
 
 2134 
 
 t Danvers, Mass. 
 
 1,236 
 
 do. 
 
 1 
 
 1,200 
 
 1 
 
 62 57 
 
 .24b 
 
 
 237 
 
 * First 13 months to Feb. 1, 1890, 276 nights. 
 
 f 12 months, ending Feb. 1, 1891, 255 nights. 
 
 The above figures on Danvers were taken from the Danvers Town Reports, including 
 items charged in Lighting account, Miscellaneous account , and Auditor's report, which dis¬ 
 tinctly state were for Electric Lighting, to which is added Town’s loss of taxes and 5 per 
 cent, depreciation. 
 
 Moonlight schedule not figured, opinions varying as to nights or hours required. 
 
 1 
 
35 
 
 Danvers puts up with a service, so far as the hours of burning 
 are concerned, which no town or city is content to receive from a 
 private corporation. They get a service, according to their own 
 reports, of only 1,236 hours in a year. The least that cities and 
 towns obtain by contract is 2,125 hours, where lights burn every 
 night from dusk till midnight. But, leaving that aside, and 
 assuming that Danvers gets just as much light, and just as good 
 light, as anybody else, what does it cost her? The following 
 figures are taken from Mr. Gilbert’s testimony. He obtained them 
 all from the town reports of Danvers. He has taken no items ex¬ 
 cept such as unquestionably apply to the electric-lighting account, 
 and he has added nothing to them except depreciation and loss of 
 taxes. Interest is included in the municipal report. The plant 
 was started January 2, 1889. 
 
 First report, Jan. 2, 1889, to Feb. 1, 1890: — 
 
 Bills paid to Feb. 1, 1889 ..... $491 07 
 
 Maintenance for year to Feb. 1, 1890 . . . 3,815 81 
 
 Committee’s services and expenses .... 184 17 
 
 Insurance . . . . . . . . 162 50 
 
 Lawyer’s fees ........ 174 17 
 
 Printing ......... 51 75 
 
 Liabilities ; committee’s services .... 80 00 
 
 A. H. Merrill, team ....... 4 00 
 
 J. Frank Dale, expenses . . . . . 20 06 
 
 D. N. Crowley, legal services . . . . . 25 00 
 
 To which are added : — 
 
 Taxes on investment, at town rate, for thirteen months, 260 50 
 
 Depreciation, at five per cent., for thirteen months . 812 50 
 
 Total.$6,081 53 
 
 Less supplies on hand ...... 583 00 
 
 Total actual cost.$5,498 53 
 
 Number of street lights (excluding the two in the station, which 
 would not be paid for by the town under the contract system), 73 ; 
 nominal candle-power, 1,200. Number of hours burned in thirteen 
 months, 1,339. 
 
36 
 
 Reduced to basis of twelve months, or 1,236 hours, gives as 
 yearly cost per lamp, $69.52-1, Q r at the rate of 5§ cents per lamp 
 per hour. Reduced to nominal candle-power per hour for one 
 cent, the result is 213^ candle-power. 
 
 These items are all in the town reports, but they are not found 
 together. They have not kept their electric-light account so that 
 you can see all the items of cost and maintenance at a glance. 
 Mr. Gilbert was obliged to go through all the accounts in the town 
 report, and pick out those items which related to electric lighting. 
 But no single item has been taken which has not the electric-light 
 ear-marks on it, unmistakably ; every item that is doubtful is 
 left out. 
 
 Second report, Feb. 1, 1890, to Feb. 1, 1891 : — 
 
 Cost as per superintendent’s report, less supplies on 
 
 hand ........ $3,419 79 
 
 F. H. Caskins, services and expenses . . . 100 00 
 
 J. T. Lynch, services ...... 23 00 
 
 Samuel C. Putnam, services .... 25 00 
 
 A. F. Hayward, care of electric lights . . . 10 00 
 
 Add: — 
 
 Loss of taxes, at town rate ..... 240 00 
 
 Depreciation, at 5 per cent. ..... 750 00 
 
 Total actual cost ..... $4,567 79 
 
 Number of street lamps, 73; nominal candle-power, 1,200. 
 Number of hours of burning, 1,236. Price per year, $62.57. 
 Price per hour, 5^ cents. Nominal candle-power per hour for 
 one cent, 237. 
 
 Now, if you will take that result and compare it with this 
 “ table with unit,” you will find that the only substantial equiva¬ 
 lent, elsewhere, of the Danvers cost, is where a town or city gets 
 1,200 candle-power lights from a private corporation till midnight 
 at about thirty cents per light. According to this table, the neigh¬ 
 boring city of Salem gets from the local company, at forty-five 
 cents per light for an all-night light of 2,000 candle-power, about 
 twice as much light per hour for one cent as Danvers does. 
 
 An objection was made here the other day about which I desire 
 to speak for a moment at this time. It was asked, “ Have you 
 
 < 
 
37 
 
 taken any other place just like Danvers, where the days and 
 hours of burning are just the same, and made the same figures ?” 
 The answer was, “ No ; because it is impossible to do so ; no other 
 place getting its light by contract gets so few hours of burning 
 as does Danvers.” 
 
 Biit what can be done? We can take the actual burning hours 
 of any other place, and it will do as well, as, of course, it is 
 simply a matter of proportion. You will remember that I asked the 
 treasurer of the Salem Company what the average burning hours 
 of his street lights are, and he said ten hours and a half. Salem, 
 therefore, burns her street lights 3,832 hours per year, which, at 
 forty-five cents a night, gives a cost of $164.25 per 3 r ear, or at 
 the rate of 4.28 cents per light per hour ; which, reduced to candle- 
 power per hour, gives us 467.29 candle-power per hour for one 
 cent. So that, taking the exact state of facts in Danvers, and 
 the exact state of facts in Salem, we find the difference is almost 
 two to one in favor of the private plant in Salem. This means 
 that the Salem Electric Light Co., if Danvers were near by, 
 could safely supply Danvers with the same quality and amount of 
 light, by actual measurement, as it now gets, at a little more than 
 half the present cost to Danvers. 
 
 The Chairman. — I want to ask you one question. Is the cost 
 per light in Salem figured out on the basis of all-night burning? 
 
 Mr. Burdett. — Yes, sir; from the actual burning. There 
 would be, in that case, I suppose, some deduction to be made. 
 Let us see. You would add to the Danvers price, if I remember 
 correctly, about 50 per cent, for all-night service, and that would 
 be at the rate of forty-five cents a night for what Danvers gets — 
 that is, a 1,200 candle-power lamp, as against a 2,000 candle- 
 power lamp in Salem. She is paying at the same rate for an 
 inferior article as Salem is for the best article. 
 
 The Chairman. — I wanted to ask that question. I think that 
 is all. 
 
 Mr. Burdett. — We do not claim that it costs twice as much to 
 run all night as it does to run until twelve o’clock. I think the 
 testimony is undisputed that it costs at least 50 per cent. more. 
 
 The Chairman. —That is all the question I have. 
 
 Mr. Burdett. —Consider one other thing in this connection, 
 which is significant. Look at the report of the Gas and Electric 
 Light Commissioners, and ascertain what various cities and towns 
 now pay by contract for substantially the same kind and quantity 
 
38 
 
 of light as they get in Danvers. I find thirty-one towns and 
 cities in Massachusetts which are supplied with 1,200 candle- 
 power lights on the midnight schedule, burning under substantially 
 the same conditions, as I understand them, that they are burning 
 the lights in Danvers. And the average price paid by contract in 
 those thirty-one cities and towns is twenty-six cents per lamp per 
 night, or four cents less than the municipal cost of production in 
 Danvers. 
 
 I have now stated all the considerations upon this subject 
 which I think are of prime importance. But I desire to pay some 
 attention to the petitioners, and I will do so in a very few words 
 in closing. There is not a single town or city, except Danvers, 
 which, according to my recollection, comes here with a real 
 grievance. Danvers is in a position where it needs help of some 
 kind. They have assumed the law to be what it is not, and the 
 result is that they have a certain number of bonds outstanding 
 which are to-day not worth the paper they were written on. 
 I have nothing to say against a law to legalize the bonds issued 
 by the town of Danvers. But that is no reason why Danvers, or 
 any other town, should be allowed to go farther than she has 
 already gone and embark in the business of manufacturing and 
 selling electricity. To-day, the citizens of Danvers have a strictly 
 municipal plant, which, like honest men, they want to pay for, 
 and which is not paid for in the securities which have heretofore 
 been issued. But if, as a matter of expediency and exigency, you 
 should legalize these securities, there is no reason why the whole 
 theory and practice of Massachusetts town government should be 
 upset. 
 
 As I reside in Brookline, I may be pardoned for referring to 
 the position of that town for a moment. They have not peti¬ 
 tioned, and in my judgment they never will petition, for any such 
 law as is embodied in the bill before you. Their petition is that 
 the Legislature will pass u a proper law,” giving to cities and 
 towns of the Commonwealth a right to manufacture and supply 
 themselves with electric lights for municipal purposes only. They 
 have not for a moment considered the proposition of allowing, the 
 town of Brookline, with its vast property interests, to go into the 
 hazardous business enterprise of manufacturing and selling gas 
 and electricity for commercial purposes. 
 
 The city of Boston has not been represented here. One of the 
 members of the Common Council, an excellent gentleman, whose 
 
 < 
 
39 
 
 personal acquaintance I have the honor to enjoy, gave you his 
 ideas, but expressly disclaimed any official character as a witness. 
 He gave certain estimates of the probable cost of a municipal 
 electric-light plant in Boston. It turned out that his figures were 
 furnished by a corporation which was subsequently involved in 
 patent litigation, the result of which was that the machinery man¬ 
 ufactured and supplied by it was adjudged to be an infringement 
 of certain letters-patent, and the further use of which was enjoined 
 by the courts of the United States. What an investment that 
 would have been for Boston ! 
 
 I do not feel that I am justified in imposing upon the committee 
 any further consideration of the special features existing in the 
 cases of the several petitioning municipalities. I have thought I 
 could better employ my time in suggesting the general objections 
 which obtain to the legislation that is proposed. These objections 
 apply equally well to special and general legislation, for if you per¬ 
 mit one town to go into this business, how can you deny the right 
 to others? The real question for you to decide, gentlemen, is 
 whether you will take this step backwards ; and if you think it is 
 undesirable to do so, you ought to meet the issue squarely, help¬ 
 ing Danvers out of her difficulty, if it can be done without vio¬ 
 lating the general principle involved, and let the other petitioners 
 have leave to withdraw.