At my request, our own Emile DeFelice considered the new Energy Party, and provided us an update on his doings. I just got it, and it’s going straight to you:
Thanks Brad for inviting me to come back to the blog and weigh in on the Energy Party.
The world can no longer support Economy v. Environment. There must be economic rewards for that which improves the air, water, plants, animals, and soil, and penalties for their degradation. My energy policy prioritizes1) Conservation,
2) Captured Waste,
3) Local Resources,
4) Non-Local Resources.
Personal responsibility in the form of conservation is our most valuable asset.
Dr. John Mark Dean’s op-ed plea for lower speed limits inspired me to take the challenge in my truck. Three good things from two weeks at 60 — 20% gas savings, less stress, and equally quick trips. Jockeying and tailgating didn’t get me anywhere faster.
Cheap food and cheap oil are intertwined, but most people are unaware. This is why corn-based ethanol proponents have been able to coast unobstructed to questionable ends. Nearly every item in a grocery store has corn in its production pipeline — we consume more corn than the Indians ever did.
Corn-ethanol endangers us by pitting food against fuel. The misguided application of ethanol extends to the car that GM supplies our Agriculture Commissioner. That vehicle—a Chevrolet Avalanche with a corn cob paint job and a 12.5 average mpg–misses the point entirely.
Ethanol-guzzling SUV’s don’t solve the problem of too much fuel consumption. And (see no. 4 above) as a net corn importer already, South Carolina is no Idaho.
Of course, food is The Original Human Energy Issue. I wish someone else here had brought up the energy implications of our food system, and the potential we have to eat our way to a better world. Right now, we have a global industrial monolith that threatens to be our only food system. I’m not advocating that we throw it out. But why must it be our only choice?
Supporting a local food option offers so many opportunities. The beauty is that every person can make choices that improve our personal and collective well being.
Bottom line: Energy Party, count me in.Brad also asked me to give you guys a quick update on what I’ve been doing since the election. It would have been surprising had I won the race, so no shock or bitterness, just thankfulness for those who helped me and the gratification of seeing so many people get into the message and the potential for agriculture in this state. What a great experience.
My campaign was less about getting a job than getting a job done. Besides getting my farm back in order, I’ve started several projects to improve our local food system–chairing a task force on putting local food in our schools, creating a business incubator for food entrepreneurs, and improving the All-Local Market, now 15 months old — a year round, rain or shine, producer-only market where you can purchase meats, vegetables, dairy and eggs, flowers, breads, soaps and sauces from South Carolina producers. If you haven’t yet, come out sometime and see how a local farmers’ market can work for everybody in our community.
I love my job as a farmer, but my passion for these issues always has and will extend far beyond my farm driveway.Put Your State On Your Plate!
Emile DeFelice
Emile for governor!
(Governor of Vermont, that is.)
Emile is way too progressive and forward thinking for this state.
I think the Energy Party– and Emile’s perspective on food and fuel– are great. Where do I sign-up? When the pep rally? The convention? Which presidential candidate will the Energy Party run? Or endorse?
This post is a stark reminder of the lack of visionary leadership or courage among our current elected offficials.
These are the people we need in government.
Do-ers, not talkers.
That’s why I voted for Emile and also donated (a small amount) to his campaign. If you can’t see the difference between his approach and that of 90% of the people who occupy positions in our government, then you’re part of the problem.
Too bad The State couldn’t bring themselves to endorse Emile over… uh… who? Some guy with a plan for a new marketing program.
Sorry to rain on the energy parade, but here’s an intriguing article:Catholic – Anglican unity?
I cannot nor ever will be a member of the “Energy Party.”
I believe the free market is the way to go. Certainly, it was the free market that gave us the internal combustion engine which is fingered as the culprit in so many disasters, but I think cars are preferrable to the horse and buggy which caused our cities to be filled with horse manure and the public health disaster that comes with it.
The public has shown a demand for so-called eco-friendly vehicles much as it did for cars in the early 20th century, and the free market is doing what it can to supply that demand. Unfortunately, for electric cars or even light rail to be economically feasible, ubiquitous nuclear power will have to become a reality. (Solar and wind aren’t going to cut it.) Instead of raising the hurdles on gas consumption, the government would be better advised to lower the hurdles on nuclear power. Nuclear energy powers much of the US Navy with little to no ill effects, yet it is virtually forbidden for commercial application. This needs to change.
Less government is the way to go.
We need many sources for our energy needs. Nuclear should play a larger role, certainly. But wind power can certainly fill an important niche. There is plenty of wind in much of the country. This is probably an area where many liberals are failing. In particular the Massachusetts elite are fighting the use of windmills off the coast. These folks are not serving the liberal cause well. The latest windmills are extremely cost effective and can generate up to 25% of our energy needs.
Passive solar is an area that could help in this struggle. A properly sited home can take advantage of the sun to help heat a home in winter and also heat water. Hybrid cars, bio-diesel, recycled co2 to breed algae as a source of fuel. All these can contribute to energy independence.
The one area that we sould abandon is the idea of drilling our way out of this mess. Let’s just move away from fossil fuels. In the end this will be good for international relations and the environment.
This just in….
Organic food may be no better for the environment than conventional produce and in some cases is contributing more to global warming than intensive agriculture, according to a government report.
The first comprehensive study of the environmental impact of food production found there was “insufficient evidence” to say organic produce has fewer ecological side-effects than other farming methods.
The 200-page document will reignite the debate surrounding Britain’s £1.6bn organic food industry which experienced a 30 per cent growth in sales last year.
David Miliband, the Environment Secretary, drew a furious response from growers last month when he suggested organic food was a “lifestyle choice” with no conclusive evidence it was nutritionally superior.
——————-
I am not stating my preference either way…other than to say we must be careful about rushing into things. I drive a hybrid, east organically, and have a power bill of $55.00 a month…but sometimes the solutions can be worse that the original problem.
RTH –
I know a lot of people without any grasp of the subjects think they have as much right as experts and property owners to dictate what those actually doing the work and taking the financial risks must produce for the peanut gallery, but no socialist has ever explained how the rabble acquired such “rights” other than the power of numbers and armed force.
If someone is actually harming the public, we have had laws to stop that since the 1600s, but obviously the modern “environmental socialists” reject those laws, because they are based in property rights and torts, which require proof of actually damages and a direct causation.
Energy and health care are two areas that scream for intervention into the free-market. The big problem with energy is that we are intervening in the wrong direction! We pay an enormous amount for a military apparatus that exists largely to ensure the continued flow of oil from the various rogue nations of the world. If that cost were built into the cost structure alternative sources of energy would quickly become viable. It’s high time that we demand our government look after the interests of the American people by addressing the energy issue rather than giving it lip service.
The simple and best solution is to tax consumption. Most liberals will go along with it, but of course most conservatives won’t…not because we don’t like the idea of conservation, but that we know the money will be wasted on something stupid, from wars to welfare queens. The last thing that the money would be used for is transportation or cleanup.
The GOP showed us they have no restraint, and were foolish when they were in power. The Dems have shown that in the past…and are not doing a good job of changing that image so far in 2007.
So what do we do? I just don’t know.
This is why I get so mad when you guys harp about minivans and speeding tickets and other trivial stuff. Our government is broken…and the people have lost faith in it. From Katrina to Iraq to immigration, the public think the government is incompetent. And because of this lack of faith, nothing of importance is accomplished. We have ourselves to blame.
I would like to be part of the solution, and will certainly do anything I can to help. But the problem is a great one, and will take time to sort out.
Chris
The only thing broken with energy and medical care is the government meddling. They don’t produce a drop of oil or treat a single private citizen. They have just inserted themselves as middlemen, gatekeepers extorting salaries for themselves.
When you stop talking in generalities like “energy” and “healthcare”, and try to discuss a specific problem, it readily becomes apparent that the solution is to remove government and let any of the market alternatives come to the rescue.
Just try it. I dare you.
I will do all I can Lee, which probably isn’t much, I’ll admit–but I will do all that I can to prevent that happening.
The reason is that I am an evangelical Christian, who is convinced that biblical truth conforms to reality, and that reality is that God has instituted human government to hold back the innate tendency to human beings to mistreat each other. Of course we have a certain degree of latitude to hold government accountable and to change it, I don’t deny that. But to get rid of it–try it–I’ll wager that, at every turn, you will be frustrated. And you’ll be frustrated because you’re trying to get rid of a God-given institution that prevents a cut-throat-me-first-free-market system from having the upper hand. But if God ever does hand us over to a total free market system, rest assured that it will be part of His wrath poured out, giving us, God forbid, what we deserve. A lot of the restraint that you so despise is actually, I think, a divine blessing.
Lee, is your last name Potter, by any chance?
There really should be some prize/award for inadvertently humorous postings. Lee would clean up.
This is the same Lee who rejects the validation of man-made environmental change by over 2,000 scientists– including the top experts in the field.
Lee, you answer you own question– except that you refuse to see the fallacy in your logic. Even the poorest, most ignorant, laziest sinner has the right to stop the “destruction of the commons.” Even your vaunted aristocracy of wealth and “expertise” doesn’t have the right to pollute the air and earth while enriching themselves.
I assume that you’re hanging your entire argument on rejecting the fact that, for instance, C02 “directly” causes global warming. Too bad for your argument. That train has left the station.
You (and your oligarchial compatriots) can continue to stick your head in the sand. The hyper-profitable petro-chemical industry can continue to finance scientific whores to dispute it– as AEI and Exxon attempted recently. However, scientists with no vested interest accept the fact that energy companies are directly causing damages to private property and common resources necessary for sustaining life on earth.
Herb’s answer is that he has the right to take my money because he his holier than I, and will do more good with it.
Ready just hurls insults.
Maybe someone else will try to pick a specific topic of energy conservation and try to explain how the government can do a better job than the better-educated, more focused and motivated individuals in the private sector can.
Lee, produce some statistics that show how those in the private sector are better educated, focused and motivated. Otherwise quite making that claim.
Motivations in the public sector are, at best, altruism, which is incapable of making the best allocation of resources. Even the best altruistic leader has layers of bureaucracy under him with a few motivated by a shared altruism, a few with their own agendas, and the rest just there for a paycheck or to steal from the public treasury.
The few altruistic individuals in any bureaucracy, public or private sector, are powerless to do any more that what every employee should do, esecially if those around and above them are lazy, callous or corrupt.
The private sector has an additional motivation at work – enlightened self interest. Those who do good work are most likely to get ahead by taking away incomes from those who work for the bureaucratic motivations of altruism, laziness and selfish greed.
That is how the free market ended the poverty and nasty environment of Charles Dickens’ era. Manufacturers hired casual laborers and gave them full-time jobs. Merchants replaced street vendors and bazaars. Plumbing and sanitary sewers replaced open wells and dumping of waste.
“That is how the free market ended the poverty and nasty environment of Charles Dickens’ era.”
Who said that you can have your own opinions but you can’t have your own facts? They never read Lee’s posts.
Lee certainly provides a bit of comic relief to the proceedings. Where the free-market goes unrestricted we end up CEO salaries 400 times greater than the lowest wage earner. This occurs even in companies that are doing very poorly for it’s stockholders. This is what is known as a market imperfections or in economic terms spillover costs. Financial reward is certainly not based entirely on hard work, industry, motivation, skill and all the other lassaiz-faire buzzwords. Luck, skuldudgery and yes, government intervention (Halliburton for example) all factor in.
The free market is never unrestricted.
Every purchase choice is restricted by the tastes and budget of the buyer.
Every investment and risk effort of the entreprenuers is restricted by competition against his products, and competition of other investment alternatives for his capital.
The free market requires, and puts in place, legal restrictions to insure that transactions are open and honest.
Beyond that, what many people perceive as “failures” of the market are simply indicators of how little they understand about economics and business. They talk in terms of children, like “fairness” and other intentionally nebulous emotional, subjective terms that are usually irrelevant.
It is a shame that people who don’t have basic understanding of economics and the history of how market capitalism so quickly cleaned up 5,000 years of arbitrary dictatorship and superstition, think that they should have the power to arbitrarily dictate doctors how much to charge, executives how much they should earn, what mileage someone else’s truck should get, etc ad finitum.
Lee writes:
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The free market requires, and puts in place, legal restrictions to insure that transactions are open and honest.
”
That’s what we call an oxymoron. “Free Market” and “Legal Restrictions” are incompatible terms.
And this:
”
It is a shame that people who don’t have basic understanding of economics and the history of how market capitalism so quickly cleaned up 5,000 years of arbitrary dictatorship and superstition …
”
Now that’s a bit condescending don’t you think? Actually Lee, you’re the one that doesn’t understand market capitalism. Anyone that’s taken a basic economics class understands that market capitalism does not distribute goods efficiently unless it operates in a purely competitive environment. Oligopolies and monopolies fail to distribute goods efficiently. These types of market structures come about for a number of reasons but in the real world they comprise a very large share of the nation’s economy. Wheat farming comes very close to perfect competition and we do, in fact, have a fantastically efficient and fair distribution of wheat products. But autos, plasma TVs and yes, health care all operate in the realm of oligopoly, hence they are not efficient. Some industries, microcomputers for example, are near monopolies. They perform even more inefficiently.
Ok, that’s the efficiency side of the equation. What’s lost to many conservatives is the equity aspect, something typically glossed over in economics classes. When it comes to health care Dr. DeMarco has made a slam-dunk case to reject the market solution. Virtually all Americans accept this rejection. Not because it’s inefficient but because it’s inequitable. Some people can afford cosmetic surgery while others simply are unable to pay for even basic health care. But the utility of basic health care(and hence it’s real value)far exceeds that of the cosmetic variety. People are willing but simply not able to pay for the basics. And that is not equitable.
Most European nations have addressed the equity issue in some official manner. In the U.S. we simply pretend to have a free market but our compassion as a people obligates us to also address equity issues. Yet we do so in a very clumsy manner. I say we can and must do better.
I think that the electrification of rural America initiated by FDR would be an informative model for our transformation to new energy sources in the 21st Century.
Many farmers and rural residents would still be reading by kerosene lanterns had we waited for the free market.
FDR recognized that government intervention was needed. Not only did electricity immeasurably improve the quality of rural dweller’s lives but it also enabled the ag sector to be more efficient.
I’m sure that Lee has some quaint, delusional alternative history claiming that the free markets actually brought electricity to rural areas and government involvement was simply a stumbling block.
But, those of us in the reality-based community know that huge capital investment with unattractive rates of return was necessary to bring electricity to the rural areas.
This is the same situation that we face today in an effort to transform our energy usage. We should explore the hybrid economic models utilized by the REA as a guide to getting off our addiction to foreign oil.
FDR’s TVA project was a flood control project to put thousands of people to work, copied from the projects of Adolf Hitler. The notes from the discussions and the press reports of the time document that.
The TVA did not bring that much electricity to rural America. Farmers were disgusted by the hundreds of thousands of acres of land seized under eminent domain and given to SCE&G, Duke Power, Santee Coopper Authority, etc. They formed rural electric cooperatives, invested their own money, and built the systemsm to bring power to farms and small towns.
They did the same thing with telephone cooperatives, to bring communications to the vast areas of America bypassed by the Bell System, which cherry picked high-density urban areas.
And “bud” provides himself as an example of the socialist mythology that free markets are incompatible with laws, when in fact, free markets require a set of laws protecting individual freedom of choice and action. That is the sort of modern legal framework which monarchists, merchantilists, socialists and other backward political philosophies cannot abide.
Lee your examples just proved our point. The free market FAILED provide electricity and phone service to rural areas. So they had to band together to create what amounted to a quasi-government entity to those areas. (And that’s accept your version of the facts at face value. I believe the federal government actually played a very significant role in rural electrification.)
Electricity was distribution was still in the process of being standardized when FDR took office. The free market had provided test beds for direct and alternating current, of 50 Hz and 60 Hz. The dust was just settling and new advances in generators and transformers were making local power grids feasible during Herbert Hoover’s administration.
Socialists don’t just step in “when the free market fails”, because the free market doesn’t fail… it only fails to support the socialist agenda. Socialists, communists and other dictators outlaw free market competition and then make excuses.
PS – Much of this state is still powered by the rural coops, which have now combined into larger, interstate electrical distribution consortiums. Their rates are about 1/2 that of local Columbia monopoly SCE&G.
AT&T ran the New York to Miami long lines right through Columbia in the 1930s, but never connected any of the small towns along the way. They did connect some of the large farmers with free telephones for the right-of-way use. We had such a free phone from 1932 until 1961, but my family still helped found Ridgeway Telephone Service, so we would have some neighbors with phones, too.
Today, the phone systems of Ridgeway, Winnsboro, Chester, Abbeville, Sumter, …. are linked in a consortium that shares technology development. They offer digital TV over the phone lines to rural customers left without any cable television service from the in-town monopolies.
Lee writes:
Much of this state is still powered by the rural coops, which have now combined into larger, interstate electrical distribution consortiums. Their rates are about 1/2 that of local Columbia monopoly SCE&G.
Isn’t SCE&G a private company? And aren’t the coops defacto government organizations? Basically what that tells me is the free market charges twice as much for electricity as the government does.
SCE&G is publicly held common stock company, operating under a monopoly granted by the state. They are guaranteed a 10.7% return on investment. The land for Lake Murray was seized from farmers in Dutch Fork and given to SCE&G. They received federal and state money to help them build the dam during the FDR administration.
The coops are owned by the rural customers, and any profits are rebated back to them. SCE&G lobbies mightily to encroach on rural coop areas like around Lake Murray, which did not have SCE&G power. They also lobby to keep the coops from selling power into their fringe customers at much cheaper rates.
From the Economic History Encyclopedia
The failure of the market to deliver affordable electricity to rural locales led to over thirty state rural power initiatives during the 1920s and early 1930s, as President Herbert Hoover argued that responsibility for rural electrification rested with state government (Brown, 1980, pp. 6 and 29). […]But the Depression led to the collapse of many state power authorities and further raised the bar in discouraging private investment in rural electrical infrastructure. When Roosevelt assumed the Presidency on March 4, 1933, the market for new rural electrification investment no longer existed.
[…]The concluding paragraph of his report states that a new “rural electrification agency” should build the necessary infrastructure since the market would not otherwise furnish electricity to sparsely populated localities (Cooke, 1934, p.11).
[…]The rural cooperative model, which had been successfully employed by Giant Power in Pennsylvania, was adopted by the R.E.A., with Congressional Representatives serving as the administrative liaisons for the formation of cooperatives within their districts (Brown, 1980, p. 68). Cooperatives were not-for-profit consumer-owned firms organized to provide electric service to member-customers. […]
The R.E.A. was essentially a government-financing agency providing subsidized loans to private companies, public agencies, or cooperatives for the construction of electrical supply infrastructure in rural regions. The loans were guaranteed by the federal government and had an attractive interest rate and a generous repayment schedule of twenty-five years. The interest rate initially matched the federal funds rate when the loan was executed, but after 1944 the rate was fixed at two percent (Joskow and Schmalensee, 1983, p. 17). R.E.A. loans furnished the incentive for rural electric cooperatives to form and connect to the existing electrical network at rates comparable to the national average. […]
The R.E.A. overcame the unwillingness of private utilities to bring power to households, farms and businesses in sparsely populated regions where profits were too low. The failure of the market, which left rural areas literally and figuratively in the dark, required an aggressive federal initiative to insure that residents of sparsely populated areas were no longer comparatively disadvantaged in the twentieth-century American economy.
The R.E.A. is considered one of the most immediate and profound successes in the history of federal policy-making for the national economy. By the end of 1938, just two years after its inception, 350 cooperative projects in 45 states were delivering electricity to 1.5 million farms (Schurr, Burwell, Devine Jr., Sonenblum, 1990, p. 234). The success of the R.E.A. over the next two decades was even more impressive, especially as a self-sustained financing agency.
Stupid socialists wanted the rural/ag sector to have economic efficiencies and human conveniences available to denser populated areas.
Wonder how that worked out. Just another silly liberal boondoggle with the gubmint footing the bill.
The market coulda done it. Except that it didn’t. Funny thing about capitalism. You have to have capital– or “rent” it.
From the Economic History Encyclopedia
[…]as with any significant surge in investment, the accompanying new demands for household electrical appliances spurred growth in home appliance manufacturing, and spawned the electrical and plumbing trades in rural communities. Electrical service also brought revolutionary new mediums of communication to rural farms, firms and households. Radio was followed by television, and the new streams of information narrowed the cultural, educational and commercial divide between urban and rural America. Rural electrification contributed to the rapid growth of suburbs, and helped create a more integrated national market.
This is another outstanding example of the efficiency/equity tradeoff. The free-market by way of the electric companies did a great job of efficiently distributing electricity to folks in the cities. But because of the costs involved there was not market incentive to distribute electricity to the rural areas. So to address this inequity issue the government stepped in a found a way. This is very similar to the health care situation we face today.
bud, you just make up history instead of learning any.
Private citizens in rural areas invested in building their own Rural Electric Coops.
Keep looking for an example of socialism doing something better than the free market. You won’t find it, but that will not stop your believing
Lee writes:
”
Private citizens in rural areas invested in building their own Rural Electric Coops.
Keep looking for an example of socialism doing something better than the free market. You won’t find it, but that will not stop your believing
”
The Electric Co-ops ARE the poster children of socialism. Here’s the definition from dictionary.com:
“a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole”
I just can’t figure out wheter Lee is really as thick-headed as he comes across or whether he just enjoys pulling people’s chain.
The U.S. Government (“We the People”) made monies and expertise available at a below market rate to capitalize cooperatives and other private entities.
Read the above quotes. Or, remain self-deluded and ill-informed.
I haven’t read a single post advocating socialism on this blog. I have read many that praised the idea of the government remedying the deficiencies of the private sector– as the REA did.
Even that famous socialist Herbert Hoover advocated government involvement. He just wanted state governments to do the job.
Those “citizens” used capital provided by the Federal Government which wouldn’t have been available (or economically affordable) from the private sector.
Socialists are like children – they just cannot think of any alternative to having some adults take care of them.
Bud and Hurl have to speculate about the history and structure of electric coops, and go searching the web for false histories to quote out of context.
I am a customer and stockholder. My grandfather was a founder.
Herbert Hoover actually proposed a lot of socialist programs that he had seen put in place by Mussolini. Roosevelt ridiculed Hoover for it during the campaign, but once elected, Roosevelt pushed through a lot of Hoover’s public works proposals, taking credit for the ones that briefly seemed to work. Like Mussolini and Hitler, FDR eventually resorted to printing gobs of fiat paper money and building up the military as the primary economic stimuli.
Lee, what electric co-op did your grandfather found?
Lee writes:
”
I am a customer and stockholder. My grandfather was a founder.
”
Dictionary definition of socialism:
“a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole”
Since the co-ops were founded by local comunities at the behest of the federal government they represent a form of socialism. (This was required because the market system failed.) Therefore Lee is a socialist. Who would have thunk it.
Since you don’t know anything about the subject, bud, please stop making noise.
Lee, I don’t have in-depth knowledge of the electric co-ops but one fact is crystal clear: The federal government played an active role in creating and funding them. That is simply an irrefutable fact. Now why can’t you just admit that the free-market was imperfect in distributing electric services and that the federal government played an important roll in addressing this imperfection? It’s pretty clear to everyone else.
So, in Lee’s World, Herbert Hoover was a closet socialist?
What’s your source? The John Birch Society?
– – –
Since Lee is a electric coop member, grandson of the founder, and– in yet another coincidence– an expert on electric co-ops, I’d assume that he can tell us where the capital came from to build his co-op’s infrastructure.
Did the founders loan the coop their personal monies?
Did the founders have the co-op borrow from a private sector financial institution? Did the founders sign personal notes to guarantee the the loan? What did they use as collateral?
Did the founders sell bonds?
As a co-op expert, you surely know off the top of you head where the capital came from.
Why don’t you go learn something about how electric utilities are organized and their history, BEFORE posting any more speculation and fabrication?
Lee, so you can’t (or won’t) answer a simple question which is key to resolving the debate. This despite your vaunted “insider knowledge” and “expertise.”
I’m the only one posting on here that has posted any references.
In your Bizarro World, I guess that qualifies my statements as “speculation and fabrication.”
Here’s a little info about the economic history site, EH.org, that I referenced:
EH.Net operates the Economic History Services web site and several electronic mailing lists to provide resources and promote communication among scholars in economic history and related fields. EH.Net is supported by the Economic History Association and other affiliated organizations: the Business History Conference, the Cliometric Society, the Economic History Society, and the History of Economics Society.
EH.Net began in 1994 as the Econhist internet discussion list. It added several other discussion lists and was chartered in 1996 to provide a wide range of internet-based services to economic historians, historians of economics, economists, historians, related social scientists and the public.
These services include an Ask the Professor service, research abstract and book review series, a collection of course syllabi, a directory of economic historians, the EH.Net Encyclopedia of Economic and Business History, several databases, numerous links to websites related to economic history, and the popular “How Much Is That?” service – which allows users to easily look up historical prices, interest rates, wage rates, GDP statistics, exchange rates and inflation rates.
In 2003 the Economic History Association became EH.Net’s owner. Additional support comes from the Business History Conference, the Cliometric Society, the Economic History Society (UK), and the History of Economics Society. In addition, EH.Net hosts discussion lists and websites for several other scholarly organizations.
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The specific article that I excerpted references the following scholarly publications:
Brown, D.C. Electricity for Rural America. Westport, CT: Greenwood Press, 1980.
Cooke, Morris L. “National Plan for the Advancement of Rural Electrification under Federal Leadership and Control with State and Local Cooperation and as a Wholly Public Enterprise.” Franklin Delano Roosevelt Presidential Library, Hyde Park, NY: Cooke Papers, Box 230, February, 1934.
Cooke, Morris L. “The Early Days of the Rural Electrification Idea, 1914-1936.” American Political Science Review 42 (June 1948).
[…]
Schurr, Sam H., Calvin C. Burwell, Warren D. Devine, and Sidney Sonenblum. Electricity in the American Economy: Agent of Technological Progress. Westport, CT: Contributions in Economics and Economic History, Number 117, Greenwood Press, 1990.
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The site itself is sponsored by Miami University of Ohio and Wake Forest University.
Now, compare that to the basis of your statements: (1) hearsay and (2) “because I says so.”
Frankly, you’re the one who needs to provide more reliable evidence and sources.
Naturally, I can understand your reticence if the facts undercut your position.
Again, where’d the capital come from?
The capital came from the rural residents who invested in their own electric utility.
Why don’t you try contacting a local rural electric coop, instead of Googling some piece by an unqualified source in Miami, FL?
Simply type in “History of Electric Cooperatives” and presto, dozens of articles about the REA and other issues dealing with rural electrification. ALL say the same thing: The Federal Government played an important role in bringing electricity to rural America. This issue is not in dispute. I’m going to move on.
You Instant Answers failed to explain how my grandfather and all his farmer friends came to own so many original shares of stock in their rural electric cooperative.
Go back and see if you can find out the details of the “major role” the socialists FDR played in the rural cooperatives. Ooooops! Your article wasn’t about the rural cooperatives. It was about some other utilities.
bud, don’t run off, just yet. I’m going to smoke ole Lee right out of his hole with facts.
Here’s how Mid-Carolina’s website describes it’s history:
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During the 1940’s, electricity had yet to arrive in much of the rural territory of our country, despite the fact that, several years earlier, Franklin D. Roosevelt had persuaded Congress to create the Rural Electrification Administration (REA). The REA provided loan money to public utilities, electric cooperatives and government-owned agencies to run lines and take electricity to rural areas.
Responding to this need, South Carolina Governor Olin D. Johnston and the SC General Assemble created the State Rural Electrification Authority which built lines in selected rural areas of South Carolina and provided power to people in other parts of the state who wanted to form electric cooperatives.
On June 20, 1940, at a meeting in Batesburg, SC, eleven men incorporated Mid-Carolina Electric Cooperative. Then, on October 14 of that same year, the REA granted Mid-Carolina its first loan to furnish electricity to 945 members and finance the construction of power lines.
===
So, in short, the answer for Mid-Carolina– and I’m betting most, if not all, of the rest– is that a group of locals incorporated and then secured capital from the REA.
I’ll be pointing out how the capital from the government (and possibly other resources) made rural electrification possible, whereas, previously the market hadn’t allowed co-ops to be economically viable.
Otherwise, Lee, why hadn’t your grandfather and his friends incorporated previously? Why didn’t the 11 founders of Mid-Carolina incorporate without the REA?
BTW, Lee, this explanation explains why your grandfather owned so much stock in an electric cooperative. Your grandfather and the other founders probably invested seed capital. But, if it weren’t for REA loans, the co-op would have been a corporation so starved for capital that few light bulbs would have been lit up.
You know the real ass-kickin’ irony in this story, Lee?
You and your fellow co-op komrads are quasi-socialists!
A co-op certainly isn’t the pure capitalist mechanism that you seem to imagine. It’s a variant of a socialist commune married with a capitalist corporation.
LOL
Stay away from fire-arms and sharp objects while you consider that little jewel, Komrad Lee.
Lee, I’ve never mentioned TVA. You need to keep your delusions and fantasies straight.
Here’s what a spokesperson for Mid-Carolina Electric Co-op confirmed.
The 11 founders of MCEC solicited memberships from the people in the service area for initial capital. Co-op memberships were sold at nominal cost. Today, the only “stockholders” in MCEC are members. People can become members by simply paying a $15.00 fee. This is how people in the MCEC service area get electrical service.
There are NO majority or minority stockholders. Each member gets the same vote. There’s an annual membership meeting similar to a stockholders’ meeting where the members present vote on questions facing the co-op.
The spokesperson agreed with my statement: “If there had not been below-market-rate loans made available from REA then MCEC would not have been viable economically.”
She was a little fuzzier as to whether REA offered technical advice/guidance on setting up a utility. However, it stands to reason that even a cross-section of the most prominent citizens of the Batesburg-area in 1940 would have been over-whelmed by such a challenge.
The spokes person thought that you might be confusing “stock” with “capital credits.” I didn’t explore the role of capital credits.
Here’s the bottom-line: the electric co-ops in SC were a product of FDR’s REA. REA (the gubmint) provided capital to build the co-op electrical service.
The market “failed” to provide electricity to rural areas because it wasn’t economically viable for private capitalists to provide the service.
In fact, the government still regulates co-ops through the Rural Utility Service, under the FDA.
This has been my contention the beginning and bud agreed.
I would be interested in reading any fact-based rebuttal (with references) that contradicts the overall story.
The REA did not make “low interest loans”. The law required them to lend money at the prevailing rate for government bonds, so it would not cost the government any money.
In South Carolina, the cooperatives could not borrow money from banks, because the largest bank, South Carolina National, lent money to the few remaining rural banks now closed by FDR. SCN was owned by the same family which owned SCE&G.
Lee writes:
EH.net:
If I’m not mistaken, the “federal funds rate” is the rate that banks borrow money at. Obviously, they have to lend at a higher rate for a profit.
So, even at the beginning, co-ops got cheaper loans from the gubmint than they could have gotten from banks.
Lee alleges:
I really don’t give this explanation too much credence but let’s examine the implications.
In Lee’s wonderful World of Capitalism the sources of capital weren’t controlled by the mythical “invisible hand” of the market. Nooooo, the fount of capital– the most significant mechanism of the market– was controlled by one of the competitors in the market.
That’s like having the casino dealer playing in the game AND rigging the deal.
What a superb system, Lee! I’m telling you, THAT’S the kind of system that we need to go back to!
I’m sorry. Were you calling someone a dunce? Mirror nearby?
RTH, I just deleted a Lee comment or two, but I didn’t see the “dunce” one. (I did see the “noisy, ignorant socialists” one, and that’s gone.) I’ll just say that if he calls you or anyone else a dunce again, or if you call him one again, it will lead to deletion.
Awwww, Brad. For Lee to call names like “dunce” just illustrates his personal laziness and the bankruptcy of his argument.
Descriptions like “noisy, ignorant socialists” may be accurate in some situations. In this one it just rolled off my back. Readers can make their own judgments.
Anyway, debating in good faith, regardless of name calling, would be refreshing.
For instance, I’m still wondering how Lee’s grandfather could have a lot of stock in a co-op.
Actually, I was first offended by the “illiterate hippies,” and “noisy, ignorant socialists” was the last straw. What did those poor ol’ flower children ever do to deserve such?
Yes, the rural coops, SCE&G, Duke Power, Georgia Power, and a lot of big businesses received subsidies from, and took orders from, the New Deal socialists, who were imposing a “mixed economy” modeled on the fascism of Italy and Germany.
Many appointees of FDR were outright communists, who wanted to seize all private enterprise. The 1930s were a time when liberals, tired for trying to convince others to accept their “reforms”, joined with socialists to promote fascism. Any business which fought back was likely to go out of business.
Conforming to fascism or any other form of government stepping over the bounds of morality, is a corrosive influence, which eventually degrades the morals of the businessmen. Socialists know that. They found it easier to corrupt people with money than to use bayonets on all of them.
The politicians also are corrupted when they realize they can get large kickbacks from the subsidies they hand out. You cannot have honest government – a democracy, republic, socialism, fascism or communism – as long as the government has control much of the economy. The more control, the more corruption.
This country is still trying to unwind the New Deal mistakes of Social Security, welfare, corporate retirement and medical insurance, nationalization of industry, farm programs, foreign aid, the military-industrial complex, and federal education mandates.
Lee writes:
Oh, puh-leeze, Lee. Socialism had zilch to do with the originating the excesses of unrestrained, government-sanctioned American capitalism from the Industrial Revolution until FDR. If you’re looking for a bogeyman then lay the responsibility on unbridled greed coupled with absolute lack of social conscience.
Socialism was society’s response to the brutal exploitation of people, environment and government by the monied class.
But, I’m interested in specifics. Lee takes refuge in ideological generalities when even his warped recounting of history doesn’t support his views.
In Lee’s Bizarro World was the SCN-SCE&G situation replicated in EVERY state where co-ops were founded?
Well, I already gave you the examples of how Georgia Power (GA), SCE&G (South Carolina), and Duke Power (NC), were big businesses owned by powerful families with political connections, receiving subsidies, huge gifts of land seized by the government, and monopoly protection in a classical model of fascist socialism so common in the 1930s.
Why don’t you try to find some examples of electric utilities who denounced the REA and New Deal for being unAmerican? It would broaden your education on the flavors of socialism within, and resistance to, the New Deal.
I’ve got a better idea, Lee. YOU provide the examples of co-ops who denounced the REA and New Deal.
It’s YOUR fantasy, after all.
Lee, the spokesperson for Mid-Carolina specifically and directly contradicts your account above. Should I contact the Fairfield Electric Cooperative? Do they have a unique history?
Tell us exactly why, say, the folks in Aiken in 1938 would reject REA below-market rate financing for an electrical co-op that would bring power to the farms and small towns of the area.
You expect us to believe that because the the evil gubmint evicted Dutch Fork landowners (with compensation) and created a power generating dam for the greater good of other area residents that people in Aiken would reject REA monies on principle?
Heh. You’ll have to provide some good evidence for that fairy tale.
In fact, Lee, do you have any independent source for ANY of your statements.
Or, is all of this your recounting of some “oral history,” maybe after a few slugs of good likker?
Heck, maybe I’d drink too if I lived in my own imaginary universe.
Read it and weep, Lee.
From the Singing River Electric Power Association history:
During the 1920s and 1930s when America was gripped by the Great Depression, some electric companies extended their power lines into rural areas for a price that ranged between $2,000 to $3,000 per mile. In addition to the line costs, the power companies charged the farmer a higher usage fee than city residents.
As part of his cure for the depression, Franklin D. Roosevelt created in 1935 the Rural Electrification Administration. It originally served as an unemployment relief program for building lines. Three months after its inception Roosevelt transformed it into an organization that offered to loan money to power companies for building power lines across rural America. However, power companies failed to seize the opportunity for financial aid to take electricity to outlying areas.
Rural Electric Cooperatives are Introduced
The next year, 1936, Congress passed the Rural Electrification Act that allowed residents to form their own non-profit groups to get financial assistance for building lines.
In 1938 residents in what is now served by Singing River Electric Power Association took charge of bringing power to the people.
It began at a meeting on August 31, 1938 at 9 a.m. in the George County Courthouse in Lucedale. Newspapers publicized notice of the meeting, which called for the attendance of all citizens interested in the organization of a Rural Electrification Project that would borrow government money to finance the construction of electric lines. The assembly elected to have three representatives from George County, two from Jackson County and two from Greene County.
In June 1940 the board voted to increase its membership to at least nine to sufficiently represent the district. Nine members still comprise that entity. At every annual meeting the co-op membership elects one director from each of the three counties.
In September 1938 the incorporators named the corporation Singing River Electric Power Association and applied through Roosevelt’s program for a $300,000 loan to build 300 miles of line.
To qualify for the REA loan, the association had to register three members per mile of line to be built. Membership fees cost $5 per house. Solicitors earned $5 per day and three cents per mile. The loan did not cover payment for rights of way and residents were asked to donate easements.
At that time, homeowners paid between $16 and $30 to have their homes wired.
You haven’t told me anything that I didn’t already know, but did you learn anything?
Are you supporting the socialism of FDR or rejecting it because it was “corporate welfare” to the utility companies? Being an ideologue puts you in some uncomfortable positions, if you stop to notice it.
Notice that the REA lent money at the same rate paid on government bonds, which was a premium rate. And $16 to 30.00 was the rate electricians charged for wiring a house in those simple days, when an electrician or skilled carpenter only earned $4 to 5.00 a day.
Lee, your arguments are pathetically weak. You’re just making a laughing stock of yourself. I’m actually starting to have pity on you. It’s time to give it up before you look any worse.
bud cannot refute the wages or other historical facts, so it’s time for him to mutter some insults as he leaves the room. Bye, bud. Just keep believing that your socialist rulers want to take care of you.
Politics and even socialist politics is profit-driven. It is way to make money by taking other people’s wealth, instead of creating wealth. Those IRS and EPA workers don’t come to work out of altuism. They are there for the short hours, soft job, lack of accountability and fat retirement paid for by hard-working creative people in the private sector.
And that greed extends from the lowest janitor to the agency heads, Congressmen and Senators.
Lee, for you to call me an ideologue is truly hilarious. This whole debate is about one fact that you refuse to acknowledge: the unregulated market alone isn’t the perfect answer for all our needs in society.
Yet, you spin and dodge and drag in red herrings.
Amusingly, some of your red herrings actually prove MY point. For instance, you allege that NBSC and SCE&G were in collusion. Some theoreticians critical of capitalism think that this is the ultimate result of unregulated markets– the concentration of economic power to the detriment of the people.
However, you’re so blinded by ideology that you don’t even see that you’re making an obvious argument against your own case.
I have NEVER argued that giving the investor owned utilities “welfare” was good policy. I know the theory behind it but not enough of the specifics to justify any particular actions. This is just a straw man argument that you drag out as a diversion.
On to some specifics:
Now, let’s see a specific example.
This loan was to a group of Aiken County residents who had NO assets for collateral and NO experience in forming or operating a utility. Aiken County boasted of 49,916 residents in 1940. Comparatively, the total population of Richland County was 104,843 with 62,396 living inside the Columbia city limits. Additionally, this co-op was the first in South Carolina.
Here is an interesting comparison of commercial rates– although it’s from Time Magazine, June 8, 1936:
You don’t know the difference between a corporate bond and a federal Treasury bond.
So are you trying defend the fascist model of New Deal Socialism, or denounce it as unAmerican?
So far, all you are doing is cutting and pasting random facts you don’t comprehend.
Tell us, oh learned one, what rate would the Aiken County Electric Cooperative been able to procure for a similar loan from any private source besides the REA?
And, that’s making a large assumption that the source would approve the loan.
I don’t have to prove that I’m an economic historian or a financial expert.
The Time Magazine article shows that a corporation with probably the best credit rating in the U.S. couldn’t even sell bonds at the rate which a group of raw amateurs in little Aiken got capital from the REA.
The REA was described as a “lending” program– not a “spending program.” Essentially, it acted as a conduit for capital from government bonds to non-profit utilities. In 1938, as today, investors were willing to buy government bonds which paid low interest rates because the risk was rock bottom.
So the government assumed the risk of loaning capital to rural startup electrical utilities.
What’s “fascist” about loaning capital to the citizenry in order to bring electricity to rural areas?
BTW, you’ve never supplied any examples about the consequences of denouncing “New Deal socialism.”
But, that’s no surprise. You’re strong on spouting sweeping allegations and statements but weak on proof.
Oh, yes, Lee… here’s another question that we’re still awaiting some to:
I’m not holding my breath.
Make that:
… here’s another question that we’re still awaiting some response to:
The Rural Electrification Act did not offer financing below market rates. It specified that the rates on loans made to coops would be the same as the rates paid on government bonds at that time, theoretically so the taxpayers would not be subsidizing the loans.
You are avoiding my question:
Do you think this FDR fascist model is one we should use today?
Jeez, Lee, you’re not this dense. You’re being deliberately obtuse and it’s obvious to anyone reading your posts.
The “market rate” would be the rate that the co-op could secure financing from another source besides REA.
Since corporate and governmental finance is another area of your “expertise,” you know that investors are willing to take a lower return for lower risk.
The rates paid on government bonds are generally lower than commercial paper– if for no other reason than the government has yet to default on its obligations and can’t “go out of business”– thus the risk is lower.
The Time Magazine article illustrated that the most stable and profitable private enterprise of the era had to offer a higher rate than the government in 1936.
You’re going to have to explain in greater detail how the REA was fascist for me to answer your question.
In the meantime, why don’t you answer mine.
TVA – another socialist failure of the New Deal
FDR spent $5 BILLION on the TVA, a huge sum of money, more than the private investment in all the other various rural electrification programs. At the end, only 1/3 of rural Tennessee had running water.
In adjoining states with private power utilities and electric coops, rural electricity in homes and running water increased from 3% to 50%.
It is the conclusion of several economists who studied the TVA for their PhD dissertations, that the TVA actually retarded economic development in Tennessee relative Georgia, Virginia and North Carolina, where the free market created more diversity of new companies creating a diversity of jobs.
Thanks, Lee, now answer the question that is the basis for this entire exchange: Where else could electric co-ops get capital at rates as cheap as the REA?
Your valiant attempt to drag red herrings into the discussion is duly noted and appreciated.
You desperately attempt to avoid admitting the obvious: The free market failed to provide electricity to rural areas without the New Deal (gubmint intervention).
Whenever you answer the basic question posed above, then I’ll start researching TVA.
Lee, we’re close to break through, here.
Release your dedication to “the market is never wrong.” Embrace intellectual honesty and you’ll feel much better.
You’re spending a lot of psychic energy denying the obvious.
You know that bud (and any other readers of these posts) have moved past contempt to pity for your intellectual dishonesty.
The first step of AA is to admit your problem. Take a hint. You’ll feel better and the world won’t end.
You confuse the REA with the coops. The REA did not raise money. The electric coops did.
And they did raise a lot of money much more cheaply than the partial funding they received as loans through the REA. They might could have raised it all that way, but their management made the decision to borrow some money from the REA at higher rates than their equity funding in order to move the projects along faster. Businesses do that all the time.
The TVA was a purely socialist venture, on the model of Soviet Russia and Nazi Germany. It achieved much less success than the mix of private power generation by textile mills, rural electric coops, and utility companies with local urban monopolies.
Those of us who have made a lifelong study of economics can understand how a purely free market might have done even better. The socialists of the New Deal never gave America the chance to find out. We still live with their inefficiency and high rates today.
I’m not in the least bit confused about the difference between co-ops and REA.
The electric co-ops raised a tiny fraction of capital by collecting $5.00 per member. Then they took out loans from the federal government through the REA.
Since you’re familiar with the co-op that your grandfather founded why don’t you support your version of “history” by including some specifics.
(1) What sources, other than the REA and member dues, did this co-op tap for loans in the co-op’s first decade of existence?
(2) What percentage of the capitalization came from non-REA sources during the first decade?
(3) What were the terms of the loan(s) from sources other than the REA, eg. interest rate, length etc.
I have multiple sources to support my version of how REA loans were the keystone to capitalizing co-ops. Those sources confirm the same method of capitalizing co-ops from South Carolina to Mississippi to New York state.
Your would have us believe that these co-ops had a variety of sources of capital available. If that were the case, then why bother to create a non-profit corporation? Why didn’t these upstanding citizens simply incorporate and reap the profits for their investments?
Your version of events doesn’t even begin to hold water under the most superficial questioning.
$5.00 bought you a membership in the coop, but you could still INVEST in it by buying common stock.
Why are you touting the electric coops, anyway? Is it because the more socialist enterprise of that very socialist era, the TVA, was such a failure at bringing electric power to rural Tennessee?
Do you see a trend here? The less socialistic a business enterprise is, the more responsive it is to customers, and the more efficiently it is operated.
The trend I see is that you consistently refuse to answer MY questions.
I have little doubt that you’d rather go off on ideological rants with unsupported generalizations.
You have yet to answer a single question. Let’s take the three that I posted on 3/8 as a beginning.
You claim that the co-ops for some mysterious reason decided to take REA loans and then (again, unexplained) decided to sell stock– presumably for additional capital.
Whenever you support your claims of fact, then, I’ll start taking you seriously.
Why am I “touting” co-ops?
Because the government-private partnership represented by the REA and the co-ops conclusively disprove your assertion that the “market is infallible and gubmint ‘interference’ is consistently detrimental.”
But, you already knew that. That’s why you refuse to admit that the co-ops were a product of a vacuum left by the market. That’s why you’ve dodged, spun and dragged red herring arguments throughout this exchange.
Next week I’ll call a co-op or another source and nail down the stock question. Then you’ll be out of ground to stand on.
After Roosevelt closed most of the banks and destroyed the stock market, he offers government loans to farmers, and to private utility companies who are providing power to rural America much better than the totally socialist TVA.
That is the Democrat’s idea of a great economic program.
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Hey guys.. Whats up. <a href=http://verifiedfile.com><img>http://www.jed7.com/iphone.gif</img></a>
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Hi Folks!
I wanted to share with you a AMAZING site I just came across teaching Krav Maga like they teach it in the Israeli Army (IDF) If you guys have seen the Discovery Channel TV Show called Fight Quest you would have seen their chief instructor Ran Nakash there. Anyways, I think it’s worth a look. I’ve been a member for the last 4 months, and I’ve been loving every second of it.
Hope I’ve helped someone here,
cheers