The following arguments are advanced by the opponents of municipal ownership: (1) It is a fundamental mistake for the government to engage in enterprises which can satisfactorily be carried on by private capital and manage ment. The municipalization of public utilities is socialistic and subversive of sound economic doctrine. (2) The weakness, inefficiency and corruption which have been so prevalent in the government of American cities demonstrate conclusively the incompetence of municipalities to assume the burdens and responsibilities of municipal ownership. Under such a system, with numerous men to be employed and costly materials to be purchased the opportunities for dishonesty and mismanagement would be far more numerous and alluring than at present. (3) Even if cities could be kept free from cor ruption they would still be unequal to the problems of efficient administration of so com plex an undertaking. The city would be as suming in relation to its public utilities the posi tion of owner, consumer and public, and it is highly probable that the city's interests as pro prietor of the enterprise would be sacrificed to its interests as consumer and as the public. The almost universal popular prejudice against paying high salaries to public officials would prevent the securing of thoroughly competent men to manage these businesses for the city. At the same time the pressure in the direction of securing sinecures in the public management of these systems coupled with the fact that peo ple who work for the public are usually less industrious and efficient than those who work for private employers would tend to impede further the efficiency of municipally owned services. (4) Municipal ownership would so overburden the municipality with duties that not only would the operation of the public utilities be less satisfactory than under private control but also the efficient conduct of the other affairs of the city would suffer by being over-shadowed and crowded out. (5) Serious difficulties would arise from the creation of a large body of municipal employees who would enjoy an enormous potential political influence. They would be a ready-made nucleus for a powerful political machine of great solidarity. In European countries this problem has some times been met by the disfranchisement of the employees of the city but it will not be seriously argued that such a solution would be open to the American city. (6) Experience in many in stances has shown conclusively that municipal ownership is a failure in operation. In this connection the experience of Philadelphia in the public ownership and operation of her gas plant is usually referred to. The city took ever this utility in 1841 and retained it until 1897 when it leased the plant to a private cor poration. The history of the public ownership and control of this enterprise is a story of almost incredible coi ruption and mismanage ment. Other less conspicuous instances are cited of cases in which, due to mismanagement or financial failure, municipally owned plants have been turned back again if not to private ownership at least to private operation. It is pointed out furthermore that not only has the success which has attended municipal owner ship in Europe been greatly over-rated but that, even if it does not serve as an argu ment for municipal ownership in this country since the determining conditions surrounding such enterprises are strikingly different here from what they arc abroad. It must not be assumed that the argument for or against mu nicipal ownership is equally strong in the case of every type of public utility. There are spe cial considerations in connection with certain enterprises which have a bearing upon the de sirability of municipal ownership which may be briefly commented upon. The argument in favor of the municipalization of the city's water supply is stronger than for the municipal owner ship of any other service or utility. Many critics who oppose the system generally favor its application to waterworks. There are sev eral reasons why this is true. First, the health of the city is dependent upon an adequate sup ply of pure water. The city should control the conditions which relate so directly to its disease and death rate. Second, the city itself is the largest consumer of water, taking usually about 10 per cent of the entire supply. The city must have water for fire protection, sewers, street sprinkling and cleaning, public buildings, parks and fountains. Third, many social, industrial and business enterprises and interests depend upon the adequacy and cheapness of the water supply. The prosperity of the city may be deeply involved in the policy which controls the supply and price. As a result of these considerations a large majority of the water works plants here and abroad are under public management. In 1915, 156 of the 204 cities of the United States having a population of 30,000 or more had municipally owned water plants. Only seven of the 62 cities of 100,000 popula tion or more and not a single city of 300,000 or over still allowed their waterworks to re main in private hands. The two most interest
ing cases of publicly managed water systems are, perhaps, those of New York City and Los Angeles. The new Ashokan reservoir and aqueduct opened in 1917, brings water for a distance of more than 100 miles to the city of New York and when entirely completed will have a capacity of 500,000,000 gallons per day. The Los Angeles system will bring water from the mountains 260 miles away. The adminis tration of municipally owned waterworks seems to have been satisfactory. It should be remem bered, however, that apart from the gigantic engineering projects just mentioned there are no serious technical problems connected with the systems to test severely the administrative capacity of the -city.
The increase in the number of municipally owned lighting and power plants in the United States is much less marked than in the case of waterworks. Here private ownership is the rule and not the exception. Twenty-one of the 204 cities having a population of 30,000 or more in 1915 had municipal ownership of com mercial light and power. Some others sup plied merely their own needs for public light ing. It has been estimated that of all the towns and cities of this country over 1,500 have elec tric lighting plants under municipal ownership and management but that more than twice that number still retained private ownership and control. It is usually in the smaller municipali ties that public ownership is found. The most important exceptions are the cities of Chicago and Detroit. It will be noted that, with the exception of public street lighting, the Rup plying of electricity and power bears no inti mate relation to public health or safety while at the same time the business itself is highly technical in character. These facts doubtless have some bearing upon the limited extent to which electric lighting has been municipalized. Municipal ownership is still less common in the United States in the field of municipal gas supply than in that of electric light and power. Wheeling, W. Va., seems to have had the first municipal gas plant, the policy of mu nicipal ownership being instituted in 1851. At the present time the total number of such plants under municipal management is less than 40. Only five of the 204 cities having a popula tion of 30,000 or more in 1915 have municipally owned gas plants. Of these Richmond, Va., is the largest. It is probable that municipal ization in this field as been thus limited in extent because of the costly equipment neces sary to the business as well as the difficult scien tific problems incident to its conduct. In the field of municipal ownership of transportation facilities there have been no important ventures in this country. It has been noted above that San Francisco has recently undertaken the mu nicipal ownership and operation of one of its street car lines. New York and Boston own their subways but they are operated by private corporations. There are provisions in many modern franchises which will make the acquisi tion of the street car lines by the city possible at some future time. It is highly probable that the next few decades will see considerable ex pansion of municipal ownership and operation in this field. Thus far American cities have been deterred from embarking upon such ventures not only by the difficulties and complexities of administration but also by the financial ob stacles such as municipal debt limits which have made it impossible for municipalities to acquire the ownership of such costly properties.
The foregoing paragraphs point to the con clusion that the practicability and desirability of municipal ownership vary with the kind of public utility to which it is applied and that the relation of such services to the public health and safety, the inherent difficulty and complex ity of their management, and the amount of capital investment needed for the enterprise are all factors which have a direct influence upon cities in determining the advisability of ventur ing into the field of municipal ownership. It has not yet become profitable nor illuminating to multiply statistics regarding municipal own ership is American cities for two reasons. The first is that the facts regarding private owner ship which should be available for purposes of comparison are usually withheld by private corporations which do not encourage such In trusion into their private affairs. The second reason is that municipal accounting in this coun try is so chaotic, confused and non-uniform as to render almost meaningless most of the com parative financial statements which have thus far been issued. There are few fields of in quiry in which less reliance may safely be placed upon published statistics. This situation will doubtless be remedied in time and even now some reliable facts regarding municipal owner ship are being collected and published from time to time by the United States Census Bureau.