Major Leonard Darwin delivered the first of his series of lectures last night in Emerson Hall on "Municipal Ownership." After being introduced by Professor Taussig, Major Darwin gave a brief outline of the subject which he would treat, and stated that he would consider it entirely from an English standpoint.
In describing the main issues connected with municipal ownership, Major Darwin made the distinction between the older and the newer municipal monopolies; the former comprise water works, gas works, etc., and the latter the street railway and electric lighting systems. The city may own and manage these directly, own and lease them to a private concern for management, or leave them completely under the ownership and control of a private corporation. At the end of 21 years in the case of the railway system, or 42 years in the case of the electric light system, the city may take over the management itself or intrust it again to a corporation. In England the subject of municipal ownership is not really the point for dispute, but the question of the employment of municipal labor is the pivot on which the controversy must turn.
The most important subject for discussion is the regulation of private trade. Franchises which are granted to private corporations tend to become more and more valuable and private proprietors should not reap the whole benefit. At the expiration of a short franchise, if the city takes over the ownership, the unearned increment of value is captured by the city and no difficulty whatever is experienced. When the franchise is perpetual, however, and the question arises as to how private corporations are to be influenced to charge fair scale prices, the difficulty is almost insuperable. Short period franchises are urged by many and especially by English legislators, but it is questionable whether they are beneficial. In any enterprise it is almost certain that initial losses will occur, and short period franchises are not sufficiently attractive to draw capital to the work. The effect of the short period franchise in England seems to have seriously crippled the industries, and it is evident that too rigid terms demanded from operating companies paralyze their industries. A compromise must be made which is favorable to the investing companies. This difficulty in regard to franchises may be remedied by two methods: by trying to alter legislation, or by the more drastic method of municipal ownership.
In closing, Major Darwin said that municipal trade in England was not associated with either high or low taxation; and statistics proved that cities neither gain nor lose much from their municipal ventures.
The second lecture in the series will be delivered in Emerson Hall on Friday evening at 8 o'clock.