"Immediate Orders"

To the utility industry it has lately become apparent that the New Deal handwriting is on the wall. Last month legalistic skirmishings ended when Chairman C. E. Groesbeck of Electric Bond & Share agreed to file integration plans in keeping with the holding company ''death sentence'' (TIME, Oct. 24). Last week the industry poked a hole in the dam that has held back some $3,000,000,000 worth of replacements and expansions in the last two years. On the face-saving excuse that the utilities must be geared for national defense, 16 potent utility financiers on the National Defense Power Committee agreed to place "immediate orders'' for new equipment of 1,000,000 kw. capacity.

The National Defense Power Committee was appointed by Franklin Roosevelt in September when the recent European crisis was getting hot. Headed by Assistant Secretary of War Louis Johnson, it includes such New Deal dynamos as Thomas Corcoran and Benjamin Cohen. Last week's announcement, result of several quiet conferences between utility magnates and the Administration powers, was seen in various lights by the utility men. One said: "They wanted ballyhoo and we gave it to them." Chairman Floyd Carlisle of Consolidated Edison Co. would only say: "We are delighted to make the studies with the Government.'' Mr. Groesbeck declared: "The results of the meeting this morning afford an excellent demonstration of what can be accomplished when government and industry sit across the table in cooperation."

There was equal confusion on how much money actually would be spent. One estimate was as low as $79,000,000 a year to provide the new generators, boilers, etc. necessary to eliminate power "bottle-necks," modernize plants in war material centres. Floyd Carlisle, however, thought expenditure might reach $2,000,000,000 in two years.

Last week the U. S. Government also did the following for and to U. S. Business:

> Launched a new attack upon basing-point price systems. The Federal Trade Commission already has three basing-point cases in the works--against the Cement Institute, the United Fence Manufacturers Association and the Cast Iron Soil Pipe Association. Each of these complaints has charged violation both of the Robinson-Patman Act, forbidding price discrimination between customers, and of FTC rulings, forbidding price conspiracy between companies. Last week, for the first time, acting solely under the Robinson-Patman Act, FTC challenged gigantic Corn Products Refining Co.'s basing-point price setup, gave No. 1 U. S. producer of syrups and starch 20 days to file an answer.

> Created a new body to watch newspaper and radio advertising. FTC set up a Radio & Periodical Division to administer provisions of the recent Wheeler-Lea Act. Appointed director was an FTC trial lawyer with the extraordinary name of PGad Morehouse. PGad is a contraction of Peter Gad, given name of Mr. Morehouse's grandfather.

> Continued its competitive squeezing of public utilities by announcing the lowest power rates in U. S. history. Though rates (2.64-c- a kw-hr) in the Pacific Northwest are well below the national average, Bonneville Power Administrator J. D. Ross offered electricity at rates ranging from 2.5-c- down to .5-c- a kw-hr, even lower than TVA. Because $31,963,600 of Bonneville's $74,144,600 cost will be written off for inland navigation, this Federal project's rate base is far below anything a privately-owned company could attain.

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