Page:American Journal of Sociology Volume 2.djvu/397

 PRODUCTIVITY OF MUNICIPAL ENTERPRISES 383

and recoup itself for losses thus incurred by unduly high prices to individual patrons. Municipal enterprises, on the contrary, are tempted to close contracts with private patrons at a losing figure and let the municipality as a whole make up the losses. The true end of such a service, then, whether municipal or private, is, first, to guard the capital invested and secure it, if private, a fair return, and then to render the best possible service to all classes of consumers at the lowest remunerative rates.

It is unnecessary to argue here that in the fields under discussion competition is an inadequate controller of price and so an unsatisfactory defense of the consumer. The various forms and degrees of governmental control and also govern- mental ownership are devices to secure the results obtained in other fields through competition. These devices have been introduced as the conviction has been forced upon the com- munity that competition was here ineffective. Hence it would seem to be reasonable that the study, following the sequence of events, should start with an analysis of earlier methods and pro- ceed from unregulated private control through the various forms of governmental regulation or supervision to governmental management. The American people, I believe, are averse to governmental ventures into industrial fields, although that aver- sion may be decreasing. At the same time they can hardly approve of the results of unrestricted freedom in the field of natural monopolies.

If a comparison between municipal and private enterprises is to be instituted, the facts of importance must be ascertainable in a form admitting of comparison. It is doubtful that this requisite can be satisfied with regard to the majority of private enterprises, and the doubt is strengthened by the fact that the officials who prepared and published the Klcventh Census of the United States were unable to secure returns from one-fourth of the gas companies of the country including many large establish- ments, and published returns regarding electric lighting only for New York state, the District of Columbia, and the city of St. Louis. Probably a larger proportion of the companies would