Page:American Journal of Sociology Volume 3.djvu/856

 842 THE AMERICAN JOURNAL OF SOCIOLOGY

pass any regulation interfering with the work. The difficulties encoun- tered in the prosecution of the enterprise were so great that the stock had to be increased to $605,000, and indebtedness incurred amounting to $750,000. The company has been in successful operation up to date, and now has 325 miles of pipe line, drawing from 230 gas wells. Both the trust and its rival have found the rates fixed by the ordinance ample. These rates guarantee fuel to the people of the city at one-third the cost of coal ; and the aggregate saving to the consumers, over what the cost would have been had the rates been doubled, has been not less than $1,000,000 per year. The company has paid dividends and interest on the capital invested at the rate of 8 per cent., has paid off all of the indebtedness, and has returned to the stockholders all that they invested except $236,000. When this latter amount is paid, gas will be furnished to the consumers at actual cost. This favorable busi- ness showing is possible in spite of the fact that the industry is one that is subject to the law of diminishing returns. Every year, in order to supply the increasing demand, new wells have to be opened, farther and farther from the city, until now some are forty miles away.

Mr. Potts did not feel like pushing his plan farther until it should have been tested in this case. He is now convinced and in this opin- ion he is upheld by the leading business and professional men of Indianapolis that the plan has worked so successfully that it is now time to apply it to the management of other quasi-public works. At a recent meeting of the Commercial Club he suggested that steps be taken to bring the street-railway system, which is quite likely to be for sale or to be forced to sell within a few months, under the same method of control. He has still more recently urged the city authorities, who are being pressed for a franchise by independent telephone companies, to grant a franchise to a telephone company organized on the plan of the gas trust. This latter will be a comparatively simple enterprise, unless the city authorities favor the other applicants. It is proposed to offer to purchase the plant of the Bell Company, giving a small bonus for its franchise, if it will sell ; otherwise, to construct a new plant and force the old company out of the field. Greater difficulties are in the way of the street-railway movement, but they are not thought to be insuperable.

The plan of organization under which the gas trust has been operated, and under which it is proposed to bring all other quasi- public works, is as follows :