The Path to Power

by Robert A. Caro

  In 1935, the monopolization of the nation’s hydroelectric power was being attacked on three fronts. Regulation of private utilities had been strengthened by revitalizing the Federal Power Commission. The Rayburn Utilities Holding Company Act had begun breaking up the giant monopolistic systems which had so tightly controlled—and limited, in the interest of profit—the production and distribution of electricity. And great government-financed dams, such as Marshall Ford and “Big Buchanan,” were being built across rivers throughout the West.

  Roosevelt wanted the electricity generated at these dams to be made available not to utility companies but to farmers, and to be available so inexpensively that it would “become a standard article of use … for every home within reach of an electric light line.” On May 11, 1935, he signed an executive order establishing a Rural Electrification Administration. For a year, rural electrification went slowly, partly because of the difficulty of meeting requirements of the relief act, partly because REA Administrator Morris Cooke wanted to enlist power companies in the rural-electrification effort—and felt the lure of government loans would draw them in. For a while, Cooke was optimistic on this score. The companies agreed to form a committee to study the subject. Then the committee issued its report: farmers, it said, were already the “most-favored” class of consumers, “There are very few farms requiring electricity for major farm operations that are not now served.” In January, 1936, therefore, the Roosevelt administration introduced a bill that would remove REA from the relief set-up and make it an independent agency, and that would allow it to make self-liquidating loans to cooperatives established by the farmers themselves. Provision was also made for small loans to individual families, to enable them to wire their homes and purchase appliances.

  The bill, drafted by Corcoran and Cohen, was introduced in the Senate by Norris. Agriculture Chairman Marvin Jones expected to introduce it in the House. But Sam Rayburn knew that the REA measure would face bitter opposition from the power lobby that, just a year before, had almost beaten his Holding Company bill, and he very much wanted it to pass. “Can you imagine,” he was to say, “what it will mean to a farm wife?” And, he told the House, there were other arguments in favor of rural electrification. “We want to make the farmer and his wife and family believe and know that they are no longer the forgotten people, but make them know that they are remembered as part of—yea, they are the bulwark of the Government.” To the utility lobbyists’ argument that farmers were too “unsophisticated” to organize cooperatives or handle complicated legal questions, and too poor to pay electric bills, Rayburn replied that “the lobbyists did not take into account the spirit and determination of the people who form the backbone of this nation.” He felt that Jones was not tough enough to force the bill to passage. Pounding into the office of House Parliamentarian Lewis Deschler, he laid the bill on Deschler’s desk. “Give it to me,” he said, and left without waiting for a reply.

  Rayburn was needed. Although the REA bill had sailed through the Senate, in the House, more susceptible to pressure from the utilities, there was trouble. Members of his Interstate Commerce Committee—Corcoran’s “conservative sons-of-bitches” who a year earlier had gutted the Holding Company bill—objected violently to the provision that made private companies ineligible for REA loans. Hostile though he was to the power companies, Rayburn was willing to compromise on this issue; what he wanted was electricity for farmers; he didn’t care who gave it to them; he felt, furthermore, that it was silly to exclude from so difficult a task as rural electrification the only organizations that had equipment and trained personnel. The bill was reported out of his committee by the margin of one vote. On the floor, Rayburn had less trouble; his quiet, terse remarks cut to the heart of an argument; to the free-enterprisers, he replied by citing statistics on Texas: “When free enterprise had the opportunity to electrify farm homes—after fifty years, they had electrified three percent,” he was to say. But the speech that mattered most was one given not on the floor of the House but in a Capitol corridor—to one man.

  The man was Norris. Old now—seventy-six—and somewhat rigid in his long-held views, full of hatred, moreover, for the utilities he had fought so gallantly, he was also full of pride of authorship in the REA legislation and was reluctant to agree to any changes when the House-Senate conference committee met under his chairmanship. “It was in the conference committee … that the real battle developed,” he was to recall. “I discovered at the very first meeting I had a stubborn, embittered fight on my hands. … Days and weeks passed. We held many conferences, and while in those deliberations discussion always was courteous, conducted in a high moral tone, the issue was sharply joined and exceedingly bitter.” Rayburn, whose efforts were chiefly responsible for maintaining the courtesy and the high moral tone, was working, member by member, point by point, to effect a workable compromise, but after weeks of meetings, he was still short of his goal. And then Norris flatly said that compromise was impossible. He would take the issue of rural electrification to the voters in the next congressional campaign, he said; he had no doubt it would be a very effective issue. “I am going to quit the conference,” he said. “I will not call another meeting of the conference committee.”

  Rayburn had managed to get the bill out of his Interstate Commerce Committee by a single vote. If it went back to committee, he might not ever be able to get it out again. If Norris carried out his threat, rural electrification might be dead. Sam Rayburn’s people didn’t need a campaign issue, they needed electricity. Hurrying after Norris, he caught up to him in the hallway, and pleaded with him—Sam Rayburn who hated to ask for anything—to reconsider. “Now Senator, don’t be discouraged. I think we are going to reach an agreement. After that little speech of yours, I believe we will come together. … Just let it rest awhile.” After Rayburn had taken the edge off the old man’s anger, Rankin talked to him, and Norris agreed not to quit the conference. Rayburn kept working in his quiet way. When, after some weeks, the conferees returned to the bargaining table, writes the most thorough historian of the affair, “a mood of compromise was apparent.” The conflict over inclusion of the utilities was compromised by allowing them to be eligible for REA loans, but giving preference to non-profit bodies such as cooperatives. On May 11, 1936, Congress passed the new REA bill. Within the next eighteen months, electricity was brought to half a million American farms. Hundreds of thousands of other farmers were forming cooperatives so that they could get electricity, too—and rural electric rates were beginning to drop in many areas. The times were changing—and they were changing fast.

  THEY WEREN’T CHANGING for the Hill Country.

  The hopes that had been raised there by the creation of the REA had been dashed when the REA announced the minimum requirements for electrification.

  The REA Act required loans to be self-liquidating; before a farmers’ electrical cooperative could obtain a loan, therefore, the REA had to be satisfied that the cooperative would be able to repay it, together with annual interest of about 3 percent, within twenty-five years. The crucial criterion the REA established to ensure this was population density: the agency said it would make no loan in any area in which the electrical lines to be built would serve an average of less than three farms per mile.

  Even so low a figure was dangerous, critics said; not three but seven customers per mile—seven good customers, heavy users of electricity, not poor farmers but farmers equipped with electrical appliances—was the bare minimum necessary to repay a 3 percent loan, they said. And the REA—all too aware that failure to comply with the Act’s self-liquidating provision might give congressional conservatives ammunition to use against the agency—would go no lower. Approaching the REA late in 1936, a delegation from the Hill Country was told that the three-per-mile criterion would not be waived; even the powerful Congressman Buchanan, intervening on their behalf, had been unable to persuade the new agency. Developments in other parts of Texas proved that the agency was, in fact, determi
ned not to waive the three-per-mile minimum even for wealthy ranchers who might be expected to be heavy users of electricity: in one area of West Texas, for example, prosperous ranchers guaranteed the REA a minimum payment of seventy-five dollars per month per ranch; their application was turned down “on the ground that it could never pay out.”

  The REA would not even consider electrifying areas as sparsely populated as the Hill Country—because it simply could not afford to do so. The REA’s first administrator, Morris Cooke, had estimated that an investment of a billion and a half dollars—a figure far beyond the agency’s anticipated budget—would be necessary to bring electricity to even “fifty per cent of all rural [homes]” within ten years. As for the rest: “Of course, there are many farms which cannot be reached for many years. There are farms in neighborhoods too sparsely settled to afford power. …” Early in 1938, representatives of five Hill Country counties—Barnet, Blanco, Llano, Gillespie and Hays—who were planning to form a “Pedernales Electric Cooperative” met in Austin with an REA representative, Russell Cook. Cook put it to them straight: “You have too much land and not enough people.” Says one of the men at the meeting: “He was just very discouraging. He said, ‘You want to go [lay lines] to one of the most remote areas of the whole country. We simply can’t do that. It’s impossible.’”

  The words were familiar to the people of the Edwards Plateau. The Plateau’s implacable geography had always been too strong for men. The distances; the hilly terrain; the lack of rainfall; the rocky sparseness of the limestone soil—these forces, forces over which they had no control, had kept the population small and had condemned them, and their parents and grandparents before them to isolation and poverty. These factors had kept them from getting a railroad. Why shouldn’t these same factors keep them from getting electricity? They had not been able to persuade even the People’s Party—the party which had been spawned on the Plateau—to send them lecturers because they were “too thinly settled … away up here on the Pedernales River.” Why should the New Deal be any different? New Deal programs that had helped farmers in other areas hadn’t helped the Hill Country much. More important, perhaps, the New Deal had given other farmers hope. After five years of the New Deal, hope in the Hill Country was still in almost as short supply as cash. Why should REA be any different from AAA?

  And then other words began to be heard in those hills.

  One of the first men to whom they were spoken was a rancher named E. Babe Smith who had, by coincidence, been raised in Lampasas, birthplace of the People’s Party, before moving to northeastern Burnet County, an area so isolated that it was known as “The Dark Corner of Burnet County”; Smith’s grandmother had lived there for fifty-five years, and had never during that time visited even once the town of Marble Falls, forty miles away. In Lampasas, Smith had had electricity—from a diesel engine—from sunset to ten o’clock every evening (“when it wasn’t breaking down”), and when in 1936, he had heard that the Rural Electrification Administration was organizing a cooperative in Bell County, and that lines would be built to Bartlett, only forty miles away from his ranch, he had gone to the Bell Cooperative office to see if the lines could be extended into his area. But, he recalls, “They said there was no way I could be served, that we were just too sparsely populated; they said, ‘You’re just too thin’; they said there was no hope.” Smith, a slender man, six-feet-three-inches tall, a man of considerable determination—he had managed to earn a degree from Southwestern University in Georgetown—was a rancher other ranchers respected, and when the Pedernales Electric Cooperative was being organized, he was asked to join the Burnet County delegation to the PEC meeting in Johnson City. He refused, however. “I said, ‘No sense my going. I been to Bartlett. No hope for me.’” His corner was the dark corner; he felt it was going to stay dark.

  Then Roy Fry, a Burnet druggist and politician, asked Smith to meet with the district’s new Congressman.

  The meeting took place in Fry’s Rexall Drug Store. The three men sat behind the prescription counter, Fry on a stool, Babe Smith and Lyndon Johnson on packing cases; when a customer entered, Fry would interrupt the conversation to wait on him.

  The Buchanan and Roy Inks dams were almost completed, and would be producing power shortly, Johnson told the two men. With REA help, that power could be brought to the dark corner. Smith demurred, the area would never get an REA loan, he said. Johnson replied: “I’ll get it for you. I’ll go to the REA. I’ll go to the President if I have to. But we will get the money!” On June 20, 1938, the PEC held a second meeting, in the Courthouse in Johnson City, for county agents and community leaders. Although the 108-mile round trip took five hours because “there was not a foot of paved road between here and Johnson City,” Smith went to this meeting. “Lyndon Johnson had inspired me,” he says. “He had made me feel there was a chance.”

  DESPITE JOHNSON’S EFFORTS—“He had been talking to other people all over the area just like he had me,” Babe Smith says—only sixty persons came to the PEC meeting. “And not all of them were believers,” Smith says. The Gillespie County Agent, Henry Grote, delivered an angry lecture to the young Congressman, telling him that in attempting to obtain electricity for farmers, “You’re not doing farmers any favor.” They would not be able to pay their electric bills, would sink into debt, and would lose their farms. Other men at the meeting were not enthusiastic because of their lack of understanding of electricity’s many uses on a farm. “A lot just felt it meant the light bulb and that was all,” Smith says. “And they weren’t sure that that was worth the expense.” Even those who were in favor of electricity felt, as Smith felt, that “We cannot meet the three-to-the-mile.”

  Standing in front of the Judge’s bench, Johnson explained that electricity could run farm equipment as well as lights. He said that if lines were laid out carefully, and every person along them was signed up, he believed that a three-per-mile average could be obtained. Most important, in Smith’s words, “He inspired everyone with the feeling that there was at least a chance.” If you get the people signed up, he told them, he would get the REA loan. “And he made us believe it.” They agreed to try to get as many signatures as possible, and the REA-required five-dollar deposit, on applications for electric service, and on easements to allow the REA to string lines across their land.

  In that sparsely populated area, these signatures had to be obtained the same way votes were obtained—one by one. And they were harder to get than votes.

  The reluctance of the people sprang from simple poverty—“It cost five dollars, and a lot of people didn’t have five dollars,” says Guthrie Taylor. And it sprang from fear.

  They were afraid of the wires. The idea of electricity—so unknown to them—terrified them. It was the same stuff as lightning; it sounded dangerous—what would happen to a child who put its hand on a wire? And what about their cows—their precious, irreplaceable few cows that represented so much of their total assets? “They were so worried,” Lucille O’Donnell recalls. “They would say, ‘What’ll happen if there’s a storm? The wires will fall down and kill [electrocute] the cattle.’” Or they were worried that the wires would attract lightning—which would kill the cattle. Or that the crews that came to repair downed lines would leave the gates open, and let their cows loose. “They simply could not afford to lose their livestock,” Mrs. O’Donnell says. And they were afraid of the papers—the papers that they were being asked to sign. The people of the Hill Country were leery of lawyers: lawyers meant mortgages and foreclosures. Legal documents—documents they did not understand—turned them skittish: Who knew what hidden traps lay within them? Were they signing something that would one day allow someone to take their land away? In vain, the county agents and community leaders tried to explain to the farmers that they were not being asked to surrender control of their land. Many farmers, as one report put it, “had the idea that in signing an easement they were mortgaging their property to the U.S. Treasury.” Thousands of easements were
required—not only from farmers who wanted electricity but from farmers who didn’t, because the lines had to cross their land—and it was difficult to persuade the farmers to give them. They were afraid of debt—terrified of debt, for in the Hill Country it was felt that once you went into debt you never got out, that once you went into debt it was only a matter of time before you lost your land. At meetings, Smith recalls, “people would say, ‘How much is it going to cost to run that line to my farm?’ ‘Five hundred dollars.’ ‘You’re not going to convince me that when I sign that application, I’m not going to be responsible for that five hundred dollars. You’re not going to convince me that I’m not going to be putting a debt on my farm.’ I tried to explain to them that this [the Pedernales Electric Cooperative] was a corporation, and that the government was going to look to the corporation to pay back, but they couldn’t accept the idea of corporate responsibility.” (For families so afraid of debt, the minimum monthly charge for the electricity—$2.45 for twenty-five kilowatts—was also a source of concern.)

  And there was the suspicion, generations old, of a people who felt that they had been victimized by railroads and utilities. The first letter sent out on behalf of the PEC—by secretary-treasurer Hugo Klappenbach—sought to allay those suspicions in a rallying cry that might have been sounded by a lecturer of the old Farmers’ Alliance. “This line is being built by the consumers it serves and they are the owners,” he said. “… It will not try to cover up the investments it has either.” The management is local people, “and does not have to wait for some group of New York financiers to grant permits or concessions.” “Let’s stand together and build our own electric distribution lines and then have the voice in the control.” Creation of the PEC, he said, would free the Hill Country from dependence on the Northeast: “We may see the opening up of manufacturing interests here where the raw materials are grown. Why should we continually send our wool to Boston? Why not manufacture it here or anyway … get it ready to spin right where it is grown?” But many Hill Country residents could not believe that they would really keep the “voice in the control.” Lyndon Johnson was sitting on the porch of his cousin Ava’s home one afternoon, talking about the PEC, when Ava’s husband, Ohlen Cox, suddenly burst out: “I don’t believe it’s going to work, Lyndon. The Northerners will pull the strings, and buck you down.” And the reluctance sprang from ignorance about the potential benefits of the product they were being asked to buy. To many Hill Country families, electricity meant light bulbs—a benefit, to be sure, but not, in the view of many, a benefit worth risking losing one’s farm for. “Something you had never had or experienced—are you going to miss it?” Babe Smith asks. The county agents and community leaders were not having much success in the sign-up campaign. Babe Smith remembers a meeting in the Kempner schoolhouse attended by perhaps one hundred farmers and their families. At the beginning of the meeting, Smith passed out PEC applications; only two of the farmers signed them. So Johnson tried his hand at persuasion. “He played on the emotions of the women,” Smith says. He talked about his mother, and how he had watched her hauling buckets of water from the river, and rubbing her knuckles off on the scrub board. Electricity could help them pump their water and wash their clothes, he said. When they got refrigerators, they would no longer have to “start fresh every morning” with the cooking. “You’ll look younger at forty than your mother,” he told them. Because he was the Congressman—and, to rural people, therefore an object almost of awe—and because he was “very persuasive,” they listened to him attentively. But they didn’t sign up. On the Fourth of July, 1938, he drove with Smith from picnic to picnic—Smith had brought along a Sears, Roebuck catalogue to show them the washing machines and refrigerators that they could use if they had electricity—but collected only a few handfuls of signed applications. “In the car going to the next town, he [Johnson] would say: ‘What’s the matter with these damned people? You offer them something …’ He’d get discouraged.” Despite months of effort, the county agents had collected nowhere near the number required—not three per mile, but fewer than two. The Pedernales Electric Co-op appeared stillborn. Johnson warned the farmers that if they didn’t establish a cooperative to purchase the electricity created by the dams, TP&L might buy it—and offer it only at rates they could never afford. In a speech entitled “Our South,” he said, “I believe we should use that power. I believe that river is yours, and the power it can generate belongs to you.”