Statement on Muscle Shoals Legislation.

THE FOLLOWING statement was issued by the President today:

I have received a multitude of telegrams from Governors and citizens in the Southern States urging approval of Senator Norris' Muscle Shoals project, and requesting that I express my views upon it. Some of them express dissatisfaction with its principles but consider it expedient to approve it. I have also many telegrams from citizens of the Southern States and other parts of the country protesting against the principles of the bill.

It is obvious from the debate, the press, and these many communications that Muscle Shoals legislation is no longer a question of disposing of a war activity to the advantage of the people primarily concerned. It has by this legislation been transformed into a political symbol and is expected to be a political issue. To be against Senator Norris' bill appears to be cause for denunciation as being in league with the power companies. It appears also to be emerging as the test of views upon Government operation and distribution of power and Government manufacture of commodities. In other words, its adaptation to the use of the people of the Tennessee Valley and to farmers generally is now enmeshed in an endeavor to create a national political issue.

One side issue of this political phase is the use which has been made of Muscle Shoals to sidetrack effective action on the Federal regulation of interstate power in cooperating with the States. Before and since taking office I have proposed this as a measure of essential protection to the 75 million consumers and several million investors in power securities in all walks of life, who use and own the 35 million horsepower of the country. This public necessity has been held aside for 18 months and time of Congress given to 1 percent of the power and the interests of 1 percent of the people of the United States which is the proportion of the Muscle Shoals problem to the whole.

The bill calls for expenditure of $90 or $100 million from the Federal Treasury to expand a power-plant which has been a byproduct of other major purposes of navigation and national defense, into a large undertaking by the Government, the major purpose of which is to be the generation and distribution of power and the manufacture of fertilizers.

In acting on the bill I have to consider whether it is desirable to adopt a change in Federal policies from regulation of utilities to their ownership and operation; whether the lease provision in respect to the fertilizer plant is genuinely workable; whether the method proposed in this bill will produce cheaper fertilizers for the farmers; whether the project is required for national defense; whether the proposals in this bill are, in reality, in the interest of the people of the Tennessee Valley; and in general to consider the commonplace unromantic facts which test the merits and demerits of this proposition as a business.

This happens to be an engineering project and so far as its business merits and demerits are concerned is subject to the cold examination of engineering facts. I am having these facts exhaustively determined by the different departments of the Government and will then be able to state my views upon the problem.