Announcer: Welcome to Civil Discourse. This podcast will use government documents to illuminate the workings of the American Government and offer contexts around the effects of government agencies in your everyday life. Now your hosts, Nia Rodgers, Public Affairs Librarian and Dr. John Aughenbaugh, Political Science Professor.
N. Rodgers: Hey Aughie.
J. Aughenbaugh: Good morning, Nia. How are you?
N. Rodgers: I'm excellent. How are you?
J. Aughenbaugh: I'm doing lovely. Thank you very much.
N. Rodgers: How much coffee have you had today?
J. Aughenbaugh: I've already had a full pot. When the podcast is over with, I will be bringing my second for the day.
N. Rodgers: I watched a 60 minutes episode where they talked about longevity and apparently drinking a lot of coffee is actually pretty good for you, and drinking alcohol is good for you in moderation.
J. Aughenbaugh: I think you use the key phrase, moderation.
N. Rodgers: Yeah, you're not moderate in your coffee drinking. You're just going to live forever because you're just going to live forever, but not because of coffee. Other people, they said it was 2-3 cups and I laughed because I don't drink any and you drink 7,000 cups in a day. I thought, well, if you split the two of us, we would live forever. But you are insignificantly better shape than I am, which is why you will last a lot longer. But anyway, interestingly enough, they suggested that slightly elevated blood pressure is actually good for you when you're older. These are all people who were being studied in their 90s.
J. Aughenbaugh: Yes.
N. Rodgers: It's really cool thing. I thought, yeah, but if you have high blood pressure your entire life, that's probably not a good thing.
J. Aughenbaugh: Again, that comes back to the key phrase, moderation.
N. Rodgers: Exactly. I don't do anything in moderation. Actually, that's not true, I do lots of things in moderation. Today, I'd like to think of it as the last part of our first foray into the New Deal, I know that at some point, we've got other topics that we want to talk about within the New Deal. But this is the one that I find very exciting because I didn't realize how controversial it was and I want to get to that way at the end. But the first thing I want to start off by saying is we're going to talk about the TVA, which is the Tennessee Valley Authority?
J. Aughenbaugh: That is correct.
N. Rodgers: Can I tell you what I know about the Tennessee Valley Authority?
J. Aughenbaugh: Yes, please do.
N. Rodgers: Oak Ridge. That's it. That's all I know. I mean, I've read your notes so now I know more, but until I read your notes, I really wasn't as familiar. I have this vague idea that it's a power thing. It creates power. That's it. That's all I know. I know that it was in the Appalachians because it runs along the Appalachian Mountains. But beyond that, I didn't really know until I was looking at your notes. I'm excited for us to share all of this information with you. By the way, Oak Ridge was where they made plutonium, uranium. One of the things that explodes, atomic bombs, which I am as chemists everywhere are wailing right now. I think it's uranium now that I think about it, but it can be plutonium. Anyway, it's one of those things that you don't want to mess with because it will make you sick. But they enriched that during the Manhattan Project at Oak Ridge.
J. Aughenbaugh: At the Oak Ridge facility in Tennessee, correct.
N. Rodgers: But that's not the main focus of TVA. It's just the thing that I remember it for.
J. Aughenbaugh: Nia your intro went ahead and touched upon basically four or five of the major themes of the podcast episode.
N. Rodgers: Yeah, you got to me, I made an abstract without trying.
J. Aughenbaugh: Which was rather impressive because as you were speaking, I'm like, well, she touched upon that. It's like the opening slide in a PowerPoint presentation. What we're going to talk about today that was basically what you did in your intro.
N. Rodgers: I didn't intentionally, sorry there.
N. Rodgers: I was just like, wow, the next time I do a PowerPoint slide presentation, I'm going to want Nia to put together that first slide right after the title slide. Because I always struggle with putting that the one together. But you did an excellent job.
J. Aughenbaugh: Thank you.
J. Aughenbaugh: The TVA, as Nia pointed out is another one of those New Deal programs.
N. Rodgers: Thank you, President Roosevelt.
N. Rodgers: It was definitely something that came from the Roosevelt administration. The TVA is a federally owned electric utility corporation. The first thing we should note about the TVA is that it is considered as a type of government agency. It is considered a government corporation, meaning that it receives no taxpayer funding. It was created by the government, but it is supposed to be fully self-funding.
N. Rodgers: Like the post office or Amtrak, those kinds of things. Although they aren't self-funding because they are holes into which money is thrown. Although the post office would be doing okay if it didn't have that weird thing where it has to fund it's retirement out 400 years or whatever it is. Some ridiculous.
N. Rodgers: Yeah, so listeners see our previous podcast episode about the United States Postal Service.
N. Rodgers: Our bitterness thereof.
J. Aughenbaugh: The United postal service is the only corporation in the United States that is required by law to have on hand enough cash to cover current and future retirement liabilities. It's the only corporation.
N. Rodgers: Now, that's not saying that that's a terrible idea for all corporations because then people would be guaranteed of their retirement.
J. Aughenbaugh: Yes.
N. Rodgers: But it does cause you to often run in the red.
J. Aughenbaugh: Yes.
N. Rodgers: Amtrak is a whole different animal.
J. Aughenbaugh: TVA, unlike those other two, has been historically profitable.
N. Rodgers: Okay.
J. Aughenbaugh: When we discussed the full scope of the TVA, I think Nia, most of our listeners wanders stand why it's been so profitable over the years.
N. Rodgers: Tennessee Valley Authority is a is a misnomer. It's not just Tennessee.
J. Aughenbaugh: But it covers a geographical region of the United States known as the Tennessee Valley.
N. Rodgers: Okay.
N. Rodgers: But the Tennessee Valley includes not only basically the most of the State of Tennessee, but it also covers other parts of the country, including small areas of Virginia and North Carolina and Georgia. But it has larger portions of Alabama and Mississippi and Kentucky. Basically folks, for those of you who might know the Appalachian Mountain region of the United States, it covers a big chunk of the southern half of the Appalachian Mountain region in the United States. But more specifically, if you were born and raised there, you would know, this is the Tennessee Valley area.
N. Rodgers: For anybody who is wondering about the pronunciation, those are the Appalachian Mountains as pronounced by them, and Appalachian as pronounced by everybody else. If you go with the local pronunciation, we pronounce it Appalachian, and I say we because I am from the foot hills of Appalachia in North Carolina. But I think most people know the Appalachian trail. That's what they think of when they think of the long hike. It goes from Alabama, Maine. I'm going to walk a trillion miles from here to there and eat lobster and then walk home or whatever but this is the southern chunk of that really.
J. Aughenbaugh: Yeah, southern middle.
N. Rodgers: Little bit of the middle.
J. Aughenbaugh: Yeah, a little bit of the middle. But Nia as you pointed out, it was created by the United States Congress in 1933 at the request of the Roosevelt administration. There is actually a law and we'll put this in the research guide, the Tennessee Valley Act. Its initial purpose was quite broad. It was supposed to provide navigation, flood control, generate electricity, manufacturer fertilizer, regional planning and economic development in the Tennessee Valley. Nia, why was the United States Congress at the request of FDR so interested in doing all that stuff in the Tennessee Valley.
N. Rodgers: One, Tennessee River was traditionally used for navigation and trade, so it was known to people like so you're not building a thing that doesn't already exist and isn't already used for that. But I'm assuming because of the crushing poverty that the Appalachians experienced, not just then, this fixed some of it, but some of it lasted into the 50s and 60s. Some parts of Appalachia even now are crushingly poor and have little access to health care, little access to services that most people who live in less rural areas think of as "normal". There are some real pockets and even still in the Appalachians that are not connected to other areas.
J. Aughenbaugh: By any number of measures there are still pockets of the Tennessee Valley that compare rather poorly to the rest of the country. Nia, I'm going to talk about today and then I'm going to go back to what the conditions were, when the TVA was proposed but even today Nia, in terms of educational attainment, the Tennessee Valley ranks quite low in terms of employment, general public health.
N. Rodgers: Life expectancy.
J. Aughenbaugh: Life expectancy.
N. Rodgers: Which is quite low, I think, relative to everybody else.
J. Aughenbaugh: Yeah, to the other parts of the country. Even something like the digital divide, the Tennessee Valley, struggles in regards to access to broadband, the Internet. In many ways it's always been a part of the United States that has been shut off to the rest of the country.
N. Rodgers: Part of it is physical isolation.
J. Aughenbaugh: Yes, it is a difficult terrain to navigate.
N. Rodgers: Right, it's remote.
J. Aughenbaugh: Yes.
N. Rodgers: There's that, that's part of it and part of it is, and I do not mean this pejorative, please listeners if you're from Appalachia, I love you all, but those communities are often insular in the sense that they do not want outsiders, they do not like outsiders and they do not welcome outsiders. If you have not lived there for 200 years, if your family is not from the area, you are immediately met with suspicion. In one of our previous episodes, we talked about librarians visiting those areas. It took a while for people to warm up to the book ladies. They weren't sure about these people because traditionally, outsiders have met trouble.
J. Aughenbaugh: Yes.
N. Rodgers: They just tend to be rather self isolating in many instances, intentionally they don't want a lot of outside intervention.
J. Aughenbaugh: In a number of scholars are chronicled that those first settlers in the Appalachians, and in the Tennessee Valley specifically these were folks who did not like government.
N. Rodgers: Still are.
J. Aughenbaugh: Yes. They move to very remote areas in the hopes that they basically would be left alone and that's part of their culture. But in the 1930s, particularly during the Great Depression, this was an area that even compared to the suffering in the general population, the Tennessee Valley was really hard hit.
N. Rodgers: Part of it hadn't they depleted soil, they were starting to see crop yields drop and things like that because of poor farming practices and that sort of thing which was hurting them, like even for raising food for themselves let alone to sell.
J. Aughenbaugh: You're correct. Almost all the research that I did mention that the Tennessee Valley, much of the land had been exhausted because of poor farming practices, so the soil was eroded and depleted. Crop yields are falling so farm incomes plummeted.
N. Rodgers: As a side note on that, sorry If you don't mind me interrupting, crop rotation is a modern concept. People didn't rotate their crops, Jefferson did, because Jefferson understood, he experimented, he was a scientist, he was also highly educated. He experimented a lot with Monticello, but most farms, that's not how they ran. You just had two fields in one year you might plant two, in one year you might plant one but you didn't rotate in other crops that would help reinvigorate the soil. They didn't know any of that so they didn't do any of that.
J. Aughenbaugh: I've tried to explain this to students, crop rotation requires a certain amount of wealth because when you're rotating crops, either you're bringing in new crops, which requires a capital investment, or you're basically setting aside parts of your land to not be used. That requires you to have some savings, because you're basically taking out of rotation for a year, a growing season, or two or three land that you would otherwise use.
N. Rodgers: That's an excellent point.
J. Aughenbaugh: Jefferson could do that.
N. Rodgers: Because he had a lot of money.
J. Aughenbaugh: Yeah, he had money. But for poor farmers in the Tennessee Valley, what they grew not only what fed their family and the livestock, but it was their source of income. If you've took out a part of your land from use it was going to cut into your income.
N. Rodgers: People, if you say to them, you're going to go three-quarter time. They're like, oh, I get time back and then you say, you're also going to get three-quarter pay. They're like, wait, what?
J. Aughenbaugh: Yeah.
N. Rodgers: Like, I get to do less work but wait, I get less money where those things go hand in hand.
J. Aughenbaugh: This is also an area that is heavily forested.
N. Rodgers: But I think was heavily forested.
J. Aughenbaugh: The best timber had been cut. Again, we now know this and we see this with some regularity with the forest fires out west. You cut the best timber and what you're left with is timber that is very susceptible to fires. Right?
N. Rodgers: Right.
J. Aughenbaugh: You were seeing that with some regularity in the Tennessee Valley.
N. Rodgers: I'm sorry, go ahead.
J. Aughenbaugh: But also you and I have also mentioned public health concerns. Tennessee Valley had a Malaria infection rate during the early years of the Great Depression of 30 percent. Thirty percent of the residents of the Tennessee Valley had Malaria.
N. Rodgers: Three in 10 people.
J. Aughenbaugh: Yes.
N. Rodgers: We're not talking about Panama, we're talking about Tennessee.
J. Aughenbaugh: Yeah, we are talking about Tennessee. In the guts of the country.
N. Rodgers: Yeah, not where you would expect to get malaria in the United States. Most people don't think malaria, I'll go to the United States and get malaria. I think most visitors don't think that's probable and when you think about 30 percent, that's enormous and then you think about the treatments that it involves and poor people. It's just a horrible cycle.
J. Aughenbaugh: Again, this is a population that is very skeptical of outsiders.
N. Rodgers: Right.
J. Aughenbaugh: Public health officials were coming in. We see this even today in regards to doctors and medical staff going into sparsely populated areas in developing countries, they're not trusted. They are an outsider.
N. Rodgers: They brought this disease with them. That's what happens in people's minds.
J. Aughenbaugh: Yes.
N. Rodgers: You're here to fix the disease or you must have brought the disease. Because those two things happened at the same time.
J. Aughenbaugh: Same time.
N. Rodgers: When people's minds, it become conflated and what you've seen a lot of third world countries is I won't take your vaccine because it's giving people the sickness as opposed to I'm here because I'm trying to prevent more spread of the sickness.
J. Aughenbaugh: Yes.
N. Rodgers: You see that a lot in people who are like, I don't know about this trust thing.
J. Aughenbaugh: Okay.
N. Rodgers: Roosevelt looks across the nation in the depression and he's, ''This is bad, this is really bad. We need to have all kinds of programs to help people and we need to put people to work and that sort of thing.'' He says, in the Tennessee Valley, we need economic development. We need to do something that will help spark.
J. Aughenbaugh: It was not only that Nia, there was also a growing movement in the country in regards to the government being responsible for electricity. Because one of the large issues in the 1920s and into the 1930s was that many utility companies where privately held by the private sector.
N. Rodgers: Electricity is a commodity that you can sell.
J. Aughenbaugh: It was a commodity, and that was intention with or in conflict with the fact that most of us need electricity.
N. Rodgers: Right.
J. Aughenbaugh: Is this a public good or is this private good? We could have a debate about this but that's one of the core debates among economists and whether or not the government makes sure to regulate something. Is this a public good which should be protected for everybody in the public or is this a private good, a commodity? If you use more, you pay more.
N. Rodgers: Right.
J. Aughenbaugh: If I'm a company that has sunk investment costs and providing the source of electricity, the distribution of the electricity, should I not be able to charge what the market will bear? This was becoming a huge issue particularly with the depression. You have all these people who are losing their homes, their land. They can't put food on the table. But we had these privately held utility companies that weren't lowering their rates. Roosevelt comes into office and says, ''I have this severely economically depressed area of the country and the government needs to push back against all of these privately held utility companies.'' This is an area, that Tennessee Valley, that has access to water.
N. Rodgers: Hydro-power.
J. Aughenbaugh: Hydro-power. The solution was the Tennessee Valley Authority Act.
N. Rodgers: We will bring electricity to the region.
J. Aughenbaugh: Yes.
N. Rodgers: We will bring our generation to the region which will also help with economic development. Because if there's power generation then a company that makes steel can build a plant and then they will employ local people because there's power. How can I put? If there's no power to where you live, then a company can't build a company there because it can't build anything unless they build stuff by hand with wooden tools. Unless it's an Amish company, you're not going to see a lot of companies or corporations going where there's no power. Similarly, they will not go where there's no water. This would have both. It would have power, it would have water because almost every industrial process also requires a fair bit of water.
J. Aughenbaugh: Yes.
N. Rodgers: That's why you don't see lots of huge companies out in the deserts, you see a few and they are often run by solar power because that's a strength of the desert.
J. Aughenbaugh: Yeah.
N. Rodgers: But they also are what I call dry industries. They're industries that don't require water in order to make something.
J. Aughenbaugh: That's right, but at that point in US history, that's a few years down the road.
N. Rodgers: Right.
J. Aughenbaugh: What was known at that time was, if you have a source of water and a large population that increasingly was un or underemployed. Well, the thinking of the Roosevelt administration was, this is an opportunity for a grand experiment. We don't have to rely upon the private sector to provide the utility.
N. Rodgers: Because the private sector looks at that and says, that's a great opportunity but the upfront cost is going to be enormous.
J. Aughenbaugh: Enormous.
N. Rodgers: Most companies are not willing to go to their board of directors and say, here's this out. We'd like to spend $6 trillion. I know that it's going to put us in depth in the next 10 years but it's going to turn out really well we think. The board of directors can get out of here Bozo. That's not how companies work.
J. Aughenbaugh: Yeah. What is the guaranteed return on the investment? Building a power plant in the Tennessee Valley.
N. Rodgers: Might have worked out but it might not have worked out.
J. Aughenbaugh: Certainly didn't offer a guaranteed return on investment.
N. Rodgers: Exactly.
J. Aughenbaugh: But the Roosevelt administration was.
N. Rodgers: We're the government, we can do that.
J. Aughenbaugh: We are the government, we can do this.
N. Rodgers: We build stuff all the time that doesn't work out.
J. Aughenbaugh: Almost immediately I mean, within a year, the Tennessee Valley Authority was employing 9,000 people.
N. Rodgers: Thousand locals. Because they did have some people that they brought in for administrative positions from other places because you need experts.
J. Aughenbaugh: Yeah, experts in regards to hydro-power. A lot of agricultural experts. They brought in a lot of people from the Department of Agriculture to basically reteach the farmers how to farm.
N. Rodgers: For better farming practices, let's say that.
J. Aughenbaugh: Well, but in some cases, you're basically telling family farmers who generationally have been doing the same thing for three or four degeneration. Yeah, the way you've been doing it is wrong. Which didn't necessarily all of these go over well.
N. Rodgers: Yeah.
J. Aughenbaugh: Okay.
N. Rodgers: I'm sorry, outsider. I can't hear you over the sound of yelling, get off my land.
J. Aughenbaugh: But they also taught foresters how to do it better for the land.
N. Rodgers: All had no clear cut.
J. Aughenbaugh: Yeah, they planted a whole bunch of trees and once they developed the power, guess what?
N. Rodgers: I want to ask you a quick question before you get into what I think is going to be the next cool thing that I'm also interested in. Where was the headquarters of the TVA?
J. Aughenbaugh: Initially it was Muscle Shoals, Alabama.
N. Rodgers: Do you know what else is in Muscle Shoals, Alabama? So many things I'm adding a very open ended question but I bet, you know.
J. Aughenbaugh: I mean, for me and I don't know if you're doing this on purpose, it is the home of some excellent blues music.
N. Rodgers: That's right. Its the Muscle Shoals recording studios? Brought in the greatest names in music in the '30s, '40s, '50s, and '60s to record their stuff. Rolling Stone said that it changed their lives to go to the Muscle Shoals recording studio. I can't remember which one. There are several recordings still there but yeah, that's where all that comes out of. Just anyway. I think it's cool that they put it there but then they eventually moved to Knoxville?
J. Aughenbaugh: Yeah, they moved it to Knoxville, Tennessee.
N. Rodgers: It makes sense from an administrative point of view, Knoxville is more centralized than Muscle Shoals.
J. Aughenbaugh: You have the University of Tennessee there. If you've ever been to Knoxville, I mean, it is a good size city in Eastern Tennessee. Yes, I've been there a number of times. Particularly for college football games, which the stadium holds well over 100,000 people.
N. Rodgers: Are you kidding me? That stadium is like what religious sites are for religious people. That's a football religion place.
J. Aughenbaugh: Yes.
N. Rodgers: You go there and you're like ooh.
J. Aughenbaugh: Saturday night.
N. Rodgers: What do you mean you're doing something other than going to the football game, what's wrong with you?
J. Aughenbaugh: Yes.
N. Rodgers: You're staying home and watching the football game on TV? Oh, okay. But anyway, I thought it'd be nice to mention Muscle Shoals to folks.
J. Aughenbaugh: Yes.
N. Rodgers: Anyway, so these things come together, water and we build a hydro dam and now we have power, and we get?
J. Aughenbaugh: Well, then you start getting a whole bunch of other industries.
N. Rodgers: Obviously, I said it should be a crazy amount of industry, right?
J. Aughenbaugh: Well, this goes back to your point. All of a sudden now you'll start seeing textile plants. Again, these are textile plants that for nearly a generation and a half, provided jobs in Tennessee Valley. Now many of them are now where?
N. Rodgers: I'm assuming Bangladesh and Thailand.
J. Aughenbaugh: Yeah. They are overseas.
N. Rodgers: They are overseas.
J. Aughenbaugh: Yeah, they've been outsourced.
N. Rodgers: But another company that was there. Can I mention it?
J. Aughenbaugh: Yes, go ahead.
N. Rodgers: Alcoa.
J. Aughenbaugh: Yeah, Alcoa.
N. Rodgers: If anybody doesn't know what Alcoa is an aluminum company?
J. Aughenbaugh: Yes.
N. Rodgers: Aluminum takes a huge amount of water and a huge amount of power to make.
J. Aughenbaugh: Yes.
N. Rodgers: Aluminum is very resource intensive industry.
J. Aughenbaugh: It produces a product that lasts forever.
N. Rodgers: And is in everything.
J. Aughenbaugh: Is in everything, and the United States rose to the forefront of the nations of the world in producing high-quality aluminum products. It was amazing how this all came together. But I mean, Nia within a decade, there were 12 hydroelectric plants, one coal-fired steam plant, just in terms of construction, they had hired 28,000 people.
N. Rodgers: It is exactly what it needed to do.
J. Aughenbaugh: Yes.
N. Rodgers: It changed the region in terms of mean, yes, there's still crashing poverty in pockets of the region, but the vast majority of that region has been lifted out of poverty. Basically due to the floor that Roosevelt put underneath it. But it's not all good, is it?
J. Aughenbaugh: No.
N. Rodgers: Before we get to that, can I ask you though about the board of directors? Because you have an interesting note in here about the board of directors of the TVA. The board of directors, they're nominated by the president and then confirmed by the senate. But what I think is interesting in your notes is that a minimum of seven of the directors are required to be a resident of the service area?
J. Aughenbaugh: Yes.
N. Rodgers: You can't just be living in California and be appointed to the Board of Directors of the TVA. You have to be directly affected by the decisions you make and the things that you do on the board. I really like that. I really think that that's an important check or balance on the idea of, we'll just play around. Because Enron did all crazy stuff with the utility in California, and they didn't live in California.
J. Aughenbaugh: Yes.
N. Rodgers: They lived in New York. They weren't affected by the brown outs and the rolling blackouts and the this and the that, but none of that bothered them.
J. Aughenbaugh: Not only is it a check, but it's also a way to get buy-in, when you think about it.
N. Rodgers: Excellent point.
J. Aughenbaugh: Seven out of the nine directors have to be residents of the service area. How better to go ahead and get buy-in, than the go-ahead and guarantees slots on the board, in many cases, local elites? But if the local elites are willing to go ahead and serve on the board, might this not be a good thing for the Tennessee Valley?
N. Rodgers: Well, and it also prevents that parachuting from Washington.
J. Aughenbaugh: Yes.
N. Rodgers: Do a thing regardless of what the local population wants me or cares about and then parachute back out. Well, you don't parachute out, you extract.
J. Aughenbaugh: But the logic is spot on here. I would actually like to see that with more federal governing boards.
N. Rodgers: I would too.
J. Aughenbaugh: Okay.
N. Rodgers: You have to be somebody who's got skin in the game as it were if we're going to talk football.
J. Aughenbaugh: Yeah, I mean, no, exactly that, yes.
N. Rodgers: If you live there, whatever you're going to do is going cause rolling brownouts and they're going to happen at your house too, you may have a whole different point of view about that than you would if it's going to happen to some other guy somewhere else. Everybody here is going to feel the pain. Oh, well, maybe I don't like this pain nearly as much now.
J. Aughenbaugh: If you're from the area, you might be able to go ahead and pause and say, hey, wait a minute here, this is going to affect the folks this way, and I know it well, cause I was born here, I was raised here, I went to school here.
N. Rodgers: I know the ins and outs.
J. Aughenbaugh: I'm hearing from farmers. This is what they need or what they don't need. Will textile jobs be good? Will aluminum manufacturing jobs be good? But when they brought Alcoa there, that's when the federal government started thinking, hey, wait a minute, if this particular industry can thrive in the Tennessee Valley, what other projects we seem to be working on or in World War II, that is, energy dependent, might need significant amounts of water and draws upon the same scientific knowledge.
N. Rodgers: You know, what I think is also interesting about Oak Ridge, interesting about the Manhattan Project in general, because part of it also took place in Eastern Washington State, and that is the idea that these are relatively, at the time, they're not now, but at the time were relatively remote
J. Aughenbaugh: Yes.
N. Rodgers: The likelihood of being spied on, being caught, having anybody figuring out what you're doing. Now we think, sure, I could drive over to [inaudible] , of course you could, you can drive over to Eastern Washington. But getting through the pass from Western Washington to Eastern Washington, back in the day, was not a simple thing. That was a long drawn-out, complicated process and you had to do it at the right time of the year or you weren't going to get through, so
J. Aughenbaugh: For our enemies, logically, it makes no sense to go ahead and build an atomic weapon's plant in the middle of nowhere. Again, think logically of your enemies, because your enemies would go ahead and assume, well, it's got to be built somewhere where there is a lot of knowledge and technical expertise, etc. It's probably going to be close to government agencies or colleges and universities, because you need a lot of smart people.
N. Rodgers: Or you could just pick them up and take them to Tennessee, flop them down and say, go do it
J. Aughenbaugh: Yes, logically it's just like, hey, you know, nothing's going on here, it's Tennessee Valley, nothing happens here, it's economically depressed. Hey, nothing's going on here.
N. Rodgers: That's right, nothing to see move along.
J. Aughenbaugh: Right, okay
N. Rodgers: The other good thing you said is if you're in an area like that and weirdos, strangers show up, you'll be like, who's that guy? What's he here for?
J. Aughenbaugh: Yes.
N. Rodgers: Strangers will stand out more. It's an interesting thing of like a confluence of events that came together. It sounds to me and I'm betting one of your objections or one of the things you're going to mention as an objection, because they're not your objections, you were not alive then, you did not object to this. But I'm guessing one of the objections at the time would have been this sounds like Commi, socialism, [inaudible] , government intervention, and the market rules and what's wrong with you people, am I right that that's one of the objections?
J. Aughenbaugh: Yes, the existing private utility industry had some strong objections, because they thought that the provision of electricity was a private good, it was a commodity, that the government should not be involved. That if Americans wanted cheaper electricity, they would indicate their desires in the marketplace and the industry would respond accordingly, so that was one objection. Then this whole idea that the Federal Government would be a jobs creator, I mean, come on now. In capitalism, the government is not supposed to be a jobs creator.
N. Rodgers: Same argument for the WPA, which is, the market prevails
J. Aughenbaugh: Yes, so we have an economic downturn, a rather severe one, but we have an economic downturn known as the Great Depression. Eventually though, those with wealth will reinvest, they will produce goods and services that the public will want, they will have to hire more people to produce those goods and services, and the marketplace will return. This whole idea that the government would, one, get into the power producing business, the production of electricity was a problem? But then, two, the fact that the Roosevelt administration was never shy, the TVA was going to be an economic development engine for this depressed area of the country. This violated all kinds of capitalist principles, and this has got to be socialism, and why aren't you letting the market respond? There's the economic theoretical, then they went to.
N. Rodgers: Can we side-note something?
J. Aughenbaugh: Yes.
N. Rodgers: By 1933, we're four years into this depression,
J. Aughenbaugh: Yes.
N. Rodgers: We were four years into people struggling because Hoover didn't do anything, hence, Hoovervilles. Hoover was a, the market will correct. He kept saying the market will correct itself, and it kept getting worse and worse because the market was not correcting itself. Proof that capitalism occasionally needs a goose, it needs to be goosed, it needs to be,.
J. Aughenbaugh: Well, yes, if you think about the matching critique of capitalism, eventually, the worker class will revolt against the owner class. But what Marx could not have foreseen was how many Western democracies would interject safety nets, and laws and regulations that mitigate the worst outcomes of capitalism. That's where you get the phrase or the concept of regulated capitalism. We don't allow capitalism to engage its worst tendencies or pathologies, we try to mitigate or soften the worst externalities of the market.
N. Rodgers: So that the people don't overthrow the overlords.
J. Aughenbaugh: There you go.
N. Rodgers: It's in people, it's in the wealthiest best interest to have a safety net
J. Aughenbaugh: Yes.
N. Rodgers: To prevent the rocky ground from forcing people.
J. Aughenbaugh: Yes, to allow the occasional government foray into
N. Rodgers: Now we've moved into classes and Marx hysteria and we should move back out of that, you and I can talk about that for four or five or ten episodes.
J. Aughenbaugh: Yes, we should probably go ahead and wrap up with a couple of other trenching criticisms. First of all, and this was a big one, and even advocates of the TVA, or supporters of the TVA have recognized that this was a huge problem. The TVA was given authority in law to use eminent domain, and for our listeners who don't know this, this basically means that the government has the authority to take private property and use it for, "public use", and they,.
N. Rodgers: They have to pay you what's "market value."
J. Aughenbaugh: Yes, just compensation.
N. Rodgers: But I'm going to argue that in this particular instance, market value of dirt that is completely worthless, probably wasn't very high.
J. Aughenbaugh: High.
N. Rodgers: They probably didn't pay a huge amount to these farms when they took them.
J. Aughenbaugh: According to some scholars, over 125,000 Tennessee Valley residents were displaced by the agency.
N. Rodgers: Sorry, we should note that one of the things that they did when they build dams was they built reservoir, it backs up the reservoir, it builds a reservoir. When you when you build a dam and you make a reservoir, you flood the area behind that. Well, if that's where people live, then you have to move those people and you have to buy their farms and you have to move them off that property, so that you can flood that land and not, you can't just flood land and kill people. I know the government probably occasionally wants to do that, but they can't, because that's not cool. But the other thing is, you also have all of the attendant buildings that have to go along with supporting that along the river, and so those properties would have also been taken as well, so 15,000 families you said.
J. Aughenbaugh: Yes, 15,000 families over 125,000 residents. By the way, at least initially, its first couple of decades of existence, the TVA didn't go about this nicely.
N. Rodgers: A guy just showed up and said, "Hey, you're going to need to get off this man."
J. Aughenbaugh: They went to court. By the way, folks. I'm completely shocked Nia and I forgot to mention this, the TVA actually has its own police department.
N. Rodgers: Oh, that's right.
J. Aughenbaugh: Yes. Their own law enforcement agencies.
N. Rodgers: Many private entities they have.
J. Aughenbaugh: Yes.
N. Rodgers: I'm sure they showed up to remove people from the farm. Those people said, "We're not going," and they said, "Okay, well, here's the lawsuit." By the way, if you are so dirt poor that you're dirt doesn't produce anything, you're not going to be able to fight that in court.
J. Aughenbaugh: No.
N. Rodgers: They're going to bring a lawsuit and you're going to capitulate because there's no way that you can afford to fight.
J. Aughenbaugh: Also, the TVA had no problem flooding historic Native American sites, including burial sites, and many early American Revolution era settlements.
N. Rodgers: It's gone.
J. Aughenbaugh: Gone.
N. Rodgers: Underwater.
J. Aughenbaugh: Yes. By the way, for those of you who are wondering, when the TVA was challenged in federal court, the United States Supreme Court in the case of Ashwander versus the Tennessee Valley Authority, said that the United States Congress, using what authority, Nia?
N. Rodgers: In your notes it says under the War Powers Clause.
J. Aughenbaugh: But there was one other you need to read up earlier.
N. Rodgers: Sorry, missing it.
J. Aughenbaugh: The court noted the regulating commerce among the states.
N. Rodgers: The Commerce Clause.
J. Aughenbaugh: The Commerce Clause.
N. Rodgers: The Commerce Clause. I think it's interesting War Powers Clause. I guess that's the war on the depression.
J. Aughenbaugh: No, the Supreme Court was actually basically trying to give the federal government multiple bullets in its gun, by mentioning the War Powers Clause.
N. Rodgers: Although Commerce Clause really makes the most sense. You're talking about several states.
J. Aughenbaugh: Yes.
N. Rodgers: You're talking about the delivery of power across that and I should've known because it's your favorite.
J. Aughenbaugh: It's not necessarily my favorite, but it's.
N. Rodgers: It's the overwriting clause.
J. Aughenbaugh: I tell my students.
N. Rodgers: For all the law students who are listening to this, if you're in a class and somebody says, what's your constitutional basis for that? Just lead with the Commerce Clause.
J. Aughenbaugh: Commerce Clause.
N. Rodgers: Make them disprove you, because you're going to be right 99.4 percent of the time.
J. Aughenbaugh: I mean, particularly in the period between 1937 and the early 1990s.
N. Rodgers: Just say Commerce Clause and say it all derisively like they should know that. When they say, "What's your authority?" You say, Commerce Clause.
J. Aughenbaugh: The Commerce Clause.
N. Rodgers: Then take a drink of your beer and walk off. Then they can make them wonder about their life choices, I'm just saying.
J. Aughenbaugh: But one of the other interesting things that should be noted is the Roosevelt administration's arguments in federal court during this period of time, they started using war powers, and this was before the United States was even in World War II.
N. Rodgers: This is before World War II was even in World War II, 1936.
J. Aughenbaugh: Yeah.
N. Rodgers: I know Poland was invaded in 19 -
J. Aughenbaugh: Thirty-seven, right?
N. Rodgers: Yeah.
J. Aughenbaugh: Rio is working us up. When did Germany invade Poland?
N. Rodgers: Thirty-nine.
J. Aughenbaugh: Thirty-nine. We're a couple of years now, but the Roosevelt's administration was already beginning to use that as a justification, which I was just like [inaudible]
N. Rodgers: Anybody who thinks that the war on terror isn't the same thing, that's exactly. Presidents discover a "war". Nixon had his war on drugs, and then you can do all stuff justified under that.
J. Aughenbaugh: Because generally, as we discussed in the previous podcast episode, one of the rules of justice ability is the political questions. But one of the cases that is considered a, "political question," that the Supreme Court typically won't get involved with is decisions about war.
N. Rodgers: Theoretically, it's up to Congress who often takes that ball and pumps it over to the White House. The other, I think, big criticism that you have listed here that I'd like to mention before we wind up the episode is the discrimination aspect of this. Something that we need to keep in mind in this time period, African Americans had little to no rights. Women of either, I should say any race, because it also included Native American women, had absolutely no rights practically. They had the right to vote, that's it. Women were not hired in very many numbers at all. Now, what's interesting is that the textile plants that came along as a result of this hired lots of women.
J. Aughenbaugh: Women, yes.
N. Rodgers: But we still have a problem with folks of color finding jobs.
J. Aughenbaugh: The Tennessee Valley jobs were segregated. Segregated by race, segregated by gender, and they were well into the 1970s, Nia.
N. Rodgers: Right. I saw in here that you said in 1987 they settled a lawsuit.
J. Aughenbaugh: Lawsuit. Yes.
N. Rodgers: In 1987 people, that is 50 years after the thing started.
J. Aughenbaugh: Yes.
N. Rodgers: I guess we ought to get around they're treating people equally. Maybe that would be a good idea, Chucklehead. But that is the thing that one have to keep in mind. However, I would like to end on a positive note if we could.
J. Aughenbaugh: Yes.
N. Rodgers: Which is that the TVA recognized unions. That was not hugely common in giant corporations. I don't know if Ford's folks were unionized, but I would bet if they were, it wasn't much. You know what I mean?
J. Aughenbaugh: Yes. It was a big deal. It actually was part of their criticism that the TVA was, "socialist and copy paste."
N. Rodgers: Because they agreed that there should be some power of the workers.
J. Aughenbaugh: Yes.
N. Rodgers: Maybe being a negative is also a positive. Hey, thanks Aughie. Thanks for talking to me about this.
J. Aughenbaugh: Hey, this is great. I loved the discussion. As Nia, mentioned listeners, in the future we might pull on a couple of more strings that are part of the new deal.
N. Rodgers: Cool. Thank you.
J. Aughenbaugh: Thank you.
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