February 1977 | Volume 28, Issue 2
What has befallen “the greatest peacetime achievement of twentieth-century America”s since the New Deal
In recent years, as the energy crisis has developed, and bureaucracies in Washington have wrestled with little success to solve it, and Congress has moved slower than a West Virginia coal train even to agree on a battle strategy, some Americans have proposed that a public agency based in Knoxville, Tennessee, become the model for coping with the problem.
On first impression Knoxville seems an unlikely site for providing a solution to an internationally baffling crisis. For three decades the civic fathers of that eastern Tennessee center have smarted over John Gunther’s pronouncement that it was probably rthe ugliest city he had seen inside America. Whatever the demerits of the Knoxville skyline, its two Jest and newest structures in 1976 were the headquarters for the Tennessee Valley Authority (TVA), Deal-era agency that once made the city the Ie for any discussion of public ownership, resource management, or the success of F.D.R.’s deperssion-recovery program. No fewer than sixty-five of state, most of them from developing nations, have made a visit to TVA a necessary part of surveying America, and many have returned home to imitate the workings of the agency that TVA supporters now propose extending to a larger area of the United States to take on the energy crisis.
Though TVA’s national profile receded after it won the last of its major political survival battles in the 1950’s, its continuing work in the seven-state Tennessee River Valley area transformed it into the nation’s largest utility, the near single source of new ideas for chemical fertilizer development, and a growing fountain of suggestions on how to manage the nation’s resources without dragging the afterbirth of bureaucracy into all dealings with people as an accompaniment. At a time when electric bills nationally exceeded mortgage payments in some cases for the middle class, and welfare payments for some of the poor, TVA’s ability to produce power at rates 45 per cent below the national average made its virtues even more appealing.
Senator Adlai E. Stevenson of’Illinois introduced a bill in Congress to create a Federal Oil and Gas Corporation, based on the TVA organizational model, to compete with the oil industry in drilling on federal lands, inland and offshore, and selling oil and gas to refineries. Senators Edward M. Kennedy of Massachusetts and George McGovern of South Dakota, Lee White, a former chairman of the Federal Power Commission, Leonard Woodcock, president of the United Auto Workers, and consumer advocate Ralph Nader, among others, supported the measure. Former Oklahoma Senator Fred Harris suggested using TVA as a model in reforming private utilities. Seconding him were groups like the National Coalition for Land Reform, and consumer organizations in various parts of the country who were seeking relief from power prices.
Ironically, however, while national leaders were rediscovering TVA, grassroots elements across TVA’s 8o,ooo-square-mile area were revolting against it. Farmers, ratepayers, strip-mined land owners, coal suppliers, unions, and politicians in Tennessee, Alabama, Mississippi, Kentucky, Virginia, North Carolina, and Georgia, loaded down visiting reporters with reams of TVA critiques full of quotes honed for printing. The agency seemed almost under siege by this new brand of opposition, and so mystified by its volume that its historic proficiency at persuasion was replaced by dump loads of defensive press releases issued from its Knoxville headquarters. TVA is accustomed to battling. What was different in the mid-1970’s was that it was dueling not with outside power interests, but with its own people. TVA’s chief information officer, who commanded a public relations and technical information budget of $1.3 million, called the criticism “healthy,” and then sighed, “I hope.”
When President Franklin D. Roosevelt leaned back in his chair on May 18, 1933, and handed Senator George W. Norris of Nebraska the pen with which he had just signed the TVA act, he could not have guessed that he had just launched the most enduringly controversial program of the New Deal. It was true that the bill the President signed was the 138th that had been introduced in Congress since 1921 relating to the disposition of the Tennessee Valley. The new act resembled bills vetoed in 1928 by President Calvin Coolidge and in 1931 by President Herbert Hoover, but Roosevelt hoped that he had laid to rest national socialism and regional favoritism debates with the promise that TVA would be “a corporation clothed with the power of Government but possessed of the flexibility and initiative of a private enterprise,” and concerned with the Tennessee River Valley but working “for the general social and economic welfare of the Nation.”
For all the comfort those words gave the private power interests, Roosevelt might as well have said that he was creating a socialist river-damming project that would be used to barge children to integrated schools and supply electric power to the Kremlin. Words like a “yardstick” by which true power costs could be judged, and multipurpose “planning,” were signals to the program’s opponents that what the liberal New York Democrat and Norris, the progressive Nebraska Republican, had in mind was more than another public relief program for the eroded hills and pocketbooks of the Southern mountaineer and his flatland neighbors who lived farther down the flood-prone Tennessee River.
While the New Deal “Brain Trust” was frequently given credit for the TVA idea, proposals to uplift the Tennessee River Valley went all the way back to John Calhoun’s proposal to President James Monroe in 1824 to appropriate funds to remove the river blockage at Muscle Shoals, Alabama. Other proponents of national development took up similar proposals in later generations, but not until the end of the nineteenth century were the basic theoretical premises of TVA formulated. It was Giffbrd Pinchot, chief forestry adviser to President Theodore Roosevelt and a leading spokesman for the conservation movement, who first elaborated what was to become the major theme of TVA-style regional development. “A river,” said Pinchot, “is essentially a unit from its source to the sea” and should be harnessed for “all the uses ‘of the waters and the benefits to be derived from their control.”
Pinchot’s definition of conservation as “the use of the earth for the good of man”—with emphasis on how a young nation was squandering its vast resources—built the consciousness that eventually created TVA and sustained its first officials. On its twentieth anniversary TVA used Pinchot’s definition as an epigraph for its annual report to the President and Congress, and cited TVA’s achievements as a tribute to the soundness of his ideas. The TVA founders believed that they had created a unique government agency which met President Theodore Roosevelt’s criticism of our national development policy as “the piece-meal execution of projects,” without a planned responsibility that is “definitely laid on one man or group of men who can be held accountable.”
Not until 1917 were any facilities other than marginally useful canals built at Muscle Shoals. That year the government announced that it had chosen the Shoals area as a site for the wartime production of nitrates for munitions so that the U.S. could reduce its dependence on Chile for its supply. The nitrate plant was not completed until January, 1919. and the dam—named Wilson Dam, after the President—that was to supply its power was delayed in final construction until 1925. In 1921 the Secretary of War had asked for bids on the Muscle Shoals facilities in accordance with the routine disposal of government “surplus property.” One of the bidders, in what became one of the most talked-about stories of the early igao’s, was Henry Ford. The auto magnate magnanimously offered $5 million for the government’s $90 million investment. He promised a Ruhr Valley in the American southland that sent real estate speculators scurrying to the area. Fate was against Ford, however, whose bid was not accepted even after he made a highly publicized trip to Muscle Shoals in the company of Thomas Edison.
Somehow, the bills to dispose of Muscle Shoals landed in the Senate’s Agriculture Committee chaired by Senator Norris rather than in the Military Affairs Committee, where they might have been expected to be sent. “I never have known how it came to be dumped upon my lap,” Norris wrote in his autobiography, Fighting Liberal . But “after beating back efforts of private interests to get Muscle Shoals,” he launched an intensive battle to create TVA, only to have his bills vetoed twice. Behind Norris’ motivation was his well-known antipathy for the “well-intrenched, enormously rich, and powerful forces” he felt controlled the nation. In TVA he saw, “not daring to express it publicly … a model by which this country could see the happiness, material progress, and prosperity to be attained if the American people act promptly and properly in the preservation of God-given natural resources of the country.”
Presidential candidate Franklin D. Roosevelt, who had fought high utility rates as governor of New York, endorsed the Norris bill, and as President-elect demonstrated his interest in TVA by visiting Muscle Shoals. On April 10, 1933—during the famous first hundred days of his administration—he sent the Congress a message asking for the creation of TVA, promising that the new authority would be a “return to the spirit and vision of the pioneer. If we are successful here,” he said, “we can march on, step by step, in the like development of other great national territorial units within our borders.” By May 18, 1933, he had signed the bill “for the especial purpose of bringing about in said Tennessee drainage basin and adjoining territory … the maximum amount of flood control; the maximum development… for navigation purposes; the maximum generation of electric power consistent with flood control and navigation; the proper use of marginal lands; the proper method of reforestation … and the economic and social well-being of the people living in said river basin; and to provide for the national defense.”
For a government agency the act allowed a very flexible program. Other than the general development mandate, the act’s most explicit requirements were that the new authority—in fact, a government corporation—would be ruled by three presidentially appointed directors, one to be designated chairman, who would serve for nine-year terms with the consent of the Senate. The act dictated that the agency locate its headquarters in the region, excluded it from Civil Service laws, and required the three directors to believe in the “feasibility and wisdom of the Act.” The directors would report to the President, consult Congress on appropriations not covered by power revenues, and otherwise be free to develop the “model” that Norris and Roosevelt wanted to spill across the American landscape. Depending on the point of view of the observer, the power of the board of directors of TVA was either the most ideal arrangement ever devised by government for grassroots input, allowing three men to bend to the demands of their constituencies and the wiles of a river; or it was the first Washington-imposed dictatorship that blanketed an entire region. No one at the time of TVA’s creation or since has doubted that the validity of either of these views depends on the caliber and character of the three directors.
For chairman of TVA, Roosevelt chose Arthur E. Morgan, the president of Antioch College in Ohio, who had a national reputation as the hydraulic engineer who had tamed the Miami River after it had visited a disastrous flood on the city of Dayton. From his experience in resisting political appointees to the board of the Miami Conservancy District, Morgan had learned to be suspicious of politicians. Though Roosevelt promised him “there is to be no politics in this,” Morgan came to have doubts, believing that Roosevelt “worked out a philosophy that made ethical considerations secondary to the possession of power.” That statement hinted at the righteousness with which Morgan regarded public service, how he believed human frailties could profit from the discipline of engineering, and how his moralism would eventually conflict with TVA’s directors and Roosevelt in a way that almost wrecked the agency.
The President told Morgan to choose his two colleagues on the board, taking care that one be familiar with power development and the other with Southern agriculture. The chairman first chose Dr. Harcourt A. Morgan (no relation), the president of the University of Tennessee, a Canadianborn entomologist who had advanced rapidly in the hierarchy of the Southern land-grant college system because of his research on the boll weevil. Supreme Court Justice Louis Brandeis, a friend of Chairman Morgan’s, then suggested a young Wisconsin attorney named David Lilienthal for the third directorship. Brandeis had heard good reports of Lilienthal’s performance on the Wisconsin Public Service Commission.
From their first meeting, the three directors were considerably at odds. On that occasion Chairman Morgan presented a letter from Wendell L. Willkie, president of Commonwealth and Southern Corporation, who wanted to know just how TVA would function as a “yardstick.” Morgan was willing to exchange ideas with Willkie in a spirit of honest competition, an attitude that alarmed Lilienthal. Time thereafter quickly proved that personalities and personal philosophies could become—however petty they were—major obstacles in even the most revolutionary of agencies. H. A. Morgan, it turned out, was far more interested in fertilizer programs than in social revolution. Lilienthal, while a reformer at heart, was a practical politician who believed the power program was the major ingredient that would revolutionize the valley. The chairman thought a cautious approach to the power program would allow concentration on uplifting the human resources of the region.
Given this background of discord, which lasted until the chairman was removed by Roosevelt in 1938, the achievements of the first board of directors were remarkable. To build Norris Dam—its first—the board dispensed with private contractors and hired its own construction forces, a policy that still continues. The workers were recruited without the patronage that dominated other New Deal programs, were trained for their jobs, allowed to bargain collectively with the agency, and provided with housing, libraries, and cultural activities. Rates charged by TVA-organized cooperative distributors allowed regional use to attain that of double the national average and forced the competing private companies in the South to lower their rates by nearly one half. Through the extension services of the Agriculture Department the agency enlisted, in five years, more than twenty-three thousand farmers in its demonstration fertilizer programs. Its nurseries turned out sixty-one million seedlings for forestry development. It completed three dams and was working on four more in 1938. Agency efforts all but eliminated malaria, an affliction that had affected up to one third of the population in some areas. But, most importantly, it captured the imagination of the people of the Tennessee Valley, won over many of the doubters in the region’s conservative establishment, and kept its profile high enough to merit regular attention from Roosevelt and such influential newspapers as the New York Times .
Though the early TVA demonstrated unusual sensitivity and courage in certain areas of human concern such as hiring black-listed miners and holding up the flooding of a reservoir because of a bedridden landowner, in other areas it made crucial compromises. Despite Chairman Morgan’s claim that blacks were hired in proportion to their percentage in the regional population, there is evidence that even black college graduates were kept in menial jobs. Certainly blacks were housed in segregated areas, and separate toilet and drinking facilities for blacks and whites were installed at all TVA dams. Though Eleanor Roosevelt was a friend of many of the agency’s early executives and a major influence on other liberals who flocked to TVA, her efforts on behalf of women were never reflected in their having a major role in the agency. (Even today, of the top thirty-seven staff people who meet with the board each two weeks, only one is a woman and one a black.) The agency all but turned over important parts of its agricultural program under H. A. Morgan’s direction to the conservative Extension Service and the American Farm Bureau Federation, which worked mainly with more prosperous farmers.
As tremendously successful as the dams and recreation areas were for flood prevention and economic relief, they were not built without sacrifice. Whole communities were uprooted for reservoirs behind dams, and traditional folkways and community cohesiveness had to make way for a new brand of progress. Since its inception, TVA has forced the removal of 125,480 persons from their homes in a territory slightly larger than New England. Most of the removal occurred during the early years when dams were being built “by assembly-line methods,” as one executive described it. To tame the Tennessee River TVA created what Donald Davidson, the Vanderbilt University writer, called a two-million-acre “permanent flood.”
Though the power program had been only one of many elements of regional development envisioned by the founders, challenge after challenge from private power interests forced it—and Lilienthal as power affairs manager —into the forefront of national attention. The first of many legal hurdles put in the way of TVA came from a coalition of coal and ice companies who claimed that hydro power would threaten coal consumption and replace ice dealers with refrigerators. When courts refused to hear that case, TVA opponents organized a stockholders’ suit to prevent the Alabama Power Company from negotiating with the agency over power territory. Known as the Ashwander case, it was appealed to the Supreme Court, which upheld TVA. The utilities themselves organized and filed another suit, only to be rebuffed again in the courts. The years of legal challenges delayed important advances in TVA’s power program, further divided Lilienthal and the more cautious chairman, and brought Wendell Willkie into the national limelight for his run for the Presidency against Roosevelt in 1940.
Chairman Morgan, increasingly disaffected with his two board colleagues, began to air his grievances in the press. Though rarely specific, he hinted in public statements and magazine articles that the other two members were involved in “evasion, intrigue and sharp strategy,” and in “subtle forms of failure to meet a public trust.” Pressed by the President and by a congressional investigation, Morgan eventually revealed that his most serious reservation about his colleagues concerned what he saw as their connivance in a move by private interests to secure mineral rights on land that was part of the Norris Dam site. But the chairman produced no evidence—before or after his removal by the President—that his colleagues had acted unprofessionally or illegally in this or other matters. In finally removing Morgan, the President told Congress “he is temperamentally unfitted to exercise a divided authority.”
Until his death in 1975, Arthur Morgan continued to provide ammunition for a debate over whether Lilienthal had destroyed the TVA ideal by limiting it to a narrowly denned agency concerned almost entirely with being a utility. Lilienthal supporters had ample volumes of his writings on which to base a case that Morgan was an eccentric and politically naive engineer trying to apply hydrology principles to the vagaries of human character. Both men’s genius had made TVA more than just another federal pork barrel; but their pettiness raised serious doubts that it was a national “model.”
Roosevelt named H. A. Morgan chairman in 1938 and Lilienthal chairman in 1941. It was Lilienthal’s leadership in the power program during World War n that made TVA a major contributor to national defense. In 1941, before U.S. entry in the war, the Office of Production Management asked TVA to increase its capacity by 100,000 kilowatts of power to enable the expansion of aluminum production for bombers. OPM gave the agency a timetable calling for the new capacity by the winter of 1943, and TVA engineers determined that they could build a required new dam on the French Broad River within that time. At the behest of landowners who would be flooded out, however, Senator Kenneth McKellar of Tennessee, the ranking member of the Senate Committee on Appropriations, held up construction, suggesting other dam sites. Standing by Lilienthal’s principle that “experts as well as rivers have no politics,” the engineers refused to accept alternative locations. After the attack on Pearl Harbor, President Roosevelt got a congressional go-ahead, and the engineers set up a “hot line” phone system from Washington to the dam site so that work could begin the moment the President’s pen left the authorizing bill. The agency then completed the dam in thirteen months, setting a new world record for construction speed. Unbeknownst to TVA—although Lilienthal had some privy information—its power would also meet a critical need for the production of the atomic bomb at nearby Oak Ridge. With its power capacity and its production of munitions at Muscle Shoals, TVA’s significant role in the war ultimately helped to silence a larpe number of its critics.
By the end of ig53 the agency had reached many of its original goals. In some respects all that was to happen after that date were finishing touches. While its later accomplishments were still extraordinary, by the end of the first two decades TVA had tamed the river, established a power territory and system, rebuilt the region’s eroded hills, and fulfilled Roosevelt’s hope for an agency that “touches and gives life to all forms of human concerns.”
Following the river system plan devised by Arthur Morgan, the agency had proved that a river could be harnessed for flood control, power generation, navigation, and human uplift all at once—an idea that used to keep the Army Corps of Engineers in stitches over predicted fumblings of the maverick engineer. Thanks to Lilienthal, the agency had won the battle for public power, proving in the process the contested notion that a heavy electrical load and not consumer subsidy of transmission lines was the way to get volume power to neglected rural customers at the lowest price. The debatable conservative approach of TVA’s agriculture programs notwithstanding, H. A. Morgan’s efforts with fertilizers and farmers laid the groundwork for the restoration of valley farms and the chemical secrets of the processes that later produced the international “green revolution.” Altogether it was a remarkable record, doubly so because of its experimental nature and the political odds stacked against it.
In twenty years the agency had built twenty dams on the nation’s fifth largest river, turning the 65o-mile unpredictable and destructive giant into the nation’s most controlled river. At that time the total dam system had cost over $25 million and averted potential flood damage of more than $51 million. In 1952 alone the navigation system had saved barge shippers $10 million at an expense of $3.5 million to the government. Since ig33 the agency had reforested 212,000 acres of land and produced 295 million seedlings in its nursery. Over the same period sixty-eight thousand farmers had allowed their farms to be TVA test demonstration areas to educate them and their neighbors about new farming techniques. Per capita income had risen from 44 per cent of the national average in 1929 to 61 per cent in 1952. Manufacturing employment opportunities had increased 57 per cent faster in the valley than in the nation.
As impressive as the statistics were, they failed to convey the sheer magnitude of the project in the seven-state area of 201 counties. The concrete, rock, and earth laid in the path of the river and its tributaries was twelve times the bulk of the Great Pyramids. The’Volume of water behind its dams could cover the entire state of Illinois to a depth of eight inches. The construction effort at its peak in World War n had required forty-two thousand employees. But more importantly—and surprisingly—an agency that had had a vague mandate to “sell the surplus power not used in its operations” had by its twentieth year become the nation’s largest utility, selling power at the lowest possible prices to a people who in 1933 had had almost no knowledge of the electric age. By 1953 the agency’s customers were consuming twice as much power as their national counterparts.
TVA had also become a government organization that the valley’s people believed they could trust. When the private power companies built “spite lines” to claim TVA power territory, farmers chopped down the poles. John Gunther reported on his trek through the region that TVA’s employees were the most fiercely loyal group he had ever encountered. Thanks to the abilities and connections of Chairmen Morgan and Lilienthal and to favorable newspaper coverage, the TVA story was internationally well known, and the nation’s liberal community stood ready to defend the agency against its detractors. In 1950 historian Henry Steele Commager, in common with most academicians, pronounced the agency “the greatest peacetime achievement of twentieth-century America.” To win its battles in its third decade, the agency had to cash in those liberal chips.
By the late 1940’s TVA engineers had determined that the agency had exhausted most of the hydro power potential of the river and that it would have to turn to steam generation if it was to meet the growing demand on the system coming particularly from the Atomic Energy Commission plants at Oak Ridge and at Paducah, Kentucky. Lilienthal’s successor as chairman in 1946, Gordon Clapp, began construction of seven coal-fired plants between 1949 and 1953. In typical TVA fashion, several of them at the time were the world’s largest. In 1952 TVA asked the Bureau of the Budget to approve funds for a steam plant north of Memphis on the Mississippi River to supply an anticipated critical need for power in the Memphis area. The proposed new plant, at Fulton, Tennessee, was vigorously opposed by Middle South Utilities’ President Edgar Dixon, who feared that a TVA steam plant close to his subsidiaries, Arkansas Power & Light and Mississippi Power & Light, would signal the start of competition from a new TVA power system expansion. The Truman administration in its final days approved the capacity increase for the agency, but Congress waited on a budget request from the incoming Eisenhower administration before voting the necessary appropriations.
Eisenhower’s budget left out the Fulton plant, and the new President let Congress know his antagonism to TVA by labeling it an example of “creeping socialism” and accusing the agency of stealing industries from other areas. TVA supporters could marshal facts to dispute both claims, but the “socialism” charge by a popular President in 1953 was hard to overcome. That year Eisenhower told his Cabinet, “By God, if ever we could do it, before we leave here, I’d like to see us sell the whole thing, but I suppose we can’t go that far.” The Eisenhower administration was prepared to make good on the President’s hope, however, and it set about to cripple TVA’s progress.
The administration ploy became known as the Dixon-Yates case, named for Dixon of Middle South Utilities and Eugene Yates of the Southern Company, another power combine. To obviate TVA’s need for the Fulton plant, the administration proposed to supply AEC with power from a new privately built Dixon-Yates plant. The controversial plan was advancing until it was discovered in 1955 that the administration had deceptively hidden the fact that the government adviser who had helped devise the plan worked for the financial institution backing the deal. Not even the public outcry over that revelation would have stopped the plan, however, had the city of Memphis not decided to build its own steam plant and ignore the federal government.
When Clapp’s term on the board ended, the President named a retiring general of the Corps of Engineers, Herbert Vogel, as chairman, hoping apparently that he could pull the Dixon-Yates deal through. He was unable to do so, and though the administration continued to take pot shots at the agency, the only substantial change in the TVA act came in 1959 when Congress passed an amendment requiring new TVA power program costs to be financed from bonds. It also directed the agency to accelerate its repayment schedules to the U.S. Treasury so that public investment in the power system would be repaid more quickly than originally provided. With the demise of the Dixon-Yates plan, TVA won its last survival struggle, and in the absence of life-and-death controversy its national profile declined.
During the deceptively quiet period after Dixon-Yates, however, another major crisis was developing for the agency. TVA’s size, its power, its sometimes lackluster leadership, and its mistakes were cumulatively brewing a series of confrontations with its own people in the valley. The agency that had fought valiantly for conservation and the opportunity for grassroots participation was finding itself up against a new generation of critics with new definitions of conservation and new ways of thinking about participation. In most recent years the confrontations have grown to a crescendo from a disparate chorus of critics.
TVA has been attacked, for instance, by Al Puckett, a representative of Kentucky farmers who claimed that sulfur dioxide from the agency’s coal-fired steam plants “defoliated” their crops and that TVA refused to recompense for damages for four years; by Corrine Whitehead, a landowner forced out of TVA’s Land Between the Lakes recreation area, who was outraged that the agency was selling lumber from the preserve to the Peabody Coal Company for mine timbers; by Mart Shepherd, a Kentucky landowner whose home used to have a safe water supply and good farm land before a TVA-contracted coal stripmine company changed all that, with Shepherd picking up the tab; by Arnold Miller, president of the United Mine Workers, who called TVA a “public menace” for buying coal from unsafe and nonunion deep mines and for creating a “nightmare” in Appalachia by purchasing stripmined coal; by coal operators like Cloyd McDowell of the National Independent Coal Operators Association who charged that TVA gave cost-plus contracts to its conglomerate suppliers, but bid coal down by “predatory purchasing practices” so that small firms had to cut corners or go out of business; by newspapers like the respected Louisville Courier Journal , which asked editorially, “Is the TVA Just Another Power Firm?” and answered close to an affirmative; by Tennessee Congressman Joe L. Evins, who claimed that TVA had not done anything about “price gouging” by its coal suppliers; and, finally, by Mrs. Betty Higginbotham of Cleveland, Tennessee, a senior citizen who collected over fifteen thousand signatures on a petition protesting TVA power-rate increases.
TVA’s reply to such critics has been forceful and uncompromising. A new chairman, Aubrey Wagner, argued that TVA alone of utilities in the nation has sought a “balance point” between the “polarized extremes” of environmental demands and ecocide. TVA’s problems, he said, exemplify on a large scale a question the nation as a whole has not answered: “How does a people, caught between an expanding population and a shrinking resource base, meet its day-to-day needs and at the same time reasonably ensure its future?”
A lifelong veteran of TVA, an engineer who climbed from the ranks to the top, Wagner has few apologies for TVA’s programs. “TVA views electricity as a critical catalyst for bringing about a better quality of life for the people. … We believe in the usefulness of electric power not to stimulate growth for growth’s sake, but because we know what it has done and what it can do to improve the lives of people everywhere.” TVA’s resistance to strong strip-mine control, air-pollution regulation, coal-mine health and safety laws, and other concerns pressed by its critics has been based on the “balance” theory, providing “the greatest good for the greatest number of people over the longest time,” the 6a-year-old chairman has said. He warned that if all of TVA’s critics were heeded, the valley and the nation would face “total social and economic disaster before the end of the century” because of power shortages.
TVA’s chief argument for its policies—one that has grown increasingly less effective in the region, but one that must seem disarmingly appealing to protesting ratepayers across the nation—is that it is required by law to produce power at the lowest possible rates. That it does. With almost the single exception of the Pacific Northwest, where hydro-generation from that region’s rivers still predominates, TVA produces the cheapest power in the nation with the same kind of generators and black coal that other large utilities use. One thousand kilowatt hours of power cost TVA’s six and one-half million users about $;25 in 1976, compared to $63 in New York City, $46 in Boston, $35 in Atlanta, $31 in Los Angeles, and $3o in St. Louis.
TVA’s defense of its behavior galls such agency critics as Harry Caudill, the author of Night Comes to the Cumberlands and a well-known Kentucky conservationist and public power advocate, who blames TVA’s emphasis on low rates for creating and sustaining the ruinous Appalachian strip-mining industry. “The agency is the very epitome of everything evil in the destruction of nature for gain,” Caudill charged. It is a fact that stripped coal is cheap coal. But critics of stripped coal argue that it is deceptively cheap because of the social and economic damages it brings to the people and the land. As the nation’s largest purchaser of stripped coal from a concentrated area—72 per cent of all of TVA’s coal comes from Kentucky—the agency has to bear a large share of the burden, say its critics, for what the nation now seems agreed has been nothing short of recklessness in the destruction of large parts of eastern Kentucky.
While TVA argues that it not only supervises the stripping but also requires reclamation in its contracts, TVA strip mines look no different, and in many cases look worse, than strip mines that sell to private utilities. As a matter of fact, when the state of Kentucky has cited TVAcontracted companies for violations of state law, TVA inspectors have tended to look the other way, comparisons of the state and TVA inspection records indicate. The fact that TVA in 1974 was secretly considering strip mining coal reserves that it owned on twenty-five thousand acres of the presently unstripped Daniel Boone National Forest in Kentucky, until a newspaper exposed the plan, gave credence to arguments by conservationists that TVA’s strip-mine practices reflected a greater concern for cheap coal than they did for setting a higher standard of excellence for utilities. A TVA reclamation director, James Curry, said, “Strip mining is part of the American way.” That may be true, observed Caudill, for an agency interested in cheap power and power promotion, but it “remains a mockery of the conservationist vision of George Norris.”
TVA believed that the demands on its system left it little choice but to pursue the courses it took. In 1951, 85 per cent of the 3,541,000 kilowatts of power generated by TVA was from hydro capacity. By 1955 the agency’s output was 9,400,000 kilowatts (a full half of which went to federal installations like AEC’s Oak Ridge and Paducah uranium enrichment plants), with 60 per cent of the total power produced by coal-fired plants. Today its generating capacity is 23.3 million kilowatts, 80 per cent of which comes from twelve steam plants using coal. The agency projects that its capacity will increase to 47 million kilowatts in 1985—a whopping 66 per cent increase in a tenyear span. To generate that power the TVA planned the most massive nuclear construction program of any utility in the nation.
If its plans are fulfilled, TVA will retain its role as the nation’s largest power producer and largest consumer of coal, and will become the nation’s largest generator of power from nuclear energy. Such TVA critics as the former Federal Energy Administration adviser John Gibbons, who went on to become head of the University of Tennessee Environment Center, charged that the agency grossly overestimated power demand growth and would find itself in a few years with excess capacity and higher-than-average rates. In 1974 the power demand on the system actually declined by 14 per cent, but TVA explained that that aberrance in an otherwise growth-oriented region was due to the recession of the period and to power conservation.
Despite its commitment to selling power at the lowest possible rates, TVA also has not escaped criticism over its rate structure. In fact, the agency sells power on a “cost of service” basis, meaning that larger users pay lower rates than those who use less power. TVA has denied charges that this means that users have an incentive to consume, not conserve. Whatever the agency’s protestations to the contrary, however, TVA’s rate structure has not changed basically since 1953 when, in a less conservation-minded era, the TVA staff proudly admitted in an agency report that its rates were designed to be “promotional.”
TVA has proceeded with the planning and construction of seven nuclear plants—five were in the process of being built or sited in 1976—despite growing evidence that its nuclear-powered electric plants may be costlier than originally estimated. It has also had to contend with nuclear critics in the state where the atom bomb was born. TVA’s Sequoyah plant—named for the inventor of the Cherokee alphabet—many months behind schedule in construction, doubled in estimated completion costs. The cost overruns on that plant alone would raise consumer bills by about 2 per cent. Power from other sources to make up for the delayed construction of Sequoyah would raise electric bills by another 5 per cent.
On March 22, 1975, TVA made its first major contribution to the nuclear safety controversy when a fire underneath the control room of its Browns Ferry nuclear plant near Athens, Alabama, knocked out both units of the world’s largest nuclear generating facility. According to TVA the fire started when a candle being used by an employee to check for air leaks ignited a sealant on electrical cables that controlled the plant’s emergency core-cooling system; the flames then spread to other wiring, knocking out the automatic safeguards designed to prevent a nucle’ar mishap. Had a major water coolant pipe broken during the critical minutes of the eight-hour fire before TVA operators employed manual core-cooling controls, “We would have been in trouble,” said Jack R. Calhoun, TVA’s nuclear branch chief.
The trouble, according to nuclear critic David Comey of Business and Professional People for the Public Interest, would have been a “catastrophe”—a melt down of the reactor’s core, spreading radiation for hundreds of miles. Comey said only “good luck” saved TVA. TVA immediately discounted such a notion, and launched an intensive press campaign to counter the charges of critics and a suspicious press corps.
When nuclear critics learned that the Browns Ferry plant had already had sixty-five “abnormal occurrences” in its short life—Unit 1 went into operation in August, 1974; Unit 2 in March, 1975—and demanded that the TVA board halt its nuclear construction program, TVA chairman Wagner’s only response was that nuclear power was still safer than highway driving. The Browns Ferry accident was not even discussed at the regular board meeting following the occurrence until the issue was raised by the press. At that meeting TVA approved $7 million of further expenditures for the Hartsville Nuclear Plant to be located outside Nashville. It is slated to be the world’s largest nuclear plant when completed.
For TVA engineers, the Browns Ferry accident was an ego buster. It was the first major flaw in a record of accomplishment that had gained them international fame. Their hope to have Browns Ferry operational again in a “few months” proved too optimistic, as the start-up date stretched to eighteen months, at a cost to the agency of $10 million a month. They were further embarrassed when the accident became a major item of evidence cited by California nuclear critics in support of a referendum in that state for a moratorium on nuclear plants.
It is the question of accountability, of how TVA makes decisions about nuclear power, strip mining, dams, etc., that is at the heart of the region’s dissatisfaction with the agency. As previously observed, three men, appointed by the President and confirmed by the Senate for nine-year terms, exercise the full authority of the unusually openended TVA act. Not until 1975, when pressure from the press and the public forced them to do so, did the three directors ever hold an open board meeting.
TVA has contended that the structure of the agency allows it to have freedom not allotted to the average plodding bureaucracy. On one occasion, Chairman Wagner cited a noisy showdown with TVA’s nuclear critics at the Knoxville headquarters building as a good example of why the agency needs to be free to make decisions unhampered by public service commissions, governors, or a voting electorate. “If we built power plants this way, we’d still be operating by kerosene lamps,” he said, after both sides had made emotional speeches for and against TVA’s nuclear program.
The authority to pass along rate increases and fuel costs without the scrutiny of the public or some administrative body in the states has become a major source of disillusionment with TVA. Scottsboro, Alabama, attorney Bill Garner, a former assistant attorney general of that state, told a U.S. Senate oversight panel in 1975, “I’m a second class citizen from Alabama … because I live in the TVA part of Alabama. If anyone … who doesn’t live in our area wants to complain about his light bill, he can … talk to his State senator .… But I have to drive all the way to Washington, B.C.” Widespread agreement with Garner’s position led Tennessee Governor Ray Blanton, with the support of Governors Wallace of Alabama, Waller of Mississippi, and Carroll of Kentucky, to propose that the TVA board be expanded to include four new members, to be nominated by the governor of each state and confirmed by the Senate. “It seems to me that the citizens of the state of Tennessee should have some input into TVA,” Governor Blanton said. He was opposed on that notion, however, by Senator Howard Baker of Tennessee, who argued that TVA was “a national asset rather than a regional institution.”
Until 1972, when President Nixon appointed Bill Jenkins, a 38-year-old Rogersville, Tennessee, attorney to the board, no native Tennessean or mountaineer had ever served as a TVA director. Although Jenkins’ appointment was widely assailed by strip-mine critics because of his controversial reign as supervisor of strip-mine reclamation in Tennessee, many conservationists came to praise him for his insistence on open board meetings, his opposition to the spiraling costs of TVA nuclear plants, and his hostility to land condemnations by the agency. On matters in which he disagreed with the board majority and the staff, Jenkins admitted that he had to look outside the agency for information and advice because he had no staff available to him. When he sought to get accurate information on the death and injury rates in deep mines which sold coal to TVA, for instance, Jenkins found that TVA had no data, and he had to turn to a friend in the Bureau of Mines for the information.
Part of the agency’s problems with the valley’s people has been a widespread feeling that reflects lack of faith in its credibility. Kentucky farmer Al Puckett put it bluntly: “Farmers in our area don’t trust TVA.” J. W. Bradley, the head of Save Our Cumberland Mountains, a Tennessee anti-strip-mining group, charged that the agency’s employees “willingly accept loads of rock, mud and slate disguised as coal [from coal suppliers] even though they know they’re being defrauded.” Video tapes supplied by Bradley’s organization showing the practice taking place were sufficiently convincing to a House of Representatives investigative committee for it to demand an explanation from TVA. TVA’s general manager, Lynn Seeber, admitted that layer-loading of trucks, as it was called, had occurred, but blamed sampling techniques. As a result of the charges, sampling devices now probe coal loads at varying points rather than at fixed spots known to the coal companies.
Environmental critics pointed also to Seeber’s admission on a witness stand in a federal court that he had changed a staff report critical of TVA’s Columbia and Normandy dams because it was “too negative,” as further evidence that the agency was more interested in self-protection than public candor. After the Whitesburg, Kentucky, Mountain Eagle reported that the TVA private security force was maintaining files on critics of the agency’s Tellico Dam project, TVA began charging the newspaper $6.75 an hour for time spent by agency file clerks in supplying information which the paper requested. Citing such unusual actions, United Mine Workers president Arnold Miller told a Senate oversight panel, “I am sorry to say that TVA has not been a friend to us. I am even sorrier to say that I don’t think TVA gives a damn.”
Seeber replied that he changed the staff assessment of the dams because it said “too much about the ‘bad’ about the project and not enough about the ‘good.’ ” He defended the information charges to the critical Whitesburg newspaper on the ground that the public should not have to subsidize the furnishing of information that is not directly related to public business. Charges from such critics as Arnold Miller came because the agency had a reputation for being more than an average utility, he said. To critics like Richard Ayres of the National Resources Defense Council, who called TVA a “major obstruction” to the nation’s air cleanup program because of its opposition to chemical scrubbers, Seeber cited TVA research discrediting the Environmental Protection Agency’s insistence that the costly devices were needed to cleanse sulfur dioxide from TVA smokestacks. As a final rejoinder, Seeber said, “We believe TVA has the largest and most comprehensive program of environmental activities of any power producer in the country—as it should have.” In 1976, however, the Supreme Court refused to hear TVA’s arguments that it should not have to monitor its sulfur dioxide emissions continuously.
As the debate over public power versus private power bloomed again—as it inevitably seemed destined to do—and as the issues of rates, strip mining, and nuclear power received closer attention, TVA got more scrutiny as a prototype of a national “yardstick.” That probing, in time, may answer the question of whether TVA has been, as Forbes magazine said, a “yardstick with less than 36 inches,” or as Paul Wieck of the New Republic observed, “a little off course, maybe, but still a damn sight better than the private power trust.” Meanwhile, TVA officials have comforted themselves with a statement by former chairman Gordon Clapp that hangs over almost every executive desk: “TVA is controversial because it is consequential; let it become insignificant to the public interest, an agency of no particular account, and the people will stop arguing about it.”