as waterworks, gas and electric lighting, there is needed, to make a wise decision possible, a knowledge of the effect a change to public ownership will have upon cost and service.  If public officials can furnish some goods cheaper than they are furnished by private enterprise, it is because of the wide margin of monopoly profit, not because there is any magic in public ownership.  The same general items of cost must be met.  The first cost of the plant and the annual interest payments are much the same.  Experience shows that, because of political influence and of public opinion, wages are likely to be higher under public ownership, but salaries for management lower.  Public collection of dues along with taxes is an advantage not enjoyed by private companies.  Several public officials sometimes share the same office and thus reduce expenses.  In small towns the public electric lighting and waterworks have been operated more economically under one roof.  Some items of cost may be less under public management, but on the whole, public industry probably has no advantage in these respects.  Public industry does not have to meet the costs of lobbying and blackmail which are often forced upon private companies.  But the greatest source of saving in public ownership is the value of monopoly privileges that, under private management, go into private pockets.

The temptation of political corruption may be more insistent when a large force of men is constantly employed, and when large supplies are constantly purchased, by public officials, but the temptation is not so strong or so centralized as it is in the granting of franchises to wealthy corporations.  Public industry is weakened by the absence of certain motives to excellence that are present in private business.  The income of public officials not being dependent on the economy of management, the spur and motives of competitive industry are lacking.  No social discovery has made individual honesty and civic virtue useless to good government.

The decision in any specific case is one dependent on local conditions, and the exact limits of public ownership are not fixed.  Industry is changing so rapidly that new adjustments are made every year.  The main outlines of public ownership, however, are now in large part determined.  Some industries do well, others ill, under public management, and between these lie many debatable cases.  Waterworks and probably electric lighting, because of the comparative simplicity of their operation, are more suitable for public ownership than are gas works.  No absolute line divides the one group from the other.  But whatever the changes, the fact can not be ignored that the increase of public ownership is altering in manifold ways the organization of industry, and is reacting upon the production of wealth, and the distribution of incomes.

[Footnote 1:  See above, ch. 16, sec. 5.]

[Footnote 2:  See above, ch. 16, sec. 2, on the police function.]