The website http://stopthecap.com has a 3-part article on the history of electrification in the U.S., and notes the political and economics similarities the current development of broadband networks. A very good read. Of particular interest, in Pt. 3, there is a little history of Niagara Mohawk:
Double-crossing Roosevelt With the Help of 'The House of Morgan'
The electric companies soon saw the results of those price comparisons as voters demanded better prices. Republicans began shifting toward Roosevelt's plan. For the power companies, it was time for "Plan B." Quietly meeting with J.P. Morgan Bank in the summer of 1929, three major upstate New York power companies planned to merge into one giant company: Mohawk Hudson Power Corporation.
The modern day Mohawk Hudson Power Company was Niagara-Mohawk, which has since been purchased by National Grid.
Mohawk Hudson Power Corporation incorporated:
- Buffalo, Niagara & Eastern Power Corp.: Served 500 cities and towns including Buffalo. Niagara Falls supplied most of its power;
- Northeastern Power Corp.: Served communities along Lake Ontario and the St. Lawrence;
- Mohawk Hudson Power Corp.: Served Albany, Schenectady, Utica, Syracuse, and many other communities.
With such a merger, Roosevelt's original plan to let upstate power companies compete to offer the best possible rates for hydro power were dashed. In fact, the power companies loved Roosevelt's plan because as a combined entity, they'd profit handsomely from state taxpayers paying to construct hydro generating stations, saving them the trouble. Then as a monopoly cartel, they'd set rates artificially high, pocketing the proceeds. J.P. Morgan Bank would also get paid handsomely for helping make it all possible.
To add insult to injury, just two months later, Mohawk Hudson acquired another state giant—Frontier Power Corporation, which in the words of Time magazine, "set Roosevelt agog."
Governor Franklin D. Roosevelt of New York (Democrat) declared that the fact that 80% of New York State is now served by one hydro-electric corporation made it necessary for him once again to urge the Legislature (Republican) to create a body of public trustees to develop St. Lawrence water power for the people.
Roosevelt's experience with the House of Morgan and the power utility trusts would be a lesson he would never forgive or forget. In fact, it culminated in his broadened vision to consider power an integral part of economic redevelopment after the start of the Great Depression later that year.
Read the full articles:
Pt. 1: http://stopthecap.com/2010/03/17/broadband-the-21st-century-equivalent-o...
Pt. 2: http://stopthecap.com/2010/03/18/broadband-the-21st-century-equivalent-o...
Pt. 3: http://stopthecap.com/2010/03/19/broadband-the-21st-century-equivalent-o...