CONNECTING TO COLLECTIONS
THE TICKER
Museum Acquires FDR Letter
By Sarah Poole , Collections Manager
This summer , the Museum acquired for its permanent collection a framed , signed letter , dated July 6 , 1935 , from President Franklin D . Roosevelt to American politician and millionaire , Herbert C . Pell . Affixed to the back of the frame is the July 1 , 1935 letter from Pell to Roosevelt to which the President was responding . The exchange regards FDR ’ s efforts to enact legislation reforming the utilities industry to fulfill his 1932 campaign promises .
At the time , 10 large , private holding companies controlled 75 % of the nation ’ s electricity . An investigation by the Federal Trade Commission ( FTC ) from 1928 – 35 concluded that the holding companies were overcharging consumers , paying little in taxes and manipulating their securities prices . Public regulation of the electrical supply was an integral part of Roosevelt ’ s New Deal and one of his administration ’ s biggest political battles .
Pell ’ s letter came while Congress was still debating the Public Utility Holding Company Act of 1935 , which would ultimately pass into law in August 1935 . The legislation gave the Securities and Exchange Commission ( SEC ) the authority to regulate , license and dismantle the private electric utility holding companies . Pell writes in support of Roosevelt ’ s efforts despite his own personal financial interests :
I have over a quarter of a million invested in power securities … But I thoroughly believe that your principle is right and that the reckless exploitation of the public — the consumer , the laborer and the investor , by the power interests has done more to lessen the integrity and to weaken the solidity of property than has any other single cause in this country .
Pell laments that there is a lack of honor and responsibility in the business of utilities and gloomily predicts that “ the business answer to regulation will be in the future what it always has been in the past — the systematic corruption of the regulating body .” He pushes beyond Roosevelt ’ s stance to state , “ In this matter I go further than you , I believe that government ownership of Public Utilities is the only alternative to Utility ownership of government .”
This statement was indeed the fear of the holding companies , who heavily lobbied against complete government takeover of the electrical utilities and attempted to brand Roosevelt ’ s efforts as “ socialistic .” They ultimately failed to sway public opinion in their favor , but FDR did pursue regulation over complete federal control .
Roosevelt responds in stride , praising “ Bertie ” for considering the public good over his own interests and exclaiming ,
Herbert Pell ’ s July 1 , 1935 letter to President Franklin D . Roosevelt ( right ) and President Roosevelt ’ s July 6 response ( left ).
“ that is a ‘ he man ’ by gosh !” He briefly acknowledges Pell ’ s concerns about the shortcomings of a regulatory approach by stating , “ To be sure , we shall not arrive at Utopia tomorrow , but we are headed that way .” The President agrees to meet Pell socially in September and then closes with the signature , “ FDR .”
Prior to this acquisition , the Museum only had one letter signed by FDR in its collection . That letter , dated October 23 , 1929 , was written by Roosevelt during his service as governor of New York to his personal broker regarding four shares of American Cyanamid Company . That letter was on display in the Financial Markets exhibition at 48 Wall Street and in the traveling exhibit , “ Out of the Vault .”
www . MoAF . org | Summer 2021 | FINANCIAL HISTORY 5