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case upon the record of the trial in the Circuit Court, and

may enter such order as it thinks the Circuit Court should

have entered. There can be no doubt that, so far as proce-

dure is concerned, the rights of the patient are most care-

fully considered, and, as every step in this case was taken in

scrupulous compliance with the statute and after months of

observation, there is no doubt that, in that respect, the plain-

tiff in error has had due process of law.

The attack is not upon the procedure, but upon the

substantive law. It seems to be contended that in no cir-

cumstances could such an order be justified. It certainly is

contended that the order cannot be justified upon the exist-

ing grounds. The judgment finds the facts that have been

recited, and that Carrie Buck is the probable potential par-

ent of socially inadequate offspring, likewise afflicted, that

she may be sexually sterilized without detriment to her gen-

eral health, and that her welfare and that of society will be

promoted by her sterilization, and thereupon makes the

order. In view of the general declarations of the legislature

and the specific findings of the Court, obviously we cannot

say as matter of law that the grounds do not exist, and, if

they exist, they justify the result. We have seen more than

once that the public welfare may call upon the best citizens

for their lives. It would be strange if it could not call upon

those who already sap the strength of the State for these

lesser sacrifices, often not felt to be such by those con-

cerned, in order to prevent our being swamped with incom-

petence. It is better for all the world if, instead of waiting to

execute degenerate offspring for crime or to let them starve

for their imbecility, society can prevent those who are man-

ifestly unfit from continuing their kind. The principle that

sustains compulsory vaccination is broad enough to cover

cutting the Fallopian tubes. Jacobson v. Massachusetts, 197

U.S. 11. Three generations of imbeciles are enough.

But, it is said, however it might be if this reasoning

were applied generally, it fails when it is confined to the

small number who are in the institutions named and is not

applied to the multitudes outside. It is the usual last resort

of constitutional arguments to point out shortcomings of

this sort. But the answer is that the law does all that is

needed when it does all that it can, indicates a policy,

applies it to all within the lines, and seeks to bring within

the lines all similarly situated so far and so fast as its means

allow. Of course, so far as the operations enable those who

otherwise must be kept confined to be returned to the

world, and thus open the asylum to others, the equality

aimed at will be more nearly reached.

Judgment affirmed.

Source:

Tom Russell. American Legal History. Available on-line. URL:

www.law.du.edu/russell/lh/alh/docs/buckvbell.html.

Accessed November 2003.

Olmstead v. United States, 1928

U.S. Supreme Court decision, issued on June 4, 1928, that

allowed the admission of wiretapping evidence in court. Fed-

eral agents had used recorded conversations obtained from

wiretapping to secure convictions of suspected bootleggers

during Prohibition. The case was appealed on the grounds that

wiretapping constituted an unreasonable search and seizure,

prohibited by the Fourth Amendment to the U.S. Constitution.

In a 5-4 decision, the Court stated that wiretapping was per-

mitted because it was not physical entry; even though wire-

tapping was illegal in the state of Washington, where the acts

occurred, the evidence was admissible in federal court. The

decision stood, and, in fact, was widened to exclude micro-

phones from Fourth Amendment protections, until 1967,

despite the passage in 1934 of Section 605 from the Federal

Communications Act, which outlawed federal government

wiretapping but was interpreted only to exclude overhears

from the courtroom. (States continued to govern their own

wiretapping policies.) This case is remembered far better for

the dissents than for Olmstead’s confirming the government’s

ability to eavesdrop. Justice Louis Brandeis held that the

Fourth and Fifth Amendments conferred a right to privacy and

famously wrote, “The makers of our Constitution undertook to

secure conditions favorable to the pursuit of happiness. . . .

They conferred, as against the Government, the right to be let

alone—the most comprehensive of rights and the right most

valued by civilized men.” Also in dissent, Justice Oliver Wen-

dell Holmes called wiretapping a “dirty business” in which the

government should not engage. A “right to privacy” was not

recognized by the Court majority until Justice William O.

Douglas incorporated it into his decision in

Griswold v. Con-

necticut

(381 U.S. 479 [1965]).

________________________

_______________________

Mr. Chief Justice Taft delivered the opinion of the Court.

* * *

The petitioners were convicted in the District Court for

the Western District of Washington of a conspiracy to vio-

late the National Prohibition Act (27 USCA) by unlawfully

possessing, transporting and importing intoxicating

liquors and maintaining nuisances, and by selling intoxi-

cating liquors. Seventy-two others, in addition to the peti-

tioners, were indicted. Some were not apprehended,

some were acquitted, and others pleaded guilty. The evi-

dence in the records discloses a conspiracy of amazing

magnitude to import, possess, and sell liquor unlawfully.

It involved the employment of not less than 50 persons, of

two sea-going vessels for the transportation of liquor to

British Columbia, of smaller vessels for coastwise trans-

portation to the state of Washington, the purchase and use

1322 ERA 7: The Emergence of Modern America

of a branch beyond the suburban limits of Seattle, with a

large underground cache for storage and a number of

smaller caches in that city, the maintenance of a central

office manned with operators, and the employment of

executives, salesmen, deliverymen dispatchers, scouts,

bookkeepers, collectors, and an attorney. In a bad month

sales amounted to $176,000; the aggregate for a year must

have exceeded $2,000,000. Olmstead was the leading con-

spirator and the general manager of the business. . . . The

information which led to the discovery of the conspiracy

and its nature and extent was largely obtained by inter-

cepting messages on the telephones of the conspirators by

four federal prohibition officers. Small wires were

inserted along the ordinary telephone wires from the res-

idences of four of the petitioners and those leading from

the chief office. The insertions were made without tres-

pass upon any property of the defendants. They were

made in the basement of the large office building. The

taps from house lines were made in the streets near the

houses. The gathering of evidence continued for many

months. Conversations of the conspirators, of which

refreshing stenographic notes were currently made, were

testified to by the government witnesses. They revealed

the large business transactions of the partners and their

subordinates. Men at the wires heard the orders given for

liquor by customers and the acceptances; they became

auditors of the conversations between the partners. All

this disclosed the conspiracy charged in the indictment.

Many of the intercepted conversations were not merely

reports, but parts of the criminal acts. . . . The Fourth

Amendment provides: “The right of the people to be

secure in their persons, houses, papers, and effects,

against unreasonable searches and seizures, shall not be

violated, and no warrants shall issue, but upon probable

cause, supported by oath or affirmation, and particularly

describing the place to be searched, and the persons or

things to be seized.” And the Fifth: “No person . . . shall

be compelled in any criminal case to be a witness against

himself.”

* * *

The well-known historical purpose of the Fourth Amend-

ment, directed against general warrants and writs of

assistance, was to prevent the use of governmental

force to search a man’s house, his person, his papers,

and his effects, and to prevent their seizure against his

will. . . .

* * *

The amendment itself shows that the search is to be of

material things—the person, the house, his papers, or his

effects. The description of the warrant necessary to make

the proceeding lawful is that it must specify the place to be

searched and the person or things to be seized. . . . The

Fourth Amendment may have proper application to a

sealed letter in the mail, because of the constitutional pro-

vision for the Postoffice Department and the relations

between the government and those who pay to secure pro-

tection of their sealed letters. . . . The United States takes

no such care of telegraph or telephone messages as of

mailed sealed letters. The amendment does not forbid

what was done here. There was no searching. There was

no seizure. The evidence was secured by the use of the

sense of hearing and that only. There was no entry of the

houses or offices of the defendants. By the invention of

the telephone 50 years ago, and its application for the pur-

pose of extending communications, one can talk with

another at a far distant place. The language of the amend-

ment cannot be extended and expanded to include tele-

phone wires, reaching to the whole world from the

defendant’s house or office. The intervening wires are not

part of his house or office, any more than are the highways

along which they are stretched. This court, in Carroll v.

United States, 267 U.S. 132, 149, 45 S. Ct. 280, 284 (69 L.

Ed. 543, 39 A.L.R. 790), declared: “The Fourth Amend-

ment is to be construed in the light of what was deemed

an unreasonable search and seizure when it was adopted,

and in a manner which will conserve public interests, as

well as the interest and rights of individual citizens.” Jus-

tice Bradley, in the Boyd Case, and Justice Clarke, in the

Gouled Case, said that the Fifth Amendment and the

Fourth Amendment were to be liberally construed to

effect the purpose of the framers of the Constitution in

the interest of liberty. But that cannot justify enlargement

of the language employed beyond the possible practical

meaning of houses, persons, papers, and effects, or so to

apply the words search and seizure as to forbid hearing or

sight. . . . Congress may, of course, protect the secrecy of

telephone messages by making them, when intercepted,

inadmissible in evidence in federal criminal trials, by

direct legislation, and thus depart from the common law of

evidence. But the courts may not adopt such a policy by

attributing an enlarged and unusual meaning to the

Fourth Amendment. The reasonable view is that one who

installs in his house a telephone instrument with connect-

ing wires intends to project his voice to those quite out-

side, and that the wires beyond his house, and messages

while passing over them, are not within the protection of

the Fourth Amendment. Here those who intercepted the

projected voices were not in the house of either party to

the conversation. Neither the cases we have cited nor any

of the many federal decisions brought to our attention

hold the Fourth Amendment to have been violated as

against a defendant, unless there has been an official

search and seizure of his person or such a seizure of his

Postwar Society 1323

papers or his tangible material effects or an actual physical

invasion of his house “or curtilage” for the purpose of mak-

ing a seizure. We think, therefore, that the wire tapping

here disclosed did not amount to a search or seizure

within the meaning of the Fourth Amendment. What has

been said disposes of the only question that comes within

the terms of our order granting certiorari in these cases.

But some of our number, departing from that order, have

concluded that there is merit in the twofold objection,

overruled in both courts below, that evidence obtained

through intercepting of telephone messages by govern-

ment agents was inadmissible, because the mode of

obtaining it was unethical and a misdemeanor under the

law of Washington. To avoid any misapprehension of our

views of that objection we shall deal with it in both of its

phases.

* * *

The common-law rule is that the admissibility of evidence

is not affected by the illegality of the means by which it was

obtained.

* * *

Nor can we, without the sanction of congressional enact-

ment, subscribe to the suggestion that the courts have a

discretion to exclude evidence, the admission of which is

not unconstitutional, because unethically secured. This

would be at variance with the common-law doctrine gen-

erally supported by authority. There is no case that sus-

tains, nor any recognized text-book that gives color to, such

a view. Our general experience shows that much evidence

has always been receivable, although not obtained by con-

formity to the highest ethics. . . . A standard which would

forbid the reception of evidence, if obtained by other than

nice ethical conduct by government officials, would made

society suffer and give criminals greater immunity than has

been known heretofore. In the absence of controlling leg-

islation by Congress, those who realize the difficulties in

bringing offenders to justice may well deem it wise that the

exclusion of evidence should be confined to cases where

rights under the Constitution would be violated by admit-

ting it. . . .

* * *

The judgments of the Circuit Court of Appeals are

affirmed. The mandates will go down forthwith under rule

31. Affirmed.

Mr. Justice Brandeis (dissenting). The defendants

were convicted of conspiring to violate the National Pro-

hibition Act (27 USCA). Before any of the persons now

charged had been arrested or indicted, the telephones by

means of which they habitually communicated with one

another and with others had been tapped by federal offi-

cers. To this end, a lineman of long experience in wire

tapping was employed, on behalf of the government and

at its expense. He tapped eight telephones, some in the

homes of the persons charged, some in their offices. Act-

ing on behalf of the government and in their official

capacity, at least six other prohibition agents listened over

the tapped wires and reported the messages taken. Their

operations extended over a period of nearly five months.

The typewritten record of the notes of conversations

overheard occupies 775 typewritten pages. By objections

seasonably made and persistently renewed, the defen-

dants objected to the admission of the evidence obtained

by wire tapping, on the ground that the government’s

wire tapping constituted an unreasonable search and

seizure, in violation of the Fourth Amendment, and that

the use as evidence of the conversations overheard com-

pelled the defendants to be witnesses against themselves,

in violation of the Fifth Amendment. The government

makes no attempt to defend the methods employed by its

officers. . . .

* * *

Moreover, “in the application of a Constitution, our con-

templation cannot be only of what has been, but of what

may be.” The progress of science in furnishing the govern-

ment with means of espionage is not likely to stop with

wire tapping. Ways may some day be developed by which

the government, without removing papers from secret

drawers, can reproduce them in court, and by which it will

be enabled to expose to a jury the most intimate occur-

rences of the home. Advances in the psychic and related

sciences may bring means of exploring unexpressed

beliefs, thoughts and emotions. “That places the liberty of

every man in the hands of every petty officer” was said by

James Otis of much lesser intrusions than these. To Lord

Camden a far slighter intrusion seemed “subversive of all

the comforts of society. Can it be that the Constitution

affords no protection against such invasions of individual

security?

* * *

Whenever a telephone line is tapped, the privacy of the

persons at both ends of the line is invaded, and all conver-

sations between them upon any subject, and although

proper, confidential, and privileged, may be overheard.

Moreover, the tapping of one man’s telephone line involves

the tapping of the telephone of every other person whom

he may call, or who may call him. As a means of espionage,

writs of assistance and general warrants are but puny

instruments of tyranny and oppression when compared

with wire tapping.

1324 ERA 7: The Emergence of Modern America

* * *

Decisions of this court . . . have settled these things.

Unjustified search and seizure violates the Fourth

Amendment, whatever the character of the paper;

whether the paper when taken by the federal officers was

in the home, in an office, or elsewhere; whether the taking

was effected by force, by fraud, or in the orderly process

of a court’s procedure. From these decisions, it follows

necessarily that the amendment is violated by the officer’s

reading the paper without a physical seizure, without his

even touching it, and that use, in any criminal proceeding,

of the contents of the paper so examined—as where they

are testified to by a federal officer who thus saw the docu-

ment or where, through knowledge so obtained, a copy

has been procured elsewhere—any such use constitutes a

violation of the Fifth Amendment. The protection guaran-

teed by the amendments is much broader in scope. The

makers of our Constitution undertook to secure conditions

favorable to the pursuit of happiness. They recognized the

significance of man’s spiritual nature, of his feelings and of

his intellect. They knew that only a part of the pain, plea-

sure and satisfactions of life are to be found in material

things. They sought to protect Americans in their beliefs,

their thoughts, their emotions and their sensations. They

conferred, as against the government, the right to be let

alone—the most comprehensive of rights and the right

most valued by civilized men. To protect, that right, every

unjustifiable intrusion by the government upon the pri-

vacy of the individual, whatever the means employed,

must be deemed a violation of the Fourth Amendment.

And the use, as evidence in a criminal proceeding, of facts

ascertained by such intrusion must be deemed a violation

of the Fifth. Applying to the Fourth and Fifth Amend-

ments the established rule of construction, the defen-

dants’ objections to the evidence obtained by wire tapping

must, in my opinion, be sustained. It is, of course, imma-

terial where the physical connection with the telephone

wires leading into the defendants’ premises was made.

And it is also immaterial that the intrusion was in aid of

law enforcement. Experience should teach us to be most

on our guard to protect liberty when the government’s

purposes are beneficent. Men born to freedom are natu-

rally alert to repel invasion of their liberty by evil-minded

rulers. The greatest dangers to liberty lurk in insidious

encroachment by men of zeal, well-meaning but without

understanding.

* * *

Decency, security, and liberty alike demand that govern-

ment officials shall be subjected to the same rules of con-

duct that are commands to the citizen. In a government of

laws, existence of the government will be imperiled if it

fails to observe the law scrupulously. Our government is

the potent, the omnipresent teacher. For good or for ill, it

teaches the whole people by its example. Crime is conta-

gious. If the government becomes a lawbreaker, it breeds

contempt for law; it invites every man to become a law

unto himself; it invites anarchy. To declare that in the

administration of the criminal law the end justifies the

means—to declare that the government may commit

crimes in order to secure the conviction of a private crim-

inal—would bring terrible retribution. Against that perni-

cious doctrine this court should resolutely set its face Mr.

Justice Holmes [dissenting]. My brother Brandeis has

given this case so exhaustive an examination that I desire

to add but a few words. While I do not deny it I am not

prepared to say that the penumbra of the Fourth and Fifth

Amendments covers the defendant, although I fully agree

that courts are apt to err by sticking too closely to the

words of a law where those words import a policy that goes

beyond them. . . . But I think, as Mr. Justice Brandeis says,

that apart from the Constitution the government ought not

to use evidence obtained and only obtainable by a criminal

act. There is no body of precedents by which we are

bound, and which confines us to logical deduction from

established rules. Therefore we must consider the two

objects of desire both of which we cannot have and make

up our minds which to choose. It is desirable that criminals

should be detected, and to that end that all available evi-

dence should be used. It also is desirable that the govern-

ment should not itself foster and pay for other crimes,

when they are the means by which the evidence is to

obtained. If it pays its officers for having got evidence by

crime I do not see why it may not as well pay them for get-

ting it in the same way, and I can attach no importance to

protestations of disapproval if it knowingly accepts and

pays and announces that in future it will pay for the fruits.

We have to choose, and for my part I think it a less evil that

some criminals should escape than that the government

should play an ignoble part. For those who agree with me

no distinction can be taken between the government as

prosecutor and the government as judge. If the existing

code does not permit district attorneys to have a hand in

such dirty business it does not permit the judge to allow

such iniquities to succeed. . . . And if all that I have said so

far be accepted it makes no difference that in this case

wire tapping is made a crime by the law of the state, not by

the law of the United States. It is true that a state cannot

make rules of evidence for courts of the United States, but

the state has authority over the conduct in question, and I

hardly think that the United States would appear to

greater advantage when paying for an odious crime against

state law than when inciting to the disregard of its own. . .

I have said that we are free to choose between two princi-

Postwar Society 1325

Water Power Act, 1920

Federal legislation enacted on June 10, 1920, that established

the Federal Power Commission to conserve water power

reserves on U.S. public lands and on navigable streams. To

improve navigation and develop power, the commission, con-

sisting of the secretaries of war, interior, and agriculture, was

authorized to issue licenses for the construction and operation

of facilities, such as powerhouses, dams, and reservoirs.

Leases were limited to 50 years, with the U.S. government

maintaining the right to take over the facilities when the leases

expired. The commission was empowered to regulate rates.

The act also stated that neighboring states or cities would have

the first opportunity to use power sites.

________________________

_______________________

An Act

To create a Federal Power Commission; to provide for

the improvement of navigation; the development of water

power; the use of the public lands in relation thereto, and

to repeal section 18 of the River and Harbor Appropriation

Act, approved August 8, 1917, and for other purposes.

Be it enacted by the Senate and House of Representa-

tives of the United States of America in Congress assem-

bled, That a commission is hereby created and established,

to be known as the Federal Power Commission (here-

inafter referred to as the commission), which shall be com-

posed of the Secretary of War, the Secretary of the

Interior, and the Secretary of Agriculture. Two members

of the commission shall constitute a quorum for the trans-

action of business, and the commission shall have an offi-

cial seal, which shall be judicially noticed. The President

shall designate the chairman of the commission.

Sec. 2. That the commission shall appoint an executive

secretary, who shall receive a salary of $5,000 a year, and

prescribe his duties, and the commission may request the

President of the United States to detail an officer from the

United States Engineer Corps to serve the commission as

engineer officer, his duties to be prescribed by the com-

mission.

The work of the commission shall be performed by

and through the Departments of War, Interior, and Agri-

culture and their engineering, technical, clerical, and other

personnel except as may be otherwise provided by law.

All the expenses of the commission, including rent in

the District of Columbia, all necessary expenses for trans-

portation and subsistence, including, in the discretion of

the commission, a per diem of not exceeding $4 in lieu of

subsistence incurred by its employees under its orders in

making any investigation, or conducting field work, or

upon official business outside of the District of Columbia

and away from their designated points of duty, shall be

allowed and paid on the presentation of itemized vouch-

ers therefor approved by a member or officer of the com-

mission duly authorized for that purpose; and in order to

defray the expenses made necessary by the provisions of

this Act there is hereby authorized to be appropriated

such sums as Congress may hereafter determine, and

the sum of $100,000 is hereby appropriate, out of any

moneys in the Treasury not otherwise appropriated,

available until expended, to be paid out upon warrants

drawn on the Secretary of the Treasury upon order of the

commission.

Sec. 3. That the words defined in this section shall

have the following meanings for the purposes of this Act,

to wit:

“Public lands” means such lands and interest in lands

owned by the United States as are subject to private appro-

priation and disposal under public-land laws. It shall not

include “reservations,” as hereinafter defined.

1326 ERA 7: The Emergence of Modern America

Postwar Economy

ples of policy. But if we are to confine ourselves to prece-

dent and logic the reason for excluding evidence obtained

by violating the Constitution seems to me logically to lead

to excluding evidence obtained by a crime of the officers

of the law.

Source:

Supreme Court Reporter, Vol. 48, pp. 564–576.

“Reservations” means national monuments, national

parks, national forests, tribal lands embraced within Indian

reservations, military reservations, and other lands and

interests in lands owned by the United States, and with-

drawn, reserved, or withheld from private appropriation

and disposal under the public-land laws; also lands and

interests in lands acquired and held for any public pur-

pose.

“Corporation” means a corporation organized under

the laws of any State or of the United States empowered to

develop, transmit, distribute, sell, lease, or utilize power in

addition to such other powers as it may possess, and autho-

rized to transact in the State or States in which its project

is located all business necessary to effect the purposes of a

license under this Act. It shall not include “municipalities”

as hereinafter defined.

“State” means a State admitted to the Union, the Dis-

trict of Columbia, and any organized Territory of the

United States.

“Municipality” means a city, county, irrigation district,

drainage district, or other political subdivision or agency of

a State competent under the laws thereof to carry on the

business of developing, transmitting, utilizing, or distribut-

ing power.

“Navigable waters” means those parts of streams or

other bodies of water over which Congress has jurisdiction

under its authority to regulate commerce with foreign

nations and among the several States, and which either in

their natural or improved condition, notwithstanding

interruptions between the navigable parts of such streams

or waters by falls, shallows, or rapids compelling land car-

riage, are used or suitable for use for the transportation of

persons or property in interstate or foreign commerce,

including therein all such interrupting falls, shallows, or

rapids; together with such other parts of streams as shall

have been authorized by Congress for improvement by the

United States or shall have been recommended to

Congress for such improvement after investigation under

its authority.

“Municipal purposes” means and includes all pur-

poses within municipal powers as defined by the constitu-

tion or laws of the State or by the charter of the

municipality.

“Government dam” means a dam or other work, con-

structed or owned by the United States for Government

purposes, with or without contribution from others.

“Project” means complete unit of improvement or

development, consisting of a power house, all water con-

duits, all dams and appurtenant works and structures

(including navigation structures) which are a part of said

unit, and all storage, diverting, or forebay reservoirs

directly connected therewith, the primary line or lines

transmitting power therefrom to the point of junction with

the distribution system or with the interconnected primary

transmission system, all miscellaneous structures used and

useful in connection with said unit or any part thereof, and

all water rights, rights of way, ditches, dams, reservoirs,

lands, or interest in lands, the use and occupancy of which

are necessary or appropriate in the maintenance and oper-

ation of such unit.

“Project works” means the physical structures of a

project.

“Net investment” in a project means the actual legiti-

mate original cost thereof as defined and interpreted in the

“classification of investment in road and equipment of

steam roads, issue of 1914, Interstate Commerce Commis-

sion,” plus similar costs of additions thereto and better-

ments thereof, minus the sum of the following items

properly allocated thereto, if and to the extent that such

items have been accumulated during the period of the

license from earnings in excess of a fair return on such

investment: (a) Unappropriated surplus, (b) aggregate

credit balances of current depreciation accounts, and (c)

aggregate appropriations of surplus or income held in

amortization, sinking fund, or similar reserves, or

expended for additions or betterments or used for the pur-

poses for which such reserves were created. The term

“cost” shall include, in so far as applicable, the elements

thereof prescribed in said classification, but shall not

include expenditures from funds obtained through dona-

tions by States, municipalities, individuals, or others, and

said classification of investment of the Interstate Com-

merce Commission shall in so far as applicable be pub-

lished and promulgated as a part of the rules and

regulations of the commission.

Sec. 4. That the commission is hereby authorized and

empowered—

(a) To make investigations and to collect and record

data concerning the utilization of the water resources of

any region to be developed, the water power industry and

its relation to other industries and to interstate or foreign

commerce, and concerning the location, capacity, develop-

ment costs, and relation to markets of power sites, and

whether the power from Government dams can be advan-

tageously used by the United States for its public purposes,

and what is a fair value of such power, to the extent the

commission may deem necessary or useful for the pur-

poses of this Act.

In order to aid the commission in determining the net

investment of a licensee in any project, the licensee shall,

upon oath, within a reasonable period of time, to be fixed

by the commission, after the construction of the original

project or any addition thereto or betterment thereof, file

with the commission, in such detail as the commission may

Postwar Economy 1327

require, a statement in duplicate showing the actual legit-

imate cost of construction of such project, addition, or bet-

terment, and the price paid for water rights, rights of way,

lands, or interest in lands. The commission shall deposit

one of said statements with the Secretary of the Treasury.

The licensee shall grant to the commission or to its duly

authorized agent or agents, at all reasonable times, free

access to such project, addition, or betterment, and to all

maps, profiles, contracts, reports of engineers, accounts,

books, records, and all other papers and documents relat-

ing thereto.

(b) To cooperate with the executive departments and

other agencies of State or National Governments in such

investigations; and for such purpose the several depart-

ments and agencies of the National Government are

authorized and directed upon the request of the commis-

sion, to furnish such records, papers, and information in

their possession as may be requested by the commission,

and temporarily to detail to the commission such officers

or experts as may be necessary in such investigations.

secured hereunder, and to provide for the publication of

its reports and investigations in such form and manner as

may be best adapted for public information and use. The

commission, on or before the first Monday in December

of each year, shall submit to Congress for the fiscal year

preceding a classified report showing the permits and

licenses issued under this Act, and in each case the parties

thereto, the terms prescribed, and the moneys received, if

any, on account thereof.

(d) To issue licenses to citizens of the United States, or

to any association of such citizens, or to any corporation

organized under the laws of the United States or any State

thereof, or to any State, or municipality for the purpose of

constructing, operating, and maintaining dams, water con-

duits, reservoirs, power houses, transmission lines, or

other project works necessary or convenient for the devel-

opment and improvement of navigation, and for the devel-

opment, transmission, and utilization of power across,

along, from or in any of the navigable waters of the United

States, or upon any part of the public lands and reserva-

tions of the United States (including the Territories), or for

the purpose of utilizing the surplus water or water power

from any Government dam, except as herein provided:

Provided, That licenses shall be issued within any reserva-

tion only after a finding by the commission that the license

will not interfere or be inconsistent with the purpose for

which such reservation was created or acquired, and shall

be subject to and contain such conditions as the Secretary

of the department under whose supervision such reserva-

tion falls shall deem necessary for the adequate protection

and utilization of such reservation: Provided further, That

no license affecting the navigable capacity of any navigable

waters of the United States shall be issued until the plans

of the dam or other structures affecting navigation have

been approved by the Chief of Engineers and the Secre-

tary of War. Whenever the contemplated improvement is,

in the judgment of the commission, desirable and justified

in the public interest for the purpose of improving or

developing a waterway or waterways for the use or benefit

of interstate of foreign commerce, a finding to that effect

shall be made by the commission and shall become a part

of the records of the commission: Provided further, That in

case the commission shall find that any Government dam

may be advantageously used by the United States for pub-

lic purposes in addition to navigation, no license therefor

shall be issued until two years after it shall have reported

to Congress the facts and conditions relating thereto,

except that this provision shall not apply to any Govern-

ment dam constructed prior to the passage of this Act: And

provided further, That upon the filing of any application

for a license which has not been preceded by a preliminary

permit under subsection (e) of this section, notice shall be

given and published as required by the proviso of said sub-

section.

(e) To issue preliminary permits for the purpose of

enabling applicants for a license hereunder to secure the

data and to perform the acts required by section 9 hereof:

Provided, however, That upon the filing of any application

for a preliminary permit by any person, association, or cor-

poration the commission, before granting such application,

shall at once give notice of such application in writing to

any State or municipality likely to be interested in or

affected by such application; and shall also publish notice

of such application for eight weeks in a daily or weekly

newspaper published in the county or counties in which

the project or any part thereof or the lands affected

thereby are situated.

(f) To prescribe rules and regulations for the estab-

lishment of a system of accounts and for the maintenance

thereof of licensees hereunder; to examine all books and

accounts of such licensees at any time; to require them to

submit at such time or times as the commission may

require statements and reports, including full information

as to assets and liabilities, capitalization, net investment

and reduction thereof, gross receipts, interest due and

paid, depreciation and other reserves, cost of project, cost

of maintenance and operation of the project, cost of

renewals and replacements of the project works, and as to

depreciation of the project works and as to production,

transmission, use and sale of power; also to require any

licensee to make adequate provision for currently deter-

mining said costs and other facts. All such statements and

reports shall be made upon oath, unless otherwise speci-

1328 ERA 7: The Emergence of Modern America

fied, and in such form and on such blanks as the commis-

sion may require. Any person who, for the purpose of

deceiving, makes or causes to be made any false entry in

the books or the accounts of such licensee, and any person

who, for the purpose of deceiving, makes or causes to be

made any false statement or report in response to a request

or order or direction from the commission for the state-

ments and report herein referred to shall, upon conviction,

be fined not more than $2,000 or imprisoned not more

than five years, or both.

(g) To hold hearings and to order testimony to be

taken by deposition at any designated place in connection

with the application for any permit or license, or the regu-

lation of rates, service, or securities, or the making of any

investigation, as provided in this Act; and to require by

subpoena, signed by any member of the commission, the

attendance and testimony of witnesses and the production

of documentary evidence from any place in the United

States, and in case of disobedience to a subpoena the com-

mission may invoke the aid of any court of the United

States in requiring the attendance and testimony of wit-

nesses and the production of documentary evidence. Any

member, expert, or examiner of the commission may,

when duly designated by the commission for such pur-

poses, administer oaths and affirmations, examine wit-

nesses and receive evidence. Depositions may be taken

before any person designated by the commission or by its

executive secretary and empowered to administer oaths,

shall be reduced to writing by such person or under his

direction, and subscribed by the deponent. Witnesses

summoned before the commission shall be paid the same

fees and mileage that are paid witnesses in the courts of

the United States, and witnesses whose depositions are

taken and persons taking the same shall severally be enti-

tled to the same fees as are paid for like services in the

courts of the United States.

(h) To perform any and all acts, to make such rules and

regulations, and to issue such orders not inconsistent with

this Act as may be necessary and proper for the purpose of

carrying out the provisions of this Act.

Sec. 5. That each preliminary permit issued under this

Act shall be for the sole purpose of maintaining priority of

application for a license under the terms of this Act for

such period or periods, not exceeding a total of three years,

as in the discretion of the commission may be necessary for

making examinations and surveys, for preparing maps,

plans, specifications, and estimates, and for making finan-

cial arrangements. Each such permit shall set forth the

conditions under which priority shall be maintained and a

license issued. Such permits shall not be transferable, and

may be canceled by order of the commission upon failure

of permittees to comply with the conditions thereof.

Sec. 6. That licenses under this Act shall be issued for

a period not exceeding fifty years. Each such license shall

be conditioned upon acceptance by the licensee of all the

terms and conditions of this Act and such further condi-

tions, if any, as the commission shall prescribe in confor-

mity with this Act, which said terms and conditions and the

acceptance thereof shall be expressed in said license.

Licenses may be revoked only for the reasons and in the

manner prescribed under the provisions of this Act, and

may be altered or surrendered only upon mutual agree-

ment between the licensee and the commission after

ninety days’ public notice.

Sec. 7. That in issuing preliminary permits hereunder

or licenses where no preliminary permit has been issued

and in issuing licenses to new licensees under section 15

hereof the commission shall give preference to applica-

tions therefor by States and municipalities, provided the

plans for the same are deemed by the commission equally

well adapted, or shall within a reasonable time to be fixed

by the commission be made equally well adapted, to con-

serve and utilize in the public interest the navigation and

water resources of the region; and as between other appli-

cants, the commission may give preference to the appli-

cant the plans of which it finds and determines are best

adapted to develop, conserve, and utilize in the public

interest the navigation and water resources of the region,

if it be satisfied as to the ability of the applicant to carry out

such plans.

That whenever, in the judgment of the commission,

the development of any project should be undertaken by

the United States itself, the commission shall not approve

any application for such project by any citizen, association,

corporation, State, or municipality, but shall cause to be

made such examinations, surveys, reports, plans and esti-

mates of the cost of the project as it may deem necessary,

and shall submit its findings to Congress with such recom-

mendations as it may deem appropriate concerning the

construction of such project or completion of any project

upon any Government dam by the United States.

The commission is hereby authorized and directed to

investigate and, on or before the 1st day of January, 1921,

report to Congress the cost and, in detail, the economic

value of the power plant outlined in project numbered 3,

House Document numbered 1400, Sixty-second Congress,

third session, in view of existing conditions, utilizing such

study as may heretofore have been made by any depart-

ment of the Government; also in connection with such

project to submit plans and estimates of cost necessary to

secure an increased and adequate water supply for the

District of Columbia. For this purpose the sum of $25,000,

or so much thereof as may be necessary, is hereby appro-

priated.

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Sec. 8. That no voluntary transfer of any license, or of

the rights thereunder granted, shall be made without the

written approval of the commission; and any successor or

assign of the rights of such licensee, whether by voluntary

transfer, judicial sale, foreclosure sale, or otherwise, shall

be subject to all the conditions of the license under which

such rights are held by such licensee and also subject to all

the provisions and conditions of this Act to the same extent

as though such successor or assign were the original

licensee hereunder: Provided, That a mortgage or trust

deed or judicial sales made thereunder or under tax sales

shall not be deemed voluntary transfers within the mean-

ing of this section.

Sec. 9. That each applicant for a license hereunder

shall submit to the commission—

(a) Such maps, plans, specifications, and estimates of

cost as may be required for a full understanding of the pro-

posed project. Such maps, plans, and specifications when

approved by the commission shall be made a part of the

license; and thereafter no change shall be made in said

maps, plans, or specifications until such changes shall have

been approved and made a part of such license by the

commission.

(b) Satisfactory evidence that the applicant has com-

plied with the requirements of the laws of the State or

States within which the proposed project is to be located

with respect to bed and banks and to the appropriation,

diversion, and use of water for power purposes and with

respect to the right to engage in the business of develop-

ing, transmitting, and distributing power, and in any other

business necessary to effect the purposes of a license

under this Act.

may require.

Sec. 10. That all licenses issued under this Act shall be

on the following conditions:

(a) That the project adopted, including the maps,

plans, and specifications, shall be such as in the judgment

of the commission will be best adapted to a comprehensive

scheme of improvement and utilization for the purposes of

navigation, of water-power development, and of other ben-

eficial public uses; and if necessary in order to secure such

scheme the commission shall have authority to require the

modification of any project and of the plans and specifica-

tions of the project works before approval.

(b) That except when emergency shall require for the

protection of navigation, life, health, or property, no sub-

stantial alteration or addition not in conformity with the

approved plans shall be made to any dam or other project

works constructed hereunder of a capacity in excess of one

hundred horsepower without the prior approval of the

commission; and any emergency alteration or addition so

made shall thereafter be subject to such modification and

change as the commission may direct.

in a condition of repair adequate for the purposes of navi-

gation and for the efficient operation of said works in the

development and transmission of power, shall make all

necessary renewals and replacements, shall establish and

maintain adequate depreciation reserves for such pur-

poses, shall so maintain and operate said works as not to

impair navigation, and shall conform to such rules and reg-

ulations as the commission may from time to time pre-

scribe for the protection of life, health, and property. Each

licensee hereunder shall be liable for all damages occa-

sioned to the property of others by the construction, main-

tenance, or operation of the project works or of the works

appurtenant or accessory thereto, constructed under the

license, and in no event shall the United States be liable

therefor.

(d) That after the first twenty years of operation out of

surplus earned thereafter, if any, accumulated in excess of

a specified reasonable rate of return upon the actual, legit-

imate investment of a licensee in any project or projects

under license the licensee shall establish and maintain

amortization reserves, which reserves shall, in the discre-

tion of the commission, be held until the termination of

the license or be applied from time to time in reduction of

the net investment. Such specified rate of return and the

proportion of such surplus earnings to be paid into and

held in such reserves shall be set forth in the license.

(e) That the licensee shall pay to the United States

reasonable annual charges in an amount to be fixed by the

commission for the purpose of reimbursing the United

States for the costs of the administration of this Act; for

recompensing it for the use, occupancy, and enjoyment of

its lands or other property; and for the expropriation to the

Government of excessive profits until the respective States

shall make provision for preventing excessive profits or for

the expropriation thereof to themselves, or until the period

of amortization as herein provided is reached, and in fixing

such charges the commission shall seek to avoid increasing

the price to the consumers of power by such charges, and

charges for the expropriation of excessive profits may be

adjusted from time to time by the commission as condi-

tions may require: Provided, That when licenses are issued

involving the use of Government dams or other structures

owned by the United States or tribal lands embraced

within Indian reservations the commission shall fix a rea-

sonable annual charge for the use thereof, and such

charges may be readjusted at the end of twenty years after

the beginning of operations and at periods of not less than

ten years thereafter in a manner to be described in each

license: Provided, That licenses for the development,

1330 ERA 7: The Emergence of Modern America

transmission, or distribution of power by States or munic-

ipalities shall be issued and enjoyed without charge to the

extent such power is sold to the public without profit or is

used by such State or municipality for State or municipal

purposes, except that as to projects constructed or to be

constructed by States or municipalities primarily designed

to provide or improve navigation licenses therefor shall be

issued without charge; and that licenses for the develop-

ment, transmission, or distribution of power for domestic,

mining, or other beneficial use in projects of not more than

one hundred horsepower capacity may be issued without

charge, except on tribal lands within Indian reservations;

but in no case shall a license be issued free of charge for

the development and utilization of power created by any

Government dam and that the amount charged therefor in

any license shall be such as determined by the commission.

(f) That whenever any licensee hereunder is directly

benefited by the construction work of another licensee, a

permittee, or of the United States of a storage reservoir or

other headwater improvement, the commission shall

require as a condition of the license that the licensee so

benefited shall reimburse the owner of such reservoir or

other improvements for such part of the annual charges for

interest, maintenance, and depreciation thereon as the

commission may deem equitable. The proportion of such

charges to be paid by any licensee shall be determined by

the commission.

Whenever such reservoir or other improvement is

constructed by the United States the commission shall

assess similar charges against any licensee directly bene-

fited thereby, and any amount so assessed shall be paid

into the Treasury of the United States, to be reserved and

appropriated as a part of the special fund for headwater

improvements as provided in section 17 hereof.

(g) Such further conditions not inconsistent with the

provisions of this Act as the commission may require.

(h) That combinations, agreements, arrangements, or

understandings, express or implied, to limit the output of

electrical energy, to restrain trade, or to fix, maintain, or

increase prices for electrical energy or service are hereby

prohibited.

(i) In issuing licenses for a minor part only of a com-

plete project, or for a complete project of not more than

one hundred horsepower capacity, the commission may in

its discretion waive such conditions, provisions, and

requirements of this Act, except the license period of fifty

years, as it may deem to be to the public interest to waive

under the circumstances: Provided, That the provisions

hereof shall not apply to lands within Indian reservations.

Sec. 11. That if the dam or other project works are to

be constructed across, along, or in any of the navigable

waters of the United States, the commission may, in so far

as it deems the same reasonably necessary to promote the

present and future needs of navigation and consistent with

a reasonable investment cost to the licensee, include in the

license any one or more of the following provisions or

requirements:

(a) That such licensee shall, to the extent necessary to

preserve and improve navigation facilities, construct, in

whole or in part, without expense to the United States, in

connection with such dam, a lock or locks, booms, sluices,

or other structures for navigation purposes, in accordance

with plans and specifications approved by the Chief of

Engineers and the Secretary of War and made part of such

license.

(b) That in case such structures for navigation pur-

poses are not made a part of the original construction at

the expense of the licensee, then whenever the United

States shall desire to complete such navigation facilities

the licensee shall convey to the United States, free of cost,

such of its land and its rights of way and such right of pas-

sage through its dams or other structures, and permit such

control of pools as may be required to complete such nav-

igation facilities.

United States power for the operation of such navigation

facilities, whether constructed by the licensee or by the

United States.

Sec. 12. That whenever application is filed for a pro-

ject hereunder involving navigable waters of the United

States, and the commission shall find upon investigation

that the needs of navigation require the construction of a

lock or locks or other navigation structures, and that such

structures can not, consistent with a reasonable investment

cost to the applicant, be provided in the manner specified

in section 11, subsection (a) hereof, the commission may

grant the application with the provision to be expressed in

the license that the licensee will install the necessary navi-

gation structures if the Government fails to make provision

therefor within a time to be fixed in the license and cause

a report upon such project to be prepared, with estimates

of cost of the power development and of the navigation

structures, and shall submit such report to Congress with

such recommendations as it deems appropriate concern-

ing the participation of the United States in the cost of

construction of such navigation structures.

Sec. 13. That the licensee shall commence the con-

struction of the project works within the time fixed in the

license, which shall not be more than two years from the

date thereof, shall thereafter in good faith and with due

diligence prosecute such construction, and shall within the

time fixed in the license complete and put into operation

such part of the ultimate development as the commission

shall deem necessary to supply the reasonable needs of the

Postwar Economy 1331