Rural Electrification Administration (REA)

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RURAL ELECTRIFICATION ADMINISTRATION (REA)

By the end of World War I people recognized electricity as an important factor in the quality of life. Large and small cities and many towns were electrified at both the industrial and consumer level. Factories, homes, and recreational buildings had electric lights, appliances, indoor bathrooms, and other modern conveniences that depended on the availability of electricity. During the next decade the use of electricity would grow to such an extent that the 1920s came to be known as the "Electrical Age." American culture, the quality of health and education, and industrial productivity improved in urban areas because of the application of electrical energy. One exception, however, to this general development existed in the United States: Rural America did not have electrical service. In 1920 approximately half of the country's population lived on farms and unincorporated areas, which meant that they did not enjoy the benefits of radio, lighting, refrigeration, and modern sanitation, all of which operated on electricity. By 1935 the situation had only improved slightly, with 10 percent of the rural inhabitants of the United States having electrical service in their homes and on their farms. The movement for public power, or the generation and sale of electrical energy by government means, emerged as a national issue during the period between the two world wars partly because of the national outcry for rural electrification.

During the 1920s the privately owned electrical companies recognized the importance of serving the countryside and created the Committee on the Relation of Electricity to Agriculture (CREA). This organization, an arm of the electrical industry, undertook research and educational programs to promote the use of electricity in country homes. Only limited progress occurred: The CREA touted its program at Red Wing, Minnesota, as an example of its efforts, but a more significant attempt came through the Alabama Power Company in Birmingham. A few power companies around the nation made a small effort to build distribution lines along rural highways and roads but made little progress in getting service to the inhabitants there, as demonstrated by the overwhelming lack of rural service in the United States by the mid 1930s. Cost was the drawback; farmers could not afford the rates to use enough electricity to warrant the construction of lines to them. An endless cycle of high costs and low usage for farmers and no profits for the power companies prevented a breakthrough. In 1935 President Franklin D. Roosevelt stated that he discovered the lack of electricity in rural America in 1923 when he first visited Warm Springs, Georgia, to bathe and swim in the soothing waters there to alleviate the pain of his polio. The demand for government action grew, so that by the early 1930s some states, such as North Carolina and South Carolina, attempted to start public rural electric programs on their own. For lack of funding and the inability to overcome the complex technical and distribution barriers of extending service to rural inhabitants, the few state efforts at the time made no progress either. Only a strong and well-organized and funded program could meet the challenge, and by the early 1930s public power proponents and the rural citizens of the United States looked to the federal government for help.

One of the commitments of Roosevelt's presidency was the development of public power, and the creation of the Tennessee Valley Authority (TVA) in December 1933 was the first example of such action. Soon after commencing operations, the TVA organized a farmer-owned rural electric cooperative to serve the area around Tupelo, Mississippi, on an experimental basis. There had always been doubts about the ability of farmers to organize and operate an electric cooperative, so through this experiment public power advocates in the Roosevelt administration sought an answer. To their delight, the cooperative progressed and succeeded well, greatly encouraging Morris L. Cooke, Roosevelt's chief advisor on public power, to push for the creation of a special agency dedicated solely to rural electrification. Using funds available from the Emergency Relief Appropriations Act, the president in 1935 created by executive order the Rural Electrification Administration (REA) and named Cooke as the administrator. Cooke had to develop a means by which REA funds could be used to build the electrical network for distributing electricity through rural areas. After some experimentation, he accepted the cooperative as the best method, partly because of the efforts of the American Farm Bureau Federation. Progress was too slow, however, to suit farmers and rural homeowners, and in 1936 Senator George Norris and Representative Sam Rayburn introduced legislation to make the REA a permanent agency with statutory authority. The legislation gave preference to public agencies in obtaining funds, but it did not exclude private power companies from using the funds.

After the Act passed in 1936, the REA got underway with a construction program relying mostly on farmer-owned cooperatives along the line of the TVA experiment in Mississippi. Rural families waited eagerly for the lines to reach their homes, and as electricity became available, they first bought small appliances such as irons and radios. Refrigerators and indoor bathrooms with running water typically came later, and many of the recipients of REA service regarded the agency as one of the New Deal's greatest achievements.

For the first time, the privately owned power companies showed an interest in the rural market. Some of them began "skimming the cream," meaning they built distribution lines into the most lucrative areas of local markets, thereby leaving the REA with the high-risk customers. Bitter court fights broke out between the REA and local power companies, and the differences were not entirely resolved until after World War II. During the war, however, REA construction slowed considerably, but in 1944 Congress passed the Pace Act that set the REA rate of interest on loans to cooperatives at two percent. With this advantage and the postwar boom in the United States, the REA began a massive construction program. So popular was the REA that Congress during some years after the war appropriated more funds than the agency requested. By 1955 the portion of farms and rural homes in the United States with electricity reached 90 percent. Rural electrification had been achieved.

Electrical service brought profound, and often unrecognized, changes in country living. Health vastly improved with indoor bathrooms. A sharp decline occurred in infant mortality and deaths of children under two years of age from infectious diseases dropped. In the South hookworm became a relic of the past with the disappearance of the outdoor "privy." The quality of diets and subsequent health benefits improved with the availability of refrigeration for storage of food. Country schools enjoyed modern lighting and heat, and teachers noted an improvement in the atmosphere of their rooms and performance of the students. Home life became more attractive as families joined their urban cousins in listening to their favorite radio shows, and women enjoyed the conveniences of electrical appliances and running water in their kitchens. The REA must be considered the instrument that brought rural America out of the preindustrial age.