Natural Scrapper

His first name is Norman and his last name is Norman and a C stands between them. By trade he is a Manhattan jeweler. Few people outside of Maiden Lane had heard of Norman C. Norman until the coming of the New Deal. By last week, however, he was familiar to business newsreaders, to corporate executives, to bankers and to the Administration as a small stockholder in 50 corporations who could be relied upon to make headlines wherever he went.

Norman C. Norman got his first taste of publicity when he held out against the NRA jewelry code, refused to pay a $100 assessment for code administration, sought to go to Washington, make a test case. Next he demanded that Baltimore & Ohio Railroad pay him $39.10 in Roosevelt dollars on a $1,000 gold bond, instead of the $22.50 interest the company offered. This time he did make a test case. got his name and picture in the papers throughout the country as the U. S. Supreme Court pondered the "Gold Clause" (TIME, Jan. 21). Later he vainly tried to prevent Republic Steel Corp. from giving Kuhn, Loeb and Field. Glore 50,000 shares of Republic in return for floating a $24,000,000 issue of Republic bonds. Next he turned up in the tangled affairs of Harley Clarke's Pusco [Public Utilities Securities Corp.), brought a receivership suit against the company, tried to keep RFC from voting Pusco stock which it had acquired as collateral for an unpaid loan. Says this 40-year-old bachelor: "I'm just a natural scrapper."

Last week when Norman C. Norman turned up at the Electric Bond & Share stockholders' meeting, it was obvious there would be more news than just a reading of the annual report. Nothing happened until after Chairman Clarence Edward Groesbeck had given an accounting of his 1935 stewardship. Then Stockholder Herbert Claiborne Pell proposed that the corporation make no effort to influence public opinion against the Public Utility Act of 1935. Stockholder Pell, onetime (1921-26) Democratic State Chairman for New York and onetime (1919-21) U. S. Representative, argued that the more the company protested against Government interference, the more the Government was certain to interfere. Then up jumped Stockholder Norman C. Norman. He was emphatically opposed to Stockholder Pell's motion. The Administration, he said, had already passed many illegal measures. Utility managements would be grossly careless in failing to take every possible measure to protect their interests. Gesturing toward the table at which sat Mr. Groesbeck and other Bond & Share executives, Mr. Norman cried: "If they don't fight, the gentlemen running ' the companies will be on the WPA rolls in a few years." Stockholders applauded Norman C. Norman, called New Dealers "crackpots and Communists," shouted down the pacific proposal of Stockholder Pell.

No holding company makes a better target for the Utility Act than Electric Bond & Share. Through five large intermediate holding companies it controls operating companies which supply electricity and natural gas to 4,800 U. S. and 900 foreign communities. It is up to its ears in the business of managing, financing, otherwise serving its subsidiaries. In 1928 almost half its income came from service fees, and, though the proportion has dwindled since Depression, the shrinkage came through no will of the parent company. There is nothing shaky about Bond & Share. It owes no money. It has $38,000,000 in the bank. It does not borrow from its subsidiaries; in fact, it has loaned them $90,000,000. And if the Public Utility Act were discretionary, not mandatory, Bond & Share might be allowed to live. But should the Public Utility Act survive the test of constitutionality and the Administration survive the test of the next Presidential election. Electric Bond & Share would occupy the No. 1 cell in the industrial death-house.

Chairman Groesbeck said little last week about the Public Utility Act, except that he did not see how his company could meet the provisions of Section 11.* Neither did he say much about Electric Bond & Share. He spoke of its operating companies, their health and prosperity. In the last year, and in the U. S. alone, they got 75,500 new customers for electricity, 17,900 new customers for gas. For the week ending Sept. 26, 1935, an electric output of 215,000,000 kilowatt hours marked an all-time peak for the system. Domestic gross was up 5%; net, 4%.

But despite these encouraging statistics. Electric Bond & Share itself made only $9,264,973--hardly more than enough to cover its preferred dividend and poorest profit year of the entire Depression period.

Mr. Groesbeck did make one reference to clouded horizons. He said that the Social Security Act would cost the Electric Bond & Share system $2,200,000 in 1938 and $3.200.000 in 1949--"if we are permitted to live that long."

*This very vital section limits holding companies to integrated operations in contiguous territory--a provision obviously impossible for Bond & Share to meet.

This file is automatically generated by a robot program, so reader's discretion is required.