Business & Finance: Short Circuit

Short Circuit Just as aluminum holds the key to aircraft production, electric power holds the key to aluminum. Almost half of all U.S. aluminum is now produced in the Pacific Northwest, normally the source of abundant hydroelectric power. But last week that power was growing scarce; the Columbia River, which is studded with dams (Grand Coulee, Bonneville), was at the lowest level in 20 years. As a result, aluminum’s Big Three—Alcoa, Reynolds and Kaiser—were forced to cut their Northwest production as much as 10%.

To meet this threat to rearmament, Defense Mobilizer Charles E. Wilson sent wires to all three producers, asking them to draw up plans to remove at least part of their facilities to regions where power is more abundant (e.g., the Ohio River). As alternatives, he asked them to determine if the emergency could be met more economically by building additional standby steam plants in the Northwest. In alarm, Northwest Congressmen cried that the real solution is more hydroelectric dams.

The power shortage was by no means confined to the Northwest. Because of materials shortages, primarily structural steel, there is acute danger that the U.S. power industry will not be able to keep pace with rearmament’s growing demands. Warned the Defense Electric Power Administration: by year’s end, industries in many regions will face periodic stoppages in electric service. By the end of 1953, unless the power industry gets more materials, the shortage will amount to 4,000,-ooo kilowatts (5% of all present U.S. power capacity).