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INAUGURAL ADDRESS

OF GOVERNOR

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EUGENE TALMADGEi

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DELIVERED TO

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T.HE GENERAL ASSEMBLY~

OF GEORGIA

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JANUARY 16, 1935



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Inaugural eA.ddress
of
governor cugene 'Talmadge,_;
January 16J 1935
MR. PRESIDENT, MR. SPEAKER, MEMBERS OF THE GENERAL ASSEMBLY OF GEORGIA, AND MY FELLOW COUNTRYMEN:
Two years ago I raised my hand to Almighty God and subscribed to the oath which I have just repeated.
During these past two years we have been busy here in the State I think we have accomplished some things that are fundamental, and I wish to briefly give an accounting of this stewardship to the General Assembly of Georgia.
Two years ago, just after the General Assembly adjourned there was certain legislation which had been pending before that body and which had been voted on by the people. The House and Senate did not get together on this legislation. So, right after the Legislature adjourned, I issued an executive order, declaring the price, or exempting our people from paying more than $3.00 for all automobile, truck and bus tags in the State of Georgia.
That action, my fellow countrymen, saved the people in Georgia, in 1933, $2,515,060.33. That same Executive Order
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was repeated in 1934, and during the year 1934, the amount that was suspended and left'with the people amounted to $3,042,672.83.
However, I might add that during 1932, we had 287,198 motor vehicles registered in Georgia and sold that many more tags at the old high price. During 1933, or after the reduction, of the price of tags to $3.00 it rose to 319,446 motor vehicles, and in 1934, that number rose to 396,685-or an increase in 1934 over 1932 of 109,487 motor driven vehicles in the State of Georgia.
I might add again that the increase in gasoline consumption was $2,973,242.55; that is, the 6 cent tax that comes to the State increased in the amount of $2,973,242.55 during the year 1934 over the year 1932, and with the amount received from the tags and the extra increase in the income from the gas tax, there is very little difference in the revenue of the State by the price of tags having been reduced to a flat rate of $3.00.
I might add this: The 109,487 additional motor vehicles on the highways of Georgia certainly furnishes thousands of jobs to people working in garages, selling tires and automobile fixtures.
I believe that a step out of our economic depression was gained from the reduction to the flat rate of $3.00 for tags, and this contributed more than any other move that could have been made at the time.
After that, my fellow countrymen, I made a trip all over Georgia. I knew that millions of dollars were being expended by the Highway Department. I had an itemized list of the expenditures, which was filed with me, under the provision of the Budget Law, which you enacted in 1931, and on that list there were over 300 engineers, about 175 linesmen, rodmen and draftsmen. Having just made the trip over the State, and seeing sometimes, squads of a dozen or more engineers surveying a road that had already been graded, and bridges that were al-
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ready built, I thought that the overhead of the Highway Department should be reduced, especially when schools and other Departments of State were underpaid, and our school teachers had not, in some cases, had their salaries in two years.
I knew we could not tax our already tax-burdened people more, and I thought the thing to do was to cut down all useless overhead in that giant fiighway Department that was spending over one-half of the revenue of the State. I insisted that the Highway Department accept the amendment of the budget. When they refused to accept these amendments, and wished to operate without any budget, it became my duty to place men on the Highway Board who would obey the budget laws of Georgia.
I appointed three new men, and I am proud to tell you that since the reorganization of the Highway Department, and I _am quoting the Auditor's figures, we have saved in the overhead expenses in 1933 $1,134,088.17, and in 1934 $1,134,000.00.
There were other activities that the law imposed upon me as the Chief Executive of the State.
During the war, utility rates were advanced in some instances 100 per cent, and we did not care. We thought they should be because the price of labor and materials and everything else was getting higher.
But, after the war, instead of the utility rates coming down, in a great many instances, they advanced, and freight rates in particular, had advanced three times after our boys came back from across the seas.
My countrymen, I looked into the law. I looked into the rate charges. I knew my telephone down in Telfair County on the farm, had advanced from $1.50 per month during war times to $2.25 per month, and I found that here in Atlanta the cost of a business telephone had advanced from $5.50 to $10.00.
I knew that all transportation rates and passenger rates had advanced so that if you shipped produce over the railroads it
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would hardly bring the freight. I knew that before passenger rates were lowered, even the lawyers for the railroad companies, who rode on passes, hated to ride on the trains because they were so lonesome.
A petition was filed with me, complaining of the action of the old Public Service Commission by the Georgia Federation of Labor. On this petition, I filed a rule nisi to show cause before me why they should not be removed if the charges were sustained, and after an investigation of 19 days these charges were sustained, at least to this point: All five members of the Commission swore on direct questions by me that the old rates were reasonable, and as low as they could get them, although all other prices had come clown, and that it was reasonable and right to keep the power rates, the telephone rates, and the transportation rates up at the price they were when cotton was 40 cents a pound and corn $3.00 a bushel. After cotton dropped to S cents a pound and corn to 40 cents a bushel, these rates were kept just as high.
'vVe removed the old Public Service Commission and appointed five new men, and a special report of the evidence that developed in that hearing will be filed with you, ladies and gentlemen of the General Assembly, on the 11th clay of this sessionthat is as soon as the law permits, and in that report will be found all the evidence that was brought out at that hearing.
After the appointment of the new Commission, they took up the reduction of utility rates, and I want to report to you what they did.
They reduced the freight rates-the intra-State rates, that is the hauling inside the State and this is the only one they have any jurisdiction over, 17%, and in some instances, more. I wish to state here that the Southeastern territory, that is the territory south of the Ohio River pays on inter-state shipments 33 1-3% higher than they do in the official territory that is, north of the Ohio River. In other words, you ship goods into Georgia from the northeastern States, or the central western States, bring it down here and take the same articles and ship
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them back to the point of destination, and the charges will be three and one-half times more than the charges for sending them into our State.
Talk about calling on manufacturers and businesses to come into Georgia and this section, and they ha,ve a handicap of 33 1-3
% on transportation charges! Before this General Assembly
adjourns, I hope that you will pass a resolution calling on our Congress to equalize the rates and make them on a mileage basis from all points in the country.
I won't take time to itemize them, but the new Public Service Commission has not shown any favoritism. They have a conservative estimate of the reductions in utility rates in Georgia per annum, without the increase in business on account of new customers, which amounts to over $6,000,000 per year. I wish to say when, they reduced the telephone rates in Atlanta from $10.00 to $7.50 they reduced the others in proportion.
During the first six months after these reductions went into effect, the telephone company put in over 40,000 additional telephones in Atlanta alone. When they reduced the rates of the Georgia Power Company and other power companies, I had a statement from the companies that their demands for new installments were so large they could hardly get the men to put them in.
You people know what happened on the railroads when they cut their rates. I used to go to the Terminal Station, and to the depot at Waycross, or Albany, and there would be more employees than passengers there. But now, take a trip to these stations, and you will see them filled with people who are riding on the trains, and freight trains are stretched out and getting longer.
Right here I want to say that with reasonable freight rates and transportation rates, you are crowding the trains and need a full-crew law.
My countrymen, I wish to state to you one other activity we have had. Along in July, after our efforts with the utility
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rates and with the Highway Department, it was my duty to levy the State ad valorem tax.
The law provides that we can not exceed a levy of five mills. For years, it has been five mills, with varying exceptions. Some have reduced it to 4.93, and some to 4.98. Hon. John B. Gordon levied a flat rate of four mills and for the first time since Gordon was Governor of Georgia, we again went back and cut the ad valorem tax 20%, and put on a flat rate of four mills.
In 1933, the reduction of one mill in the State ad valorem tax saved the people of this State, and left in their pockets, $1,245,229.25. In 1934, the assessment had been reduced on property, and we saved on this reduction of one mill $979,773.29.
Right here, I wish to call your attention to this: The people here who get their tax receipts know. Look at them-the smallest bracket is the State tax, and I think the reason for it is because it has always been under the spotlight.
The State Auditor published the rolls in the newspapers, it would be used in practically every State campaign. We have kept it reasonable and kept it down.
But this is the sad part. I have received letters from residents of counties, saying that as soon as the State cut the ad valorem tax one mill the county added on two mills.
I wish to call your attention, ladies and gentlemen of the General Assembly to the fact that there are counties in Georgia with a county levy, independent of the school levy, as low as three mills. They are up-to-date, thriving counties, with good towns and good schools and progressive and are getting along all right.
Ladies and gentlemen of the General Assembly of Georgia, you could not do a better thing at this session of the General Assembly than to do for your counties and municipalities just what has been done to the State. Place a limit on the amount of taxes they can levy.
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Now, my countrymen, these are some of the activities that we have had during the past two years while you were away.
I welcome you here, the State welcomes you, the people of Georgia, I mean the working people, the men and women who are out trying to work for a living and pay taxes, and are not looking for relief-these are the people who are looking to you.
Now, let's see. There has been a great deal said as to where the money goes in Georgia. I wish to state to you in a brief way where some of it goes:
Our largest expenditure, not of the State alone but of the State with the help of the Federal Government, (and the last allotment we received from them was $10,000,000) is for highway purposes. The largest expenditure of the State is $12,000,000.00 by that Department.
The schools of Georgia cost its people $16,792,185.50 per year. In other words, Georgia taxes per pupil, white and black, amount to $17.75 per year, for education. This is what the State Government pays outside of matriculation fees, or other incidental fees that are charged.
Right here, I wish to say that there has been an indebtedness that has been outstanding to our school teachers scattered over the State, some in one county, and some in another, of approximately $2,000,000, or over. There has also been an indebtedness to our Confederate pensioners. They are receiving 100% of the amount you gave them now per year, but in the past they have not been paid in full and some is still outstanding.
In the Highway Department, we have saved up $2,000,000 in cash and are asking you members of the General Assembly to take this $2,000,000 and divert it for the purpose of paying up the past due indebtedness to the school teachers and Confederate pensioners proportionately.
I wish also to call your attention to this: The Constitution of this State provides, and I am glad we have the Judges of the Court of Appeals and the Supreme Court listening to my
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words, that the State, the counties and the municipalities, that is every town or city in Georgia, cannot incur a debt beyond the fiscal year, and that is the calendar year, with the exception of a bond issue-and they made an exception for educational purposes.
Georgia was the first State to put that limitation in the Constitution and Bob Toombs was the author at the Constitutional Convention of 1877.
After this limitation was put in our Constitution in 1877, sixteen other States in the Union adopted the same Constitutional limitation as Georgia.
Georgia is better off financially than any other State in the Union.
Her bonds are selling at a premium of from 17 to 20% above par. We have been placed in this enviable position on account of the fundamentals of our Constitution.
I wish to say now that I challenge the moral right of a government to spend more money than it has.
If you get $8,000,000 from your taxes, how can you spend more than that and be morally right? If you do, you are putting a burden on the people you represent.
In other words, if Judge Russell, Charlie Redwine and I, were a committee to whom a private individual had turned over $50,000 to go to New York to buy a bill of goods, and we went up there and bought $75,000 worth and shipped them back to the person with a Bill of Lading, we would not be acting morally right, as trustees.
I think this comparison is identical. After all, we are trustees of every one in Georgia.
During my campaign, I told you if I was your Governor two more years, I would pay up the balance of the State's indebtedness, in toto, and not raise your taxes one dime.
Let's see what has been done along this line during the past two years:
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\Vhen I came into office there was a total indebtedness outstanding as of December 31, 1932, of $7,523,835.82. This amount was reduced in 1933 to $5,384,355.24, and on December 31, 1934, this debt had been reduced to $4,024,566.15. We have the $2,000,000 saved up in the Highway Department, and if the General Assembly sees fit to divert it for the payment of the back indebtedness to our school teachers and Confederate pensioners, this indebtedness will be cut in half.
Now, my countrymen, there have been two other major activities in the past of which I had the power to approve or disapprove, and I wish to report to you my actions:
There was a great deal said in regard to ail of the States borrowing as much of the P\VA money from the Government as possible. It was argued that 30% was a grant and that as 30% was a grant and the interest was so low on the remaining 70%, it was of great interest to every State and county to develop and put up all the buildings they needed.
This was based on the best of motives and I admire it.
I had just taken the oath of office at the session of the legislature that I have taken this morning, to uphold the Constitution and laws of our State.
There were seventeen other States in the Union that had the same Constitutional limitation that we have in Georgia, that they could not incur a debt beyond the fiscal year.
Let's see what has been done in Georgia.
There was a great deal said about building a penitentiary in Tatnall County. I made several trips to Washington to see what could be done about it. Mr. Ickes, Secretary of the Interior, said that the only way we could borrow money in our State would be for the Federal Government to buy a tract of land in Georgia, put up the buildings, and if Georgia agrees to rent it, they will put a rental value on it and at the end of a certain term of years the property will return to the State of Georgia. This rental contract was approved, and also the building of this penitentiary in Tatnall County and the con-
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tract has been signed. It is up to the General Assembly of
Georgia, if they wish to rent it year by year. In this, Georgia is safe.
The other major building project in Georgia was the building of several buildings for our University system over the State.
The University is dear to the hearts of all of the people of Georgia-the University, with its traditions of -Alexander Stephens, Bob Toombs, Emory Speer, and thousands of others whom I could name, who have been a boon to humanity.
I can cast my eyes over the auditorium, and see a number of men who were students at the university when I was there, and walked those campus grounds. My son is there. My father was a student there, and also my grandfather. I glory in that College and am willing to fight for it.
We had a proposition put up at first to borrow around $3,000,000. Afterwards, it was cut to $2,800,000.
Our Constitutional limitation was before us, and finally able counsel, some of them members of the Board of Regents, and Mr. Ickes of the Department of the Interior, said, we would have to have a ruling as to whether this Constitutional limitation referred to the Board of Regents. This went before the Supreme Court of Georgia, and that Court held that the Board of Regents were not officers of the State, but a separate, independent corporation, and that the limitation of the Constitution, keeping them from going into debt did not apply.
You cannot get out of debt by going into debt.
I have no criticism to make as to the judgment of the Supreme Court. I have not examined the law. I am presuming that their ruling construed the law properly, but, I have this to say to this General Assembly, that you should pass a law declaring the Board of Regents officers of the State and subject to the laws and the Constitution of this State, just like all officers of the State. And let's have it understood that the property of the Board of Regents and the University System
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of Georgia is the property of the State. This includes the old Capitol and the old Mansion at Milledgeville. Let's keep this property the property of the State of Georgia.

Last year, through this Union there were strikes. Out West, they had a sailor or dockman's strike, which shook almost the whole of the United States. After this they had strikes in other States.

Our Sister State of South Carolina had over a thousand National Guardsmen on duty where they were having strikes at the various mills. People had quit work, which they have a right to do-and I respect the right of a man to stop and strike when he wants to-but I also think this, I don't think it, I know it; Whenever a man quits work and strikes, he should leave and not interfere with anyone else who wants to work.

I am glad I am talking to some of you who are farmers.

What would you think if some of your cotton pickers went

on a strike? Some of them strike on my farm sometimes, but

they don't hang around, they go on over to some other place

and start to work.



What would we think if our cotton pickers struck, and began to guard our lots and mules, and would not let anyone else come in!

Confronted with this, and with petitions from the superior court, the sheriffs of the counties and where it was located in the municipalities, petitions from the mayors, saying they could not control the situation and requesting me to send the troops there to protect the great constitutional rights of the people, I called out the troops last September and declared martial law.

These troops went to several sections of Georgia and in a short time peace was restored. I did not revoke that order of martial law, as there have been little intermittent uprisings in different sections, so we have kept it on and the last call we received was about three weeks ago from Rossville.

There was a strike at the Richmond Hosiery Mills, which is

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within about 100 ft. of the Tennessee line. Anyone could stand over the line and throw rocks, and anything was likely to happen. They put it up to me. They were having nightriders, and destroying people's property. The sheriff, then the people, and the mayor and the judge of the superior court called on me to protect and defend the Constitution of Georgia and the property and lives of the people, and so we sent the troops there.
This morning, we were notified that the prisoners who had been taken up during the strike were released, the troops were going home, the mills busy, and the people at work.
I expect I know nearly every pig path in the State and every creek, and river and branch.
I can ride by thousands of homes in the country, and know the names of the people who live there.
'vVe have a wonderful State.
In conclusion, you men here from Rabun Gap to Tybee lslarn;i, and from the plains of Alabama to the roaring Atlantic, are here to help either in passing laws or killing laws for the people who are back at home, hard at work, burdened down with taxes.
The only way I know that a government can help the people is to stay out of business, and be a fair referee between the people, and let its citizens do the business, and then take just as little toll as you can out of their property for government.
The only way to have an honest government is to keep it poor.
You can't help the people by giving them something. You weaken their soul and their heart, and dry up their muscles, but if you save them something, you encourage them to go on, branch out in business, and hire people.
What we want in Georgia is a busy, prosperous, happy, Godfearing people.
EUGENE TALMADGE.
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