Montana Business Quarterly

Bureau of Business & Economic Research university of montana • missoula Montana Business Quarterly'W inter 1970 i MONTANA BUSINESS QUARTERLY WINTER 1970 VOLUME 8 NUMBER 1 The subscription rates for the Q uarterly are $4.00 per year, $7.00 for 2 years, and $1.00 per single issue. Reprints of the articles are not available but additional copies of the Quarterly may be secured at $1.00 per copy. All inquiries regarding subscriptions, publications, etc., should be addressed to: Dean, MONTANA BUSINESS QUARTERLY School of Business BUREAU OF BUSINESS AND ECONOMIC RESEARCH Administration RUDYARD B. GOODE UNIVERSITY OF MONTANA MISSOULA, MONTANA 59801 Director, Bureau of Business and Economic Research RUDYARD B. GOODE Editor The Montana Business Quarterly, published by the Bureau of Business and Economic Research, School of Business Administration, is a service of the RAUF A. KHAN University of Montana, Missoula. The contents of this publication may be re produced without the consent of the publishers and/or the authors. Proper credit Editorial Board should be given the Quarterly and its contributors for the use of any published m aterial. Ma c k e y b r o w n Contents of the Quarterly reflect the views and opinions of the authors and Pa t r ic ia p . d o u g l a s do not necessarily represent those of the Bureau, the School of Business, or the University. Wil l ia m d . d i e h l Application to mail at second-class postage rates is pending at Missoula, MT. m a x in e c . J o h n s o n 59801. In This Issue I K. Ross Toole FROM THE DIRECTOR’S DESK 10 Harry N. Jackson CREDIT AND COLLECTIONS Maurice C. Taylor REALIGNING MONTANA COUNTY GOVERNMENTS 20 Joseph R. Mason COMMERCIAL BANK SUPERVISION AND EXAMINATION 37 Ronald S. Paul THE SCIENCE BUSINESS From The Director’s Desk . Environmental Degradation in Montana K. ROSS TOOLE In this day and age (and perhaps it has al As early as 1885, the women of Butte organ ways been somewhat true) the debate about ized the counterpart of today’s “GASP” and serious issues tends to get quickly polarized. protested to the mayor. But from the 1870s One finds oneself pushed from the middle until 1891 the mining companies in Butte con ground where, historically, most solutions lie— tinued to roast ores in open pits. In the latter pushed left or right by emotionalism, oversim year, when the Boston and Montana Company plification and the passion involved in the issue. began roasting an unusually huge mass of ore, Like the introduction of flourides into our fifteen people died within forty-eight hours and drinking water, sex education in the schools, hundreds grew violently ill. Then, and only and the ABM, the mere title of this paper imme then, were the mining companies enjoined from diately lends itself to extreme views, vehe open-pit roasting. mently expressed, pro and con. In Montana’s Constitutional Convention of Let me confess at the outset that I hold strong 1889, W. E. Burleigh of Custer County, in ar opinions and that I propose to express them guing against Butte and other mining centers vehemently. I have, in other words, been polar as the location for Montana’s capital said, “A ized. I can only defend my vehemence with the man there has to resort to whiskey to slake his assertion that for the past year and a half a thirst for fear of being poisoned with the water group of graduate students and I have been in that percolates down through the poisonous soil vestigating the history of air and water pollu and the guts and gutters of the country.” He tion in Montana, specifically, and in the North described Butte at high noon, with all the street west, more generally. We have made repeated lights on, “. yet,” he said, “you could not see efforts through this investigation to find the a gleam of light from either side of the street. middle ground where rational men have often I retired to my bed. I had not been there thirty worked out solutions—and we have thus far minutes before I felt that some demonical fiend been unable to do so. The evidence, both his was there injecting boiling lime into my lungs.” torical and scientific, keeps pushing us not only There was, said Burleigh, one advantage to liv toward categorical statements, but also toward ing in Butte, “It must be very consoling to know growing indignation. that the transition from this world to hell will Air and water pollution in Montana are very be so slight that you will never notice it.” old. One commentator described Butte in the W. A. Clark answered Burleigh by asserting 870s thus: “. on a windless day the smoke that “... the ladies are very fond of this smokey ay so heavy at mid-day that lamps were burned city . because there is just enough arsenic and thieves were as fearless at noon as at mid here to give them their beautiful com night.” plexion. ...” Clark went on to say in all serious- r‘ R°ss Toole is Professor of History, Department of History, University of Montana, Missoula. Winter 1970 6 K. Ross Toole ness, citing the best medical opinion, that huge and sparsely populated land simply ab Butte’s smoke was a disinfectant, that it pre sorbed the pollution. Public anger was periodic vented diptheria and other diseases. “It de but ineffective; land, livestock, rivers, and stroys microbes,” he said, and added, . it people were ruined, but anger and the demands would be a great advantage for other cities to for abatement simply withered in the face of have a little more smoke and business activity the power of industry, the enormity of the and less disease.” country: the great open spaces, and the seem Throughout all these years, the mining indus ingly limitless natural resources at the beck of try spewed tons of arsenic and other poisons anyone with the guts and money to exploit across the countryside, killed vegetation, live them. But that was then, and this is now, so let stock (and people) without hindrance or let; it me address myself to today. polluted rivers and arrogantly resisted all pres Some Montanans hold the view that we must sures to abate or improve the situation. explicitly define what we mean by clean indus In 1911 the Anaconda Company was sued by a tries; that attractive living conditions by them group of farmers in the Deer Lodge valley for selves are not going to attract industry; that damage to their crops and livestock. The deci clean air and water and recreation should be sion, in this “Bliss Case,” went against the regarded as “bonuses,” while the only cogent farmers: one, because the company in 1903 had question is, can industry make a profit in Mon erected a large smoke stack and was reclaiming tana? tons of arsenic from new flues; and, two, be cause, “. the operation of the smelter and the But a clean industry is easily defined: it does mines . .. constituted one of the chief industries not contaminate the air or the water. If that is of the state on which a large part of the popula too simplistic, then let us consider the alterna tion of Butte and Anaconda depended, directly tive. Does a kraft pulp mill foul the air and or indirectly, for a livelihood.” water? Is a glue factory placed in a valley of This lawsuit was preceded by the direct demonstrated inversion conditions going to at threat of President Theodore Roosevelt, via the tract further industry? A vast bulk of scientific Department of Justice, to force the Anaconda data demonstrates beyond peradventure that Company to clean up its operation. Indeed, the we have dangerously fouled our own nest. Attorney General of the United States did file We have, for instance, oil refineries in Mon a bill of equity against the company providing tana polluting both the air and water. Let us for an injunction until the company “modified examine their general record. The oil industry its operations to prevent injury to vegetation in America is spending about a million dollars and public forest lands.” The Attorney General a year on the study of the effects of sulfur asserted that the company had resisted all ef dioxide as a pollutant. (Independent research forts to change its smelting practices. The gov clearly indicates, incidentally, that sulfur ernment alleged that 1,000 square miles in Mon dioxide is a deadly and pernicious poison and tana had been blighted by fumes and poisons. pollutant.) The industry is proud of its expen But the Bliss Case decision was rendered in 1911 ditures on this study. Yet the combined net and the federal government dropped its suit. income of the 26 leading American oil com The pressure exerted by Anaconda and allied panies in 1967 was $5,310,733,000.1 So the indus industries on the Department of Justice was try is spending on this vital research (vital from enormous. It is equally evident, however, that the public’s point of view) l/50th of 1% of their only the threat of federal involvement brought combined net income; need one mention what a response from the company. And, even at good this small investment has done in the that, it took the explicit and publicly expressed Santa Barbara channel affair? Might one sug agitation of the President of the United States gest that this is inadequate and nothing much to get action.

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