Interview with Ralph Carnathan, February 15, 2018

MUMMERT: The following is an oral history interview conducted as part of the Tennessee Valley Authority Retirees Association Oral History Project. The person being interviewed is Ralph Carnathan.[1] Dr. Carnathan is a retiree of the Tennessee Valley Authority (TVA). He worked at TVA for 26 years between June 1962 and August 1988. He is being interviewed by Dr. Philip Mummert as part of the oral history project. The interview location is the Bicentennial Volunteers/TVA Retirees A--Association Office in Knoxville, Tennessee. Today is Thursday, February 15, 2018. The interview is now beginning. --Uh--Ralph, thank you for participating in this. I'm going to begin by asking you--uh--what were the circumstances that lead you to being 00:01:00employed or being hired at TVA?

CARNATHAN: I was completing my MBA degree at Mississippi State. And--uh--various organizations, businesses and other organizations would come to the university campus to interview. --Uh--one signed up if you wanted to interview, and I saw that a TVA personnel officer was going to do interviews and I signed up and interviewed Sidney Painter, I still remember his name, from the Muscle Shoals Personnel Office. It was a general interview, and he took the information back and, then I got a call that asked me if I could meet a person in the Tupelo District office for a further interview. I agreed and met T. Graham 00:02:00Wells, who was the Distributor Marketing Branch Chief in Chattanooga. Had a good interview--uh--. Mr. Wells was also a Mississippi State graduate, which didn't hurt me any, and we had a good interview. And--uh--then final interview was a phone interview with the section where I would be working with the section supervisor, that was by phone, on the campus at Mississippi State.[2] At the end of that interview, he indicated I would be receiving an offer from TVA. That subs--subsequently arrived, and I accepted the offer and went to work for TVA in Chattanooga in June 1962.

MUMMERT: And now, you had--uh--two degrees from Miss--Mississippi State at this point?

CARNATHAN: I did, I had a bachelor's degree in Business Administration and an MBA degree. The MBA degree was a fairly new degree in those days it 00:03:00had--uh--gotten started and Mississippi state was in the formative stages of setting up their MBA program, I was one of the first graduates.

MUMMERT: --Uh--when you--uh--were hired at TVA, what was your--uh--first job and what was the nature of your responsibilities?

CARNATHAN: The Distributor Marketing Branch was in the Division of Power Marketing. It had a section entitled the S--Special Studies Section, that's where I was assigned as an economist. The--uh--Distributor Marketing Branch had contracts sections that worked on distributor contracts, and rate section. The--the Special Studies Section however, did a variety of jobs, whatever came up that didn't fit into the--uh--fit into the other groups--uh--that's what we did--um--. And--um--we had six people that worked in that section plus a supervisor. I remember--uh--when I arrived, there was a lawsuit, 00:04:00there were 160 distributors with TVA including, REAs, Rural Electric Cooperatives and municipal distributors. And as you can imagine out of 160, there were--uh--many, many, many issues. --Uh--all of the distributors obviously had industrial customers. --Uh--there were conflicts and there were--uh--things--issues that came up. And--uh--I remember when I arrived, there was a lawsuit in process and studies were being carried out for our section supervisor to appear as a witness. --Uh--that lawsuit went on for quite a while. I don't remember exactly the issues, but I do remember one--one other project that I worked on. A distributor wanted to contribute to a city 00:05:00program, and he was prohibited from doing that because it wasn't allowed under the contract. He appealed and asked for permission to do that. Obviously, permission couldn't be given to one distributor, so it had to be looked at--uh--in totality. We looked at the request, what the purpose was going to be--uh--how much revenue was going to be lost--uh--all those sorts of analyses that go into it. And we recommended that--uh--the contract be revised to allow distributors to make contributions to projects like this. And that was kicked up all the way to the manager of power and they--uh--accepted it and the contracts were revised, those sorts of things. And--uh--it was interesting, we had--uh--four--four engineers and myself and I were economists. And we had a variety of issues that we worked on. In those days of course--uh--you 00:06:00were talking about power marketing. --Uh--that is quite different then some--uh--days down the road when we were talking about power conservation. In those days, you promote--you promoted the use of power. You wanted--uh--power to be used in every way possible. And--uh--the Division of Power Marketing worked with distributors--uh--in promoting the use of power. Distributors had programs like--um--home economists that worked with TVA home economists to promote use of power in--uh--electric appliances. They had an all-electric home being promoted. Those sorts of things--uh--would--uh--fall by the wayside as the years past. But, in those days we were in the business of marketing power.

MUMMERT: In 1962, when you began--uh--TVA had begun--uh--producing 00:07:00power through--uh--burning of coal. Is that right?

CARNATHAN: That's right.

MUMMERT: Not too many years beforehand. And--um--at that time--um--you can describe this any way you want, but how big was the TVA power service area?

CARNATHAN: Well, I--I assume the service area was--was the same through the years--.

MUMMERT: It didn't change much since then?

CARNATHAN: No, I--I don't think the service area changed very much. --Uh--I remember Kingsport was--was not a TVA power distributor, and later it became a distributor. There may have been some movement around the edges, and but--but there was no major difference in the power service area than the power service area today.

MUMMERT: This is Kingsport, Tennessee?

CARNATHAN: Yes.

MUMMERT: When--uh--you began at TVA, where were you working in--?

CARNATHAN: I was working in Chattanooga. And--uh--we did some travel--uh--to meet--uh--with distributors--uh--. We--uh--you know, went to meetings occasionally, but mostly my job was--uh--on the 8th floor of the power board building in Chattanooga.

MUMMERT: You may not remember exactly, but how--about how many distributors were there at that time?

CARNATHAN: There were 160. 160. REAs and municipal distributors, I don't remember the mix.

MUMMERT: Well, are there any other--uh--special studies that you got involved with that--uh--are memorable during your early year or two?

CARNATHAN: [3]No, I remember that we had a backlog of studies, there were issues--uh--that you can imagine that would come up. Some trivial issues and some important issues. We dealt with those as we 00:09:00were assigned. And our--um--supervisor and the senior people in that section had a relationship that they had built up over the years with distributor managers. There were five district offices of power--uh--scattered around the TVA region, and everything you did with the distributors you--you went through and kept a district manager informed. And so there was a close relationship with each of the five districts in the TVA service area. And--um--it--w--it was an interesting job and--um--varied.

MUMMERT: How long did you--uh--how long were you in that job?

CARNATHAN: I was in that job--uh--2½ years.

MUMMERT: And then--uh--you went on to something different. I--I let me interrupt and ask you just to give a really--uh--uh--a--a thumbnail sketch of 00:10:00your whole TVA career and how you--uh--maybe moved up from one position to another or maybe from place to place.

CARNATHAN: I started in Chattanooga and--uh--was there 2½ years in the Office of Power. I then came to the Navigation Development Division [in Knoxville] and basically stayed there--uh--and--and the successor organization that came out of ND--uh--Navigation Development for the rest of my career. In--uh--while I was working--uh--in Chattanooga in the Special Studies Section, I kept hearing about a man named Mike Foster, who had worked in the Office of Power. He was well-respected and he went back to the University of Florida and took a PhD and then came back to TVA. --Um--his PhD dissertation, I remember, was 00:11:00entitled "The Nature of the Demand for Electric Power." TVA participated in some way, and I'm not sure all the things, in his getting the PhD and coming back. I don't know how that worked, except that when he came back, he didn't come back to the Office of Power, he came back to an organization in Knoxville, Navigation Development Division. For a long time, I didn't understand exactly what happened there. I knew there was a-- keen interest in what Foster was doing in Knoxville by people in the Office of Power. What he was doing was industrial development. If you're trying to build a power load, it's obvious that one of the ways--one of the best ways to do that is to get industry into the valley.[4] It does two things, it provides jobs, which was part of TVA's--uh--original--uh--purpose, and it builds that power load. So, there was a keen interest in Foster's work in Knoxville, but he was 00:12:00just getting started. And I kept hearing about it and I thought boy that sounds interesting. The problem was I didn't know Foster, had never met him, had no way to get to him. And so one Saturday, morning, I called just him on the phone. I called information, got his phone number, gave him a call. Told him who I was, told him something about my background. I had heard about what he was doing, it sounded interesting. I just wanted to tell him if there was ever a--an opening in his staff, I would like to talk to him about it. He was receptive and he said--uh--sounds like you might have what we may be looking for in terms of staff. If you're ever in Knoxville, give me a call. I said I'm going to be in Knoxville next Saturday. That could be called a slight exaggeration, or that could be called an outright lie. I wasn't about to be in Knoxville 00:13:00the next Saturday unless he could see me. But, he said that'll be great if you can come by my house, we'll have a chat. The next Saturday I drove up, went out to meet Dr. Foster in his house in Holston Hills, and we had a very good discussion. --Uh--I left--um--very optimistic about my chances of coming to work for him. Nothing happened for several months and then one day as me and my colleagues were coming up from the basement--uh--break area in the elevator in the power board building. It stopped on the first floor, the door opened. Standing outside the door was Mike Foster. He pointed at me and crooked his finger. --Uh--I went out and he said are you still interested in working for us, and I said Yes. He said--uh--you will be alerted to an opportunity, and that basically was the conversation. You can imagine when I got back to 00:14:00the 8th floor what my colleagues were saying: "What were you doing talking to Mike Foster"? I don't remember what I said. Anyway--uh--I got an envelope, personal, confidential it said the job from his secretary said the job Dr. Foster--uh--talked to you about will be posted on such and such date. It appeared, I applied and I got the job.

MUMMERT: Congratulations. --Uh--when you had that first meeting with him at his home--uh--what were some of the things if you remember, that he mentioned? What he was trying to do in this new position?

CARNATHAN: I do remember, it was a very interesting conversation. And he told me--uh--that what we're doing is industrial development. And TVA doesn't apologize for that. We're--i--industrial development is a phrase 00:15:00that's in the TVA Act.[5] We're supposed to be doing industrial development, but we are working with appropriated dollars. And there was an instance, apparently that a person from another state, an industry came from his state came into the Tennessee Valley, and he queried the board members, did you have anything to do with that, you know. So--um--TVA has to do this sort of under the radar. He said: "We don't have an industrial development program, we work with people that have an industrial program--industrial development program in the valley." And of course there were many. The states, there were five RIDAs--uh--that were--uh--we called them RIDAs--uh--Regional Industrial Development Associations that covered f--part of the TVA region, the North Mississippi Industrial Development Association, the North Alabama 00:16:00Industrial Development Association, Middle Tennessee, West Tennessee, and South Kentucky. There were no associations like that in the eastern part of the valley. --Uh--we worked with those people--uh---Foster's group worked with those people--uh--worked with the TRDA, Tennessee River Valley Association, headquartered in Decatur, Alabama. It promoted industrial growth along the--the river. And worked with chambers of commerce and industrial development organizations along the Tennessee River. Those are the things that--uh--that--that group did. It--the group, as I remember that Mike headed up--uh--was only a handful of people maybe five or six at that time when I came on board.

MUMMERT: Were the industrial development organizations--uh--that old at that point?

CARNATHAN: No, remember this is 1965, mid 60s, industrial development 00:17:00as a--as an endeavor started--uh--in the 50s. And a few of the--a few of the regional industrial associations, these were organizations that were sponsored solely by distributors of TVA power. And they covered the entire TVA region except for the eastern part. They started--some of them in the 50s, some of them in the 60s, so they were relatively new. They had maybe one or two staff people.[6] --Uh--what Mike was setting up was an organization to assist them--uh--with--uh--research, with--uh--engineering help, all the things that TVA had to offer that we could sublease and let--and let them help on industrial development. That's--that what the program was. We did not--uh--I say we, the--the program Mike described to me did not participate in recruiting trips, did not do overt exercises that put TVA in the 00:18:00limelight, did not meet with industrial prospects that somebody else had. We worked under the radar, but we assisted--uh--states, regional organizations and local organizations and their programs.

MUMMERT: And these--uh--regional organizations had just been created by the states at some point?

CARNATHAN: No, the regional organizations were strictly created by distributors of TVA power.

MUMMERT: Oh, I see and--uh--so and there were at that time, of course there was no federal legislation or impetus that encouraged economic development. So it was all because of the distributors and the--.

CARNATHAN: Yes--uh--one has to assume that the--that the TVA management encouraged the creation of those RIDAs, but--uh--I don't know that to be sure. But the distributors were the sole, they had no other funds, the 00:19:00distributors joined voluntarily. And it wasn't 100 percent. It--say in south Kentucky you might have--um--I'm guessing 26 distributors and maybe 20 of them would be members. Sometimes there was--um--a chamber of commerce in a local community that did not encourage--um--membership because there were turf battles, as there always are. And but most of the distributors in those areas were members. And they supported financially, and the staff worked on their behalf.

MUMMERT: In your new job--uh--what did you--what did you do?

CARNATHAN: We--we called on--we got in our car and we drove along the Tennessee River calling on--um--chambers of commerce, development organizations, such as there were at that time. And we would go in and say how are things 00:20:00going, what can we do to help you? Now, remember, these people--uh--usually a person and his secretary might have two people. They had no--uh--basic analytical--uh--people, they recruited by sending out letters. Say they would send 100 letters to businesses in New York, if they got ten replies, they would say we'd like to come up and see you and--uh--taut our state or our region in case you want to expand. Now that was basically recruiting the world, you know, there was no--there was no indication that any of those people were thinking about building a--a new facility. We tried to narrow that focus, we provided them with--uh--research--uh--such as it was, would be rudimentary at this time. But we used publicly-available information to show for e--example 00:21:00what industries were growing in the southeast. At least that narrows it a little bit--uh--what companies in those industries are growing and what e--expansion plans might they have. We might have a community, and again in those days, industrial parks was relatively new. A community might say, I need an industrial site, you know. A--a few acres and a cow pasture was not--was not good, you needed to have utilities in to it and roads, and so forth. So, we had--uh--engineers in the navigation engineering group that we would subcontract. And they would go out and lay out an industrial park for them. Now, we didn't do the final design. You couldn't have built a facility based on our layouts because we didn't want to compete with the private sector. But we did--we--we evaluated maybe three or four--uh--sites and said this 00:22:00one would be the best and here's a possible layout, those sorts of things we did. We also worked with the Tributary Area Development Office (TAD). TAD worked with--uh--organizations that they had set up, tributaries of the TVA region, Bear Creek Watershed Association, the Yellow Creek Watershed Association, the Upper Hiawassee. All of these organizations had committees that they were working with to try to better their communities. --Uh--they would have a recreation committee--they would have an agricultural committee, they had a business and industry committee. And TAD came to us and paid for our participating and helping work through th--those committees to help those communities. So we did the TAD work, we worked with communities along the river, and we worked with the RIDAs. And if other organizations came--and 00:23:00states came in and asked for our help, we did what--whatever we could to help any other organization in the TVA region that was doing industrial development work.[7]

MUMMERT: And--uh--this was--uh--pretty new at the time for TVA. --Uh--you mentioned in your new job though that--uh--it was called the navigation development.

CARNATHAN: The Navigation Development Division, our group was the Navigation Resources Branch.

MUMMERT: Okay, there was other work going on in the navigation?

CARNATHAN: There was a Navigation Economics Branch, there was a Navigation Engineering Branch. The Navigation Economics Branch kept up with barge transportation. They--they knew how many tons of product was shipped on the river. They kept up with the lockages at different locks. They--uh--did a shippers' savings analysis. They worked with companies that were looking at locating on the waterway in terms of navigation. --Um--they--they 00:24:00cou--they had a--uh--a little section that was absolutely the best at determining what transportation rates are. Not just barge rates, they had people that could tell you what it would take--how much it would cost to ship a product from point A to point B exactly, not an estimate, by barge and rail or by barge and truck and rail, they could tell you this was the--. They had rate books lined tariff--uh--rate books lined on shelves, and they were absolutely experts at transportation. Now, that of course was invaluable to companies that are looking to use the waterway. And so that's what the Navigation Economics Branch did. The Navigation Engineering Branch--uh--did sort of the operational. They had a--they had a boat--uh--uh--a boat with a--a crew in Muscle 00:25:00Shoals, and they worked with--um--the Corps of Engineers. The Corps of Engineers of course operated the dams, but TVA was totally responsible for the dams. If you had a problem at a lock, the Navigation Engineering group--uh--worked through that. Occasionally you would have to--uh--shut down a lock. And once or twice I think, l--locks were rebuilt to make them larger. You went to Congress, you got appropriations, the Navigation Engineering group did that. Occasionally you would have--uh--an accident. I remember one time there was--um--a barge that hit a bridge--hit a rail bridge. And--uh--that was a--that was bad, you had to shut the bridge down and all. That's what the Engineering group did. --Um--the engineering group also had people that we--uh--in other words, our little group, the Navigation Resources branch, used engineering and economics 00:26:00people to help us do our job. And that was perfectly good. I mean, we paid them out of our budget, and they came and helped us, they would do transportation studies. Or--uh--the people that--that--did the--uh--the--uh--industrial park came out of that group.

MUMMERT: The work that the Navigation Economics people did, was that pretty much standard at the time, do you know? Nationally, or was that something that maybe was unique at that point for TVA to provide rate information to industries that were looking around?

CARNATHAN: I don't know for sure, but I would say that was unique. I mean all of the other waterways, I think, were operated by the Corps of Engineers, only the Tennessee River.

MUMMERT: And the Corps would not have been doing that sort of thing.

CARNATHAN: I wouldn't think so, no I wouldn't think so.

MUMMERT: Well--uh--do you have any other--uh--or any stories--uh--for that period of your career that you'd like to add?

CARNATHAN: Well, there were--there were all kind of s--stories. 00:27:00--Uh--I remember we--.

MUMMERT: Have any favorites?

CARNATHAN: We--uh--we did--uh--go--to--we went as far as to say to local folks--or--in- ec--economic development and Ind--Industrial Development--uh--what do you need from us. And occasionally, they would need something that we just couldn't provide. So, I remember early on, we--uh--actually started hiring consultants to do a more sophisticated--uh--study.[8] And--and I remember going to New York, talking to and hiring a consultant to do a study on electronic components. This person had been--uh--the owner and--of a--of a--of a company that manufactured electronic components in New York. He knew all about it.[9] And he did that study, and we provided that study to--uh-- I believe one of the states, and they started promoting 00:28:00electronic components. --Uh--we had a group--a small group--uh--headed by Cynthia Simpson that got more and more sophisticated in what they were doing. They--uh--Cynthia's group did a branch plant location model that carried it one more step. What industries are growing--growing in the southeast, what companies in those industries are growing, what companies can we select that we think are growing fast enough that they made need a new branch plan. And so they did an analysis model which included transportation rates and other factors that showed you your best shot for--uh--optimizing your growth and profits in the TVA region. Now, all of the studies didn't show that though--the best spot, so we threw those in the wastepaper can. But those that showed that the TVA 00:29:00region would be a great location for your next branch plant, we farmed those out to the areas that looked like they would be the best fit for--for that. So as time went on, we ex--expanded our staff, we got more and more involved with--uh--organizations. We did more and more sophisticated studies, and I think we--I think we made an impact--uh--but again, always under the radar--always under the rada--never overt. Never for you know, TVA, never appeared as far as I know, never appeared at a--uh--groundbreaking ceremony for a new. We just didn't do that, we stayed under the radar and with good reason. That was--uh--that was--uh--that was--why--uh--TVA--uh--participated was to build the power load and to create jobs but not to take any of the credit.

MUMMERT: So--uh--you were in this position for--uh--how many years? 00:30:00You said it began in 1965?

CARNATHAN: [10]1965--uh--somewhere along in 19--late 1960s, I had a conversation with Mike and told him I would like to go back to school at some point and work on a PhD. He--uh--encouraged me, and one day he called me to the office and said if I wanted to do that--um--TVA would support it financially, give me time off and basically made an offer that I couldn't refuse. He also told me that one of the groups, oh--one--one thing I--I--I didn't mention--uh--when I came to TVA in Knoxville, the Navigation 00:31:00Development Division was headed by a man named J. Porter Taylor. A few--a couple of years maybe after I got there, the--the--uh--Director of the Division of Reservoir Properties retired, and the General Manager asked Porter Taylor to move over to DRP. That left that--that division director's position open, and Mike Foster, my boss, was promoted to that position. And there was--there was a change in the way things operated under Foster than there were under Taylor. Taylor came up through the Navigation group, Mike was an economist, not an engineer. He had a broader spectrum of things. And along about that time, another retirement--uh-- caused a reorganization. And Lawrence 00:32:00Durisch, who headed up the Government Relations and Economics Staff, which was--.

MUMMERT: How do you spell that?

CARNATHAN: D-u-r-i-s-c-h. He was a PhD from the University of Chicago, came to TVA in the early years. And that little group, as small as it was, had a lot of impact. Included in that group was a guy named A. J "Flash" Gray, a guy named Bill Stephenson. Gray worked in planning and Stephenson worked in a group--uh--called the Government Relations that--that administered Section 13 of the TVA Act, Payments in Lieu of Taxes. His group cranked out the information that paid states--um--a lot of money in lieu of taxes--um--. So that--.

MUMMERT: And this--and--and just to interrupt--uh--and explain, that was the system that was set up when TVA was created--uh--and remove taxable land from the roles because of what it--some of its projects.

CARNATHAN: TVA paid five percent of its revenue to states a--based on two factors--um--the revenue that came from those states and the book value of power property in those states. So, that was the split, fifty-fifty, and of course Tennessee got the lion's share, but--uh--Miss--. It--it was serious--serious funds. And--uh--so that group, instead of finding a replacement for Durisch it, was moved over to our group. And Navigation Development became Navigation Development and Regional Studies (NDRNS). --Uh--Flash Gray's group expanded, got into all sorts of things. Tellico was being--uh--studied at that time, and they looked at a new town--uh--called Timberlake. It--they were working with the Boeing Company, that project didn't really ever get off the ground, but there was a lot of work on that. --Um--Tellico was a you know, was big 00:34:00project, and--and--and the Navigation Development people were involved in--in a lot of that. So the NDRNS became a different organization than the Navigation Development. It was broader, it was more regional, and it undertook a more overt--uh---uh--overt position in terms of helping--uh--create jobs.

I--uh--went back to the University of Tennessee in 1970 and received a PhD in 1973, and Mike asked me to understudy Bill Stephenson--uh--in the--in the--uh--Government Relations--uh--group, which I did. --Um--shortly after that, he called me to the office one day and asked me to become the 00:35:00assistant to the director. So I had two jobs. Not too long after that, the chief of the Navigation Resources Branch resigned, and Mike asked me to undertake that. So we combined--uh--the Section 13 group with the Industrial Development group. They had absolutely nothing in common, but we combined those groups, and I was still assistant to the director. --Uh--this--this continued in terms of my participation in the program until--um--1978. In 1978--uh--big changes--uh--. Jimmy Carter was elected president in 1976, in 1977 he took office, 00:36:00and S. David Freeman was appointed to the board early in--uh--President Johnson's tenure. Dave came to the board--um--and then A. J. "Red" Wagner, his term ended in May 1977, and Dave then became chairman. And at that time, he was the only board member.[[footnote]]11[/footnote]] Dave had a completely different philosophy. He came to the TVA board with the--with the reputation of an environmentalist that he was, but as he got more acquainted with things, he became an advocate for economic development. And in the later stages of my career, he was a strong advocate, very, very helpful--uh--in--in economic development. So he--he didn't give up his environmental hat, but he put on his economic development hat. But, he also w--was of the opinion that all 00:37:00of this under the radar stuff was--uh--not the way he was going to handle things. He thought we should get more involved--publicly involved, and--um--he encouraged that. And he said publicly and privately that TVA is in the economic development business. And he--he would make speeches saying, "We aren't just generating power for the heck of it, we're generating electric power to help the people of the valley and one ways we can help is to develop--help develop jobs." We--uh--we were turned loose, in a sense, to do more things. He encouraged me to get involved in recruiting.

And--uh--the State of Tennessee called and said they we're sending--uh--uh--the Commissioner of Economic Development, and the Commissioner of-- 00:38:00uh--Tax Administration and--uh--the Laborer Commissioner--uh--on a tour of Europe and I want you to go, represent TVA. And Dave said go. So, I went as--as a TVA representative, and we promoted economic development, we met with companies in various places in Europe. We held seminars in Switzerland, and Germany and UK. --Uh--we set up a--um--Economic Development Conference in Knoxville, which we sponsored. We invited everybody in the region to come, we had several hundred people. And we would have speakers and we--um--we sponsored that. We made recruiting trips with local people that asked us to. We met with prospects. I joined an organization called the Industrial Development Research Council, which is a large organization that had--uh--semi-annual conferences where industrial development people came in and met with economic development people. We participated in that. So--uh--Dave brought--uh--to TVA a 00:39:00new view about our posture, and we became very much more--uh--publicly--uh--um--economic development oriented.

--Um--we--um--had a change in organizations about that time. NDRNS, well let me back up. Some--somewhere along in those months, early 1978, I believe, the general manager of TVA resigned, and the assistant general manager took his place. And he asked Mike to come over and help him instead of naming anybody as the assistant general manager. Mike went over informally and helped him. Well, that informal arrangement where Mike was coming back to our group and 00:40:00going over, he needed him all the time. So Mike--uh--sent out a memo that he was going to be working over there most all the time, that I was going to be the acting division director.[12] And that happened--uh--as I say--uh--I--I'm saying, 197--early in 1978, it may have been '77. --Um--then Dick Freeman came on board, and there were two of them, not long--too long after that Bob Clement came on board. But Dick and Dave had come up through the--uh--Office of General Counsel and were familiar with TVA. And they--they paired up and made a lot of changes in TVA. One of them being that they--uh--and--and the General Manager of course at that time, Bill Willis, also very supportive of economic development. They created an Office of 00:41:00Community Development (OCD). They brought in--they combined TAD, NDRNS and some other--uh--s--parts of TVA into the Office of Community Development. --Um--I was still acting director of the NDRNS[13] and became acting director of--of the group that did all the things I've described and then--um--I was promoted to Division Director--the Division of Commerce, which only lasted for a short time, and the name just changed to the Division of Economic Development. And that is where I remained, basically, for--for the rest of my career.[[ footnote]]14[[/footnote]] Economic Development--uh--had--uh--five branches. We did all things economic development. We were--we were 00:42:00involved in programs for TVA. We worked with states, we worked with regional organizations, local governments, we did everything we could to enhance the--uh--TVA region for--uh--economic growth.

MUMMERT: You've--uh--given a very good--uh--summary of the--um--changes that oc--organizational changes and the some of the people involved that happened at TVA say from--uh--1973 when you got your PhD until maybe toward the end of your career. I wonder if I could ask you to take that period of time, basically 1973 to 1988 when you retired and talk a little about--uh--how the field 00:43:00of industrial development changed or what changed it in terms of--uh--not only maybe how TVA was going about business, but the field in general?

CARNATHAN: There are a few things that I've ever experienced that's more competitive than--um--economic industrial development in terms of recruiting.[15] --Um--what changed was--um--the South, became the TVA region and the south in general, became much more--uh--a--a--uh--place where large and--uh--sophisticated industries looking--uh--. There was a time when the only--not the only, but a large part of the people who were looking at the TVA region were labor-intensive industries that were looking for cheap labor. And--um--the apparel industry for 00:44:00example, is a good example of that. Over the years that you're talking about, the apparel industry sort of slowly went away, and those jobs had to be replaced. And they were being replaced with higher--higher wage, better--uh--jobs. And during that period--um--things like the automotive industry began to look at the southeast. --Um--the--oh--the Board became more inv--the TVA board became much more involved working with states. I remember Freeman asked me to set up a conference at Fairfield Glade between the Tennessee Commissioner of Economic Development, and his key staff, me, and our 00:45:00key staff and Dave. We went over there and spent two or three days talking about what TVA needs to do, how we can help Tennessee--uh--. So TVA became more involved, it became more sophisticated. The South began to get more and more industries like Nissan--um--Saturn--um--uh--. Tellico opened up and Dave--uh--I feel like, would not have been in favor of that project at its inception, but it was there. We had 1,000-plus acres that--.

MUMMERT: Excuse me, when you said Tellico opened up, that means that the Tellico Reservoir and Dam had been completed, and had--there was some area then for development.

CARNATHAN: Yes--uh--I believe the--the gates closed on Tellico in 1979, and--um--Dave--uh-- is now responsible as the Board Chairman for 00:46:00something happening over there. And he was very interested in that happening.[16] And so--uh--Nissan just Nissan comes to town, they want to meet with Nissan--the board wants to meet with them. I shepherded them over there, then I took Nissan to Tellico, showed them Tellico. They were looking at other sites obviously--uh--in the southeast, three of them being in the State of Tennessee. Actually the one in Memphis was o--over the line in Mississippi, but that was the Memphis site. A Middle Tennessee site, and Tellico was the East Tennessee site. As you know, they wound up in Middle Tennessee. That was a big deal, we had never had an automotive plant located in the southeast. --Uh--never had--n--never had a foreign automobile company located in the United States, that was a big deal. You can imagine that--.

MUMMERT: Was that was--that the first--uh--foreign-owned automobile 00:47:00or vehicle manufacturer?

CARNATHAN: Yes, I--I feel certain it was. You can imagine the competition for that. You're talking about thousands of jobs--uh--um--hundreds of millions of dollars of investment, good-paying jobs. --Um--and here we are in the TVA region--um--competing and winning. --Um--that would not have happened, I can assure you--uh--in the early years in of my career in working with industrial. So--um--it became more--more competitive. The sophistication and the high-wage industries began to look more and more at the southeast and the TVA region. --Uh--we--uh--becam--became closer associated with the efforts. We were not parter--TVA was now a full partner in economic development, which it is today. --Uh--in the earlier years, we were not full partners, we were, as I 00:48:00mentioned, by--under the radar. We were now full partner and so when I left--uh--I think TVA's economic development program, I believe we had about 100 people in--in the division I had headed up. So that's a long way from the Navigation Resources Branch of the eight or ten people when I first came. And the things we did are were--much..

--Um--I suppose of all the things I'm the proudest of was the Nissan project. We worked with the State of Tennessee very, very closely. And I indicated to the commissioner, we have some excellent people in transportation analysis, we can do something for you that probably not many other people can do--other organization can do. We--if they will give us the--uh--the products 00:49:00that go into making the cars that they plan to make and tell us where they originate, we can tell you how much the shipping cost will be. Then if you can give us the markets for the automobiles, we can tell you how much those transportation rates are going to be. Transportation rates for something like that's pretty important. So they said good. So we go out to Los Angeles the guy's name was Ron Black, who was on our staff who was real expert in this, and Ron made a presentation. And they liked what they heard. And Nissan very confidentially gave TVA their--the products that went into their automobiles, and they told where they were coming from some of them were coming from Japan, of course. Some were going from Japan to Mexico, and another 00:50:00manufacturing--uh--happening there. And then a new product was coming out of Mexico. Ron could do all of that, he take the product from--from Japan to Mexico to Tennessee. And he did--they worked on this for a long time and came up with a big, thick report that--that gave Nissan all of that information. The--uh--the Japanese people at Nissan like detailed information, and they soaked that up. Well, there are 30 or 40 factors, I've determined, that--that determine whether--a--where a company locates. --Uh--some are a lot more important than others, of course. This was important. And when that announcement was made of the location of Nissan in Smyrna, I was at the announcement, and Dave Freeman spoke. The--uh--the big--uh--principals at Nissan of course spoke, 00:51:00and they gave TVA credit for assisting in that. After that meeting, the Commissioner of Economic Development for Tennessee said: "Ralph, I want to tell you something. You know how competitive this is, when it gets down to the last two or three s--potential sites, it can go any way. There's this much difference." He said: "I think your study may have made the difference." --Um--who knows, but I thought boy, you know--uh--you can't get better accolades than that from. Think about if that Nissan plant was located somewhere else for the last--uh--20 years. So, that gave me a lot of satisfaction that our people--uh--and Ron and his people--uh--did a job that 00:52:00might--certainly helped make the difference--it might have made a difference.

MUMMERT: Yeah and as--as you indicated--uh--I mean it's special enough to have--uh--been able to attract that industry, but the fact that it still exists, and has employed those people and has expanded for all those decades, is--uh--

CARNATHAN: No matter. I--I--I think it's had five or six expansions. Goodness knows what--what it's meant for the state of Tennessee.

MUMMERT: And--how--and--and how about--uh--whatever--uh--very indirect or tertiary impacts there may have been on all the other automobile locations in the southeast since that time.

CARNATHAN: They all didn't work out quite that good. --Uh--Coors came and looked at the Tellico site. They were at that time, a strictly a Colorado company, and they were looking to build a new facility. And they were interested in Tellico, it had some of the features that they were looking for you know, the 00:53:00beauty of the area, and so forth. --Uh--went out to--Larry Colaw and I went out to--uh--Golden, Colorado, met with the Coors people and made our pitch. --Uh--they liked it, they came here, they met with the board, over in the board room had lunch at the--uh--at--at the--one of the restaurants with the--with the people. They actually brought a tanker down, put it on a barge, and floated it out in the middle Tellico Lake, filled it up with Tellico water, took it back to Golden and made beer from it. It got that--. So--uh--we thought we had a shot at a big--uh--big name company to locate at Tellico, but the--alas they located in the Shenandoah Valley, Virginia. Toyota came to town, I took them 00:54:00over to the board. Now, when I say took them over to the board, I want to tell you, the board was very good. Dave Freeman is a good salesperson and Dick's also, and so--uh--we took Toyota, they had interest--uh--they located in Georgetown, Kentucky--uh--. So all--all things didn't work out like Nissan, and we never got the real big one at Tellico although the Tellico I think has--has--uh--met what TVA said it was going to meet in terms of employment. --Uh--we never got the big one, but--uh--the board was interested, we were interested and--uh--and--we--uh--had some shots at it.

MUMMERT: You mentioned of course, or have been talking about--uh--uh--motor vehicle manufacturing and a brewery, are there any other industrial sectors that come to mind that--uh--you would view as being a big success?

CARNATHAN: Well, in the early years, of course, the--uh--Tennessee River--if you go along the Tennessee River and you go to Calvert City, Kentucky; 00:55:00New Johnsonville, Tennessee; Decatur, Alabama, you will see the river lined with industrial firms. They use process water and/or navigation, and so the--the--uh--the heavy industry that has developed--uh--in large part in--in the years before--um--the automotive sector starting looking, was along the Tennessee River in--in Tennessee and--and Alabama primarily. Along about 197--uh--5, I guess--uh--we participated--our group developed a study for a--uh--a large public barge--well, I won't say large, a port facility on the Yellow Creek--um--Yellow Creek in north Mississippi near Iuka. It 00:56:00later became the entrance of the Tennessee Tombigbee Waterway. We sent that to Congress and it was--it was approved. And money was appropriated, and a--a rail was built in, roads were built in. And that--uh--facility now still a--llows barge transportation through that port of smaller industries that don't have their own barge facilities. --Um--the Tennessee Tombigbee of course--um--developed--uh--during--uh--during those years, and now you have direct access to the Gulf. And that--uh--that was another navigation boost. So over the years, various things happened, but TVA was involved to a greater and greater degree in the economic development of the region--uh--in--my--in my time here.

MUMMERT: Well, you've given a--a great--uh--overview of industrial 00:57:00development and TVA and--and your career, and how it's--uh--changed and some of the you know tremendous--uh--results that have been--uh--brought about. --Um--I'd like to ask you a question now about your own personal experience and what you think about it--um--. What did you like most about your work?

CARNATHAN: I recall one time--uh--driving and sitting outside of a company, in the car and watching people go into work at a facility that we had something to do with. I don't say we were responsible, economic development is a joint effort by a lot of organizations, but we had something to do with that. And I was down in--in that area and I just sat and watched. And I thought you know, 00:58:00this is worth doing--uh--when you--when you see people going into a facility that you had something to do with, and it--it was a satisfying career from that standpoint. You weren't just doing something that--uh--uh--you know, that--that didn't matter. Jobs matter, and the more we worked, and--and I think that was true of--of almost all the people that we worked with, it was--it was something that we found a lot of satisfaction in. Our group--uh--participated in a lot of things that--that mattered. And so I guess overall, I couldn't have asked for a more satisfying career than--than I had at TVA--uh--for that reason.

MUMMERT: Obviously--uh--if you attract an industry to the--um--or 00:59:00helped attract an industry to the Tennessee Valley, and it's--uh--one that--uh--whose management is located in another part of the country or maybe another part of the world--uh--you maybe having some impact--uh--beyond the Tennessee Valley. But, I wanna ask you if--uh--you can point to any fruits of your work today that were recognized beyond the Tennessee Valley. Other than just from those particular industries that may have been impacted? You had to keep things under the radar, the earlier part of your career.

CARNATHAN: --Um--I can't--I can't think of anything that would--uh--that would--uh--be--bring to mind that.

MUMMERT: I'm--I'm going to be rapping this up, but I have a question that--uh--I ask everybody in these interviews and it maybe the more difficult one. But--uh-- I'd like to know if there are any questions you wished I had 01:00:00asked that I did not ask.

CARNATHAN: Well, Phil, I can't think of any. I think you've covered it--uh--very well and sort of have--uh--allowed me to tell the story about that part of TVA and my experience with TVA. I had a satisfying career with TVA and I had opportunities. And--uh--I enjoyed--uh--most of my career at TVA--uh--but--uh--I think you've covered it.

MUMMERT: Okay and--uh--it sounds to me that--uh--that--uh--little phone call you made to--uh--Dr. Foster--uh--turned ou--turned out to bring some decent results. For--for more than just you.

CARNATHAN: You know, you'd be amazed, I--I have--I have often--I have often asked myself the question, what would have happened to my life, where 01:01:00would I have been today if I hadn't of made that call. And that was not an easy call to make I didn't--Mr--Dr. Foster was an important person, and I was a nobody. And I--making that call and--and you know--uh--uh--trying to post--uh--uh--myself as having something to offer was not that easy, but I--I'm glad I made it.

MUMMERT: Well, I agree you had a most interesting career, and that--uh--you've brought a lot to--uh--TVA as well as to the Tennessee Valley. And with that I'm going to--uh--close the interview, thanks again for your time.

CARNATHAN: Thank you, Phil.