Even Clark recognized the state’s dependence on Duke thus far. In private correspondence, he expressed frustration to a colleague, admitting, “I do not know
the best [way] to take over these properties.” Clark suggested as a possibility purchasing
water power and energy resources from Southern Power with hundred
year, two percent non-transferable bonds subject to a graduated inheritance tax.
Future developments would be funded from “heavy graduated income and inheritance
taxes.” Yet North Carolina had only recently in 1920 approved a constitution
amendment to provide for a modernized income tax system. And the
system established by the legislature in 1922 set the top rate at 8 percent—10 percent
for corporations. The 8 percent rate was far below what Clark expected and
that would have been required to fund a governmental takeover of the Southern
Power Company.