354 ANNUAL REPORTS OF DEPARTMENT OF AGRICULTURE. 



water-holding power of the Forests from harm; (4) expenditures to 

 equip the Forests with the things required to facihtate use and pro- 

 tection; and (5) expenditures for investigations, designed to promote 

 bettor use. 



Of these only the expenditures of the first class are to be regarded 

 as the cost of doing current business; and since a })art of current 

 business is free use, the cost of doing tlie business which yields receipts 

 is less even than tlie total expenditures in this class. By stopping all 

 work other than that involved in making and supervising timber sales, 

 regulating grazing, and handling special uses for which payment is 

 made, the Forests could easily be made to show a net profit to the 

 Government, even with the charge for grazing left, as at present, far 

 below the commercial value of the privilege. Such a policy would, 

 however, lessen the public benefits which the Forests are yielding at 

 the present time; it would entirely fail to provide for the best use 

 of ail kinds of land; it would expose to destruction by fire public 

 property of enormous money value and incalculable future impor- 

 tance; it would fail to provide the means for making the natural 

 resources of the Forests most serviceable. In otlier words, it would 

 be a reversal of the entire policy which has underlam both legislation 

 concerning the National Forests and the present administrative 

 system. It would also be a serious business mistake. 



The major part of what is spent on the Forests each year is an 

 investment. Permanent improvements are like betterments made by 

 a railroad to enable it to handle business at a low^r cost. In the 

 absence of proper equipment, operating expenses are increased. 

 This is forcibly illustrated in the case of fire protection. Last year 

 nearly SI, 100, 000 was spent in wages for temporary employees hired 

 to fight fires and for transporting, provisioning, and equipping them. 

 While the natural conditions this season are very different from those 

 faced last year, so that a close coroparison of results is impossible, the 

 extra expenses incurred in fire fighting will not exceed $190,000; 

 yet much better protection has been given. Every step forward in 

 developing a good systen^ of permanent improvements means a 

 lower annual cost for fire protection. It is already evident that the 

 increase in the permanent improvement fund expendable in 1912 will 

 materially reduce the expenditures for fire fighting. Fires can now 

 be discovered and reached more promptly, and consequently put 

 out at less cost, than ever before. The total expenditures for all 



Eurposes in 1912 will probably fall slightly below the total for 1911; 

 ut because of the more highly organized and better equipped pro- 

 tective system the money will be spent to much better advantage. 



Properly speaking, most of what is spent in protecting the Forests 

 is also an investment. Any private owner of timber held for future 

 sale would, as a matter of course, add his carrying charges to his 

 original outlay as an increase in the capital tied up; and if he sees his 

 property rising in value faster than the cost of carr}dng it, he knows 

 that he is on the safe side. Since the National Forest timber is for the 

 most part either on what may be called the fringe of present demand 

 or quite beyond the zone of present operations, its value will for some 

 years to come rise rapidly. The average rise in the stumpage price of 

 timber sold by the Forest Service in the last four years has been 18 

 cents per thousand, An average annual increase of only 6 cents per 

 thousand feet for the 518 billion feet of merchantable timber on the Na- 



