THE ORGANIZATION OF FINANCE IN FOREST INDUSTRY 



By Burt P. Kirkland 

 University of IVashingtoii, College of Forestry 



GlvNllRAI, CONSlDIiRATIOXS 



Owing to the short period of participation by America in the great 

 war. reconstruction may not be as radical a process as must be faced 

 l)y Europe. Certainly, however, many changes overdue before the war 

 must be brought about to place industrial and social conditions on a 

 stable footing. Inasmucli as forest industry was recognized as one of 

 the most unstable, it must receive a large share of attention. This be- 

 comes all the more urgent in view of the paramount importance our 

 forests have in war or ])eace. Furthermore, it can scarcely have es- 

 ca])e(l the attention of the most unthinking that our natural resources 

 are after all severely limited. It follows that no man with honest desire 

 for his country's continued welfare can refuse support to sound meas- 

 ures of improvement in handling our forests. Nevertheless, either- 

 through inability to grasp a unified program of forest betterment or 

 reluctance to undertake thoroughgoing measures at one lea]:), it is prob- 

 able that necessary changes will be undertaken ]")iecemeal. This dis- 

 cussion is therefore confined to one item of possible improvement, 

 which is. however, of a most necessary nature, namely, improvement 

 in the organization of financial credit. 



AMOL'N't op CAI'ITAL Ki;nr I Ki:i » V<\ l"OKi:ST INDlSTin' AND I XTKKKST 



RATl-S A\ AILAT-LK 



The necessity for this imjjrovement is very evident. Investigations 

 of the U. S. Forest Service conducted in 1915 disclose that 30 to 50 per 

 cent of the cai)ital used in forest industry is borrowed, and that interest 

 rates vary from 5 to 8 ])er cent, with an average of at least C^Yi per cent, 

 or even more, when the cost of securing loans is added. ^- '-• '• Accord- 



' Rci)(irt No. 114, U. S. Dept. Agriculture: "Some Pulilic and I'.conomic Asjiects 

 of the Luml)er Industry," l^y W. B. (ireeley, pp. 14-15. 



* West Coast Luml)erman. Novenil)er i, 1916, p. 34. 



■'Journal OK Forestry, January, 1917: "Continuous Forest Produclion of Vuh- 

 licly Owned Timberlands as a Solution of the Economic Difficulties of the Lum- 

 l)er Industry, liy l^.urt P. Kirkland. pp. 12 and 13. 



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