492 JOURXAIv OF FORESTRY 



the best methods for managing different kinds of forests is not yet 

 sufficiently complete to enable us to definitely and certainly predict the 

 returns which will be received on specific areas, even if all the other 

 risks are eliminated. The negotiable value of a forest property is sel- 

 dom equal to its true value, so that if for any reason an owner should 

 be obliged to liquidate his investment he would probably lose not only 

 the accrued interest, but also part of the capital value. Only in the 

 case of mature or nearly mature forest would he be likely to get back 

 his investment with the interest it had earned. Moreover, to raise 

 money on such a property would probably require the cutting of the 

 timber, regardless of silvicultural or economic conditions at the time. 



Several measures have been suggested to make investments in for- 

 estry more attractive to private owners. These include the following: 



(a) The adoption of more just and scientific systems of taxation of 

 forest properties. This should be done, provided care is taken that the 

 system adopted is really just as compared with the taxation of other 

 property and is not in fact a subsidy or discrimination in favor of 

 forest owners. Tax reform, however, goes only one step toward the 

 desired end. 



(b) Organized forest-fire protection by the public, the owners usually 

 paying part of the cost. This certainly reduces the fire hazard, but no 

 system of protection yet devised has entirely eliminated the risk. Be- 

 sides, when a loss occurs, the loser cannot, as in many other kinds of 

 investment, recover insurance. He is somewhat in the position of a 

 man who has paid premiums on his insurance policy for many years, 

 but cannot collect the insurance when the loss comes. A system of 

 State (or State-encouraged, but privately operated) forest insurance 

 might go far toward remedying this condition. Such insurance, how- 

 ever, if it is to make capital invested in forestry safe, should cover not 

 only losses by fire, but also by weather, insects, disease, and all other 

 causes. 



(c) Subsidies to private owners to encourage them to practice for- 

 estry. This is clearly uneconomic and may be justified only on the 

 theory that in this way the public pays for the public benefits which 

 will be derived from the forests so subsidized. It hardly seems likely 

 that such a measure will ever be adopted on a large scale, or that it 

 would be effective, since it does not remove any of the uncertainties 

 involved in the business. 



(d) Long-term loans at low rates by the public to forest owners to 

 enable them to carry their forest investments. Such loans might make 



