492 JOURXAL OF FORESTRY 



the first ten-year period, however, the sale of bonds might nmunl to 

 the annual maximum of $100,000,000 which Mr. Sherman mentions. 



These relatively small issues could have no great material efifect 

 upon the financial or business conditions of the country. Whatever 

 effect they would have upon the business conditions would be bene- 

 ficial, especially in the sections where the money was spent, by putting 

 more money into circulation in those sections and by furnishing em- 

 ployment to thousands of men in those communities. 



True, the Government has a huge debt, but it is saving millions by 

 buying its own bonds now'below par. By doing so it is trying to help 

 the investor because its purchases is a big factor in stabilizing the 

 market and holding the price at a higher selling point than it otherwise 

 would be. Therefore it would be good business for the Government 

 to sell reforestation bonds now, maturing at a distant date, in order 

 to have more of its present revenues free to be used in buying these 

 war bonds below par. 



Mr. Sherman admits that the proper expenditure for "silvicultural 

 rehabilitation" now, from current revenues, would reduce the (jov- 

 ernment's ability to cancel its war and floating indebtedness by about 

 20 per cent, which when we consider that for every dollar spent now 

 for the purchase of bonds the Government realizes a saving of from 

 10 to 15 per cent is a very considerable item. 



It is also true that issuing bonds for reforestation, at the same time 

 that we are paying off war bonds, would leave our indebtedness the 

 same, to the extent of the bonds sold, but the indebtedness would be 

 of a highly dift'erent character. Our war indebtedness must be 

 charged off to public safety, advertising, and international good will, 

 which have great intangible values, but the reforestation bonds will 

 be met directly from the profits on the crop produced, and will not 

 have to be met by taxation of the future citizens as we are now 

 meeting the war indebtedness. It would seem, therefore, that this 

 change in the character of the Government's indebtedness would be 

 a very desirable thing. 



It is evident that ^b\ Sherman did not analyze my article very 

 carefully because he seems to have read into it several things that are 

 not there. For instance, he implies that I would have the Govern- 

 ment sell bonds for fire prevention, which, of course, should be borne 

 by the present generation, and I think it was made clear in the article 

 that such expense would be met from current revenue. In his exceed- 

 ingly humorous reference to what "grandson" would say, he stated 



