ECONOMICS OF PRIVATE FORESTRY 217 



a yield tax. The yield tax, though doubtless desirable, is necessary 

 only to unorganized forests ; in other words, improperly managed 

 forests. It is further desirable during the transition from unorganized 

 to organized forestry, but not an indispensable preliminary to forestry 

 in any case. 



4. In conclusion we may summarize : 



(a) Hereafter industry will be judged in terms of human service. 

 This means continuous production on forest lands whether the returns 

 are as high as may temporarily secured from ruthless exploitation or 

 not. 



(b) Continuous production will yield net revenues whether on 

 private or public forests in nearly all cases. The capitalization will 

 depend on the interest rate. If a 3 per cent rate is chosen capitalization 

 in a given case will be high ; if a 15 per cent rate is chosen it will be 

 low. Whatever the current return forestry by conserving the basic 

 capital value of the property will for years yield a further percentage 

 of return from "unearned increment." 



(c) Valuation is fixed by the consensus of opinion of buyers and 

 sellers. Taxation is on the valuation fixed. If valuation is wrong, and 

 hence taxation, buyers and sellers should blame themselves, not tax 

 authorities. Under organized forestry (the kind we want) taxation is 

 essentially the same under general property tax or yield tax. Forestry 

 need not, therefore, wait on tax reform. 



