REPORT OF THE SUBCOMMITTEE 265 



millions of acres of land cut over in the past. The present area of the 

 National Forests is about 150,000,000 acres, of which perhaps 100,- 

 000,000 are productive timber land. In Europe it has been found that 

 the line between the timber importing and timber exporting countries 

 lies at the point where there is nine-tenths acre per capita of forest 

 land. A new country, such as ours, needs more and we can expect 

 our population to double within a short term of years. It therefore 

 appears a minimum program to acquire for the Government the 

 equivalent of the newly cut-over land of each year, or about 2,000,000 

 acres. This would bring the land under national control at the end of 

 the first century to about 300,000,000 productive, acres. The annual 

 expense of such a plan will depend on many uncertain factors but is 

 estimated at about $500,000 for the first year. Each subsequent year 

 would see the amount increased by a similar figure until the leasing 

 program ceased. It would then continue constant until the end of the 

 rotation period when it would decrease by the same annual differences 

 to zero. At the end of the rotation period returns may be expected 

 to commence from the ripening timber which will not only pay all 

 future expenses but yield a good return on the investment of the ]5ast. 



FOREST LOANS 



Fundamentals of a Forest Loan Policy 



Finance plays a dominant role in the direction of industry and tends 

 toward more and more control of industrial policy. Our railroads, our 

 public utilities, our steel industry all conform to the mandates of the 

 financier. This situation is seemingly unavoidable but brings in some 

 respects unsatisfactory results. Under it the test of all industrial 

 policy is "will it give immediate profit?" Still worse, some of the 

 nation's store of wealth is used as real "predatory" wealth functioning 

 like the highwayman along the channels and highways of trade, or 

 exacting tribute for the use of some privately owned natural resource 

 without giving service in return. Also the determination of industrial 

 policy solely by the financier frequently means determination by one 

 unfamiliar with the technical details and special needs of the industry. 

 To meet these objections two things are necessary : First, that special- 

 ized financial institutions be created to deal with each industry. This 

 makes possible that the technical details of the industry will be under- 

 stood by the financial expert dealing exclusively with one instead of 



