CONTINUOUS FOREST PRODUCTION 29 



and, as has been pointed out, the position of the business man who must 

 borrow at 7 per cent to operate an industry which earns 5 per cent or 

 less is untenable. 



The holding of timber for increases in value is still more untenable 

 under the high interest charges. The per cent earned by holding is 

 probably not above 3 per cent at the present time and must almost 

 inevitably sink to under 1 per cent in the course of time, (See Table 1.) 

 Thus, here again, either cheaper money must be had or the government 

 must step in and take over the timber, otherwise the forest will be looted 

 of its best and the rest left to be destroyed by fire or what not. It 

 may be considered impossible for the government to step in to the 

 tune of $6,000,000,000 in any short space of time. It seems to be, 

 further, most undesirable. There is, in my judgment, only one prac- 

 ticable and reasonably quick solution to this problem and that is to 

 allow complete organization of the industry through which lumbermen 

 are fully competent to solve their own problems. This will save the 

 public general taxation to conserve this resource and make unnecessary ' 

 another large corps of government investigators and regulators of indus- 

 try, such as seems to be necessary in agriculture. 



This question is also related to the problem of remuneration to labor. 

 So long as we insist on the maintenance of present small-scale organiza- 

 tion in industry, which carries with it this unnecessary interest charge of 

 $60,000,000 and the destructive competition charge of at least an equal 

 amount, both capital charges, we are making it necessary that these 

 charges shall be added to property income in order to maintain the 

 capital of the industry. Hence, either the public or labor or both 

 must share this loss between them. Just what proportion of the loss 

 each bears it is impossible to say, but the share of labor must be large. 

 This means less purchasing power and a lower standard of living. Inso- 

 far as the purchasing power is lowered the market for the products of 

 other industries, especially those producing goods for immediate con- 

 sumption is decreased. Right here is where every other industry has 

 vitally affected interests at stake in seeing to it that forest industry is 

 so organized as to divert these wastes of capital to productive expenditure 

 either by capital or labor. 



It further may be seriously questioned whether the saving, in this 

 and other industries, of the capital wastes we are here considering, will 

 not, in the future, be the surest means of market extension for all 

 industries. The limit of market extension through these means falls 

 not far short of the total ability of labor to produce and the consumer 



