THE COST OF TRANSPORTATION AS A TAX ON THE CONSUMER 607 



than the white pine. For the different species, the premium per 

 thousand feet is: Southern pine, $6.60; Douglas fir, $9.85; western 

 pine, $7.35 ; Idaho white pine, $6.60. 



This is a burden which the people must bear indefinitely, or until 

 an adequate supply of timber can be produced every year from local 

 forest land. Since it is such a heavy burden, and so definite in dura- 

 tion, it may be considered as a tax, paid to the railroads, for the privi- 

 lege of letting forest land lie idle and unproductive. 



This tax, based on an annual per capita consumption of 375 board 

 feet, and an average freight rate of $9 per thousand feet on all lumber 

 shipped into the State of Minnesota, is arrived at in the following 

 manner: Rate on 375 feet western and southern lumber, $2.40; rate 

 on the same amount of northern white pine, 37 cents; tax for using 

 foreign lumber, $3.03 per capita. For the whole State this would 

 amount to $-4,561,410, or the equivalent of a tax of 2.8 mills on all the 

 real and personal property in the State (1915 assessed value $1,609,- 

 493,000.) As this amount is paid by railroads largely as wages and 

 dividends to non-residents, it is not returned to Minnesota either 

 directly or indirectly. This tax would not remain constant, but would 

 tend to increase on account of the following factors : 



1. As the local supply grows smaller, it will be necessary to import 

 into the State a greater proportion of rough lumber, which weighs 

 more per thousand feet, and consequently pays a higher rate. 



2. As supplies decrease in the south and the inland empire, a 

 greater proportion must be shipped from the extreme northwest with 

 a resulting higher rate. 



3. Owing to the demands of labor and increased operating ex- 

 penses, the railroads may eventually be forced to raise their rates. 



To sum up the steps of this argument — 



1. Local supplies of timber are rapidly diminishing in most parts 

 of the country, with the result that a growing proportion of the demand 

 is being satisfied by the large reservoirs of stumpage in the south 

 and the west. 



2. This growing demand upon the remaining timber will exhaust 

 the supply more rapidly than is indicated by comparing the stumpage 

 supply and annual growth with the present annual cut. 



3. When each lumber region is able to supply only its local needs, 

 the price of lumber will be governed by the cost of production; or if 

 none is produced, it will be a monopoly price set by a few large timber 



