1154 A NATIONAL PLAN FOR AMERICAN FORESTRY 



It might be, and frequently is, reasoned that the owners of proper- 

 ties such as described should suffer the consequences of their own poor 

 financial judgment; that it is no part of the function or obligation of 

 the public to take over such properties and permit the owners to 

 retrieve their unsound investments. If only the property owners 

 were involved, this reasoning would be correct. However, the inter- 

 ests of the owners may become wholly insignificant as compared to 

 the train of adverse circumstances set in motion by their attempts to 

 salvage their investments. The ultimate economic consequences 

 deserve serious consideration in such situations. 



On the basis of sound social economy, timber for which there is no 

 immediate need should be withheld from rather than forced into 

 destructive competition. Its current operation seriously aggravates 

 an already critical situation. In another quarter century the stump- 

 age might conceivably do much to alleviate a different type of critical 

 situation one caused by a real deficiency of timber supply. How- 

 ever, the owners could not be compelled or expected to retain the 

 timber uncut for that period of time except under a definite guarantee 

 that through tax relief, fixed prices, bonuses of public money or other- 

 wise, they would be compensated for all costs of ownership during 

 the intervening period plus a proper return upon invested capital and 

 managerial control. 



In the circumstances described, it might be the highest public econ- 

 omy to take over the holdings subject to premature and uneconomic 

 exploitation, establish them as public forests to be controlled and 

 managed by appropriate public agencies, and hold the timber they 

 support until its utilization is dictated by sound economic considera- 

 tions. In this way the forest resources would be preserved from 

 destruction, a large amount of capital would be kept available for 

 other needs instead of being invested in unnecessary mills, railroads, 

 and other manufacturing facilities, established lumber manufacturers 

 would not be threatened with or actually thrown into insolvency, 

 their forest lands would not be so destructively logged, and remote 

 owners of forest lands sincerely endeavoring to practice forestry and 

 maintain the productive power of their properties would not have 

 their efforts nullified by forms of sacrifice competition they could not 

 meet. 



Such properties cannot be expropriated or taken over without equi- 

 table compensation to the owners. But such compensations should 

 be based upon factual and actuarial determinations of sound invest- 

 ment values in the light of probable future trends in demand and 

 value not on the basis of unprofitable and possibly unwise invest- 

 ments which may have been made therein, nor on that of earlier 

 standards of valuation which have markedly been modified by recent 

 and prospective price trends. It should not be the purpose of a public 

 forest-land acquisition policy to recoup the losses of timberland inves- 

 tors. If conducted under the principles herein proposed, the public 

 acquisition of properties such as herein discussed would not compre- 

 hend a wastage of public funds. Consistently managed, with utiliza- 

 tion deferred until need therefor acutally existed, and barring unfore- 

 seen calamities from fire or disease or insects or windthrow, the prop- 

 erty should return to the public treasury the full costs of its acquisi- 

 tion and management. Meanwhile, in offset to taxes, it would be 

 contributing to many social needs and rendering many forms of bene- 



