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force production to any very sensible extent ; but the constant increase, in 

 geometrical progression, at last comes to a point when the increase is so great and 

 sudden that those who held any timber berths in reserve had either to occupy or 

 relinquish them. Unfortunately as regards the great bulk of the license holders, 

 the operation of the system had just reached the point (when they had either 

 to produce more timber or relinquish that which they had already paid a series 

 of rents for, and in some instances, otherwise laid out money upon, without 

 return) at a moment when the trade was in a state of considerable depression, 

 and required a decreased instead of an increased production. This state of 

 depression, too, arose from causes wholly foreign to the internal management of 

 the trade ; for it differed from the previous great crisis in the trade (that of 1846- 

 47, etc.) in this, that it arose less from an excessive production than from a 

 sudden cessation of demand the result probably ot the war then raging. It 

 diff.red also in degree, bearing only the character of a temporary embarrassment 

 as compared with the wide spread-ruin which fell upon the trade on the former 

 occasion. It was none the less necessary, however, to apply a remedy, if practi- 

 cable, in time, and it was in this view that the producers sought to be temporarily 

 authorized to suspend productions where the ordinary tendency of the regulations 

 was to enforce it. 



" It was not, therefore, as put by the opponents of the producing interest, a 

 question of the holders of timber berths fulfilling or failing in their obligations ; 

 and even if it had been so, the maintenance of the penalty in its full force would 

 not, at least for some time, have compelled any considerable relinquishment of 

 licenses ; on the contrary, the parties would have continued to hold them, and 

 endeavored by extended operations to reduce to their original amounts the 

 ground rents on such berths as the penalty had most accumulated upon, thus 

 risking the consequences of increased production rather than abandon their licenses. 

 " The real question at issue, therefore, simply was, whether the penalty for 

 non-occupation had been made too severe or not. 



"But there was also the question of whether the exceptional circumstances then 

 existing, arising out of the war or otherwise, were such as would justify the 

 temporary suspension of the penalty. 



" On the first head, as regards the penalty for non-occupation generally, it is to 

 be observed that, if any regulation were to succeed in compelling the occupation of 

 all the lands licensed, it would force a production far beyond the requirements of 

 the trade ; no regulation could permanently have this effect, however, as the 

 result of an excessive penalty would be to cause the relinquishment of a portion 

 of the territory now under license, which (apart from the question of whether 

 it would not afford, in every period of excitement, too great a facility for a rush 

 into the trade) would leave a portion of the timber lands wholly unproductive, 

 either in ground rents or duties, which now afford a very considerable revenue. 



' The system of regulations for the granting of licenses to cut timber began 

 by a course of trial and error and has gradually been perfected by experience. 



" The ground-rent system was a trial ; it has proved a most happy and suc- 

 cessful one, which has given general public satisfaction to the trade, but it would 

 be too much to pretend that, in the first trial there had been no error, that it had 

 been perfected at once without any experience of it practically. 



' In the introduction of the system the then remote contingency was not pro- 

 vided for, that if no limit was set to the ultimate amount the ground -rent 

 might reach, great hardships might in some cases be the result; such, for instance 

 as might arise in case of several timber berths being taken up in a previously 

 inaccessible locality, assuming in such a case that the license holders (joining 

 together for that purpose) proceed to improve the stream (as is frequently done 



