RESULTS OF OUR FOREST POLICY 343 



EFFECTIVENESS OF EFFORTS TO FIX PRICES 



As to the effectiveness of price activities, it is very difficult to gen- 

 eralize. Conditions have varied so greatly among the different regions, 

 and at different times, that any general statement is likely to be mis- 

 leading. The report of the Commissioner of Corporations (Part IV) 

 was largely dedicated to proving the existence of monopolistic condi- 

 tions in the lumber industry, and it contains a great deal of evidence 

 intended to prove that. On the other hand, lumbermen claim, and 

 there is a great deal of evidence tending to prove, that efforts of 

 lumbermen to influence prices have generally been ineffective) th^t, 

 in spite of them, lumber prices have generally been too low to cover 

 even the bare cost of production for many lumbermen. 



It is the increase in lumber prices since the middle or late nineties 

 which has directed attention to the question of price activities among 

 lumbermen; but there can be no doubt that this rise in prices is 

 mainly due to other causes. In the first place, other causes are ample 

 to explain most, if not all, of this increase. The depreciation in the 

 value of money is responsible for much of it. If it is true, as Professor 

 Fisher estimates, that the dollar was worth two thirds as much in 

 1914 as in 1896, lumber prices could have risen nearly 50 per cent 

 without indicating any peculiar forces at work.^^ In the second place, 

 the shifting in the main sources of supply, from the Lake states to 

 the southern and western states, will account for much of the rise in 

 lumber prices. In 1896, the Lake states still led in the production of 

 lumber, and even the northeastern states were furnishing consider- 

 able amounts. This lumber could be sold in the great consuming cen- 

 ters very cheaply. When, however, these readily accessible supplies 

 were nearly exhausted, and lumber had to be shipped in from the 

 southern states, and even to some extent from the western and Pacific 

 states, higher prices were inevitable. Transportation charges are a 

 very large element in the cost of so bulky a product as lumber. In 

 the third place, the increasing scarcity of lumber might account for 

 an increase in lumber prices. The lumber supply of the country con- 

 stitutes a limited natural resource, and, with its rapid exhaustion, 

 the forces of supply and demand would account for a considerable 



12 See Compton, "Organization of the Lumber Industry," 80. 



