358 UNITED STATES FOREST POLICY 



thousand feet of stumpage yearly, although in northern Idaho fire 

 protection has cost one third of a cent per thousand feet. 



Broadly speaking, if taxes and protection costs be added to the 

 investment and if interest be compounded at 6 per cent, the amount 

 invested in the property doubles every eight or ten years. It is ap- 

 parent that any timber, no matter how cheaply obtained, will acquire 

 a high book value when the period during which it must be carried 

 'is measured by decades. Ten cent stumpage obtained from the public 

 lands in 1880, and carried at 6 per cent interest on first cost and on 

 current outlays for taxes and protection, becomes $1.50 stumpage 

 in 1916 and $6 stumpage in 1940.** Some careful students of the 

 lumber industry are inclined to doubt whether private individuals 

 can afford to own any but readily accessible timber. Representative 

 Johnson of Washington stated in Congress recently that many large 

 holders had found their properties so burdensome that they would 

 be glad to have the government take them over.*^ 



For many years previous to 1907, timber values generally in- 

 creased fast enough to cover all these carrying charges, and in many 

 regions yield great profits to investors. Between 1907 and 1915, 

 however, there was no material advance in values, except in the yellow 

 pine region; and many lumbermen found themselves hard pressed to 

 meet obligations they had incurred in earlier years. Since 1907, a 

 great many lumber operators have been compelled to saw up their 

 stumpage almost regardless of market values, in order to meet heavy 

 carrying charges, and in this way the market has been badly demor- 

 alized much of the time. It was noted in 1913 and 1914 that a marked 

 decline in the price of yellow pine lumber was accompanied by an 

 equally marked increase in the stock on hand, because some hard- 

 pressed operators had to saw more lumber rather than less, as the 

 price went down, in order to meet their fixed charges. Thus a decline 

 in the speculative value of timber holdings fostered rapid forest de- 

 struction. Beginning about 1915, lumber prices rose again because 

 of the war demands, and at the present time (1919), the general 



44 For an interesting computation by Professor Kirkland of the University of 

 Washington, see the Forestry Quarterly, 12, 4.32. See also an article by Professor 

 Compton in the Journal of Forestry, Apr., 1917. 



45 Cong. Bee, Apr. 19, 1916, 6459. 



