33 



tion was a little over $200 million, and the $46 million is about 25 

 percent of that. So this is not something that is just a casual 

 amount of money that one could make up through efficiency im- 

 provement. 



So, when we looked out there and tried to say, well, if you ap- 

 plied that $46 million cut to timber sale programs that were in 

 place somehow, and tried to allocate that, there are at least some- 

 where in the neighborhood of 60 candidate national forests where 

 those cuts would likely come from, and they would be substantial 

 and would essentially do away with the entire timber sale program 

 as we know it on those forests. That represents 23,000 jobs, $850 

 million in wages those jobs produce, $119 million in annual Federal 

 timber income taxes that are paid from those wages, all for a 4- 

 year purported savings that the President would like to gain of $72 

 million. Well, that's not wise economics, in my opinion. It is a sac- 

 rifice of $120 million a year in Federal income tax in order to save 

 a net of $72 million somehow from doing away with this program. 



It also doesn't make sense to me when you look at recent prices. 

 We did a quick analysis of what would happen in Idaho and Mon- 

 tana if you applied the recent stumpage prices to the full allowable 

 sale quantities in the forest plans, and just the change of the 

 almost doubling of stumpage prices which has occurred over the 

 last 6 months alone obliterates much of this alleged deficit. 



Part of the problem comes about in the whole debate about what 

 to do about returns to the counties. As you know, the 25-percent 

 funds are allocated back to counties, like the one I live in in Idaho, 

 where it is a vital part of what I believe is a very fair way for the 

 Federal Government to discharge its obligation as a land owner in 

 the county to help support the tax base. Those 25-percent funds are 

 in fact an obligation that is separate, in my opinion, from the 

 timber program. PILT payments, or other forms of transfer, would 

 remain the obligation of the Federal Government. And I would just 

 note in passing that while the timber sale program has declined in 

 Oregon and Washington, this Congress for the last 4 years has re- 

 peatedly authorized special appropriations to keep the counties 

 funded at levels that they were funded at before, in recognition of 

 those obligations. So to somehow attribute that as a cost to the pro- 

 gram is just irrational, in my opinion. 



And then there is no opportunity in this whole scenario for cor- 

 rection. As you know, the Black Hills National Forest in South 

 Dakota, in the early 1980's was alleged to be one of the worst 

 below-cost offenders in the country. And in the few short years 

 from 1985 to 1990, that forest was able to make some adjustments 

 in its program and went from being an alleged below-cost forest to 

 now one which is substantially above cost. Had this policy been in 

 place in 1980, there would be no timber sale program on the Black 

 Hills; the town of Spearfish would cease to exist, and the hundreds 

 of jobs of your constituents would not be there. 



It seems that to make these kinds of precipitous changes without 

 giving the Forest Service an opportunity, if the new standard is 

 going to be profit maximization, to practice profit maximization is 

 unwise. 



I also have to talk about the incentive to obstruct, as I call it. We 

 see repeatedly, when proposals like below-cost sales are on the 



