36 



made up of approximately 550 member companies and related trade associations 

 and represents about 7 percent of the entire manufacturing output of the United 

 States. 



I'm glad to be able to discuss the below-cost timber sale issue with you today be- 

 cause I think that the debate in its entirety will take us in a positive direction. Once 

 we get beyond the sixties rhetoric — that below-cost timber sales are a subsidy that 

 allow the timber industry to rape the forest — we can then work towards a produc- 

 tive dialogue, asking the questions that need to be asked, such as: 



— How is it possible that at today's highly competitive timber prices the Forest Serv- 

 ice loses money when everyone else selling timber is making a healthy profit? 



— What is the cost of maintaining a cumbersome and abused appeals process? What 

 are the costs of preparing mountains of environmental documents for every deci- 

 sion to cut a tree? 



— By eliminating timber sale programs on half of America's national forests, what 

 will happen to lumber prices and the cost of building a home, and what will 

 happen to the hundreds of rural communities when the middle-income manufac- 

 turing jobs are eliminated? 



— Is forest health served by not harvesting trees in some areas when insects, dis- 

 ease, and wildfire are the alternative? 



We must answer these questions, and others, if we are going to allow the below- 

 cost discussion to be more than just another surrogate issue to stop the cutting of 

 trees on national forests. 



The Administration s Proposal is Ill-Conceived at the Forest Level 



On April 30, we read in the New York Times of the administration's direction to 

 the Forest Service to phase out, over 4 years, the timber programs on 58 national 

 forests. Although the agency is now proposing to delegate closure selection to the 

 Regional Foresters, these forests are still on the chopping block because of action, 

 during markup on June 15, by the House Interior Appropriations Subcommittee. 

 During that session the subcommittee failed to restore the administration's $46-mil- 

 lion reduction for the below-cost forests and even cut another $42 million in funding 

 for timber sale and road program accounts. The net result will be to reduce the 

 total national forest timber program to around 2 billion board feet; less than one- 

 fifth of what it was just 3 years ago. 



To better understand the impacts of these program closures the Timber Industry 

 Labor Management Committee did an analysis of each of the 58 forests by examin- 

 ing Forest Service data and by interviewing local Forest Service employees. (I would 

 like to ask that this forest-by-forest study be submitted into the record.) This analy- 

 sis shows that the timber programs on each forest fit with local objectives and are 

 well justified on ecological and economic grounds as long-term investments. The rea- 

 sons why these forests were unprofitable vary from forest to forest. However, some 

 general patterns emerged in the study: 



Land stewardship. The Forest Service uses the timber program as a cost effective 

 tool to achieve a wide variety of benefits. Maximizing timber profits has never been 

 defined as a driving force for agency management. (The Multiple-Use Sustained- 

 Yield Act of 1960 and the National Forest Management Act of 1976 specifically in- 

 structed the Forest Service to not manage for the greatest profit or the greatest unit 

 output.) Sometimes high land management costs are the "price of inheritance." 

 Many forests, particularly in the East and Midwest, weren't "forests" at all when 

 they were brought into the National Forest System. They had been cut over, cleared 

 for farms, or burned. Historic costs of rehabilitating these areas have been high, but 

 the actions have produced vigorous forests. These forests are still too young to pro- 

 vide high economic yield, but in the meantime we must continue to manage them 

 for the long term. Already they provide the benefits of improved ecosystem health. 



Present costs of land stewardship include managing for amenity values, such as 

 wildlife habitat, recreation, and forest health. Amenity costs may include accepting 

 lower revenues from a sale by designing it for maximum wildlife benefits rather 

 than maximum timber volume, or incurring higher expenditures for roads so that 

 they can be built to recreational standards for post-harvest use. Management for 

 forest health — insect and disease control, fuel reduction and salvage — is particularly 

 important in the western forests. Decades of protection from fires has allowed a 

 build-up of forest fuels (dead trees, branches, and leaves) that increase the risk of 

 catastrophic, large-scale fires: the great Yellowstone fires of 1988 brought down 

 mountains of mud into the rivers and within a year, through habitat destruction, 

 caused the starvation of over half of the elk and bison populations. Recent drought 

 conditions all over the West have increased the vulnerability of the stands to insects 



