towns have grown up supported by timber. In some cases, timber 

 represents the primary source of economic support for a region. 

 Are we prepared to accept the economic and social dislocation that 

 will probably occur if we phase out all forests that cannot make 

 money for the Federal Government? 



We in Congress must bear some responsibility for creating expec- 

 tations among rural communities for a never-ending supply of 

 timber from national forests. During the 1980's, Congress estab- 

 lished high timber sale targets each year in the appropriations 

 process. These timber targets drove the timber harvests on nation- 

 al forests to record levels. By the mid-1980's, the harvest was over 

 10 million board feet. We realize now that this level was unsustain- 

 able. 



Harvesting levels have been reduced dramatically on national 

 forests. The consequences of historically high harvest levels and 

 questionable forest management have led to higher costs for the 

 Forest Service. Now, because of the large number of endangered 

 and sensitive species, the Forest Service has had to hire many new 

 wildlife biologists to ensure that timber sales do not further harm 

 those species. When a sensitive or endangered species could be af- 

 fected by a timber sale, the Forest Service must perform a biologi- 

 cal evaluation and modify plans to ensure that the timber sale will 

 not harm the species. 



There are a number of issues related to below-cost timber sales 

 that need to be addressed so that Congress and the administration 

 can begin to develop long-term solutions to this problem. These 

 issues include the establishment of annual timber sale target 

 amounts by Congress, the adequacy of the existing Forest Service 

 cost accounting system, efforts by the Forest Service to control 

 costs and effects on employment in the timber industry. 



Hopefully, we will begin to explore some of these issues this 

 afternoon. Certainly no one has taken a greater interest in this 

 issue and has spoken in ways, personally and publicly, about this 

 issue to me and others than my ranking member, and at this time, 

 I would ask Senator Craig for any comments that he would have. 



STATEMENT OF HON. LARRY E. CRAIG, A U.S. SENATOR FROM 



IDAHO 



Senator Craig. Mr. Chairman, thank you, and a very sincere 

 thanks for your willingness to convene this hearing and deal with 

 this issue, because it is very important for all of the reasons that 

 you have just spoken of. 



When the administration came forth with the assumption of the 

 discontinuation of below-cost sales in 62 national forests, those as- 

 sumptions were made by money lost in fiscal 1992, based on the 

 agency's TSPIRS accounting system. That is one side of the story. 



Let me give you the other side of the story. First of all, it is not 

 unique to argue at some point that this Government has had subsi- 

 dization policies, whether it be in agriculture or in other areas. The 

 questions to answer are: is it worth doing, what will the results be, 

 and what are the long-term implications. 



