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that we are much more competitive than we were back in 1980. So, 

 the timber industry in the Southeast has improved a great deal in 

 recent years. We claim that probably the causes are many, but the 

 ANILCA provisions of 1980 did create what was an accessible sta- 

 bility in terms of policy so that people could make investments in 

 confidence that things would not change the following year. I think 

 it would be very difficult to say to what extent ANILCA caused 

 this change in the timber market for the better and which part of 

 it was caused by other factors completely different from ANILCA. 



Senator Wirth. Thank you. Governor Cowper. 



Senator Murkowski. Thank you. 



Governor, I was particularly impressed with your presentation 

 representing the state and the Southeast Conference, which Mr. 

 Privett reviewed for us. As one who was very involved in the draft- 

 ing of the legislation which is before you, S. 237, I think it is worthy 

 to reflect that you know well the spirit of compromise in which 

 legislation is drafted. 



As I said in Ketchikan, the development of legislation is some- 

 thing like making sausage, not too pleasant to observe but never- 

 theless a necessity and a reality. I think the recommendations ex- 

 pressed by you of the Southeast Conference for the most part rep- 

 resents just that kind of input relative to the divergency that we 

 have between Senator Wirth's legislation and that of my own, and 

 I feel quite confident that we pursue this process of making sau- 

 sage, so to speak, that many of those recommendations can be ad- 

 dressed. 



One of the difficulties that we are going to have, however, in the 

 Southeast Conference recommendations is the suggestion of estab- 

 lishing an economic diversification fund for grants and loans. As 

 we well know in this climate it is pretty difficult to depend on 

 Washington for Federal assistance. And, in both Senator Wirth's 

 bill and my bill, we have done away with Federal assistance of $40 

 million. To combat — and I am not saying this is possible — but it 

 does create some problems. I think in the Southeast Conference the 

 request is about $15 million. I just wanted to share that reality 

 with you. 



We have had a great deal of discussion on the merits of why the 

 Tongass is different. As you indicated, you were back in Washing- 

 ton during the ANILCA drafting and I think we have to look at the 

 issue both ways. As you recall. Governor, we have done a fair job 

 in relationship to the job issue, inasmuch as there are two pulp 

 mills in Southeast Alaska providing jobs. 



What I do not think we have done adequately, as reflected by my 

 colleague from Colorado, is the other side of the issue. We had no 

 wilderness in Southeast Alaska prior to ANILCA in 1980. That leg- 

 islation set aside out of the commercial forests in Southeast 

 Alaska, not just the area but the commercial forests, the areas that 

 were selected for reprobation purposes by various environmental 

 groups, 1.7 million acres were put into wilderness, and that was a 

 very positive thing. That precise process has not been done in other 

 forests. 



The question is what price wilderness? This has been discussed 

 at great length because you take an area out of a commercial 

 forest and put it in wilderness and we see the redwoods and that 



