441 



My environmentalist friends assure me that the pulp mills would continue to 

 operate despite the unilateral abrogation of these contracts. I suggest that this is 

 disingenuous in the extreme. The voiding of the contracts by the U.S. government 

 could be interpreted in only one way by the other parties: the volume of wood 

 required for economic operation of the mills not only will not be guaranteed, but, by 

 inference from the fact of cancellation, the necessary timber will actually be denied. 



There would be little reason for either mill to attempt to continue operation, and 

 every reason to sue for damages. I find it extraordinary that neither the Mrazek nor the 

 Wirth bill addresses the issue of compensation, to which there is no doubt the pulp 

 companies would be entitled should either of these bills be enacted. I am not 

 suggesting that either of these bills would be acceptable to the people of Southeast 

 Alaska if there were compensation. I do suggest, however, that the reason the figure is 

 not in the bills, is that it would grossly exceed the net annual cost of what the enemies 

 of these contracts call the Tongass subsidy until the contracts expire, and would put 

 the lie to any claim that passage of these bills would save money for the U.S. 

 Treasury. 



There is a parallel situation in the country at the present time. As Senators you will 

 be called upon this year to approve legislation that will cost upwards of one hundred 

 billion — that's billion with a B — dollars to honor the deposit insurance claims of 

 depositors in failed, and in many cases, fraudulently run, savings and loan institutions. 

 The rationale is that the credibility of the United States in honoring its obligations is 

 as stake. I have yet to hear of anyone in public office suggest that the government not 

 honor this obligation, despite its astounding cost. 



I and thousands of my townspeople, Senators, have a much more modest claim 

 against the full faith and credit of the United States, and that is that the spirit of the 50- 

 year contracts that underpin our economy continue to be honored. 



