TIMBER GROWING AND LOGGING PRACTICE IN CALIFORNIA 73 
The likelihood that insects will cause serious loss of reserved trees 
on cut-over lands does not appear great, judged by conditions on 
old cuttings, though damage may occur locally. The future of 
sugar pine as a potential host of the white pine blister rust, is some- 
what in question, but even its obliteration from the forests, which 
is not to be anticipated, would not be an overwhelming loss, for the 
other species which would replace it are of recognized value and 
forest management would still be possible. 
It is in cost of production that the greatest apparent obstacle 
to private timber growing lies, and two elements in particular have 
acquired a disproportionate importance in the discussion. These are 
taxes and compound interest. At present the actual tax on most cut- 
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Fig. 24.— cut-over LANDS AS AN ASSET 
By reserving the smaller, thrifty trees, the owner of this forest area has left 
it producing wood at a rapid rate. A second cut can be made within a few 
decades. 
over lands in California is not high, about 3 cents an acre each 3^ear, 
and this is on many holdings more than returned by income from 
grazing leases. It is rather the fear of large future increases than 
the existing situation that deters the potential grower of timber. 
Fortunately, the principle of special tax treatment of cut-over forest 
lands has been recognized already in several States, and there is 
but little question that a solution will be reached in California. 
In 1923 a tax-relief bill was passed by the legislature, and though 
vetoed^ shows clearly the recognition of the problem and the desire 
to remove this stumbling block to commercial timber growing. 
Even more obstructive is the traditional concept of compound in- 
terest as the controlling factor in the cost of production. But, as has 
already been shown, compound interest is not of importance when 
timber growing is part of a going logging operation. 
