SOS Forests

The Greenhouse Effect

The sun came out in W. Oregon today, and a welcome visitor it was. Temps shot up into the upper 50’s, a comforting change from the soggy lower 40’s. I swear the grass grew an inch.

Much to do on Mike’s Back Acres: pruning, spraying, planting of trees, tilling, planting of peas, starting starts in the greenhouse, etc. In the coming weeks more time must be spent on the agrarian actual, less on the digital virtual, which will be nice for me.

The solar blessing of the day got me to thinking about the dreaded greenhouse effect.

I assume we all know why greenhouses have that word “green” attached. And that we all know why people build them and what greenhouses are used for. In case there is any confusion, greenhouses are places for growing plants, where the climate can be warmed, because plants like it warm.

Some folks worry that global warming, should it occur, will have a negative impact on agriculture. Grotesque Algore warns of “agricultural deterioration” [here]. Obama’s spanking new Secretary of Energy and Media-acclaimed genius-type Steven Chu warned [here]:

“I don’t think the American public has gripped in its gut what could happen,” Chu told the newspaper. “We’re looking at a scenario where there’s no more agriculture in California.

Excuse me? You’re tripping, Stevo. Plants like it warm. The warmest places on the planet are Equatorial jungles, and they’re called jungles for a reason.

The warmest place in California is the Imperial Valley, a below-sea-level inland basin south of Death Valley. It is also one of the most productive agricultural areas in the USA. In 2007 tiny Imperial County produced $1.37 billion in farm commodities [here].

Get it? Warmer is better for agriculture. Farmers in the Imperial Valley are harvesting right now while farmers in the Willamette Valley are looking at rain-soaked fields and just starting to think about planting.

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Unappealing Authority, Or Whom Can You Trust?

In our modern day and age we face a plethora of social and political issues that revolve around science. Whether the weather or questions of global warming, forest management, wildlife management, economic crunches, morbid obesity, dog training, ear wax, or what have you, the arguments frequently rely on the expertise of authorities.

An “authority” is an expert with uncommon knowledge about a particular subject. In our modern day and age, authorities often bear Ph.D. degrees and publish in peer reviewed journals, both of which are de facto qualifications for their lofty perch.

Of course, certain recognized authorities may be completely wrong in their scientific assessments, or stray beyond their field of expertise, or may be utter charlatans. Or they may be unappreciated geniuses whose bullseye pronouncements are largely ignored.

In our modern day and age, sometimes it’s hard to tell which is which.

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The Great Montana Land Swindle Sleazes On

by Dave Skinner

The Montana Legacy Project just announced its second phase of a plan to spin off 312,000 acres of unwanted Plum Creek forest land to other buyers. The entire package was, until yesterday, priced at $510 million. Now it’s apparently $490 million.

It is my conclusion that the Legacy Project is an indicator of an “end game” in the REIT/TIMO phenomenon that has swept away the “timber industry.” Wall Street and Capitol Hill created a business and tax environment that leaves us a world in which the timber beasts are no more. They’ve been replaced by real estate beasts, with huge implications for forestry and land use all across America.

The REIT/TIMO creature was born in Montana, when Plum Creek Timber Company (NYSE:PCL), the largest private landowner in the US, pioneered the conversion of integrated forestry corporations into REIT’s with taxable operating subsidiaries. The tax advantages of doing so first put PCL in a superior cash position which in turn allowed it to buy large blocks of land from cash-strapped integrated companies.

Some of you may have read the excellent SOSF discussion [here] about the “Valuing Timberland” post put together by former Westvaco forester J. Brian Fiacco on his Timberland Blog [here]. His follow-up three installments [here, here, here] give a superb nutshell of how timberland is valued as well as what PCL and other REITs/TIMO’s do when they buy ground.

In short-short, Plum Creek busted their land up into “HBU” real estate, to log off and then sell for “trophy” homes; core timberland, to log and then manage as a forestry investment; and other lands, to log and then sell at whatever price to whatever sucker they can find.

But the low fruit on the forest money tree is now about gone. In a February 2nd Plum Creek earnings call [transcript here], one of PCL’s major investor reps notes that about 15 to 20 million acres of industrial ground has now been transacted and the big hunks are gone. PCL currently owns around eight million of that, meaning it was able to buy a third of the national pool using the cash from logging its Montana holdings and its early-adopter advantage as the first big timber REIT. But the first wave is over, the first harvest of cash profit and leverage petering out.

The next phase is clearly, to begin disposing of the junk holdings that present a negative present value or negative cash flow. And only suckers are interested in such things.

The sucker in this case is the federal government, and the government’s point-pork man, Max Sieben Baucus, D-MT. Of PCL’s junk sales in Montana, the end-buyer of 85% has been the Feds (the Forest Service), brokered through the Nature Conservancy, at prices a rational buyer would find completely nuts. The overpayment is always politically covered by cries about “conservation” and “saving land.”

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We Need a Horse To Push the Cart

by bear bait

Hi Mike: Sunday I did my citizen due diligence and attended the Independence stop on the Wyden town hall meetings around the State tour, done in weekend chunks all year long. This is my report, or really my impressions of that meeting.

There were about 100 people in attendance at the pretty new and wonderful Independence Library. Most were geriatric supplicants from around the county, there to support their guy while he preached to his choir. Independence itself is 35% or more Hispanic, and demographically they are an older generation of post WWII Tejanos (US citizens) from the lower Rio Grande agricultural areas of southeast Texas, who came to replace the Okies in farm labor while the Okies were taking jobs in the mills and logging camps after coming home from the War.

They are a wonderful group of senior citizens, and they and their offspring are a core group in good citizenry for Independence. The rest are of recent arrival and dubious papers. We do have an all Hispanic aliens-only Headstart program which acts as a summer babysitting service for women needing to work in the fields. However, none of those were at the meeting. In fact, there were two people of color that I could see, one an Asian lady and a retired WOU prof of Asian (India) background. I also saw at least two people under 20 and a small sprinkling of people between 20 and 40, most of whom were either press or Wyden staff.

The rest in attendance were old farts like me, and quite concerned about their entitlements as they take their final steps to eternity. What’s in it for me? was the general question raised. That and some FAA decision that might keep airpark folks from accessing the State airport from their private taxiways, thus lowering property values… me, me, me. America at its best. None expressed concern for lost jobs or the collapsing economy. What will my take be? What is in it for me? And also punish Bush. Get that Bush administration and Halliburton… (under my breath I said to one and all: “Get a life, dudes.”)

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The Montana Legacy Project: Worth the Price?

by Dave Skinner

In late June 2008 U.S. Senator Max S. Baucus (D-MT), along with representatives of Plum Creek Timber (PCL), the Trust for Public Land (TPL), and the Nature Conservancy (TNC), announced the “Montana Legacy Project” or MLP.

The Project covers 312,000 acres of “non-core” Plum Creek commercial forest in several western Montana counties: Missoula (223,400 acres), Mineral (42,800 acres), Lake (35,500 acres), Lincoln (13,800 acres) and Powell (3,900 acres). MLP plans to allocate proportions of roughly a third each to: The U.S Forest Service, Montana Department of Natural Resources and Conservation (DNRC), and private owners.

In general, the asking price for MLP is $510 million, an average of $1,634 per acre. $250 million in Federal funds is set aside for the Forest Service to buy 112,000 acres (roughly $2,232 per acre), while the Montana state legislature is considering a general issue of $21.5 million in bonds for 27,000 acres south of Potomac, around $796 per acre.

Is that price fair? Should the State of Montana obligate its citizens to a bond issue and other spending that may or may not retain 36 jobs, for $10 million per job? Should Montana buy forest lands when current information indicates the price is five to twelve times what the land is worth? Is this project truly a “legacy”?

Before purchasing forest lands, especially so much land with so much money, rational buyers undertake due diligence, seeking information relevant to the decision, in this case timber inventories, growth potential indices, species composition, mineral estate issues, taxation and other issues, before buying.

Lack of disclosure on the part of a seller warrants caution on the buyer’s part, the less disclosure, the more caution. In short, caveat emptor – buyer beware.

In the case of MLP, which involves a half-billion dollars in what history indicates will be a 90% publicly-financed scheme, one would expect troves of information freely available to not only public officials, but also the citizens who will ultimately fund MLP.

Instead, “hard” information from MLP proponents has been nonexistent. While there have been plenty of buzzwords bruited about, relevant numbers have been released only sparingly, or totally held back as “proprietary business information.”
The minimal information that has somehow managed to escape MLP’s “cone of silence” has been less than reassuring – alarming would be more apt.

Timber Value

While MLP is being pitched as a “conservation” deal, Montana’s recent fire seasons have proved the truism that forest land is best-off managed. Management costs money. The primary way to pay for forest management costs is by producing forest products.

Well-managed forests provide not only timber and associated employment, but the full range of “conservation” and recreation “values” the multiple-use public desires.

To support a simple six-percent mortgage on MLP’s “buy” of $510 million, an investor would need to realize at least $30.6 million in cash flow each year, and more to pay off the principal. How much wood needs to be on MLP to support its price?
Using Plum Creek’s rule-of-thumb of 6 to 7 percent growth aggregation, assuming a price range of $175 to $265 per thousand board feet of harvest, and further ensuring that sustainable harvest does not eat into the standing forest inventory “principal,” MLP would have to have, at a minimum, between 2 and 2.9 billion board feet of standing timber today, yielding between 115 and 174 million board feet of harvest each year.

Does it? Plum Creek CEO Rick Holley told the Flathead Beacon he “does not know” how much wood MLP lands contain, only that the MLP land trust partners conducted an inventory and were “satisfied.” Other company and land trust representatives have repeatedly said inventory information was “proprietary” or otherwise restricted.

The only information that gives even a glimpse of actual MLP ground conditions is a September 5, 2008 “Fiber Supply Agreement” (FSA). The FSA gives Plum Creek a first right of refusal to harvest 92 million board feet in ten years, an average of 28.5 board feet per acre per year. The FSA further states that MLP is growing 29 million feet of wood per year, or 93 board feet/acre/year – a figure oddly above DNRC’s production average of 63 feet/acre/year.

The first number, if based on sustained yield from actual inventory, implies a timber base of only 153 million board feet, worth only $26.8 million, or $86 per acre. The second number, if based on actual growing stock, implies a “base” of 483 million feet worth $84.5 million, or $271 per acre. Both figures are far below MLP’s “ask” of $1,634.

Montana DNRC has conducted an appraisal on MLP’s Potomac parcel. Over the next 60 years, DNRC expects to harvest 44.2 million feet from Potomac’s 27,000 acres, an average of 27.2 board feet/acre/year. This productivity appears somewhat lower than MLP’s at-large productivity of 28.5 feet/acre/year.

Such marginal productivity may explains why the price for Potomac is “discounted.” But the price, $796 per acre, remains far above the apparent value. In constant dollars, discounted at 6 percent, DNRC’s planned Potomac harvest is only worth $2.33 million, or about $86 per acre.

Adding in the net present value of a 10,000 foot/acre harvest in year 60 ($53.05), the range of values for MLP based on proponent information run from a low of $139 to a high of $324 per acre. This in turn forces the conclusion that MLP’s asking price is from five to twelve times (not percent, times) the ability of the forests to pay for themselves.

Jobs

Montanans concerned about losing the timber “leg” of Montana’s economic-diversification “stool” might be willing to pay a premium if the premium could be made up by a positive jobs impact from MLP. MLP partner Trust for Public Lands has registered a website to promote the Legacy Project as a source of employment (www.montanaworkingforests.org). However, the site makes no direct claims of how many “working forest jobs” MLP may or may not create. Why not?

Using the data from FSA and DNRC’s Potomac appraisal as well as an industry rule-of-thumb for primary forest jobs around 5.5 jobs per million feet of harvest (one logger for three millworkers), MLP looks to have insignificant employment impact.

The planned FSA harvest level is only a bit over one percent of Montana’s recent harvest levels of around 800 or so million board feet, a yield already well below historic yields now that the Forest Service has left the arena.

Rounding the FSA annual harvest up to an even ten million feet gives MLP an impact of 55 jobs, meaning MLP would “buy” jobs at over $9 million each. But after the FSA expires, many expect the Forest Service will cease routine harvests on its “share” of MLP, reducing MLP’s total impact to around 36 jobs, and increasing job “price” to $14.1 million each. Breaking out the Potomac parcel separately, the slightly more than four jobs “bought” come in at $6.67 million each.

Nonetheless, management activities will always be necessary on MLP no matter the ownership. In other words, claims that an “investment” in MLP will create jobs, or retain existing jobs, cannot be credibly made.

Note: author Dave Skinner is a Montana freelance journalist who has written for Evergreen Foundation and Range Magazine, and is a frequent contributor to SOS Forests. He doesn’t like being ripped off by large corporations making sweetheart deals with on-the-take Senators and lying multinational “enviro” consortia. Nor do we.

See also The Great Montana Land Swindle of 2008 [here]

Last Gasp of a Dying Newspaper

Today the bankrupt Seattle PI, days away from closure due to insolvency [here], published a vicious attack on the Boy Scouts of America. While railing about “bans” against gays and atheists, the purpose of the lie-filled diatribe was to “expose” the fact that the BSA has logged (gasp, oh dear) a handful of acres over the last 20 years.

The hit piece from the soon-to-be-defunct Seattle Un Intelligent is [here]. Some choice quotes with revealing commentary follow.

Profit trumps preservation for Boy Scout councils nationwide

They logged, sold thousands of acres of prime lands

By Lewis Kamb, Seattle Post-Intelligencer; Todd Bensman, San Antonio Express-News; Nadja Drost, Albany Times Union; Lise Olsen, Houston Chronicle; Seth Rosenfeld, San Francisco Chronicle — Jan 29, 2009

For nearly a century, the Boy Scouts have worn a self-adorned badge as campsite conservationists and good stewards of the land.

“The Boy Scouts were green before it was cool to be green,” said the organization’s national spokesman, Deron Smith.

But for decades, local Boy Scouts of America administrations across the country have clearcut or otherwise conducted high-impact logging on tens of thousands of acres of forestland, often for the love of a different kind of green: cash.

A Hearst Newspapers investigation has found dozens of cases over the past 20 years … Scouting councils have logged across at least 34,000 acres.

My oh my! That’s 1,700 acres per year. Compare and contrast that with the US Government which has burned 100 million acres in wildfires during the same period. That’s 53 square miles for the Boy Scouts versus 156,000 square miles for the Feds, a ratio of 1 to 2,940.

Or consider the Hearst Corporation which clearcut their 67,000 acre estate in the McCloud River drainage in Northern California.

The Boy Scouts may have logged on 34,000 acres over 20 years, but they did not clearcut them all. The BSA owns summer camps and they attempt to maintain healthy forests for the safety and use of the campers.

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Bribery In Action: Mt. Hoodgate

In September, 2006 SOS Forests reported on Mt. Hoodgate, a sweetheart bailout package for a multi-million dollar company and its tycoon owner [here]. The Oregonian reported it too, in a full-color editorial that called for the American taxpayers pony up the cash and land to buyout/tradeout a private company.

Well, it happened. S. 22, the Omnibus Public Land Management Act of 2009, was passed Sunday by Harry Reid and the US Senate, their very first action of 2009. The entire Act is 1,264 pages and may be downloaded [here].

I haven’t read the whole thing yet (it’s 1,264 pages long), but right there on pages 62 to 66 is the sweetheart landswap with the millionaire, laid out in black and white or more properly red ink for taxpayers. All that is missing is the quid pro quo that sleazed into Sen. Ron Wyden’s back pocket.

SEC. 1206. LAND EXCHANGES.
4 (a) COOPER SPUR-GOVERNMENT CAMP LAND EXCHANGE.—
6 (1) DEFINITIONS.—In this subsection:
7 (A) COUNTY.—The term ‘‘County’’ means
8 Hood River County, Oregon.
9 (B) EXCHANGE MAP.—The term ‘‘exchange map’’ means the map entitled ‘‘Cooper
11 Spur/Government Camp Land Exchange’’,
12 dated June 2006.
13 (C) FEDERAL LAND.—The term ‘‘Federal
14 land’’ means the approximately 120 acres of
15 National Forest System land in the Mount
16 Hood National Forest in Government Camp,
17 Clackamas County, Oregon, identified as
18 ‘‘USFS Land to be Conveyed’’ on the exchange
19 map.
20 (D) MT. HOOD MEADOWS.—The term ‘‘Mt.
21 Hood Meadows’’ means the Mt. Hood Meadows
22 Oregon, Limited Partnership.
23 (E) NON-FEDERAL LAND.—The term
24 ‘‘non-Federal land’’ means—

1 (i) the parcel of approximately 770
2 acres of private land at Cooper Spur identified as ‘‘Land to be acquired by USFS’’
4 on the exchange map; and
5 (ii) any buildings, furniture, fixtures,
6 and equipment at the Inn at Cooper Spur
7 and the Cooper Spur Ski Area covered by
8 an appraisal described in paragraph
9 (2)(D).

In September of 2006 we reported that the US Government Accountability Office investigated the deal, and the investigators had serious problems with the land appraisals. It seems the appraised land values on the acres the private company, Mt. Hood Meadows Oregon, Limited Partnership, wishes to convey to the government were hugely overstated.

The parcel of land that the private company wants to exchange is roughly 770 acres of fresh clearcuts. It is almost worthless. The land used to belong to Hood River County, up until a few years ago, when the private company swapped their Dog River 850 acres for HRC’s 770 acres. The HRC Forestry Department had previously clearcut 80 to 90 percent of the 770 acres over the last 20 or so years.

At the time of the land swap, the company was led to believe they could put a destination resort on the clearcut land, a land use the county had denied them on the Dog River property. Then the old switcheroo was pulled by HRC, and the company was left holding a bag of clearcut land they couldn’t use.

Business is business. Everybody went into the deal open-eyed. If both parties’ vision was clouded by greed, it is their own fault. If there were contract faults or mis-performances, then sue. Don’t ask the American taxpayers to bail out millionaires!

However, Oregon’s Congressional Delegation did exactly that, setting it up via S. 22 so that American taxpayers bail out the company. S. 22 calls for swapping 120 USFS acres in Government Camp for the 770 acres in HRC. The problem is, the 770 acres is nearly worthless, and the Government Camp acreage is worth millions.

Furthermore, the USFS has no desire for the clearcuts. They already have enough of that. The 770 acres does not block them up, but spreads Federal ownership out into private lands in an intrusive smear. This is in direct opposition to their Congressionally mandated land trade/acquisition policies.

The 770 acres has no special resource values. If it did at one time, the people of HRC took care of that by clearcutting it. If the 770 acres still has resource values, then the clearcuts didn’t impair them, and there is no need for the government to acquire the clearcuts to “protect” anything special.

The whole deal is out of the norm for USFS land swaps, to say the least. Frankly, the whole deal is a scam to enrich the rich at taxpayers’ expense. The actual parcels are just symbolic fronts for vast sums to be drained from the Federal Treasury to wealthy donors and to Ron Wyden.

Quid pro quo. You jam money at the Senator and he will reach into the Federal Treasury and pay you back a hundred-fold with the taxpayer’s land and money. That’s the way the bribery game works. He’ll write a special sweetheart law just for you, if you reward him handsomely for it.

Government land for sale or trade cheap, to the land sharks who play the game.

Note: more to come on S. 22. It is 1,264 pages after all, and there is enough sleaze in it to choke an elephant.

Higher timber taxes not the answer

By Bob Zybach, Guest Viewpoint, Eugene Register Guard, Nov. 3, 2008 [here]

I am in full agreement with Bill Barton of the Native Forest Council’s characterization of the recent award of $740 million over the next four years to Oregon’s timber counties as “federal welfare” (guest viewpoint, Oct. 21). Very little of that money will be used to create much-needed tax-producing jobs, and none of it would be necessary at all, if only our federal lands were better managed.

I disagree with virtually everything else Barton states, however, and the manner with which he states it.

Barton’s basic argument is that, because the federal dollars equal about $10 per year for each of the 18 million acres of federal forestlands in Oregon, and because private forestlands pay about $1.25 per year tax on each of their 11 million acres, private lands should start paying more taxes and stop exporting timber. That, he says, will help finance schools and roads and allow federal lands to “recover.”

First, the “federal welfare” Barton decries will last only four years, and private property taxes are forever. Second, federal lands pay no taxes at all. But third, and most importantly, federal lands have been all but closed to active management for nearly 20 years, are being incinerated in “let-it-burn” wildfires and left to rot without salvage — and all without producing any meaningful income for our schools and roads. Another way to look at these figures, according to the Oregon Department of Forestry, Oregon State University and the Pacific Northwest Forest Experiment Station, is that Oregon’s forest industries support 190,000 direct and indirect jobs with a total of $22 billion in annual economic output — about 11 percent of the total output for all of Oregon. Nearly 85 percent of that amount comes from the 11 million acres of private lands, and only about 15 percent comes from the 18 million acres of federal forestlands.

That is, the majority of Oregon’s forestland — those lands managed by the federal government — produces about 27,000 jobs and $3.3 billion in economic output, while only one-third of the land — privately owned and annually taxed — accounts for more than 160,000 tax-producing jobs and more than $18 billion in output. That’s a lot of unfunded schools and roads in timbered counties, and it renders Barton’s $10 vs. $1.25 per acre tax argument nearly meaningless.

Also debatable is Barton’s claim that “there is no sound environmental reason to log.” There are, of course, many sound environmental reasons to log, including homes for shelter, furniture, heat, paper and packaging in our cities; and beauty, sunlight, recreation, robust wildlife populations and reduced wildfire risks in our forests.

Barton touts the values of “standing” forests as producing clean air and water, topsoil and “biodiversity.” These are exactly the same values realized by a managed forest. And what happens when the standing trees are blown over in a windstorm, as often happens, or killed by bugs or fire?

Barton claims that our “precious” lands could be allowed to “recover” and that these lands “would provide carbon sequestration, flood control, clean air, clean water, and a plethora of wildland experiences to a community that treasures them.” Again, these are exactly the same values already realized from our “pre-recovered” forests. What is Barton missing?

Why the seemingly urgent need to stop managing forest lands, and why is that called “recovery”? Do lawns recover after they are mowed, or orchards after they are picked? Or do they just keep growing and producing, so long as they are properly tended?

Finally, there is the inflammatory rhetoric with which Barton expresses his delusional charges. One example is, “the logging industry … has trashed our drinking water, wiped out our fish runs and pushed several species to the brink of extinction.”

Of course, logging has done no such thing, as must be obvious to any Oregonian who enjoys fishing or drinking water — or knows anything factual about the state’s wildlife history.

Another example of Barton’s rhetoric: “the publicly funded death of our forests” sponsored by U.S. Sen. Ron Wyden and Rep. Peter DeFazio, who are “firmly in the pocket of dishonest corporate interests.”

Why would “dishonest corporations” want to finance the “death” of Oregon’s forests (whatever that means), if that were even possible? Who would vote for such untrustworthy political representatives in the first place? What is Barton really trying to say here about Oregon politicians, voters and businesses? And where is he getting his information?

Barton’s use of such bluster and invective serves only to discredit him and his organization. His uses of hyperbole, dubious statistics and baseless charges likewise undermine his credibility as a critic.

In summary, Barton’s words do not make good sense and should not be taken seriously. Oregon needs more jobs, not more taxes; better forest management, not less.

Bob Zybach of Eugene is a forest scientist with a doctorate from Oregon State University in the study of catastrophic wildfires. The former owner of a reforestation business, Zybach has been program manager for Oregon Websites and Watersheds Project Inc. (www.ORWW.org) since 1996.

America: Foreclosed!

The following essay was penned by the late, great, property rights champion Wayne Hage eight years ago. Remarkably, it applies today more than ever.

by Wayne Hage, Chairman, Stewards of the Range, 2000

Don Young (R-AK) of the House Resource Committee, with considerable help from left wing extremist George Miller (D-CA) and his cadre of environmentalists, were recently successful in the passage of the Conservation and Reinvestment Act (CARA), HR 701. Senator Murkowski (R-AK), is preparing to secure passage of the same legislation in the Senate as S25. CARA would provide money for the purchase of private property by federal, state, local governments, Indian tribes and environmental groups. 2.4 billion dollars per year would be made available from offshore oil revenues. Opponents of the bill say it would eventually eliminate the ownership of private property in America. In so doing, it signals the end of Congress as an independent branch of government.

The debate on HR 701 for all its exuberance avoided the fundamental question. Why does the government need our land? Basic economics tells us that all wealth originates in the land and by extension the sea. The hallmark of a free society has always been citizen ownership of the land. The hallmark of a totalitarian society has been government control of the land.

A free society is, of necessity, a society in which the government must come to the people for its operating budget. A government that must depend on the people for its source of income is one that must listen to what the people and their representatives have to say. The United States was originally structured on the strict premise that the government be limited in land and resource ownership. Indeed, history shows us that free societies and private ownership of the resource base are inseparable, the degree of freedom and the degree of private ownership being basically proportionate.

Coercive or totalitarian societies demand government ownership or control of the resource base. If government controls the means of production it has a source of income independent of the people and certainly does not need the permission of the people to justify its actions. In a coercive or totalitarian society, the people do not need representatives or a Congress to protect property rights that do not exist. They do not need a common law of property because the people have no property. They do not need a Constitution to limit the power of government to intrude into the people’s property rights because the people have no property rights. Government is total; totalitarian. It can, and does, rule by decree.
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Field Fires Versus Forest Fires

The Governor wants to ban the burning of grass seed fields in Oregon. On the other hand, Gov. Kulongoski is all in favor of burning forests. Yet forest fires produce more smoke per acre, and ten times (at least) more forest acres burn every year in Oregon compared to grass seed fields.

The Governor’s stupidity, hypocrisy, whatever you want to call it, was explored in a recent guest column in the Salem Statesman Journal. We post it in full:

Grass Seed Field Burning Makes Sense

by John Thomas Jr.

What are the benefits of grass seed farming, including field burning? Besides producing agricultural income for Oregon, that is?

In summer, urban sewage solids are dumped on grass seed fields as cheap disposal and fertilizer. Only non-food cropland can be used. Grass seed fields are that critical cropland.

Thousands of elderly are on their farms, living out their lives, renting their land to grass seed growers. Confiscatory taxes keep them from selling the land, and grass seed growers are a godsend and economic relief for aging farmers.

To not burn straw means it has to be baled and removed to bale compression stations, and prepared for export to Asia. The whole process is powered by fossil fuels. Straw that can’t be fed still has to be baled and stack burned during winter rains, sacrificing soil and land.

Without stimulation by fire, many grasses (most native grasses) can’t be grown. Perennials have a shorter field life, which means more ground is worked more often, producing that dust haze seen all fall. After straw is removed, fields are flail mowed to accelerate decomposition, which produces fungus spores in great amounts. And uses more fuel.

To keep grass seed farming economically viable, plant breeders select grasses that will, among other traits, produce prodigious amounts of pollen to ensure a bounty of seed, now that plants are not stimulated by burning.

Residues no longer removed by fire feed voles, slugs and other insects. A robust pest population is now controlled with pesticides instead of fire. And more trips across the field, and more fuel burned.

In summary, no field burning results in more fuel use, more pesticide use, more respiratory distress agents produced. More equipment is needed, and that equipment moves more often on our roads, burning more fuel. Ground has to be worked harder and more often, using more fuel and producing more impacts on air quality. The cure has become worse than the disease.

When California wildfire smoke reached Eugene during the Olympic Track Trials, DEQ got hundreds of complaints about field burning of which there was none ongoing. As a result, Eugene lawyers and Gov. Kulongoski are attempting to halt all field burning by 2011. Quite a reaction to a non-event!!

Meanwhile, Wildland Fire Use, the Federal fire policy that allows land mangers to let fires burn at their discretion, a policy that has never been vetted by National Environmental Policy Act procedures as required by law, has wildland fires burning until winter snows in Oregon, putting out vast amounts of smoke every day. The WFU policy is supported by environmental groups, and health impacts have never been addressed. In 2007, wildland fire produced more greenhouse gases and particulates than ALL human sources in Oregon. All human sources. Cut wildland fire by half and you cut air pollution in Oregon by 25%.

Gov. Kulongoski does not speak out against that smoke and those health impacts. Of course, the second issue would be how burning 300,000 acres and untold amounts of timber and wildlife habitat is considered “good for forest health” when burning 50,000 acres of grass fields is a pox on mankind? Is it that farmers are Republicans and public land managers are Democrats? Or is it just a greedy governor poseur strutting for more political money from his Green supporters?

The Emergency Economic Stabilization Act of 2008

As of Sunday afternoon, the draft Emergency Economic Stabilization Act of 2008 is 110 pages long. The full text (at this time) is [here]. A summary and Section-by Section description may be found [here].

The bill will be introduced in the House of Representatives Monday morning and then head to the Senate. An analysis by Market Watch [here] concludes:

Under the proposed bill, the Treasury Department can use a combination of tactics to buy bad loans, focusing on mortgages and mortgage-backed securities but also including other types of loans under certain conditions. Treasury could purchase the bad debt through an auction process as well as by buying loans directly…

The proposed legislation also allows companies to participate in an insurance program, whereby Treasury would guarantee troubled assets, charging companies a premium “sufficient to cover anticipated claims,” according to the bill.

The government would get a stake in companies receiving bailout funds so that taxpayer money could be recovered if those companies grow in the future, according to the bill. …

In some cases, the bill requires companies limit executive pay, but those limits vary depending on the method by which Treasury purchases a firm’s troubled assets, and how much Treasury antes up.

“When Treasury buys assets at auction, an institution that has sold more than $300 million in assets is subject to additional taxes, including a 20% excise tax on golden parachute payments triggered by events other than retirement, and tax deduction limits for compensation limits above $500,000,” according to a synopsis of the text of the bill.

While the proposed bill prevents companies from signing new golden-parachute deals with top executives after Treasury gets involved, it does not change the terms of already-existing contracts, apparently in an effort to encourage companies to participate in the bailout program. …

The bill puts oversight provisions in place, including creating the position of an inspector general as well as a congressional oversight panel to monitor the program, plus a requirement that the Treasury secretary regularly report to Congress the details of all loan purchases. …

The bill also contains some provisions to help families in financial distress avoid foreclosures, in part by creating a plan to “encourage services of mortgages to modify loans” and allowing the Treasury to use loan guarantees to avoid foreclosures. …

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DeFazio Opposes Bailout

My Congressperson, Rep. Peter DeFazio, Fourth District, Oregon, and I rarely see eye-to-eye on most issues. But on this $700 billion bailout scam, Pete and I are on the same page.

DeFazio opposes the bailout for various reasons, as he states in the email (below) sent to me today. I take certain pause at his wording in places, but I am otherwise in total agreement.

(For instance, DeFazio calls the investment bank bailout “the Bush Administration bailout.” However, Dems like Reid, Pelosi, Frank, and others are pushing hard for the bailout with repellent vigor. Hence, wherever it started, the bailout plan is now a D.C. baby with many illegitimate parents. I can rise above DeFazio’s petty partisanship in this case. I hope you can, too.)

DeFazio’s email of 09/28/2008:

Dear Mr. Dubrasich:

Thank you for contacting me about the Bush Administration bailout. I am vehemently opposed to this bailout.

I was the first Member of Congress to take to the House floor and stand up in opposition to this $700 billion bailout. The financial crisis we face today does not need to be resolved by forking over $700 billion from the taxpayer to the “Masters of the Universe” on Wall Street.

The fundamental premise of the $700 billion Bush Administration bailout is flawed, reckless, and foolish. It is flawed because it is not clear it will achieve its stated objective of injecting commercial banks with liquidity and it ignores the needs of main street America, it is reckless because there are better alternatives, and it is foolish because giving away $700 billion will limit our ability to deal with the myriad of other problems we face such as healthcare, energy independence, and job creation.

To put the sheer audacity of this bailout plan in perspective, a compromise has been talked about that reduces the initial payments to “only $250 billion”. $250 billion would more than double our investment in bridges, highways, transit, and rail in the United States for five years. Investing in infrastructure creates jobs and stimulates the economy. According to the U.S. Department of Transportation, for every $1.25 billion we invest in infrastructure, we will create over 30,000 jobs and $6 billion in additional economic activity. In President Roosevelt’s Works Progress Administration, we invested in building roads, bridges, dams, hydroelectric systems and other public works projects to mend our nation’s broken economy. That money trickled up to Wall Street from Main Street and rebuilt our economy. We did not just throw money at Wall Street with the hopes that the taxpayer might some day be paid back.

I think Congress should respond, but the basic premise of the Bush Administration bailout is flawed. Almost 200 economists wrote to Congress stating “As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson” [here]. The letter went on to raise the issues of fairness, ambiguity, and the long-term effects.

The former chairman of the Federal Deposit Insurance Corp in the Reagan Administration wrote, “I have doubts that the $700 billion bailout, if enacted, would work. Would banks really be willing to part with the loans, and would the government be able to sell them in the marketplace on terms that the taxpayers would find acceptable?” [1] And James Galbraith, an economist at the University of Texas, has asked “Now that all five big investment banks — Bear Stearns, Merrill Lynch, Lehman Brothers, Goldman Sachs and Morgan Stanley — have disappeared or morphed into regular banks, a question arises. Is this bailout still necessary?” [2] I believe the answer is No. I have called on my colleagues to slow down this debate and seriously debate the alternative proposals.

[1] Washington Post. A Better Way to Aid Banks. William M. Isaac. Sept 27, 2008. A19.

[2] Washington Post. A Bailout We Don’t Need. James K. Galbraith. Sept. 25, 2008. A19

For example, many economists have argued that directly helping mortgage holders save their houses would be astronomically cheaper and a more effective in resolving this crisis. And helping working Americans restructure their homer mortgage will increase the value of Wall Street’s depreciated assets. As the New York Time opinioned recently:

“We could make a strong moral argument that the government has a greater responsibility to help homeowners than it does to bail out Wall Street. But we don’t have to. Basic economics argues for a robust plan to stanch foreclosures and thereby protect the taxpayers .” [3]

[3] New York Times. Editorial. What About the Rest of Us? Sept., 26, 2008. A26.

Another serious consequence is the $700 billion hole in the budget deficit this bailout will create. The next administration, Democratic or Republican, will be unable to initiate new proposals as it charts a new course for our nation. The Bush tax cuts blew the surplus created by the last Democratic Administration and the Bush Administration bailout will prevent the next administration from implementing its mandate.

My biggest concern of this bailout is who pays the $700 billion tab. The $700 billion is to protect Wall Street investors, therefore the same Wall Street investors should pay for this infusion of taxpayer money. I have proposed a minimal securities transfer tax of one percent. A securities transfer tax would have a negligible impact on the average investor and provide a disincentive to high volume, speculative short-term traders. Similar tax proposals have been supported by many esteemed economists such as Larry Summers, John Maynard Keynes and Nobel prize winners Joseph Stiglitz and James Tobin.

There is considerable precedent for this. The United States had a similar tax from 1914 to 1966. The Revenue Act of 1914 levied a 0.2% tax on all sales or transfers of stock. In 1932, Congress more than doubled the tax to help finance economic reconstruction programs during the Great Depression. In 1987, Speaker of the House Jim Wright offered his support for a financial transaction tax. And today the UK has a modest financial transaction tax of 0.5 percent. This is a reasonable approach to protecting taxpayers and ensuring the federal budget doesn’t fall further into the fiscal hole.

I will continue to challenge this bailout every step of the way. Again, thanks for reaching out to me. Please keep in touch.

CA Forests Carbon Flim-Flam Scam

File this one under Extreme Absurdity. California has a new program to sell carbon offsets for not logging trees. Here’s the con game: landowners promise not to harvest certain trees, and then are paid $10 to $15 per ton for the growth. The buyers are mainly power companies who pass on the costs to their customers.

The details are murky, but the San Fran Chronicle tried to cast some light in an article that appeared last Sunday [here].

Forests break green ground by selling offsets

Ilana DeBare, Chronicle Staff Writer, September 7, 2008

Evan Smith wrapped a forester’s measuring tape around the trunk of Tree 10525, a towering Douglas fir, to figure out its diameter. Then he used a screwlike device to remove a thin wood sample from the trunk so he could measure its rings.

The bigger the fir, the more it would be worth to Smith. But not as lumber - as carbon.

Tree 10525 is part of the Garcia River forest in Mendocino County, one of two privately owned California forests that have been recruited into the war against climate change as certified sources of carbon offsets.

Carbon offsets - which have become popular among environmentalists over the past several years - are voluntary payments made to initiatives that reduce the level of carbon dioxide and other greenhouse gases in the atmosphere.

Most U.S. offsets so far have supported technology-based projects such as solar power. …

There are so many absurdities in this scam that it is difficult to enumerate them all.

1. There is no global warming — the Earth has been cooling for the last 10 years

2. Carbon dioxide is a trace gas that has no effect on global temperatures

3. Warmer is better, anyway

4. Carbon dioxide is the key nutrient in photosynthesis, essential for Life As We Know It here on Planet Earth

5. Fixed carbon is stored more safely in boards than in trees. Just in case no one noticed, California has experienced 1.3 million acres of wildlfires so far in 2008, most of that in forests. At an average CO2 emission level of 75 metric tons per acre, an estimated 100 million metric tons have been emitted so far, approximately the amount of CO2 produced by 20 million cars driven all year.

6. Most of the forest fire acres were burned deliberately by the government at a cost of more than $500 million. Meaning that they got you coming and going. You pay for burning, for not burning, for boards, for not boards, for this, for that, and for everything until your wealth is transferred utterly and completely into the pockets of flim-flam artists.
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Forest Apocalypse Now

The US Forest Service has gone out of it’s freaking mind. Oregon is now the new Let It Burn Laboratory, and our watersheds are targeted for incineration.

The horrendous new “plan” to incinerate Oregon forests was accidentally exposed by Oregonian reporter Matthew Preusch yesterday, the very day that the Mitchell watershed was deliberately incinerated by insane nutwads from the Ochoco National Forest. Some revealing excerpts [here]:

Some Oregon wildland fires, rather than being suppressed, are allowed to burn

MATTHEW PREUSCH, the Oregonian, August 18, 2008

Concerns about budgets, forest health and overstocked woods lie behind the interest in the management technique

BEND — When a lightning storm rolled across central Oregon this month, firefighters quickly mobilized to quash the scores of new wildfires.

But on a handful of fires they chose to hold back, using instead a new tool that allows them to designate certain low-risk blazes as beneficial to the forest.

“We really like it,” said Chris Hoff, fire management officer for the multiagency Central Oregon Fire Management Service. “It gives us the opportunity to treat areas with natural fire that before we couldn’t.”

Last month, the Ochoco National Forest completed a plan for managing wildland fires, the fifth national forest in Oregon and Washington to do so. Others are the Okanogan-Wenatchee, Wallowa-Whitman, Deschutes and Willamette national forests, said Glen Sachet, regional spokesman for the U.S. Forest Service.

Guess what, Chris. WE REALLY DON’T LIKE IT WHEN YOU INCINERATE OUR FORESTS.

No “plan” was vetted through any NEPA process by the Ochoco NF. Nothing appears on their website regarding any “plan.” That kind of clandestine activity is patently illegal. But the “Little Hitlers” apparently have some secret document that they think justifies their deliberate incineration of Oregon watersheds.

The Bridge Creek Fire is now 4,900 acres (7.7 sq miles). Most of the ground burned is PRIVATE PROPERTY, not Federal land.

Where is the doc that says the US Government can now burn public and private land with impunity? You know, the one that the Little Hitlers in the USFS really, really like?

Why not come clean and produce the alleged secret document that gives you such a BIG ASS THRILL?

Did the Little Hitlers have a party to celebrate their FOREST APOCALYPSE PLAN? Did they wear little party hats and eat some cake?
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One By One

What is a land swindle? A prime example is the O&C land frauds and double dealings that have gone on in Oregon since the 1870’s. Wealthy industrialists have been bribing elected representatives for over 100 years and lining their pockets the whole time while impoverishing the citizenry, exploiting forests, and destroying the landscape.

You can read all about it in this history:

One By One: A documented narrative based upon the history of the Oregon & California Railroad Land Grant in the State of Oregon, by Robert Bradley Jones, Sources Magazine, Inc. 1972-73.

“When bad men combine, the good must associate, else they will fall, One by One, an unpitied’ sacrifice in a contemptible struggle.” Edmund Burke, 1975

Full text [here] (4.3 MB)

Then draw your own comparisons to the latest Great Montana Land Swindle of 2008. The parallels are many. The outcomes will also be similar. If you live in Montana, you just got screwed. You may not realize it now, but your children and grandchildren will suffer because of it. That is, unless they are among the fat cats that just profited by looting the Federal Treasury.