Roadless Forest Rules and Their Effect on the Global Deforestation EpidemicDavid [email protected] 4535 Natural Resource EconomicsSharma, Fall 2006The often heated public debate over the appropriate use and the significance of our forests has been going on for over forty years. It entered the national consciousness in 1970 on Earth Day, as part of the first educational and political forum for the environment. Earth Day celebrations that year “forcibly thrust the issue of environmental quality and resources conservation into the political dialogue of the Nation.” 1 The recent reversal of the Roadless Forest Initiative once again spotlights the conflict between environmentalists, arguing for utility, and firms, operating for profit, in the forest industry. Conservationist thinkers in the early 1900s usually believed that the only benefit from temperate forests was material wealth, timber. I chose make the distinction between temperate and tropical forests mainly because tropical forests are still very foreign to scientists today. Tropical forests are defined as any forest between the two tropics. They offer a much greater discovery value than temperate forests because of their immense biodiversity. For the purposes of this paper, whenever is use the term “forest,” I am referring to temperate forests. Forestry management requires a balance between market uses and nonmarket uses. The market uses include the optimal rotational period for harvesting timber, and the nonmarket uses include the total social benefit the forest provides (these include non-commodity values – the economic value of recreation, as well as non-market values – scenery, atheistic, and scientific concerns). There are essentially three categories of forest owners. First, there are private households. The households can choose to maximize profit or utility as they see fit, they also can lease their land to the second group of owners – private firms. These firms in the forest industry use forests for the sole purpose of profit maximization; the Roadless ForestInitiative prevented these firms from leasing land from a small portion, the roadless areas,of the third category – publicly owned forests. 2 Examples of publicly owned forests include national parks and national forests as well as wildlife refuges, game management areas, and nature preserves.Roadless forest areas have existed for years in the United States. Prior to World War II, areas of land were designated as “wilderness, wild, or canoe areas.” 3 Though to recoup from the costs of the war, roadless areas decreased in the 1950s and 1960s to allow for more resource extraction. This order came down direct from the administration in an attempt to bolster the post-war flailing economy. These two decades showed the first signs of financial danger for the US Forest Service. The Wilderness act, signed in 1964, allowed the term “wilderness” to forest areas “where the earth and its community of life are untrammeled by man, where man himself is a visitor who does not remain.” 4 During the period between the signing of the act, and 2005, environmental conservation advocates were able to increase the protected roadless areas from 3.7 to 13.8 million ha 5 (one hectare is equivalent to roughly 2.5 acres). The Roadless Forest Initiative policies instated by the U.S. Forest Service and President Clinton in January of 2001 during the last eight days of his second term, 6 protected 58.5 million acres throughout 39 states, roughly 2% of the U.S. land base. 7 These laws do not limit access to the forests in any way, they only protect against future road development. Under the roadless forest rule all current opportunities for public access and recreation are still made available. When President Bush repealed this law in 2005 he opened up the doors for below-cost timber sales in pristine, untouched forests. Below-cost timber sales occur when the revenues generated from the harvest do notadequately cover the timber-related forest management expenses, such as roads and recreational amenities (these amenities will be discussed further with the Recreational Sites and Facilities Master Planning program). Because of the complexity of associating particular costs to specific uses, roads are usually not included with the timbering costs when a bid is placed on a plot of forest land. 8 By forgoing the estimation of the costs of building and maintaining roads, four disparities arise. Firstly, the quantity of roads needed by logging and mining firms exceeds the quantity of roads needed by recreation users. Second, poorly designed roads may lead to damage to the environment. Third, logging and mining activity may greatly diminish the nonmarket value (aesthetic and ecological benefits) of certain areas. And finally, once the roads are in place the forest canno longer return to its “wilderness area” state, it will forever be a replanted, secondary forest. 9With an already estimated $10 billion backlog on existing Forest Service roads 10 President Bush seemed to have picked an inopportune time to reverse this rule. Up to 4.4 million acres in Colorado have the possibility of being opened up to logging and mining companies. With the chance of these new markets, new roads will be built to support the extraction, and below-cost timber sales will most likely follow. The maintenance, and revegetation, costs of these roads would only get added to the Forest Service’s backlog. Like our national debt, the Forest Service has also been seeing increasing forms of deficit. Even if opening these roadless areas to possible logging would take some pressure off of our national debt, it would not take any off of the Forest Service. Logging in new territories didn’t work in the post World War II recession and it will not work now.The opening of these roadless areas to logging and mining is only a temporary solution toboost the economy, and it will lead to greater inefficiencies else ware amongst forestry management, as shown below.In the figure above 11 MPC represents the costs burdened to the timber companies for the harvesting; not taking into consideration any costs or fees paid to the Forest Service. The firm will harvest at m1 if none of those fees are accrued, this is because at m1 marginal revenue equals the marginal cost to produce one more unit. Under the current Forest Service policies, the optimal allocation of forest would be at m3 or m4.