Mr. BURNS. Some. Mr. RESNICK. This is where you see the hope of bettering yourself by going to school and on-the-job training? Mr. BURNS. Yes, sir. Mr. RESNICK. In other words, you do not want to go back to the other? Mr. BURNS. I am not going to go back to it. Mr. RESNICK. Any questions, Mr. Zwach? Mr. RESNICK. I have seen this process happening. I think that what Mr. Rubinstein is saying is that we ought to speed it up, that these programs ought to be intensified-that these programs ought to be adjusted so that those people can participate. I think it is basically this incentive that is required. Is that not correct? Mr. RUBINSTEIN. Yes. Mr. RESNICK. So that more people like Mr. Burns can enjoy them. How much do you earn a week? Mr. BURNS. About $73 a week. Mr. RESNICK. Do you have a nice place to live now? Mr. BURNS. Yes. Mr. RESNICK. Low-cost housing or what? Mr. BURNS. $10 a week. Mr. RESNICK. $10 a week? Mr. BURNS. Yes. Mr. RESNICK. I want to thank you. I want to thank you all for coming. I hope that I have asked all of the questions necessary. If none of you gentlemen have any further questions we will proceed to the next witness but once again I would like to stress the lesson I think we have learned here. I say this in all sincerity-where the pressure has to be built up is on the local community and the State because if they do not enforce their laws, it cannot be done from Washington. The manpower is not available. The money is not available. The program is not available. Thank you again very much. The next witness is Mr. Mortimer B. Doyle, executive vice president, the National Forest Products Association. We will be glad to hear from you now, Mr. Doyle. STATEMENT OF MORTIMER B. DOYLE, EXECUTIVE VICE PRESIDENT, THE NATIONAL FOREST PRODUCTS ASSSOCIATION Mr. DOYLE. Mr. Chairman and gentlemen, I am Mortimer B. Doyle, executive vice president of the National Forest Products Association. NFPA with headquarters in Washington, D.C., is a federation of 17 regional, product and species associations representing the forest products industry from coast to coast. I would like to make a comment that at the present moment we are engaged with two other trade associations in attempting to rehabilitate a two-square-block area of housing in the Hough district of Cleveland, using private funds and hiring an architect to do the work of drawing up the plans for the area. We have in the past supported elements of the demonstration cities program. Mr. RESNICK. You say in the past, but not now-is that what you are saying? Mr. DOYLE. No, I would say that we still support the present program. Great Society programs have been a mixed blessing to the forest products industry and, in turn, the rural communities that depend upon the industry for employment. On one hand, programs like model cities and urban renewal open up market opportunities for the industry. The manpower development and training program reduces an obstacle to getting forest products into use by training people in the building trades. On the other hand, the ability of forest products to take advantage of new opportunities in the face of competitive_materials has been threatened by other Great Society programs and administrative practices which reduce the raw material supply of the industry or create uncertainty over future timber supplies. When the industry is unable to capitalize on opportunities, industry-dependent communities do not develop to their potential, rural economies stagnate and their populations move to the cities, frequently compounding urban problems. The lack of coordination between these Great Society programs and other Federal activities is unfortunate. If the reduction of rural poverty is to be a goal of some programs, their effectiveness can be increased by having all programs and activities create an environment in which private investment is attractive. It is only through private investment that long-range solutions to rural poverty problems are possible. As a result of current urban conditions, there are increasing pressures from a small minority of citizens, supported by many poorly informed urban dwellers, to take forest land from multiple-use production in order to create preserves, parks, and various scenic corridors. These pressures only tend to magnify rural poverty and, in turn, the urban problems. When urban problems lead to demands for preserved open space, natural beauty, and recreation, industry investment is discouraged by the uncertainty over raw material supplies. Lacking the job opportunities which investment would provide, rural folks flee to the cities and compound urban problems. This vicious circle must be broken if forest communities are to realize their role in achieving a better rural-urban balance. Nor can the lack of coordination in Great Society programs be held solely responsible for this futility. Other Federal programs and administration practices also work to the detriment of rural development. Take examples from the rash of proposals now threatening existing forest products firms and reducing industry expansion opportunities: proposals like the Redwood National Park, the North Cascades Park, scenic rivers, scenic roads, scenic trails, and other schemes geared to leisure which threaten wholesale withdrawals from the commercial timber base across the Nation and thus the jobs a vital timber industry can provide. While I cannot deny the desirability of having more recreation opportunities available, the size and location of many of the current proposals have been made with scarcely any regard for the rural communities most affected. The economic development of these communities is being sacrificed to provide a rustic sanctuary for a small minority of city dwellers-and, regrettably, the zealots insist on rusticity which will keep the masses out. Last week's Washington Post carried reports of a conflict starting between the preservationist groups who want to set aside half of the Shenandoah National Park as a wilderness area and the local governments who need to develop the water resources of the land. Water is a limiting factor to local development. Likewise, in the proposals to create a North Cascades National Park, in the State of Washington, the wilderness and park enthusiasts have run head on into the skiers and hunters who want their type of recreation. I offer these particular examples to show that the forest products industry is not always in the middle of the controversy. The Redwood National Park situation provides another example. Except for Representative Don Clausen's plan, the other proposals could put thousands of forest area people out of work. There are already world-famous State parks in the area and changing the name to a national park cannot be expected to create new jobs. While a new park might be useful in creating job opportunities where no jobs previously existed, as with Grand Canyon, recreation cannot be expected to replace already thriving industries. Or as Bernard L. Orell, a member of the Outdoor Recreation Review Commission, has clearly stated the fact, "Recreation can add to the economy. It cannot become the economy." A recent study conducted for the Appalachian Commission by Robert G. Nathan Associates supports this contention. Who can be expected to invest in the Humboldt and Del Norte County area of California with the present condition of uncertainty? The forest products industry has held up $150 million in new investment to create jobs in the redwood region until it can be assured that the proposed facilities will have enough raw material to operate. And until a final decision is made on the size and location of a park, no significant investments are being made in the recreation industry. In the meanwhile, the local economy stagnates. Part of the Great Society program is to provide more opportunities to enjoy outdoor recreation. This fits in with other environmental improvement programs for beautification, and pure air and water. The Great Society is also devoted to eliminating poverty both in the cities and in the rural areas. Many forest areas are much involved with Great Society programs. These Great Society programs would be more successful in our view if our land use objectives could be fitted into an overall plan rather than considered individually. The redwood situation provides a clear illustration of our need for a national policy on land use and Government acquisition. Until such a policy is formuulated and private investors and rural communities can have some measure of confidence in their future, Congress cannot expect to have substantial development in many forested areas which are in small communities. The policies and practices affecting the flow of raw materials from federally owned timberlands also can have a profound influence on rural welfare. They now tend to frustrate Great Society rural development programs. In the West, and locally in other areas of the Nation, the Federal Government is the major supplier of timber to industry. In vast areas where there is no alternate to the Federal source of timber supply, the Government wields, of course, a monopoly power. Here, the Government can, and frequently does, squeeze every possible nickel out of dependent mills. Investment in improved or enlarged manufacturing facilities can, thus, be made impossible. Part of the difficulty is that the objectives of Government ownership of timberland have not been adequately spelled out. For several years now the Bureau of the Budget and the General Accounting Office have been putting the Federal timber selling agencies under extreme pressure to use their monopoly power to derive maximum income from every timber sale. This view is myopic. Communities essentially supported by industry suffer if the income maximization objective is pursued too strenuously. Another problem involving Federal forest lands is the level of production when compared to potential output. By increasing the allowable timber cut on Federal lands, the administrating agencies could actually promote the development of dependent communities. While community stability is an admirable goal, stability can mean stagnation if the community is unable to keep up with the growth of other communities. The managing agencies should be encouraged to sell the fullest volume of stumpage the forest is capable of producing. A recent study of Trinity County, Calif., which is mostly federally owned, documented this problem. The study, conducted by Hahn, Wise & Associates, was financed in part through an urban planning grant from the Housing and Home Finance Agency. In summarizing the Trinity County situation, the consultant said: It would not be realistic to say that the forest products industry in Trinity County is on its deathbead. There is bound to be lumber production, by the mere fact that the county is situated in the middle of one of the richest forest areas in the United States. But it is fair to say that the indusry is sick and it is incumbent upon all citizens to make every effort to restore its vitality. We are witnessing the phenomenon of change whether we like it or not. Mill operations simply do not appear profitable. Current timber sale procedures by the Forest Service may only magnify and intensify this situation. Venture capital and incentives to invest surely cannot be expected to rescue an industry with barely visible profits. The ironic thing here is that a study financed by one Federal program uncovered the difficulties caused by another Federal program. It is paradoxical that forest industry employers, in areas of recognized poverty such as Appalachia, are experiencing difficulty in attracting and retaining workers due to benefits provided without work by various welfare programs. In testimony before a Special Subcommittee on Economic Development of the Senate Committee on Public Works, February 2, 1967, II. S. Mersereau, vice chairman, Forest Industries Council, and vice president, Georgia-Pacific Corp., Augusta, Ga., stated the problem we think succinctly: There is one additional problem affecting the forest based industries of the Appalachian region. We are finding it increasingly difficult to attract and hold sufficient unskilled and semiskilled labor for many of our operations. These jobs are both in the woods and in the plant. We are paying wages above the Federal minimum and with numerous fringe benefits. The people are present in the area, and have the capacity to do a good job for us and for themselves, but we nevertheless have a difficult time attracting them away from the current welfare, relief, and unemployment benefits available to them. Let us hasten to say that we are not opposed to needed welfare and other benefits to needy people. What we are concerned about is the fact that in many localities in our operating area people are in fact penalized for individual efforts to such a degree that it is easier and apparently more satisfying to the people involved to remain on welfare rather than seek full-time employment. It would appear the administration of the Economic Opportunities Act should consciously deal with the natural instinct of some to forego labor when subsistence can be secured otherwise. In sum, Mr. Chairman, our industry is genuinely interested in those Great Society programs which attack rural poverty by creating an environment favorable to investment. However, we think the effectiveness of these programs is being reduced by the lack of a consistent Government policy on land use and by the lack of coordination between these programs and other Federal activities, especially its timber management activities. We greatly appreciate the opportunity, Mr. Chairman, to present our views. We want to be helpful. We want to employ people if we can get them. We want to invest the dollars of our industry. We do need some coordination on the part of the Federal Government in these programs that make it difficult for us to do this. At the same time we are trying to preserve jobs, and to help people in these smaller communities. I thank you. Mr. RESNICK. I want to thank you for your statement. As a former industrialist I can understand some of the problems that you have. However, I have to take exception to a number of things that you have said. When you say on page 4, "Recreation can add to the economy. It cannot become the economy," I take violent exception to that because I can point out area after area where recreation is the only source of income. I can point out two vast areas right in my district and adjoining my district where recreation is virtually the only industry. I can point to Atlantic City and to Miami Beach and the woods of Vermont and many other places, so I just have to take exception to that. While I am sure that President Johnson is very happy now in feeling that the Great Society programs are preserving some of our wilderness areas I think that the first man to do this was Teddy Roosevelt. He was the first conservationist President. He was the one who first started the system that we now have. As for the last statement of Mr. Mersereau-I think that he is simply perpetuating the myth-and for what reason I do not know. I think the evidence is very ample. First of all the OEO does not engage in any welfare programs. All that the OEO does--I have gone into this very thoroughly-is to help in education and to help people to help themselves to jobs. I know of no place where the OEO becomes involved in any welfare operations whatever. As a matter of fact the OEO has been criticized and very severely for not helping the workers down in Mississippi. There is absolutely no evidence to this effect that I have ever seen. As a matter of fact, the White House just put out a study where it shows that only 1 percent of the people who are on welfare in this country are capable of holding jobs-one percentthat is a White House study. |