1. The continuing increase of population in and near forested areas;
   
   
2. The "self-selection" of people moving into the forested areas that include a high proportion of people who value open space and rural life style even at the expense of economic opportunity;
   
   
3. The potential for long-term population growth due to low price housing and unbuilt subdivisions;
   
   
4. The low likelihood that inadequate infrastructure capacity will place serious limits on this growth;
   
   
5. The decentralization of the growth from a few major developers to many small independent developers doing small projects with unknown cumulative effects;
   
   
6. The inability of local government to effectively balance the needs of the forest and range industries with public concerns over management practices and industrial impacts.
   
   

These trends reflect the growing movement of city dwellers and their concepts to rural settings, a phenomenon we call "urbanizing forestry." With it comes all sorts of problems that foresters have not faced until recent years. People are now relocating to the country in droves to enjoy the beauty, tranquillity, and safety from metropolitan problems. But no sooner there, they may well protest neighboring timber operations which for generations have provided the economic and employment base of their new community. These attitudinal changes spell trouble, and the problem will not go away. Indeed, reliable population projections for California raise perplexing questions about the viability of future investment in commercial forestlands.

Counties in California with the largest forest and range resources are now growing at a rate about 20 percent faster than the urban counties, and will probably continue to do so past the turn of the century. Whereas, Dr. Bradshaw points out, the state as a whole has experienced a doubling of its population every twenty years since statehood, California will not again double its 1970 population of 20 million people until at least 2020 - a period of fifty years. However, to make my point, by 1986 eight counties already had doubled their 1970 population, and these were all in the forested regions of California: Nevada, Lake, Alpine, El Dorado, Mono, Mariposa, Calaveras, and Amador. This growth has been concentrated along major highways in the forest and range areas of the state, often the same roads used for the largest amount of truck traffic. On small roads nearer to the forest, complaints about trucks are heard often from the growing resident population. Since the amenities of our natural environment are the major attraction bringing people to rural areas, major resistance is expressed often to common forestry practices that involve the harvesting of trees and using herbicides for brush control. Local people are aware of their interdependence with the land and the air and water quality associated with nearby forestry practices. Maintaining the viewshed causes a more difficult problem in many respects, especially for the state's large tourism industry.

These social pressures on the rural land base probably pose the most difficult problem of all. These pressures seem like a huge tidal wave at a time when our dikes are too small. We see the state's demographic mix changing, with today's minorities soon to be a majority. In total, the ecological, demographic, economic, and social forces at work in California stagger the mind. And the State's beleaguered rural economy has not profited from this population boom. The problem may be exacerbated by a rash of leveraged take-overs of major forest products companies in California. In one of his rare public appearances, Charles Hurwitz, head of the Maxxam Group, responded to a question from one of his new employees at the Pacific Lumber Company that he would bring in new management "Only if the profits aren't there." But he added ominously, "There's a little story about the Golden Rule - those who have the gold, rule." Nor do we know where Sir James Goldsmith, having absorbed Diamond Lands and Crown Zellerbach, will strike next. Yet, with all this, I think that the most important thing to emerge is that we have begun to focus on the value systems of the electorate in the year 2000 - what will they believe about, expect, and demand of the state's forestlands. Again, such studies may seem excessively sociological, but I submit this is the future of forestry. Indeed, as I have suggested, a number of our research grants this year have gone to trained sociologists.

Tomorrow's successful forester - particularly in California - will be that rare professional who can adapt his or her training and experience to changing societal values and political pressures. The new generation of professional foresters who will inherit today's problems must know how to cope if California forestry is to survive. To do so, tomorrow's foresters must be more broadly educated, more sensitive to public opinion, more imaginative in adapting to change, and more articulate in defense of traditional forestry values than we have been. He or she increasingly will be the negotiator, the mediator, and the seeker for consensus - as well, of course, as the technical expert. This notion was well summarized by a famous forest industry executive as follows:

"The public mind is more or less of the opinion that it is a crime to cut a tree, while at the same time demanding die products of the forest, so essential to our national growth and life. Accordingly, the public must be educated, not only as to the necessity of conservation but as to the conditions which must exist before conservation of our forests can be successfully brought about."

These words were written nearly eighty years ago by George S. Long, Weyerhaeuser's first manager!

It has become clear to me from my experience with the Board of Forestry over the past four years that, increasingly, people will become more important than trees in forestry operations. Technical considerations, of course, will still remain important. But more and more the decisions made will be a consequence of what people demand, will tolerate, or will accept.

The lessons of history have taught us that, although natural resources are essential to the healthy development of a community, an even more critical asset is the people that it attracts and assimilates. The value of human capital incorporated into the community far outweighs the worth of timber, minerals, energy, and related assets. Communities that focus entirely on their natural resources and pay little heed to their resident population are likely to learn the painful lesson of Appalachia.

Accordingly, the Board and Department of Forestry commissioned U.C. Berkeley's Louise Fortmann to analyze the effects of people on resource management. Her insightful study pointed out that those who are complaining about timber operations are mostly neighboring people. Not some "kooks," but neighbors! Dr. Fortmann told us that continued population pressures in California will mean increased protest. And even now in some areas of the state, it is no longer economically or socially feasible to practice timber harvesting. Or, at best, it could be practiced only by the "most careful, conscientious, and sensitive foresters." The strength of our political system lies in its ability to accommodate differing opinions from a broad spectrum of people. To the extent we are willing to hear these opinions, we can direct our course of action to changing realities. But when foresters stop listening to these voices and stop considering varied opinions of the citizenry, it is time we should become worried. For these vengeful and frustrated people probably are then marching on the forests with their arson matches and tree spikes. Few people protest for the sheer joy of it, so foresters should accept such action as a warning of extreme public concern. An example of premeditated and well-organized sabotage against timber harvest operations on private property was provided first-hand recently by a forest industry executive. On one weekend five pieces of expensive equipment were damaged in the woods by vandals placing beach sand in the fuel tanks, oil filters, and transmissions. Valve covers were even removed and sand placed directly into the engines. When this equipment was fired up on Monday morning the engines were ruined at a cost of approximately $70,000.

Of course, there are pathological exceptions to any legitimate protest movement. Earth First! (exclamation point mandatory) probably ranks as the environmentalist's most extreme, unorthodox, and unpredictable organization. Various acts of civil disobedience, "eco-tage" in their language, have been attributed to their 10,000 "tribespeople" operating in 16 states. About one-third of the membership is said to be made up of California residents. The U.S. Forest Service has offered rewards of up to $5,000 for the capture of three-spikers or related extremists. A chainsaw cutting into a spiked tree could kick a hail of deadly shrapnel back into the face of the operator. The group's operating manual, Ecodefense: A Field Guide to Monkeywrenching has sold nearly 5,000 copies and is understood to be in its second printing. This is a far cry from the serious efforts of responsible and legitimate environmental groups working through the system.


A Global Economic Context For Our Forest Industry
The Pacific Rim is a topic that has been with us for a long time, and one that continues to grow in importance. Pacific Rim countries differ significantly in their respective cultures, historical bases, and degrees of geographical separation. These differences have presented obstacles to realization of the much-needed economic cooperation. However, the area recently has been enjoying considerable political stability and relatively rapid economic development. I believe that the stage is set for dramatic economic cooperation. One factor contributing to these improved prospects is the success of the region's countries with their economic strategies. The developing countries in the Asian sector of the Pacific Basin have been recording average economic growth rates exceeding 7 percent. This has created an increased degree of interdependence. Another contributing element is the growing importance of the Pacific Rim's high-income countries Australia, Canada, Japan, New Zealand, and the United States - as export markets for the newly industrialized countries.

Yet ironically, the United States, ranked number one in industrial timber production, currently is a net importer of wood products. In 1984, for example, the U.S. exported about $2.7 billion but imported $4.7 billion in wood products, a $2 billion trade deficit. Last year we saw a further increase in imports and a decrease in exports, resulting in an even less favorable trade balance in forest products. This country is likely to remain as the world's largest producer and exporter of softwood logs, assuming the Pacific Rim market does not suffer unexpected economic reverses or that we do not impose export controls. We should expect growing competition in the log market from Chile and Brazil. Although the U.S.S.R. will continue to ship logs to Europe, it will also offer strong competition for softwood log markets in Japan, the PRC, and other Southeast Asia countries. Some say this deficit is due solely to the overvalued U.S. dollar. Others point to the Canadian lumber shipments pouring across our border, suggesting that half the lumber being sold in Georgia today is produced in Canada. My view is that the tariff and non-tariff restrictions of other countries are depressing the industry's export performance. During the past decade, the U.S producers have increased their share of forest products committed to exports, as opposed to domestic consumption, from 3 to 7 percent annually. These exports, totaling at present some $3 billion annually, would more than double to $7 billion in the next few years provided the major trade barriers imposed by Pacific Rim countries were lowered significantly.

The future position that our forest products industry realizes in world trade is an intricate problem, but the answer probably lies in how one responds to a simple question: Will the United States assume a defensive strategy or an offensive strategy in defining its role in the global economy? The former alternative seems to be where we are heading. At least it probably reflects the current mood of Washington, D.C. Therein we would continue to depend upon restrictive import regulations and punitive tariff rules to limit foreign goods from entering the country. In 1975, we are reminded often, Canadian lumber imports owned less than 19 percent of the U.S. market share. That figure has risen to over 33 percent today. But such a defensive strategy, albeit easier and comforting to many business executives, flies in the face of a basic fact of life: competition is the driving force of Western economies. Industries of the free enterprise system must take the lead if we are to adopt alternatively an offensive strategy. Japan's economy is strongly influenced by government. The Peoples Republic of China is totally dominated by central government. This role of government is quite different from our economic system, which lacks the history and ethos of public-private cooperation, and goes a long way towards explaining our present difficulties in dealing effectively with our Pacific Rim neighbors. The Federal government's role, in my view, should be limited to reducing the horrendous budget deficit, eliminating antitrust legislation that imperils competition between American firms, providing appropriate tax incentives, and enforcing trade rules when violated by our partners abroad. In a remarkably short period of time, we have been thrust into the world marketplace. Imports have redrawn the battle lines. With this background, how can we help bring about a lasting solution to the problems affecting the forest products industry?

First, I suggest an objective examination of our economic thinking. The Maginot Line did not protect France in 1940, and no economic Maginot Line will protect the United States, now or in the future. Writing in the Wall Street Journal, Senator Phil Gramm of Texas, a former economics professor, sums up this postulate with clarity and style. Arguing against the current wave of protectionist sentiment sweeping the country, he points out that tariffs will not reduce the trade deficit. Instead, further restraint of free trade will only make the nation poorer as prices rise, and the American economy will become less competitive as jobs are transferred from most efficient sectors to our least efficient sectors. Gramm concludes that "...our primary cause for alarm should be our own federal budget deficit, as reduction of the deficit would cut federal borrowing, lower interest rates, reduce the value of the dollar, and free capital to generate economic growth and jobs in the U.S. and around the world."

Change is the essence of today's business world and its underlying economic forces. Horsepower gave way to steampower. Vacuum tubes were replaced by transistors. Which brings me to my second point. Let us change our parochial thinking about world trade. While still fostering competition among and between us, why can't we find ways to join forces and together exploit the emerging global markets for forest products? The entire fiber resources of North America - not just that portion now set aside for export - cannot possibly meet the future needs of the developing Pacific Rim countries. No one state or province, for that matter - should try to meet this vast issue alone. But maybe we can together, and in so doing avoid surrendering these markets to Russia or South America. Our challenge is to respond with innovation and new strategies which will make us tough, low cost competitors in this new global arena. Let us share together and coordinate between us our research and other efforts toward enhanced free trade without which, in the words of Prime Minister Nakasone, "...we cannot maintain global peace and prosperity."


Shift in Property Rights
On the rights and responsibilities of public and private ownership, my colleagues and I have been surprised that the subject of non-urban property rights in an urban society is a grossly neglected field. You would think that the legal basis for practicing forestry and for dealing with our urban neighbors is well enumerated and understood. Sadly, it is not. But we foresters are not alone in being culpable. Only recently, the highest tribunal in the land, for the fourth time in the last five years, retreated from deciding whether property owners must be compensated when local government restricts the use of their land. Thus, the Supreme Court has left for another day a definitive answer on the power of government to enforce zoning and environmental rules. This particular case involved a group of California developers who contended that their property, in effect, has been "taken" from them by restrictions barring residential housing.

But we see the underlying principle involved every day in the practice of forestry. A specific we are struggling with in California is whether or not the Board of Forestry should designate hardwoods - oaks, madrones, etc. - as commercial species, and hence regulate and supervise their harvesting as we now do for conifers. We have looked closely at this difficult problem for over four years now, and hope for a judiciously balanced resolution shortly. Certain preservation groups, for example, represent that when a rancher cuts an oak tree on his range the area's aesthetic quality is imperiled so that their "viewshed" rights were destroyed. The opposing argument is that private landowners are providing the amenities of open space for largely urban dwellers who want it without paying. In California, the public has indicated an interest in that oak growing on private land and therefore is demanding restrictions on the landowner in terms of what he can or cannot do with his trees. The distinction that appears to be missing from the legal literature is between private and public goods. How would you categorize the farmer's oak tree? And, depending on your answer, one must wonder how far we have strayed from the Constitution's fifth amendment that reads, "...nor shall private property be taken for public use without just compensation."

Professor B. Delworth Gardner, formerly of U.C. Davis and currently teaching at Brigham Young University, has written extensively on this subject. His concern, in testimony before the Board of Forestry, is that natural resources, such as land and water, have attributes or amenities that often are coveted by nonowners of the resources. In his words:

"A cheap and effective way to acquiring these amenities is to assert that the legal owners of the resources do not have the right to exclude those who want the amenities from consuming them. Or, almost equivalently, the resources must be used in certain ways that guarantee the availability of the amenities regardless of the preferences of the resource owner or the profitability of the primary uses. The upshot is that the resource owners are deprived of valuable property rights that have been previously theirs."

Dr. Gardner cites several examples of this and then points out that a weakening of traditional property rights involves a shift in the structure of incentives and the creation of uncertainty - both of which harm the efficient management of resources. He suggests that in this situation there will be a general tendency for resources to be neglected, resulting in their depletion or degradation. If property rights are attenuated to the point where the private landowner is unable to control access and use of his property, the inevitable consequences will be to create a situation of "communal" ownership. It was the biologist Garrett Hardin who first popularized the problem of communal ownership, although economists have been writing about the issue for decades. Hardin characterized the situation as "the tragedy of the commons". More recently this argument has been picked up by scholars of the Political Economy Research Center in Bozeman, Montana. Environmental problems, they say, stem largely from unclear or unenforceable property rights. When everyone "owns" a natural amenity such as water or air, it is not actually owned by anybody. As a consequence no one is accountable for treating it properly, which leads directly to pollution because people will tend to take advantage of this common resource. Long term investment in forestry requires a belief that the property can be managed and the investment recouped by timber harvest. Certainty, as argued by Gardner, is critical to the efficient allocation of resources. And perhaps there can be improvement in the types of compensation offered to better deal with the variety of property takings that occur in the real world.


How We Think About Forestry
Forestry is a house divided. Proof of this is rather evident. One needs only to look at the many unresolved problems in the forest products industry. We have great difficulty in agreeing on how, if at all, to work with neighbors during a timber harvest plan. We cannot agree on what if anything to do about the spotted owl, cumulative effects, leveraged buyouts, or even the role that should be taken by government to help the industry operate in a global economy. Within this divided house one hears some very revealing base attitudes and limiting assumptions from key industry leaders, for example:

Within industry it will be possible to find the necessary political and financial clout to change political outcomes;

Self policing by foresters and the industry will answer public concerns about the environment. This attitude usually comes in the form that all would be better with less regulation;

The less government the better, including marketing;

We can afford to follow traditional political alliances;

We don't have to worry about our neighbors.

I find this very distressing, because it brings to light the deep schism between what the external world (i.e. urban voters and legislators) is telling us about their perceptions of resource management and what the professionals and industry think it should be. The industry viewpoint does not allow for the significant roles that governments play in global economy. It does not allow for Fortmann's insightful observations of forestry sociology or show enough sophistication to embrace Gardner's views of property rights. In short, it does not square with the public perception. It means that we do not understand each other's value system fully. We must continue efforts to improve discussion. We also must open our minds. We must try to find ways to address quality of life matters as much as economic efficiency these days.

At the most fundamental level, we in the forestry community cannot even agree on what to include in the term "forestry". Some people define it narrowly to concerns related to timber growing and harvesting. Others include the multitude of uses provided by forests. Lack of agreement on this fundamental point positions us badly to meet the shifting popular conception of forestry - management that relates to the needs of both owners and neighbors. There is no blame attached to this lack of agreement. Lack of agreement is just another sign that we do not understand each other well enough. It is also a sign that there is not a common sense of the urgency for improving discussion and communication.

This lack of dialogue between sincere people of differing views on resource utilization became painfully clear recently with the advent of Congressionally mandated preparation of management plans for California's 18 national forests. Since these plans - by law - must be developed with full public input, it became obvious that someone must inform an interested and concerned public about the many options available to it. The argument was extended far beyond the local benefits of school and road support from timber sale receipts. The enlightened leadership of the Western Timber Association at once recognized the importance of this forest planning process, the need for a sound statewide understanding of good forestry practice, and the importance of the wood products industry to the economic and social well-being of California. To these ends was organized the Alliance for Environment and Resources (AER), now working to gain better understanding from the urban communities, minority groups, and businessmen situated hundreds of miles away from the timberland bases in northern California. This has required commitment from many people of diverse backgrounds who often have only indirect dependence upon the multiple resources derived from our national forests. Much encouragement can be gained from this AER initiative, and the resultant network and future agenda typically led by business people rather than foresters or wood products executives. Community ripple effects are being felt all over the state, and the debate is no longer limited to long-antagonistic special interest groups. Bankers, automobile dealers, owners of doughnut shops, carpenters, and realtors are now showing real interest in what future plans hold for their national forests. This augurs well for a better understanding in the future of what a healthy wood products industry can provide in the way of mutual benefits.

I have long been distressed at the lack of long term strategic planning by both the profession of forestry and the industry. It is high time, I think, that we in the forestry community look methodically to the future and apply the modern tools of futurism. This can be both tricky and useful, but in such a context several techniques are available. Their power derives from penetrating to the future with an emphasis on creativity, imagination, and intuition. Traditionally we have followed linear thinking; things proceed step by step in a logical sequence. Such thinking is dualistic and excludes the possibility that several things might be true at the same time. In contrast, strategic planning techniques focus on emerging issues, where solutions are not known and where there may even be an argument over the formulation of the problem statement. Many things are possible, even in the face of apparent contradictions. It takes intuition, however, to deal with contradictions.

I have argued that we must pay more attention to the effects of stress and change. We need to be more flexible in our management systems and program room for creative, non-status quo, solutions. I have also asserted that we must open our minds so we can find ways to think more broadly about the context of forestry. I agree with many futurists that we are in a time of profound social transformation. We are being forced to deal with "quality of life" concerns - things like clear air and clean water, endangered species, noise, and viewsheds. In a highly educated, post-industrial society, quality of life matters as much or more as economic efficiency. Finally, I have pleaded that we must develop a clear vision of where we wish to go in forestry, communicate that vision, and act cohesively to reach it. Somehow we must enable leadership to emerge and then empower that leadership with our support to act in a manner that will reach the vision. Being a businessman, and knowing that one must take risks to reap profits, I have spent the last two years trying to define a vision and to move ahead within the forestry community.

This has been the so-called Centennial process, because the effort corresponded with the 100th anniversary of the Board of Forestry. The process took most of 1985. One major meeting was held in March. It produced a general vision for forestry in California, and envisaged four benchmarks. First, forestry in the year 2000 will be a well-understood and respected policy, practiced on a stable and well-organized, well-identified land base. Second, forestry in 2000 will have achieved a balance between the benefits and costs of regulation. Third, by the year 2000, the public, industry and governmental agencies will share values, or agree to accommodate them, through open, continuous communication with one another. And finally, forest policy in the year 2000 will include ways to anticipate problems and cope with them before they become crises. I regard this vision as very relevant because basically it says that forestry in California will have achieved some kind of equilibrium with the society around it. In so doing, forestry also will have defined its importance. If enough people really believed this vision it would provide the sense of direction which is now lacking. However, the vision is also deceptive. There are many general words in it and these generalities disguise some fundamental disagreements in values and perceptions. Much more discussion was needed to work out the differences. Thus, during the summer and fall, task forces met to define issues and strategies involved in reaching the vision. Then in December another major conference took place and a series of actions specific to each issue were defined-over thirty in all. Broadly grouped suggestions for action fell into five categories:

Rural economic stability and development;

Protection and maintenance of the biological base;

Social pressures on the rural land base;

Rights and responsibilities of public and private ownership;

Coordination and planning.

The year 1986 has been spent largely in trying to implement some of those actions.


Conclusion and Thoughts for the Future
The past four years on the Board of Forestry have been a wonderful experience, and I am grateful indeed for this opportunity to share a bit of it with you. As with any experiment, we have discovered that thinking in new ways is often painful and difficult. Things that we thought would change easily could not be budged. We have learned that the laws of inertia apply to forestry as well as to physics. Forestry is subject to fundamental change and, I think, needs badly to establish itself in the new and developing world of global business. Forestry as we knew it in 1948, when I left this great institution, was vastly different and simpler than today. Indeed, the forestry of ten years ago is already outmoded. People are a major new ingredient. We must learn how to accommodate and live with them. Therein is our challenge. We must also comprehend the true meaning of change, and learn how to adapt to the unknown, because great changes are coming. The business world, of which I have long been a part, has taught us that the best investment is in people. Those rare commodities with the ability to think and not shrink from the unknown. I submit this is equally true for the forest industry and profession. That is the best insurance I know against extinction. Forestry will not become a dinosaur.

I have been asked why study forestry if there are no jobs. One can ask the same question about many fields today, from lawyers to economists. Even doctors. My answer is simple and a bit prophetic. Protection of the environment and accommodation of economic development remain barely explored frontiers. The accelerating rate of information availability and the growing world population will raise severe technical and ethical questions about the environment, including our forests. If we are to deal with these problems, the world must have professionals who are trained both in science and people in a practical way. Forestry is one of the best disciplines for this type of training. What I see in the years ahead is a series of new environmentally-related occupations for which foresters could be well trained. I would have no fears about pursuing a career in forestry. I would make certain that my training was very versatile. I would not count on a woods job in a traditional sense, but rather look to being part of a new wave of environmental professionals. You will have jobs; society will demand it.

And Dow if my colleagues and contemporaries will permit me a personal word to the students gathered here. You who are studying at Berkeley must prepare yourself to join that new profession. You will be the leaders. It will be an exciting place. Look inside yourselves. Find your strengths. Challenge your assumptions. Become comfortable with the risk. Your key for success is to take each day at a time. Work for our ecology, our community, and for yourselves. Be the best you can be. You are the future. Good luck and thanks!

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Introducing: Harold R. Walt


Mr. Harold R. Walt graduated in forestry from the University of California, Berkeley, in 1948, with membership in Xi Sigma Pi and Alpha Zeta. His subsequent career took him to the presidency of William L. Pereira Associates, an international firm of planners, architects, and engineers, based in Los Angeles. After retiring from the business world in 1974, Mr. Walt joined the University of San Francisco as Dean of the McLaren College of Business Administration, where he still teaches as Professor of Management.

Mr. Walt has also specialized somewhat in mortgage finance, serving as a Director of the Federal Home Loan Bank of San Francisco, Visiting Scholar at that institution, Chairman of the Board of Fidelity Savings and Loan Association of San Francisco, and as a member of the Advisory Board for the Federal Home Loan Mortgage Corporation in Washington, D.C.

Mr. Walt is currently Chairman of the State Board of Forestry, and was designated California's "Forester of the Year," for 1986 by the California Association of Resource Conservation Districts. Other activities are described in Who's Who in America.