Thomas Michael Power, Ph.D.
Professor of Economics, University of Montana
The Economic Values Associated with Wild Forest Lands: Introduction
The Clinton Roadless Area Initiative brings to the fore a decades-old controversy and raises most of the same economic questions raised by the various proposals to manage these lands as Wilderness. This report explores the economic implications of the choices between commercial and noncommercial uses of National Forest inventoried roadless areas in Washington; i.e., allowing roading and logging or managing them for their natural values. The real issue surrounding this choice is not whether pursuing one activity limits the pursuit of other activities, but whether the economic activities being pursued are those that have the greatest potential to enhance local economic well-being or whether we are sacrificing opportunities that have a greater potential for those with an inferior potential. The purpose of this study is to provide that economic evaluation of those choices for Washington's remaining National Forest roadless areas.
There are almost two million acres of "inventoried" roadless areas in Washington's National Forests that are neither part of the National Wilderness Preservation System nor protected as wilderness study areas. In addition there is a substantial amount of roadless acreage in those National Forests that were either too small (e.g., less than 5,000 acres) to be included in the various roadless area inventory efforts or overlooked altogether. These "unprotected" roadless areas are currently managed under plans developed by the individual National Forests. Some are being managed for timber production and are scheduled for harvest in the future. Other roadless areas are not currently classified as suitable for commercial timber management and are being managed for other forest values such as backcountry recreation, wildlife, watershed values, etc.
The appropriate management of these unprotected roadless areas has been a source of controversy for several decades. Environmental groups have urged that many or, even, all of these roadless areas, should be protected as Wilderness. Timber industry representatives have urged that the standing timber inventory on these lands be harvested in order to help bring National Forest timber harvests back to the peak levels that characterized the late 1980s. In 1999 the Clinton Administration asked the US Forest Service to begin a formal management review of the remaining unprotected roadless areas, a review that would include consideration of setting these areas off limits to future roading and timber harvest.
The management of these roadless areas confronts decision-makers and the public with a classic economic choice between two alternative allocations for these forest resources:
a. build roads into the remaining unroaded areas and manage them for commercial timber and other commercial commodities, orOver the past half century, the economic view taken of forested landscapes has largely focused on the commercial values associated with them: lumber, forage, mineral, and commercial recreation values. That focus on the narrow subset of forest values that can be expressed in commercial terms is of relatively recent vintage. From its inception at the turn of the century until the Second World War, the US Forest Service emphasized its stewardship of largely noncommercial forest values, in particular watershed values, but also including wildlife, fisheries, and recreation values. That forest management emphasis on noncommercial values, however, goes back much further than the origins of the Forest Service. Much of the forest management philosophy originally adopted by the Forest Service came from a centuries old European tradition that had a similar noncommercial emphasis.
b. restrict road building and commercial activity in these areas and manage them instead for the full range of natural forest values that are important, but largely noncommercial in character.
As the aphorism about not being able to see the forest for the trees emphasizes, a natural forest is far more than a crop of commercially valuable trees or some number of tons of commercially valuable livestock forage. A forest is a complex natural system that provides a diverse flow of valuable services, goods, and experiences to people. Figure 1.1 on the next page provides an outline of some of these important natural forest values.
Commercial markets automatically tend to quantify the commercial values associated with the forest. This ready quantification may be one of the reasons these commercial values tend to be the focus of the economic dialogue over the management of our forested landscapes. In contrast, although economists have been trying to quantify some of the noncommercial values; e.g., recreation and water values, there is usually only limited information quantifying the relative importance of most of these other values. That does not mean that they are not important or not "economic" in character. They are important to the well-being of forest users, those living adjacent to the forests, and to those living long distances from the forests. In addition, those noncommercial values all have an economic aspect in the sense that the quantity and quality of their provision affects our well-being and depends upon choices that are made about the alternative uses to which we put these forest lands. We unavoidably face tradeoffs between and among these forest values as forest management decisions are made.
These noncommercial economic values associated with Washington's National Forests are not of small or trivial significance compared to the more familiar commercial economic values. While the federally owned forested mountains east of the Cascades are worth $10 to $20 per acre for their commercial timber values, their value for a broad range of recreation activities is $10 to $90 per acre. In almost all locations the recreation values are higher than the commercial timber values. (1)
Just as important, as population growth in Washington continues, these recreation values will increase in relative importance while timber values fall relative to the recreation values. Recreation values, of course, are just one set of non-market economic values. Water and watershed values as well as passive use (e.g., existence) values are also large compared to commercial timber values.
1. Watershed Values
a. water quantity2. Recreation Values
b. water quality
c. timing of water flows
d. flood control
e. headwater fisheries
a. wildlife viewing3. Scenic Integrity
d. forest travel and experience
e. adventure recreation
f. other dispersed recreation
a. scenic beauty4. Spiritual / Cultural Values
b. open space
c. natural vistas
a. opportunities for solitude in a natural setting5. Passive Use Values
b. interaction with and experience of natural systems
a. existence of natural wildlands6. Climate Stabilization
b. existence of endangered species including salmon
a. carbon storage7. Other Natural System Values
b. micro climates
c. air quality
a. ecosystem health8. Commercial Goods
b. soil productivity
c. resistance to catastrophic fire
d. scientific understanding
e. stability and resilience
a. lumberThese forest values have another important economic aspect. Except for the passive use values, it is the full set of these forest values that impact the local economy. Just as timber harvested from federal lands may provide jobs and income that stimulate the local economy so, too, do high quality recreation opportunities, scenic beauty, and the lower density population enabled by large natural "open spaces" draw people and economic activity to the vicinity of protected natural landscapes. These landscape values associated with our forested mountainsides make a major contribution to the local quality of life that is increasingly an important component of any community's "economic base." Part of this impact can be measured in terms of the employment associated with some of the non-commercial uses of the National Forests. For the four-state Interior Columbia Basin, the direct employment associated with recreation on federal land has been estimated at about 78,000 jobs. By comparison, the direct employment associated with all wood products (not just that supported by federal harvests) was about 41,000. (2) In eastern Washington, however, National Forests provided less than seven percent of total harvests in 1998. Therefore, the part of these wood products jobs that are tied to National Forest harvests is a small fraction of the total. Clearly the direct employment associated with National Forest recreation swamps the employment associated with National Forest timber harvests. This will be discussed more fully in a later section of this report.
b. livestock forage
d. special forest products
e. commercial recreation1. outfittingf. special forest products
2. ski areas
The lengthy list of important forest values provided in Figure 1.1 underlines the fact that a forest managed for its natural landscape values is not "locking up" potential value and excluding people from benefiting from the forest. Quite the contrary, preserving a forested landscape in natural conditions is one important strategy to assure that a broad range of forest values continue to benefit people. On the other hand, timber or mineral extraction has the potential to do nearly permanent damage to most other forest values. In that sense "opening" the forest to commercial logging and mining prevents people from enjoying many other forest values. The fact is that it is usually not possible to pursue all important forest values on all sites simultaneously. That type of simple-minded "multiple use" is a fantasy built around ignorance of the unavoidable damage that road building and commercial extraction causes to other important forest values.
That is not to say that timber harvest and mining are never appropriate. It is just to underline that choices have to be made that usually involve trading off the pursuit of one value at the expense of not being able to pursue other values. That is what economic choice is all about. It is a type of choice each of us has to make dozens of times a day. Forest managers unavoidably face these types of tradeoffs, too. When the commercial timber potential of part of a forested landscape is sacrificed in the pursuit of wildlife and fish habitat, recreation, water quality, scenic beauty, or ecological integrity, economic value is not being "locked up." Quite to the contrary, such protection may be required in the pursuit of the highest and best use of that landscape. We are often told that it is appropriate to sacrifice recreation and scenic values for lumber or mineral values. Despite the very real costs in the form of lost environmental values, we are told the tradeoff is a rational one because the benefits outweigh those costs. In similar manner, sometimes it certainly has to be the case that it is economically rational to tradeoff lumber and mineral values in the pursuit of recreation, scenic, wildlife, and other natural system values. Both types of decisions can be economically rational depending upon the particular values at stake. The key issue is not that economic choice usually requires us to pay a cost in the sense of sacrificing one type of value in order to obtain another. That is the economic truth conveyed by the assertion that "there is no such thing as a free lunch." The key issue is the relative importance of the values being protected compared to those being sacrificed. In general, we should be protecting that which is relatively scarce and valuable while sacrificing that which is relatively common and more easily replaceable.
From the point of view of local economic vitality, communities often face similar tradeoffs. All potential economic activities cannot, in general, be conducted simultaneously at the same place. Certain types of economic activities tend to displace other types either because they are linked to the same limited markets or because their environmental impacts make them incompatible. Destination resorts cannot be located adjacent to stockyards or regional refuse dumps. It is usually not a good idea to locate a regional school adjacent to a lead smelter or explosives manufacturer. Residential subdivisions and ranches are usually not compatible land uses. The point is that explicitly or implicitly we are always making economic choices about the balance of economic activities that take place in a local community. When the expansion of one activity reduces the opportunities for another, it is not necessarily a sign that uneconomic decisions have been made. What is important is not that pursuing one activity often limits us in the pursuit of others, but whether the economic activities being pursued are those that have the greatest potential to enhance local economic well-being or whether we are sacrificing opportunities that have a greater potential for those that have an inferior potential. It is exactly that type of evaluation of Washington's remaining National Forest roadless areas that is the purpose of this study.
2.Crone, Lisa K.; Haynes, Richard W. 1999. Revised estimates for direct-effect recreational jobs in the interior Columbia River basin. Gen. Tech. Rep. PNW-GTR-483. Portland, OR: U.S. Department of Agriculture, Forest Service, Pacific Northwest Research Station. Pp. iii and 24, Table 17.