a a ee

1990,

__ first place.

"Our wealth in the western
world, in the northern developed
countries, is the result of the con-
version of ecological capital to

financial and man-made capital.
Now we afe not even capable of.

sustaining our own existence to the

extent that we have to use the

wealth we have generated in that
‘conversion process to buy up the
ecological carrying capacity of
Third World countries. We induce

them to grow cash crops: for our’
“benefit largely because we can

afford to do so because we have
converted our own natural capital
to financial capital.

"British Columbians hypocritical-
ly insist that the Brazilians not
harvest the rain forests when we
have obliterated our own rain

 foresis. The Brazilians are quite

naturally attempting to become

. wealthy by the same process of

conversion of their natural capital
stock to financial and other forms
of human wealth.

"That process is what I mean

when I say that economic activity
based on the old neoclassical
models is cannibalizing the very
basis of the life-support systems of
the planet. This is why the cast
coast fishereies are in such dire
straits, and it is only characteristic
of the 25 major fisheries around
the world that are going through
exactly the same stock-depletion
problem from over-harvesting.
Agriculture is the same, but we do
not recognize it yet because there
we have substituted. fertilizer,
irrigation, and other forms of man-
made capital for the depleted soils.
It is all part of the same problem.

"This global warming issue and
the rise of carbon dioxide in the
atmosphere is simply a minor
symptom of this deeper malaise of
a human species that is inappropri-
ately exploiting the very environ-
ment that sustains it. In my mind,
it is doing so in ignorance, because
we are operating from a mode! that
worked for 300 years and simply

‘does not work any more." (See

Forestry Insights "Tenure: renting
land by the cubic metre" July 25,
and seven subsequent
articles describing the tenure sys-
tem in B.C.)

This caused Darling to ask: “Are
you suggesting that the provincial
government of B.C. should cut its
forests yield every year? You
would be as popular as a skunk at
a garden party out there.” Here
again, Rees’ response was direct:

“The alternative is to do what we

are doing. Every week we hear of
sawmills that are running out of
wood supply and of communities
that are shutting down. When the
fall-down comes, this is going to
be an endemic problem for the
province.

(See Forestry Insights "The Fall
Down Effect" Feb, 21, 1990, and
subsequent articles from Feb. 28 to
Mar. 28, 1990, "Convergence of
conflict", "Integration, vertical and
horizontal", "The commodity trap",
"Utilization... for what?", and
"Putting it in concrete terms". The
result of the Fall Down effect has
been demonstrated by the award-

tium of Prince George forest com-
panies and more recently by the
demise of Wedeene Timber Ltd.
where a good idea died due to a
lack of trees.)

“IE you are hearing what I am
saying, I.am suggesting that the

that renewable resource. Ifyou are
acting in your economic interest,

you might just as well got out and
liquidate that resource and put the
money in the bank because you
will make a higher retum at what-
ever the current savings account

".« the only moral thing to do is to manage
your forests to sustain the communities that

harvest them. "

— Professor William Rees

only moral thing to do is to
manage your forests to sustain the
communities to harvest them. I
would say this means no resource-
based company should be allowed
to declare a dividend until it can
show that the capital stock that it
is exploiting is the same at the
beginning of its business cycle as
it is at the end of an annual busi-

ness cycle. This would require j

them to put back investment in the.
maintenance of the capital stock
and hence re-orient the current
distribution of wealth back into the
wealth-producing system itself.

"The current practice allows us to
ship the wealth offshore to invest
in someoné else’s capital, which
we then draw down, and they have
to look elsewhere for an alternative
investment, leaving devastated
ecosystems and declining com-
munities in our wake. I may be a
skunk in a garden party but when
people begin. to understand the
consequences of the current sys-
tem, they are going to welcome me
and a whole bunch of other
skunks."

hese words strike hard at

' the forest industry. They

suggest we have been

raped and left with little to fend

for ourselves. This, however, isn’t

totally fair. As Rees said, "We are

operating from a model that

worked for 300 years and simply
does not work any more."

Forest companies are offered vast
areas of old growth forest, for
example, and they jump at the
chance. It means clear-cutting and
quick profits. Unfortunately,
though, after the quick profits, it
also means reforestation that eats
away at those corporate profits.
For this reason, says Rees, forest
industry executives have said they
restock certain areas only because
they are told by the government
they must. And even then, "They

do not go back to see whether it '

worked.” Obviously, this "model"

“needs to be altered extensively.

But before blaming the forest
industry, and perhaps attempting to
punish them in some way for their
bad deeds, we should realize that
the model suggested by the indus-
try was dictated by simple econo-
mics. It was the government, seck-
ing rapid economic growth and
thus popularity that agreed, and it
was the public, seeking those same

things, that unquestioningly
believed both.
Rees explains the corporate posi-

tion in this way: "When you have
a large natural capital stock that
reproduces on an 80-year rotation,
you are really talking about less
than two percent per year on in-
vestment. It makes no economic

rates are ~— 10 percent. Natural
capital is always at a disadvantage
if the natural rate of reproduction
is below current interest rates from
treasury bills, for example. It
makes sense, if you are thinking in
narrow self-interested economic
terms, to liquidate the capital into
usable investment funds and put in

the bank somewhere.

- Terrace Review — Wednesday, October 3, 1990 A?

-"This puts the whole ecological ;

paradigm I am putting to you at &
disadvantage, particularly in a
period of high interest rates and
therefore high discount rates, such
as we are in today..The whole
Bank of Canada policy is totally
destructive to the natural en-
vironment, and it is something else
that is not raised very frequently, I
might add, in the House of Com-
mons." a

In conclusion, Rees said that in
his opinion we have to re-evaluate
our objectives in the management
of all resources. "Are we most

‘goncemed in managing the woods

of B.C, in maintaining happy
shareholders in Zurich and New
York and so on, or ought we to be
concerned with maintaining
sustainable communities within our
own population?” At the present
time, says Rees, international
financing favours happy stock-
holders... "Ihe communities be

next segment of Forestry

Insights. Forest revenues.

Where do the come from? And |

where do they all go? We'll begin
with a discussion on the "appraisal
system" in B.C, and then examine

what really goes on inside a forest -

company. We’re going to step into

the shoes of Milton M. Jovial of |
‘New York (we made this name up

and aren’t attempting to portray an
actual investor) and build and
operate a Northwest logging oper-
ation called Jovial Logging Inc.

Taproot to treetop
Stump to dump
You'll find the best
forestry coverage in the
region in the pages of
the

Terrace Review

We have some
answers about
your new properg
assessment.

Property owners will receive a property assessment in
the mail within the next week or two. You may have

some questions about your new assessment — and if this ad doesn't
answer all‘of them, please give usa call at one of the numbers listed below.

We want to help.

increases occurred in
British Columbia.

This year assessments
have increased
significantly in most
areas of the province —
and once again this will
not create automatic
tax increases.

If my assessment is sharply higher than
the last one, will this cause a similar
: @ sharp increase in my property taxes?

Probably not. .
d ¥ The assessed value is only one side of the

tax picture — the other is the tax rate applied to that
yalue. Generatly speaking, large overall increases

in assessments are usually offset by local
governments setting lower tax rates. This has
happened in the past when large assessment

* Municipal lax rales drop
as overall assessments increase
(when munmcipal spanding
remains constant).

; | How do I know my assessment is
@ accurate?

, Check local real estate prices.
dl \ © The “assessed value” is the actual market

value of your land and buildings if they had been for
sale on July t of this year. The BC Assessment
Authority has detailed information about all land
and buildings in the province, Your property is

valued by an experienced appraiser who looks at the
selling price of similar real estate in your
community. (This is the same process used by

mortgage companies and realtors.) Assessment

&

Authority staff have computer access 10 the details
of all real estate sales in British Columbia ~
including those in your neighbourhood.

What if | think my assessment might be-
@ wrong? .

‘ Callus.
@ We will try to help you. If we agree there

is a problem, we will ask the Court of Revision to
make a change. If we cannot agree to the change you
suggest, we will still help you by providing practical
information on the formal appeal process.
Everybody has the right to appeal their assessment
io the Court of Revision — but our experience is

that many concerns can be resolved simply and

details.

For your convenience, we have extended our telephone hours into the evening
during the month of October. Call us 8:30 am - 8:30 pm Monday to Friday.

In Terrace & surrounding areas call 638-1116 (collect if necessary), or call our
province-wide toll free Help Desk at 1-800-667-3900

quickly by calling us first. Please read both sides of
your assessment notice carefully before you call us.
This will save you some time when we are discussing

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