23 JANUARY 1909, Page 5


THE Report of the Royal Commission appointed to inquire into and report on certain questions affecting coast erosion and afforestation in the United Kingdom was issued ou Friday week. It coutaius one of the most far- reaching proposals for State trading ever made. It advises that the nation shall gradually acquire by purchase some nine million acres of land, and spend during the next eighty years a sum of money which will amount in all, as far as we can see, to over X450,000,000 sterling. To induce the nation to assent to this colossal scheme, we are told that after the eighty years have elapsed the net revenue from the forest at present prices, " which promise to be materially enhanced," should be £17,500,000 a year, a sum which is stated to "represent 32.4 per cent. on the total accumulated costs of the undertaking." To put it in another way, the State at the end of the eighty years should be "in possession of property worth X562,000,000, or about X107,000,000 in excess of the total cost involved in its creation." We shall make no attempt to check these figures in detail, though we should be very much surprised if they do not share the defect of all prospective estimates,—the defect of being far too optimistic. When estimates of pros- pective profit are made for private individuals, even by conservative estimators, it is usually safe to assume that they are twice too favourable. When they are made, not for private people, but for the public, they are more likely to bo four times too sanguine. But this only applies to estimates for a short number of years ahead. When the estimate has to do with periods so distant as eighty years, the likelihood of the profits ever materialising rapidly decreases. It may be said, indeed, to diminish with the square of the distance. It was hoped and believed when the Government took over the telegraphs that the State would reap a very great profit. Look at the result. In the same way it was honestly supposed by the enthusiastic members of the London County Council that they would be able to give London a splendid service of river steamers, and also in the end make a handsome profit. Instead, they made a disastrous loss. Even the Water Board is showing us that the savings assumed to be inherent in central control, and the substitution of one Board of Directors for many, are illusory. Already State action is Proving expensive. All experience shows that Govern- limits when they attempt to trade, especially in a very difficult and complicated form of production, tend to make a " hash " of the business. As a rule, they make no profit at all. When they do return a profit, it, is pretty sure to be less than that which would have been made by the private trader. The " dead hand " cannot compete with the living interest of the private individual. Well warranted was our ancestors' detestation of mortmaiu. Milton said in a memorable passage : " The State shall be my governors, but not ray critics." If the nation is wise, it will follow hint and declare : "The State shall be my governors, but not my timber merchants." We note with regret that almost the whole of the Press, Unionist and Radical—the Daily Graphic is, we are glad Lo say, an exception—has joined in a chorus of approval of the proposals of the Royal Commission. We are convinced, however, that if sensible men will take the trouble to think the q uestion out for themselves, they will realise that it would be madness for the nation to enter upon the proposed speculation. Take first the salient fact that private owners in this country, in spite of a very genuine interest in affores- tation, and in spite of the expenditure on several of the great estates of no small amount of care and money, have not been able to make afforestation pay, except very occasionally and on a small scale. We see ne reason to believe that the Government will be able to do in Britain what the private owner cannot. As to the foreign examples, we feel inclined to say with Mrs. Gam p :—" Some people may be Rooshans, and others may be Prooshans; they are born so, and will please themselves." We are not Russians or Prussians, and their precedents prove nothing for us. The plea that the State will be able to effect economies which the private individual cannot contrive, and make money go twice as far as he can, reminds us very forcibly of the kind of argument used by the young man of small or no income who is yet determined upon marrying. The argument that though the private individual may make a loss, the State will make a profit, is in truth very much on a par with the assertion that what will not keep one will somehow keep two. The inability of the private owner to make a profit out of forestry is, we ought to point out, very candidly admitted by the Commission. They say :—" In no circumstances do your Commissioners suggest that the State should be expected to finance schemes of private afforestation, by way of loan or otherwise. The • security would not, in their opinion, in such cases be of a sufficiently substantial kind to warrant such action." We venture to think that if the project is not worth lending money upon, it is not worth spending money upon, though, of course, we admit that this argument may be countered by the assertion that the State manages so much better than the individual that all the conditions change the moment the State enters the field. That is logical pleading, no doubt, but surely it is a theory which experience contradicts. We have not had any experi- ence of Government afforestation on a grand scale in this country ; but there is at any rate the example of the New Forest. It will not, we think, be urged that State action has proved a success there, either from the economic or the aesthetic point of view.

Perhaps we shall be asked whether we really contend that it is not worth while to grow timber in these islands. That, we shall no doubt be told, is what our argument comes to. We do not shrink from the conclusion. Wo do not believe that timber can be grown at a profit here, or, to put it in a more scientific way, we believe that the money proposed to be spent on afforestation can be better and more profitably spent in other ways. That is the common-sense of the question. People in the British Isles do not spend money on growing timber because they have something better to do with their money. Now if that is the explanation—and we challenge any one to deny that this is not the reason why private individuals do not grow timber—then the spending of £450,000,000, or whatever the sum may be, by the State upon growing timber must be a waste of the national resources. Since the State has no Fortuuatus's purse out of which it can produce as many sovereigns as may be required, what we mean when we say that the State is to spend so many millions of money upon afforesta- tion is that the State shall take those millions from private individuals and insist upon their being spout upon the production of timber. The State will, in effect, say to its citizens :—" You tell us that you can employ your money better in other ways, and will not therefore spend it on producing timber. We tell you that you are wrong, and that you shall spend it on raising timber. Since you are so perverse as not to do it yourselves, we intend to take the necessary money from you and spend it for your good." Can any one deny that this is really what is meant by the State spending the taxpayers' money on afforestation ? Of course it is open to the advocates of afforestation to say that the State is perfectly right, and that it is able to force people to do what they have not the sense to do for themselves ; but at any rate the transaction must be based upon the assumption that the, State can spend people's money better for them than they can spend it for themselves. The Socialist will find no difficulty in assenting to this proposition, but we cannot help thinking that those who are not Socialists, when they argue the matter out and realise what the proposal really is, will be inclined to doubt its wisdom.

Remember, too, that what we have just said about Fortunatus's purse applies in another direction. The State cannot grow money or make it ; it must take what it spends compulsorily from the taxpayers. This means that whatever be the number of millions required by the State for planting, they will ultimately be taken away from other useful industries. At the best, and even if the State does not waste these millions, but makes a good use of them, it is only a question of a transfer from one industry to another. The £450,000,000, if not used in afforestation, will not lie idle in the course of the next eighty years. It will be used for some industrial or productive purpose. It will be spent on making docks or tramways, or building factories, or improving the cultivation of the land, or upon a thousand other forms of human activity. Since wealth is limited, and since it is impossible to eat your cake and have it too, if we set up a great State timber business we shall not have the other things upon which the money would have been spent in the natural course of events. Therefore we come back to the question whether the State is likely to make a better use of the £450,000,000 than private individuals would,—whether we believe that the State knows better how to spend money than the individual. It is the old choice between Socialism and anti-Socialism.

The objections to the scheme for afforestation are so many and so great that it would be quite impossible to state even a tithe of them in a single article. We must, however, notice one more before we conclude, and that is the taxation objection. How are we going to raise the money ? The Commissioners suggest the modern fashion,— by loan. We are to borrow £2,000,000 or so a year for the next eighty years. Are we to borrow, also, the interest that will have to be paid on those loans ? Apparently. If that is the case, then all we can say is that we are sorry for the unfortunate holders of Govern- ment securities, because the effect of such borrowing is bound to depress their property even more than it is depressed already. Already the Chancellor of the Exchequer is intent upon taking most of the Sinking Fund for current financial expenses. If in addition to this, and to the borrowings for Irish land purchase, we are to borrow another two millions a year, not only will both the old and the new Sinking Funds disappear, but we shall actually be increasing the volume of the National Debt every year instead of decreasing it. The result must be a continuous fall in the price of Consols. Just as a systematic reduction of Debt each year, even if that reduction is small, must tend to maintain the price, so the systematic increase of the capital of the National Debt, even though it is only to the tune of two or three millions a year, must tend to depress the security. In view of these facts, it would be, in our opinion, most unsound to finance afforestation by way of loans. But if the money is to be raised by new taxation, we should like to ask the advocates of afforestation how they propose to raise it.

Before we leave the subject of afforestation it is necessary to say a word in regard to the unemployment side of the matter. Though the Commission do not profess to recommend afforestation expressly as relief work, it is obvious that they have been not a little tempted to make the recommendations they do make by the thought that they will be able thereby to help to solve the problem of unemployment. We doubt it. Unemployed labour is always shown to be exceedingly dear labour, and, with the tremendous commitments involved in an afforestation scheme, the first thing that the Forestry Board would do would be to point out that it would be far cheaper for the State, to use skilled labour and to give the unemployed a dole than to waste time, money, and energy in using an inefficient, and therefore costly, type of labour.