Welfare Pests

by Patty Clary

Billions of dollars of corporate welfare is dished out by the U.S. Commerce Department (see "Ron Brown's V.I.P. Junkets") and U.S. government banks that operate within the Commerce Department. One of these, the Overseas Private Investment Corporation (OPIC), has insured a logging venture in Russia that threatens to cause destruction of Northern California forests equal in scope to that caused by U.S. logging in Russian forests. OPIC is providing political insurance for a consortium of fifteen timber mills anxious to grab part of the market share as natural resources are stripped in the former Soviet Union. The consortium, which calls itself the Global Forestry Management Group, recently leased a million acres of Russian forest in the Khabarovsk region. It plans to invest $70 million in building an infrastructure of roads and port facilities to ship billions of board feet of logs out of Russia.

Global Forest Pillagers

The companies that make up the Global Forestry Management Group are small, landless saw mills that struck it rich during the great public forest give-away of the roaring '80's. Now rich enough for action in the international market place, they are positioning themselves to participate in forest destruction on a global scale, joining timber giants such as Weyerhauser and Louisiana-Pacific in the timber rush. The massive boreal forests of the Russian Far East and Siberia beckon as the most lucrative of all the global forest resources.

Global Forestry plans to import most of the logs to its members' saw mills in California, Oregon and Washington. It is almost guaranteed that pests from Russian forests will survive importation despite kiln drying and pesticide saturation of the logs. If pests from Russian trees make it into U.S. forests, entire species of native trees would be at risk of extinction, and forests would be subjected to massive amounts of pesticide spraying.

The main obstacle to the consortium's plan for big profits is the ever present risk of political upheaval in Russia and the losses Global Forestry would incur if forced to abandon the project. Without a doubt, Russia's political situation is perilous. The current president of Russia is propped up by massive foreign aid from Western countries, and it's anyone's guess who the next president might be, or what segment of the political spectrum he might occupy (his gender is the one known factor).

The same uncertain future is true of provincial governments throughout Russia. In many areas, organized crime dominates or controls outright government agencies and businesses, bringing the political situation dangerously close to complete mayhem. In the face of such uncertainty about its future ability to do business in Russia, one could question Global Forestry's confidence in investing millions of dollars to plunder the forests of Russia. Well, look to your paycheck, folks, as they throw our children off welfare rolls and into the streets, because it's your money that provides security for the Global Forestry consortium as it rolls off into the international marketplace.

"Political Risk Insurance"

According to Commerce Department memos, OPIC is supporting U.S. companies' investment in the former Soviet Union. OPIC uses American tax dollars to provide project financing and political risk insurance to the investors. By late March this year, OPIC had approved approximately $3 billion in financing and political risk insurance to support U.S. companies' investment in former Soviet states. Since then, OPIC has approved risk insurance for the $70 million that Global Forestry wants to spend carving out roads and tearing up ecosystems in Russia.

If Global Forestry is forced to flee its investments in Russia due to political upheaval, the U.S. taxpayer will have to pay the companies back for having lost their investment gamble. If the political situation remains stable and Global Forestry is able to go ahead with its deforestation plan, the company can export to the U.S. raw logs of fairly high quality for pennies on the dollar of their actual value.

Washington's rationale for this subsidy is that foreign investment will provide political stability in Russia. For Russia's leaders, abating the threat of revolution is a major motivating factor in the drive to obtain foreign currency as immediately as possible. Russia's vast stands of boreal forest are assets that can be sold quickly. In exchange for cold cash the country's leaders are willing to write-off the milling jobs, forget the topsoil, damn the watersheds and throw away everything else that could provide long term sustainability for its citizens.

The loss of Russia's boreal forest will have the profound effect of magnifying global warming since the forest is one of the largest carbon sinks on earth. Carbon sinks bind carbon dioxide that otherwise would be in the atmosphere causing the greenhouse effect.

The logging would also devastate rare wildlife habitat. The last 250 Siberian tigers and scores of other species will be gone forever if the forest falls.

In the Russian Far East, where Japanese and Korean companies have been frantically harvesting timber for several years, thirty rivers have filled with silt. OPIC claims that Global Forestry's project will cause minimal environmental damage in Russia because the logging must adhere to U.S. forestry law in order to obtain political insurance. Anyone who has followed what U.S. timber companies have done legally on public land in the U.S. are not encouraged by this promise.

Importing Trouble

On the face of it, importing logs and chips from outside North America looks as if it would reduce the pressure on U.S. forests and allow a break from cutting trees. But in reality, importing wood from outside North America, especially from uncultivated forests such as Russia's, is fraught with danger, of unprecedented scope, to U.S. forests.

The forests of Russia and Siberia contain organisms so dangerous to U.S. tree species that an unofficial ban on log imports from the region has existed with U.S. government and business cooperation for over four years. That ban is about to be lifted now that import rules have been officially published that will allow Russian logs and chips to begin entering the U.S. as soon as late August. Under intense pressure from the Commerce Department, The U.S. Department of Agriculture has developed import regulations that will allegedly protect U.S. forests from the introduction of dangerous Russian forest pests. Logs, chips and other wood from the region must be heated and doused with pesticides. These are expensive regimens that would be done in Russia, under Russian supervision. The only assurance that the procedures had been completed in the required manner would be an importer's word.

Logs would enter the U.S. saturated in pesticides that are severely restricted for use in this country. On the front line for exposure to the poisoned wood are workers who handle wood and breathe dust particles in sawmills.

Even with poisons and heat applied to kill all organisms on and in the wood, experts say logs that aren't completely sterilized will contain dangerous pests. If just one dangerous pregnant insect or a few spores of fungi or a couple of nematodes enter the U.S. alive, find a niche in our environment and begin to spread, it could create a monumental crisis.

Pests known to inhabit Russian forests are considered capable of destroying entire species of trees in the Western U.S., such as the Douglas fir, a cousin to the larch that dominates much of the Russian forest. Pests from outside the country would not meet any resistance in the already heavily stressed forests of the Western United States.

The government and timber industry reaction to the spread of a dangerous forest pest is likely to be pesticide spraying on a massive scale. Even though attempts to eradicate a pest that has found a home in a new environment almost always fail, the pressure to use pesticides would be intense.

Destruction of the Russian forests and ecosystems, the import of dangerous pests to the U.S. and subsequent large scale pesticide use „ these are the broad strokes of the horrific destruction associated with just one of the federal government's REAL welfare programs.

Several environmental groups are considering challenging the regulations that would allow dangerous log imports from Russia and Siberia.

[Patty Clary is the Executive Director of Californians for Alternatives to Toxics (CATs), a pesticide reform group based in Arcata and serving communities throughout northern California. CATs can be reached at 860 1/2 11th St., Arcata, CA 95521. (707) 822-8497.]

Copyright Mendocino Environmental Center 1995