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Corruption and Deforestation

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ENVIRONMENT-ASIA: Deforestation Symptomatic of Corrupt Regimes
By Marwaan Macan-Markar

CHIANG MAI, Thailand, Oct 20 (IPS) - When a global anti-graft watchdog surveys the Asian landscape for corruption indicators, the continent’s forests depleted by illegal logging invariably enter the picture.

And as the Berlin-based Transparency International (TI) notes, in countries where excessive corruption prevails, the destruction of natural resources, such as local forests, for private gain is not far behind. ‘’Illegal logging is a symptom of the disease of corruption,’’ says Lisa Elges, TI’s senior programme coordinator for the Asia-Pacific region. ‘’In countries where deforestation is predominant, corruption is very high.’’

November 18, 2007 by The Nation
Confronting the Global Timber Barons

by James North


Father Andres Tamayo now gets company as he drives the church pickup truck around his rugged rural parish here in the frontier region of Olancho [Honduras]–four soldiers in battle dress sit in the back to protect him from being murdered. Father Andres is part of a grassroots environmental movement that’s trying to stop criminal deforestation, and the local timber barons have already killed some of his friends. The environmentalists cannot trust the local police, so they, and their allies overseas, pressured the national government into assigning the young soldiers.

Environmentalism in the Third World is not an imported Western fad. In Olancho the movement started from the grassroots up, after local people began to notice that the ferocious deforestation was threatening their existence. Victor Ochoa, a bricklayer and another leader of the Environmental Movement, explained, “The climate has changed violently here. In the 1970s high temperatures usually only reached 70 to 77 degrees. Now we regularly go over 85 degrees. Cutting down so many trees destroys the watershed; it fails to hold water. The rivers and creeks don’t rise like before. Once, the water came up to your waist. Now you can cross on a bicycle. The rivers are dying.”

“The way we live here has changed,” he continued. “Before, we lived in poverty. Now we live in misery.” ....

He walked back and forth in the church kitchen, explaining how deforestation is destroying his parish: “Because the trees are cut down, our people don’t have water. Before, women may have walked two or three miles for water; now they walk seven or ten. Vegetable plots produce only one-third what they once did, due to the growing ecological imbalance. People who used to be able to work in the countryside year-round are reduced to three months. Sixty percent of our young people have already left, many of them North, to the United States.”
December 1, 2007

Logging for the Wealthy - Of Forests and Finance

In one of the most ironic twists of logging booms over the past couple decades, many people still believe that the end result was construction of homes to satisfy the needs and dreams of ordinary people. There's only one problem. The popular perception is wrong.

The consequences of this mistaken perception are still not widely reported. But they're certainly no secret. By 1995, for example, Winton Pitcoff could write a penetrating analysis of America's housing crisis for March/April issue of Dollars & Sense. Pitcoff reported that, "Thirty years ago the nation boasted a surplus of housing affordable to low income people. Today there is a shortage of more than four million units."

This loss was a matter of public record. By 1995, the U.S. Census Bureau's American Housing Survey would report a "43 percent decline over the last two decades in the number of low-rent units in the private housing market." At the same time, out in the forests, many species were seeing their own homes wrecked by reckless logging that fed a boom in building bigger, more energy-guzzling, and more un-affordable houses.

This mutual decline continued under Democrats as well as Republicans. Pitcoff explained that the supply of affordable housing declined by 900,000 units just from 1996-1998 alone." The Clinton administration was in power then. Despite endless and widespread claims that forest conservation would interfere with meeting legitimate human need, wild species and ordinary people alike were going increasingly homeless, or scarcely managing to hang on.


Meanwhile, Congress and successive administrations backed tax breaks that were subsidizing large and expensive homes for buyers in the top fifth of America's income distribution. Tax allowances under the Mortgage Interest Deduction let extravagant homebuyers deduct up to a million dollars (!) in costs of borrowing for homes, including vacation homes that may sit empty most of the year.

These tax breaks, according to Dollars & Sense magazine, amounted to $82 billion in 1999 alone. This boon to the prosperous tapped forests while poor people were priced out of market after market. And the device near the heart of the matter is written into the American tax code as the Mortgage Interest Deduction. Cushing Dolbeare, founder of the National Low Income Housing Coalition, was cited in a Dollars & Sense interview saying, " If we were willing to spend as much on low and middle income housing as we do on the Mortgage Interest Deduction, we'd have more than enough to solve the housing crisis."


It's not that Congress had not passed law to offer housing for the nation's unrich. Indeed, the Federal Housing Administration was set up for that purpose. FHA even had an insurance fund to cover banks, losses if poorly paid borrowers couldn't meet their loan payments.

However, in June, 1990, Associated Press business reporter John Cunniff disclosed that the program had been twisted to reward those who didn,t need it and deny loans to those who did. That twist, according to official records examined by Cunniff, was causing " incredible losses" for the program's insurance fund. It turned out that 100 percent of the government-insured loans intended for the needy were going to the well-off.

And the bigger the loan, the more likely it was to end up in foreclosure. An expert Cunniff contacted for an explanation told him that, while the government might lose money on these bad loans, the brokers who set up financing made more money on the larger ones than they would on smaller loans needed for the nation's poor.


During booms, the Wall Street Journal would report in early 2000, homes get bigger. Like Americans, waistlines, the Journal observed, the new American home was getting much bigger, and more extravagant. While affordable housing was uncomfortably rare for the Americans who most needed it, the fortunate were demanding homes with "more bedrooms, more bathrooms, and more flourishes than ever before."

Architects and even the builders of luxury homes were noticing the trend. An architect told the Journal that the trend was "appalling." He said that the bigger-is-better trend was about showing off to neighbors. In his opinion, people buying luxury homes were saying, "I can be a 1920s tycoon like anybody else."

One homebuilder interviewed by the Wall Street Journal was quoted as saying," Does anybody need all this? No."

Indeed, the Journal observed, " Need is hardly a consideration these days."

It would be hard to find a forest conservationist who would disagree.

Right now, the media hum with stories of Americans vulnerable to foreclosure on the energy-guzzling homes they could neither afford to buy or to heat. But another major problem may lie on our near horizon. If the nation ever does get around to building homes for people who really need them, the public forests no longer have the capacity they once had for meeting this need, thanks to lending/logging/construction booms that have already removed millions of acres of wild trees of every age. Any undercapacity of our forests in the face of new demand is an unrecognized cost -- or an opportunity cost, as economists might state it -- of the logging boom.



Right now, the media are all abuzz about need to reform America's financial system. Well, yes, there's plenty of reason to argue in favor of reckless lending. But homes are not built of money alone, and the needed reforms must extend to the forests too.

Gifford Pinchot, the first Chief of the U.S. Forest Service, would likely agree. "The rightful use and purpose of our natural resources," Pinchot wrote in 1947, " is to make all the people strong and well, able and wise, well-clothed, well-housed, with equal opportunity for all and special privilege for none."

Back then, America's political leadership was listening, and was responsive to ordinary needs and dreams. In 1949, America passed its Housing Act, which stated that it is the policy of the United States to provide " a decent home and suitable environment for every American family."

That was then.

Forests have kept falling so that buildings will go up, but luxury kept trumping ordinary needs and dreams all the way from wilderness to the city. And the nation's financial and forest systems are left in equal disrepair because of it. To date, though, the major media are all but clueless when it comes to connecting the dots that so clearly link reckless lending and reckless logging, and the proposed new regulations only cover half the crisis.


This article is an adaption of an earlier one published by Progressive Populist, the Great Bear Foundation's Bear News, and the Southern Appalachian Biodiversity Project's Wild Mountain Times. It may be freely distributed for non-profit purposes if no changes are made in the text.. He can be reached at: lance @

Copyright (c) 2007 by Lance Olsen. All rights reserved by the author.


Public release date: 7-Dec-2007
Consultative Group on International Agricultural Research

Contact: Greg Clough
g.clough @

Jeff Haskins
jhaskins @

New report on deforestation reveals problems of forest carbon payment schemes
New report outlines underlying causes of deforestation based on 10-year analysis

BALI, INDONESIA (7 December 2007)—A new study by one of the world's
leading forestry research institutes warns that the new push to
"reduce emissions from deforestation and degradation," known by the
acronym REDD, is imperiled by a routine failure to grasp the root
causes of deforestation. The study sought to link what is known about
the underlying causes of the loss of 13 million hectares of forest
each year to the promise—and potential pitfalls—of REDD schemes.

Based on more than a decade of in-depth research on the forces driving
deforestation worldwide, the report by researchers at the Center for
International Forestry Research (CIFOR) found that there is ample
opportunity to reduce carbon emissions if financial incentives will be
sufficient enough to flip political and economic realities that cause

The report was released today at the United Nations Conference of the
Parties (COP-13) in Bali, where environment ministers from 190
countries are meeting to plot a long-term strategy for combating
global warming. High on the agenda is reducing the 1.6 billion tons of
carbon emissions caused each year by deforestation, which amounts to
one-fifth of global carbon emissions and more than the combined total
contributed by the world's energy-intensive transport sectors.

"After being left out of the Kyoto agreement, it's promising that
deforestation is commanding center-stage at the Bali climate talks,"
said CIFOR's Director General, Frances Seymour. "But the danger is
that policy-makers will fail to appreciate that forest destruction is
caused by an incredibly wide variety of political, economic, and other
factors that originate outside the forestry sector, and require
different solutions."

In other words, Seymour said, stopping deforestation in Indonesia
caused by overcapacity in the wood processing industry is a completely
different challenge from dealing with deforestation stemming from a
road project in the Amazon or forest degradation caused by charcoal
production in sub-Saharan Africa.

According to CIFOR, careful examination reveals that complex, indirect
forces are often more important than the logging and slash and burn
activities popularly understood as the main causes of deforestation.
Forces such as fluctuations in international commodity prices;
agricultural and, more recently, biofuel subsidies; and roads and
other infrastructure projects can encourage forest clearing. Deeply
ingrained and routinely corrupt government practices often favor large
corporate interests over community rights to forest resources.

Seymour said the CIFOR analysis, which draws on a range of studies of
the economic, social and political conditions affecting the world's
most vulnerable forests, seeks to ensure that any initiatives to stem
deforestation that might emerge in future climate change agreements
are firmly grounded in reality.

Most importantly, CIFOR advises decision makers to learn from the past
and look beyond the confines of the forestry sector to the array of
market failures and governance failures that spark a chain of events
culminating in deforestation.

For example, according to the study, Indonesia, which is estimated to
lose 1.9 million hectares of forest each year, has emerged as one of
the world's leading sources of carbon emissions in part due to a
global spike in prices for palm oil and a surge in China's demand for
wood pulp. Together, these forces have pushed deforestation into
carbon-rich peatlands that are being cleared and drained to make way
for oil palm and pulpwood plantations. Limiting deforestation in
Indonesia's peatlands should be a high priority because the carbon
losses per hectare are substantial.

Meanwhile, CIFOR notes that in South America, the loss of 4.3 million
hectares a year is driven in part by meat consumption that encourages
conversion of forests to pasture lands throughout the region. In
Ecuador, road building has been a major cause of deforestation. In
sub-Saharan Africa, fuelwood extraction and charcoal production are
factors behind the continent's loss of 4 million hectares a year.

Markku Kanninen, one of the authors of the report, said that "Policies
that seek to halt deforestation will need to be crafted to address
diverse local situations and target activities in areas such as
agriculture, transportation and finance that lie well beyond the
boundaries of the forest sector."

"The perverse subsidies that provide incentives for clearing forest
must be removed and efforts to secure property rights for local forest
communities should be encouraged," Kanninen said.

The report also sees promise in the increasingly popular notion that
deforestation can be addressed with financial incentives that
compensate landowners for "environmental services." Seymour said
discussions in Bali to fight deforestation by compensating forest
stewards for protecting the carbon-storage capacity of forests through
what is now a multi-billion dollar global market for carbon credit are
potentially powerful.

"Such payments to individual land-users have the potential to "flip"
financial incentives from favoring forest destruction, as they now do,
to favoring conservation," Seymour said. "But the key question is
whether or not REDD incentives will be sufficient to flip political
and economic decisions at the national level that drive

Appealing as they are, Seymour said it's critical to understand that,
due to decades of inattention to the rights of forest dwellers, new
payment streams tied to conservation could intensify the severe
poverty that now afflicts the majority of rural forest communities in
the developing world.

"Since forest property rights are often very unclear, payment for
carbon services could end up providing incentives for corrupt
officials or local elites to appropriate this new forest value from
local communities," she said. "We've seen this happen before in
similar situations, and there's every reason to believe, given the
kind of money now being paid for carbon credits, that it could happen

Seymour said such problems can be avoided if policy makers enter the
process of designing REDD strategies with a clear understanding of
potential pitfalls and what can be done to avoid them. The report
advises that reducing carbon emissions from forests will require
strengthening the weak governance mechanisms that have long proven
unable to enforce many existing prohibitions on forest clearing.

Finally, the report calls for ensuring that the REDD process is fair
to poor forest communities.

"We need to temper the desire for maximum reduction in forest-based
carbon emissions with regard for the legitimate rights of forest
communities to realize the income potential of their forestlands,"
Seymour said. "At times there will be trade-offs between reducing
carbon emissions and reducing poverty."


About the Center for International Forestry Research (CIFOR)

Headquartered in Indonesia and with offices in Latin America and
Africa, the Center for International Forestry Research (CIFOR)
( is a leading international forestry
research organization established in response to global concerns about
the social, environmental, and economic consequences of forest loss
and degradation. CIFOR is one of 15 research centers within the
Consultative Group on International Agricultural Research (CGIAR)