Fostering the Forest Economy in the United States, with James Boyd

Notable Quotes

• US forests are good for the economy and the environment: “Forests play such a big role in supporting ecosystem services like biodiversity and water availability and quality. They help avoid erosion, they help protect against flooding, and they’re culturally valuable. The forest economy touches almost all Americans and all geographies, and [forests] have a potentially large role in our future climate solutions, as well.” (5:00)
• Recent legislation targets carbon storage in US forests: “In terms of nature-based climate solutions, the idea here is that trees and vegetation generally are good at removing and storing carbon. The US land carbon sink (think of this as soil and vegetation) already stores 50 years’ worth of our annual emissions, and it removes about 12 percent of our annual emissions every year. The question—and what Congress is hoping for—is that we could ramp that sink up and get more out of it. There’s a lot in the legislation about that.” (8:17)
• Managing wildfire is a priority: “Wildfire is a huge source of emissions. We’re never going to (nor would we want to) get rid of forest fire. Forest fire is a natural and important and valuable ecological process. Having said that, the amount of forest carbon and greenhouse gases emitted from wildfire in California recently is more than all the emissions associated with their electricity production … To the extent that we can be managing and controlling fires, particularly huge ones—that’s going to be good on the emissions side, as well.” (25:19)

Top of the Stack

• Aubrey-Maturin series of nautical historical novels by Patrick O’Brian
• Master and Commander: The Far Side of the World film

The Full Transcript

Daniel Raimi: Hello and welcome to Resources Radio, a weekly podcast from Resources for the Future (RFF). I’m your host, Daniel Raimi.

Today, we talk with RFF Senior Fellow James Boyd about forests in the United States. Private-sector investments and recent federal legislation are injecting tens of billions of dollars into wildfire management, expansion of forest product markets, and forest conservation and expansion. Jim will help us understand how all of that new investment is likely to affect wildfire risk, carbon sequestration, local communities, and much more. Stay with us.

Jim Boyd, my colleague from Resources for the Future. Welcome to Resources Radio.

James Boyd: Thank you, Daniel.

Daniel Raimi: It’s kind of wild that we’ve had the show on the air for almost four years, and you are just appearing for the first time. It’s on us that we’ve taken such a long time to get you in here, but it’s great to have you now. We’d love to start off by asking you the same question we ask all of our guests: How did you become interested in working on environmental issues—whether that interest was generated at a young age or later in your life?

James Boyd: It started at a very young age. My parents were outdoorsy, and we did a lot of roughing it. We canoed, we hiked, we cross-country skied, we snowshoed. We would camp for a month at a time in the Upper Peninsula of Michigan in the summer, and I remember the stars, the quiet, and the mosquitoes. I grew up being involved in that.

That was our vacation—getting out into the woods or onto a river. Then, my brother and I got into backpacking in high school and had some great hikes in the Midwest. I joined the Sierra Club and subscribed to Backpacker Magazine. I was into gear, and then, somehow, I wound up getting a PhD in economics in a business school, but I connected my love for the environment to that. The rest is history, if you will. Thanks for making me think of those memories.

Daniel Raimi: It sounds wonderful. You grew up in Michigan, right?

James Boyd: I grew up in Chicago, actually.

Daniel Raimi: Oh, okay.

James Boyd: We would go straight north—nine hours from Chicago up to the Upper Peninsula—and that’s where we would hang out.

Daniel Raimi: I was in the Upper Peninsula this summer. It’s spectacular up there.

I’m sure we could reminisce about our recent and distant vacations for much longer, but we brought you in today to talk about the forest economy; in particular, how recent legislation has affected the sector and what it means for wildfire, carbon, and jobs.

Before we get into the details, I think it would be helpful for our audience for you to define this term, “forest economy,” which we’re going to use a lot in today’s episode. What does “forest economy” mean to you?

James Boyd: First of all, the forest economy is huge. It’s varied in part because we here in the United States are blessed with so much forested land. A full third of the country is forested. You can start out narrowly talking about the forest economy as being about timber harvesting and forest products—think pulp and paper, construction materials; increasingly, think bioenergy—but forest products are also important to Indigenous communities and subsistence agriculture. A lot of people, myself included, enjoy mushrooming.

That’s the conventional answer. But then, of course, there’s the whole recreation sector that’s centered around recreation, which happens a lot in our forests. This is all of the businesses, jobs, and travel that support that kind of activity. Then, there’s a large number of forest owners who are called “family forest owners,” who are managing their own property at a smaller scale. They do that for a whole set of personal reasons that are really varied.

In a lot of ways, you can think about the forest economy in the United States as being equivalent to the rural economy, but I’ll expand the definition even further, because forests play such a big role in supporting ecosystem services like biodiversity and water availability and quality. They help avoid erosion, they help protect against flooding, and they’re culturally valuable. The forest economy touches almost all Americans and all geographies, and they have a potentially large role in our future climate solutions, as well.

Daniel Raimi: That’s a great way to start us off. We’re going to touch on all of those elements in our conversation. But, as I mentioned, I think it would be nice to get us started here by asking you to give us a sense of how recent legislation—the Infrastructure Investment and Jobs Act and the Inflation Reduction Act—is affecting the forest economy. What are some of the most significant investments that those laws make, and where are they targeting resources? Which part of the forest economy are they likely to affect?

James Boyd: Before I give some specifics, I’ll just say that those two acts are going to be hugely consequential for US forests—both public forests and private forests and the forest economy connected to them.

There are three main drivers behind what we see in the forest provisions of the two acts. The first is a traditional desire to conserve and protect forests in ecological terms and support the multiple objectives we have for forests: recreation, forest products production, species protection. In this last cycle, we’ve seen two more distinctive and timely drivers. The first is a lot of attention paid to the wildfire crisis and managing our forests to reduce wildfire risks. The second is a search for nature-based climate solutions—in other words, having forests remove and store more carbon to help us meet our climate goals. The acts up our game and help us out in those last two categories.

In terms of wildfire, the two pieces of legislation together provide more than $7.5 billion in new money to reduce wildfire risks and restore forests so that they’re ecologically resilient. Wildfire has been top of mind for Congress. It’s about time, many would say. Lives are being lost; incredible amounts of property are being lost and damaged. 100 million homes live in what’s called the “wildland-urban interface,” where people in homes are exposed to these kinds of damaging fire events. This $7.5 billion is starting to work on that backlog of underinvestment in recent decades. That’s a big piece of what’s happened.

In terms of the nature-based climate solutions, again, the idea here is that trees and vegetation generally are good at removing and storing carbon. The US land carbon sink (think of this as soil and vegetation) already stores 50 years’ worth of our annual emissions, and it removes about 12 percent of our annual emissions every year. The question—and what Congress is hoping for—is that we could ramp that sink up and get more out of it. There’s a lot in the legislation about that.

It’s hard to summarize. Let me give you a couple further things of note. There are additional billions of dollars available through what are called “cost-share programs,” where private forest owners and farmers can be supported to take climate-smart action on their land. These are actions that help store more carbon in forests or agriculture.

Not all of the almost $20 billion will go to climate-related activity, but a fair chunk of it will. The Inflation Reduction Act has $450 million to support carbon incentives for private landowners. This helps private landowners participate in carbon-offset markets. There are hundreds of millions of dollars to help smaller, more disadvantaged, underserved landowners participate in those markets; that’s really notable.

Again, I’m just touching on what’s in the acts. There’s also a lot of money for workforce training, technical assistance, and research and development, all of which is focused on this wildfire-and-climate set of issues.

Daniel Raimi: We’re talking about billions, if not tens of billions of dollars when you add it all up. Does that sound about right?

James Boyd: Yep.

Daniel Raimi: That is a lot of money flowing in from the public sector, but there’s also lots of private-sector investment that is increasingly flowing towards forest projects, partly because of this desire to increase the carbon sink and perhaps provide offsets for corporate activities. Can you talk a little bit about how those private-sector investments are shaping the broader forest economy?

James Boyd: One thing to notice is that there’s a real linkage between these private investments, as you’ve framed them, and public incentives or policy incentives. I want to make that point. For example, with the cost-share provisions of the acts (where costs are shared between the public and private sector), there are policy incentives to retrofit wood-product facilities. It’s a hand-in-hand thing.

What we’re seeing is this historic injection of funds into the forest landscape. In aggregate, it’s going to be good for the forest economy in terms of jobs, property values, and business conditions; private forest owner participation in voluntary carbon markets could create even greater movement in this direction.

I think about this investment opportunity and economic opportunity for the sector in the following categories. First are these cost-share payments, which are government payments to the private sector that are geared toward changing behavior and also changing forest practices that are good for our climate and wildfire goals. Then there is support for forest-product production. Think about using wood and wood products that we remove from the forest to produce bioenergy and innovative construction materials. There’s this thing called “mass timber,” where we can now be thinking about building skyscrapers out of wood. There is stimulus for the product sector in these acts—low interest loans, loan guarantees, things like that.

A third category is a lot of the investment—particularly in the Infrastructure Act—goes to management of our public forest lands. Even so, though, there are going to be all of these spillovers to the private sector and adjacent communities in terms of jobs. A lot of that work on federal land is going to create jobs and involve private-sector contracts. Then, you’ve got the ambition to, for example, reduce wildfire risks and enhance recreational resources. Neighboring communities are going to benefit from that, and you could start seeing how that’s going to be good for property values and tax revenues, things like that.

Finally, there are the private voluntary markets for forest carbon offsets, which I keep mentioning. Those are going to increasingly become important because of the demand for these offsets globally from companies and governments who’ve made net-zero pledges. They have to find those offsets somewhere, and one of the best places to find them is on the land with these nature-based solutions.

Daniel Raimi: One thing that we don’t have time to get into today, but I’m sure some listeners are thinking about, is the complex accounting of forest carbon offsets and whether all of those investments really are additional and taking carbon out of the atmosphere. Is there anything you want to briefly say on that?

James Boyd: It’s a huge issue. You can talk about how forests are the prime example of nature-based solutions. The dynamics of how carbon gets stored and eventually released when trees die or decompose and figuring out what forest owners would’ve done without the incentive to create the appropriate baseline—it’s complicated. These are huge, complicated issues. Lots of people have been thinking about them for decades.

I want to just agree with you that this is a complicated issue with lots more work to be done. But the upside is that we have 1.5 billion acres of land in the United States that could be in play here, so we have to figure this out. That’s all I’d say; it’s a conversation for another podcast.

Daniel Raimi: We should do an episode on offsets in nature, and I’m sure we could find some great folks at or around RFF.

We’re going to come back to this topic of carbon storage and emissions in a few minutes. First, I’d love to ask you about the first issue that you mentioned, which is wildfire risk. What’s your sense about how these investments are likely to affect wildfire risk in the United States in the years or decades ahead?

James Boyd: I want to frame it like this: These investments are catch-up investments, because we have this history of suppressing wildfires and underinvesting in what are called “forest treatments.” Forest treatment is either controlled burns or what’s called “mechanical thinning.” Both of those strategies are designed to take fuel out of the forest so that you don’t get huge, uncontrollable fires, and you can manage them better. We have this backlog of handling that appropriately.

This is just the beginning. I can confidently say that this money is going to help, but, again, it’s a down payment and probably not enough in the long run to really get ahead of the problem.

Daniel Raimi: Can you say more about that to help our listeners understand the historical policies that have led to the need for all of this management and forest treatment?

James Boyd: The pivot that’s happening is (and I’m overstating this) from, Okay, a fire has started, now let’s suppress it and try to put it out, which is action you take once the fires are already burning. The pivot that’s happening now is to a more proactive and protective set of investments and strategies, where you’re trying to make investments in reducing these risks at the front end. That’s historically notable, and a lot of both communities and people who care about the social impacts of fire and the natural resource experts have been calling for this for quite some time.

You’ve seen those two groups come together and agree on this. This is not just a natural resource–management issue, it is also a deeply social issue. It’s about where people live, how they build, and how they plan their communities. It’s a behavioral question, and, by the way, something that my colleagues and I work on at RFF.

Daniel Raimi: I want to ask you now about the economic implications of these investments. You’ve already touched on them in broad terms, but can you say more about how you expect these investments from the public and private sectors to affect communities that are, today, heavily dependent on the forest economy or may become more dependent on the forest economy in the future?

James Boyd: There’s this almost historic, new set of investments, proposed action, and attention to the forest sector right now. That money certainly will percolate through the broader forest economy in aggregate. One thing I would like to raise as an important question, though, is, Will all communities benefit equally?

This is something important to keep an eye on, because not necessarily everyone will benefit from these new approaches and the new money. In particular, the acts pay some attention to what we could call underserved communities. There are a couple of specific places where support for small forest owners and underserved forest owners are called out in the acts. But I have a couple of concerns.

Let me give you a couple of examples. First of all, to participate in national or global carbon markets—by selling credits to a global corporate customer, let’s say—there’s a lot of what could be loosely called paperwork involved with that, a lot of administrative burden. You have to figure out how to sign up, you have to get your plans in place, and you have to monitor and verify. That plays more to the strengths of large forest owners and even institutional forest owners who have perhaps their own accountants, lawyers, and land managers. They’re going to find it much easier to access these markets and participate in them. So, one thing I would want to keep an eye on is, What’s going to happen to the smaller forest owner?

Another thing I’d pay attention to is what we could call forest community gentrification. By that, I mean gentrification occurs when, in one way, economic conditions are improving for some people. Property values are going up, tax revenues are going up, and local infrastructure might be improving. With this injection of money and opportunity into the forest sector, we might see something like forest community gentrification.

But it also means, of course, that some people in the community, like poorer residents and people who rent rather than own their homes, are losing out. They can be pressured by rising rents, rising tax burdens, and even by a change in these communities’ demographics. People move in for second-home use, for example. I wanted to note those things.

One thing at RFF that we care a lot about is—even though I’ve argued that this is a rising tide that, on average, is going to lift all these boats—we want to pay attention to the equity of that overall change. Again, this is something that we work on here at RFF and care a lot about.

Daniel Raimi: I was speaking this morning with someone from Idaho, and they were talking about second homeowners, too—people coming in from other places who had more money, and this was leading to some of this gentrification concern that you were talking about.

One last question that I want to ask you before we go to our Top of the Stack segment: Could you say more about what you think the implications of all this new investment might be on carbon storage, on one side of the equation, and carbon emissions, on the other side? Emissions, presumably, come primarily from wildfire, but maybe there are other sources we should think about. Where do you see these investments affecting both the sink and the source?

James Boyd: In terms of the sink, I am very confident in saying it’s good for an expansion of the sink. There’s money being really directed at this. There is attention being paid to how the private sector can engage in these offset markets. In directional terms, I’m very comfortable saying this is going to help expand the sink.

How much is it going to help expand the sink? That is a much trickier question to answer. It’s something we are trying to analyze here at RFF. It’s complicated. You’ve mentioned the baseline and the additionality and leakage issues that we have to sort through to figure that out. The jury’s still out on that. And, of course, when you change land use in order to store more carbon, you’re changing land use, and that can be socially, politically, and economically disruptive to the way we are doing things right now. I see this playing out in an interesting way. I’m not here today to be able to say, Yes, this is going to help us achieve net zero in the United States by the year 2030 or something like that. But it’s good news.

Daniel Raimi: How about on the source side?

James Boyd: Wildfire is a huge source of emissions. Now, we’re never going to (nor would we want to) get rid of forest fire. Forest fire is a natural and important and valuable ecological process. Having said that, the amount of forest carbon and greenhouse gases emitted from wildfire in California recently is more than all the emissions associated with their electricity production. It’s a big number. It’s really material. To the extent that we can be managing and controlling fires, particularly huge ones—that’s going to be good on the emissions side, as well.

It goes to a life-cycle issue that’s important here. When we remove these fuels from the forest, we can be using them in products that, in the greenhouse gas life cycle, offset other sources—petroleum products as an energy source, for example—or we can store them in long-lived construction and change the life cycle that way. So, it’s definitely good news on the emissions side, as well.

Daniel Raimi: Those construction materials you’re offsetting are presumably steel and concrete, right?

James Boyd: Exactly. They are very harmful in terms of emissions.

Daniel Raimi: We’re just talking about greenhouse gas emissions, right? There are all sorts of other emissions associated with wildfires.

James Boyd: That’s true. Absolutely.

Daniel Raimi: Major damage to people’s lungs and their health.

James Boyd: Yeah.

Daniel Raimi: This has been a fascinating conversation. I know we are scratching the surface on this topic, as we often do with our podcast episodes, but I think it’s been a great summary of what’s happening in the forest economy and how this recent legislation is affecting it.

I’d love to ask you the last question we ask all of our guests, which is to recommend something that’s on the top of your literal or your metaphorical reading stack that you think our listeners might enjoy. What would you like to recommend?

James Boyd: I’ve just reread a 20-book series by an author named Patrick O’Brian. I’m a huge fan. One way to describe this series of 20 books is that it’s about the British Navy during the Napoleonic Wars. There was a Russell Crowe film called Master and Commander that was based on one of the books. It’s swashbuckling and historical fiction, but that’s probably going to turn off a lot of our listeners. It turned me off until I actually started reading these things.

It’s got Jane Austen: the social relationships, the psychology, and the romance. But one of the main characters is a spy, a doctor, and an amateur naturalist. One of the things you get in this book is this incredible knowledge of botany and biology from the golden age of natural history, as they explore the seven seas. I just learned a ton environmentally. It’s both poetic about the environment and scientifically substantive about the environment. This is kind of a strange answer to your question, but I do recommend this series of books to you all. It’s amazing writing, and it’s amazing environmental writing.

Daniel Raimi: Does the series have a name, or is there one book that is iconic that people can search for? We’ll have a link in the show notes to the broader series, but can you just tell us what it is?

James Boyd: The first book is called Master and Commander, but the series is often referred to as the Aubrey-Maturin series. Aubrey and Maturin are the two main characters. Again, it’s 20 books. It’s a serial; one flows into the next. If you end up liking the first book, good news: There are 19 more.

Daniel Raimi: And if you end up not liking the first book, then good news, you don’t have to read the rest.

James Boyd: Exactly.

Daniel Raimi: Great. This has been a fascinating conversation. Thank you so much for coming on the show and helping us understand the forest economy and how it’s changing in the United States. We appreciate it.

James Boyd: Thank you, Daniel.

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