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failure, but three stand out:

      • The Forest Service’s incentives conflicted sharply with what most people regarded as the best way to manage the national forests.

      • Comprehensive planning for 1- to 2-million-acre national forests is simply too complicated, especially when the plan depends on information about the future that no one can accurately predict.

      • Finally, planning cannot be rational in a political environment, even if the politics are only the internal politics found in any bureaucracy.

      Congress had carelessly designed a budgetary process that rewarded forest managers for losing money on environmentally destructive activities, and penalized the agency for earning a profit. As a result, managers came to believe that it was in the public interest for them to lose money, impose ugly clearcuts on the landscape, spray thousands of gallons of chemical herbicides on the clearcuts, and build tens of thousands of miles of expensive roads. Planners built these beliefs into their FORPLAN models: beliefs that timber was so scarce that people would pay a fortune for helicopter-logged lodgepole pine; that managers could make trees grow far faster than nature; and that cutting trees produced such positive effects on other resources that those effects alone justified below-cost timber sales.

      The Forest Service is far from the only government agency whose incentives conflict with its mission. Congress lets the Park Service keep 25 percent of construction and reconstruction costs as overhead, so the agency lets national park ecosystems decline while it spends millions of dollars rebuilding housing for employees who could easily live in private housing outside the parks.¹² Some state land agencies that are required by law to earn revenues for local schools fail to do so because they are funded out of tax dollars and have no incentive to produce revenues.¹³ Everywhere, agencies learn that failing to solve a problem can be more lucrative than solving it because, when the problem becomes a crisis, Congress or state legislatures will deal with it by dumping money on the agencies.

      Perverse incentives pervade government agencies and create real conflicts about how the agencies fulfill their missions. These conflicts will not be resolved by legislatures passing the buck to planners. They will only be remedied when Congress or state legislatures change the incentives within agency budgets.

      Even if there had been no conflict between the Forest Service’s incentives and the public good, forest planning would still have failed. To paraphrase forest ecologist Jerry Franklin paraphrasing J. B. S. Haldane, a 1- to 2-million-acre national forest is not only more complicated than we understand, it is more complicated than we can understand.¹⁴ Forest planning might have been useful when each plan focused on a single resource, such as timber, wildlife, or recreation, but comprehensive planning of all resources required more variables than any human or any computer could deal with. Adding to this complexity is the fact that new issues arise and public tastes change faster than planners can plan.

      How is it that private timber companies can plan a forest but the government cannot? Private forest plans rarely attempt to be comprehensive. Instead, they focus on the resources that are valuable to the company doing the planning. They also tend to be relatively short-term, committing the company to actions for only a few years instead of a decade or more. Since they are short-term in nature, they are also very flexible, and since they are narrowly focused, they do not lead to the formation of special interest groups dedicated to carrying out an absurd program.

      The real reason national forest planning failed is that it was a solution for the wrong problem. Senator Humphrey proposed planning because he erroneously assumed that national forest controversies resulted from inadequate data collection, poor analyses, and insufficient public involvement. But the Forest Service had always been good at these things; indeed, its ability to collect data and work with the public declined when it began writing comprehensive forest plans. So it was no surprise when, in 2001, the chief of the Forest Service described the planning process as “analysis paralysis.”¹⁵

      Ultimately, the real problem with national forest management was that Congress failed to align the Forest Service’s incentives with the public interest in the national forests. Newsweek magazine praised the Forest Service of 1952 for earning a profit, avoiding conflicts between resources, and being responsive to the public. Although the Forest Service at that time sold timber, its use of selection cutting minimized public objections to those sales. If the incentives inadvertently built into the Knutson-Vandenberg Act had not encouraged the Forest Service to switch to clearcutting, sell money-losing timber, and increase timber cutting to the point where it conflicted with almost every other resource, then most of the controversies over wilderness, herbicides, the spotted owl, and other issues might never have happened and no one would have proposed to solve those problems with an unwieldy and unworkable forest planning process.

      5. The Return of Fire Dominance

      As the decline of national forest timber sales reduced the controversy over clearcutting, a controversy over fire management has taken its place. Like timber, the fire issue also has its roots in budgetary incentives. In 1908, Congress passed a law that effectively gave the Forest Service a blank check for “emergency fire suppression.” In 1924, Congress passed the Weeks Act, which provided the Forest Service with funds to distribute to the states to encourage the formation of state and local fire protection districts. Together these laws “helped to bring political power to the Forest Service,” says fire historian Stephen Pyne.¹ Yet “as that power grew, the Service found itself subtly corrupted in spirit and imagination.”²

      Initially, that corruption was expressed in the Forest Service’s attitude toward prescribed burning. Private landowners and university researchers found that, in many parts of the West and South, frequent light fires favored commercially valuable trees and prevented the buildup of fuels that could lead to catastrophic fires. But for several decades, the Forest Service ignored this research and sometimes suppressed publications by its own researchers who came up with similar results.³

      For many years after passage of the Weeks Act, the Forest Service also refused to distribute federal fire protection funds to states that allowed prescribed burning. Many private landowners, particularly in the South, refused to join forest protection districts until the Forest Service completely reversed this policy in the 1950s. Until landowners joined those districts, Forest Service officials spitefully recorded all prescribed fires on their lands as “wildfires.”

      The 1970s were the wettest decade of the 20th century, and as a result, the United States experienced the fewest number of acres of wildland fires. Despite this, the costs of the blank-check emergency fire suppression program rose rapidly, raising alarm bells in the Office of Management and Budget. In 1978, Congress repealed the blank-check law and instead gave the Forest Service a fixed amount of money for fire suppression each year. When fire costs exceeded this amount, the Forest Service was expected to borrow the money from its Knutson-Vandenberg (K-V) fund and then repay it in future years when costs were less than the annual appropriation.

      The Forest Service responded with many cost-cutting measures, including allowing forests to let natural fires burn instead of suppressing every fire and changing strategies from suppressing fires on every acre to containing fires within natural boundaries. Average annual fire costs fell dramatically for several years. However, droughts in 1987 and 1988 forced the Forest Service to severely deplete the K-V fund. So in 1990, Congress gave the Forest Service a supplementary appropriation of nearly $280 million to replenish the fund.⁴

      Congress’s action effectively restored the blank-check mentality and reduced the incentive for forest managers to control costs. An internal Forest Service review in 2003 found that fire managers continued to act as though “suppression funds [were] unlimited.” They spent millions of dollars on little-used rental cars, unnecessarily purchased upscale camping gear for crews, and paid exorbitant rates for firefighting equipment.⁵

      Such free spending offers many opportunities for corruption. In 2006, a Forest Service purchasing agent in Oregon was discovered to have paid her boyfriend more than $640,000 in firefighting funds. No one in the agency missed the funds; she was caught only after someone tipped off the local district attorney that the couple was gambling

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