```

[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]

    FUNDING OF ENVIRONMENTAL INITIATIVES AND THEIR IMPACT ON LOCAL 
                              COMMUNITIES

=======================================================================

                           OVERSIGHT HEARING

                               before the

               SUBCOMMITTEE ON FORESTS AND FOREST HEALTH

                                 of the

                         COMMITTEE ON RESOURCES
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                   FEBRUARY 15, 2000, WASHINGTON, DC.

                               __________

                           Serial No. 106-87

                               __________

           Printed for the use of the Committee on Resources

 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 house
                                   or
           Committee address: http://www.house.gov/resources

                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
67-408 r-ar>          WASHINGTON : 2000

                         COMMITTEE ON RESOURCES

                      DON YOUNG, Alaska, Chairman
W.J. (BILLY) TAUZIN, Louisiana       GEORGE MILLER, California
JAMES V. HANSEN, Utah                NICK J. RAHALL II, West Virginia
JIM SAXTON, New Jersey               BRUCE F. VENTO, Minnesota
ELTON GALLEGLY, California           DALE E. KILDEE, Michigan
JOHN J. DUNCAN, Jr., Tennessee       PETER A. DeFAZIO, Oregon
JOEL HEFLEY, Colorado                ENI F.H. FALEOMAVAEGA, American 
JOHN T. DOOLITTLE, California            Samoa
WAYNE T. GILCHREST, Maryland         NEIL ABERCROMBIE, Hawaii
KEN CALVERT, California              SOLOMON P. ORTIZ, Texas
RICHARD W. POMBO, California         OWEN B. PICKETT, Virginia
BARBARA CUBIN, Wyoming               FRANK PALLONE, Jr., New Jersey
HELEN CHENOWETH-HAGE, Idaho          CALVIN M. DOOLEY, California
GEORGE P. RADANOVICH, California     CARLOS A. ROMERO-BARCELO, Puerto 
WALTER B. JONES, Jr., North              Rico
    Carolina                         ROBERT A. UNDERWOOD, Guam
WILLIAM M. (MAC) THORNBERRY, Texas   PATRICK J. KENNEDY, Rhode Island
CHRIS CANNON, Utah                   ADAM SMITH, Washington
KEVIN BRADY, Texas                   CHRIS JOHN, Louisiana
JOHN PETERSON, Pennsylvania          DONNA MC CHRISTENSEN, Virgin 
RICK HILL, Montana                       Islands
BOB SCHAFFER, Colorado               RON KIND, Wisconsin
JIM GIBBONS, Nevada                  JAY INSLEE, Washington
MARK E. SOUDER, Indiana              GRACE F. NAPOLITANO, California
GREG WALDEN, Oregon                  TOM UDALL, New Mexico
DON SHERWOOD, Pennsylvania           MARK UDALL, Colorado
ROBIN HAYES, North Carolina          JOSEPH CROWLEY, New York
MIKE SIMPSON, Idaho                  RUSH D. HOLT, New Jersey
THOMAS G. TANCREDO, Colorado

                     Lloyd A. Jones, Chief of Staff
                   Elizabeth Megginson, Chief Counsel
              Christine Kennedy, Chief Clerk/Administrator
                John Lawrence, Democratic Staff Director
                                 ------                                

               Subcommittee on Forests and Forest Health

                 HELEN CHENOWETH-HAGE, Idaho, Chairman
JOHN J. DUNCAN, Jr., Tennessee       ADAM SMITH, Washington
JOHN T. DOOLITTLE, California        DALE E. KILDEE, Michigan
WAYNE T. GILCHREST, Maryland         OWEN B. PICKETT, Virginia
JOHN PETERSON, Pennsylvania          RON KIND, Wisconsin
RICK HILL, Montana                   GRACE F. NAPOLITANO, California
BOB SCHAFFER, Colorado               TOM UDALL, New Mexico
DON SHERWOOD, Pennsylvania           MARK UDALL, Colorado
ROBIN HAYES, North Carolina          JOSEPH CROWLEY, New York
                     Doug Crandall, Staff Director
                 Anne Heissenbuttel, Legislative Staff
                  Jeff Petrich, Minority Chief Counsel

                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held February 15, 2000...................................     1

Statements of Members:
    Chenoweth-Hage, Hon. Helen, a Representative in Congress from 
      the State of Idaho.........................................    01
        Prepared State of........................................    04
    Smith, Hon. Adam, a Representative in Congress from the State 
      of Washington..............................................    06

Statements of witnesses:
    Arnold, Mr. Ron, Executive Vice President, Center for the 
      Defense of Free Enterprise, Bellevue, Washington...........    08
        Prepared State of........................................    11
    DeVargas, Mr. Antonio, Officer, Rio Arriba County Land 
      Planning Department, La Madera, New Mexico.................    62
        Prepared State of........................................    64
    Lyall, Mr. Jeff A., Disabled Outdoorsman, Catawba, Virginia..    58
        Prepared State of........................................    60
    White Horse Capp, Ms. Diana, Chairman, Upper Columbia 
      Resource Council, Curlew, Washington.......................    44
        Prepared State of........................................    46

Additional Material Supplied:
    Correspondence...............................................    99

 
  OVERSIGHT HEARING ON FUNDING OF ENVIRONMENTAL INITIATIVES AND THEIR 
                      IMPACT ON LOCAL COMMUNITIES

                              ----------                              

                       TUESDAY, FEBRUARY 15, 2000

                  House of Representatives,
          Subcommittee on Forest and Forest Health,
                                    Committee on Resources,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2 p.m., in 
room 1334, Longworth House Office Building, Hon. Helen 
Chenoweth-Hage (Chairperson of the Subcommittee) presiding.

STATEMENT OF THE HON. HELEN CHENOWETH-HAGE, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF IDAHO

    Mrs. Chenoweth-Hage. The Subcommittee is meeting today to 
hear testimony on the funding of environmental initiatives and 
their impact on local communities.
    In last week's Economist magazine, one of the lead stories 
was about non-governmental organizations, or NGO's. The article 
said that ``the general public tends to see them as uniformly 
altruistic, idealistic, and independent. But they are often far 
from being `non-governmental', as they claim. And they are not 
always a good force''. The Economist goes on to say that NGO's 
``deserve much sharper scrutiny''. That is what we are doing 
here today: examining the funding of NGO's environmental 
initiatives on the national forests and their impact on local 
communities.
    A full Committee hearing on the Impact on Federal Land Use 
Policies on Rural Communities'' was held on June 9, 1998. At 
that hearing, it was pointed out that in States with a high 
percentage of Federal land, there is a significant urban-rural 
prosperity gap. Urban areas are booming while rural areas are 
reeling. Many witnesses attributed this to Federal land 
management policies and outlined specific examples of how 
current Federal land management policies have had devastating 
impacts on the economies of their communities. Several 
witnesses pointed out that many of the destructive Federal 
policies were implemented as a result of NGO environmental 
advocacy, financed by tax exempt grants from private charitable 
foundations.
    Environmental groups are relying more and more on wealthy 
non-profit foundations to fund their operations. According to a 
recent article in the Boston Globe, foundations invest at least 
$400 million a year in environmental advocacy and research. The 
largest environmental grant-maker, the $4.9 billion Pew 
Charitable Trusts, gives more than $35 million annually to 
environmental groups.
    Advocacy for national forests policy initiatives appears to 
be largely financed by charitable foundations through tax-free 
grants. For example, the Clinton-Gore Administration's Roadless 
Initiative may withdraw up to 60 million acres of National 
Forest Lands for multiple use. This initiative appears to have 
been organized and funded by charitable foundations, primarily 
the Philadelphia-based Pew Charitable Trusts.
    Since September 1998, Pew has given the National Audubon 
Society more than $3.5 million in tax-free grants to organize 
the Heritage Forests Campaign, a coalition of about a dozen 
environmental groups. The sole objective of the Campaign 
appears to be the creation of widespread public support for the 
Clinton-Gore Administration's initiative to restrict access on 
60 million acres of national forest lands.
    The Heritage Forests Campaign illustrates several potential 
problems with foundation-financed environmental political 
advocacy, namely, the lack of fair, broadbased representation 
and the absence of accountability. Particularly disturbing is 
this Administration's acquiescence to the Campaign in the 
setting of policy. At a recent hearing on the Roadless 
Initiative, I asked George Frampton, Director of the Council on 
Environmental Quality, for the names of all those attending any 
meetings he held regarding the development of this initiative. 
The list he sent in response is a who's-who in the 
environmental community. Even more telling is that not one 
individual representing recreation, industry, academia, county 
commissioners, or local schools were in attendance. Only 
representatives of the national environmental groups 
participated.
    Now only was the public excluded during these meetings, but 
so was Congress. The Administration's Roadless Initiative 
appears to be an attempt to bypass the role of Congress. Under 
Article IV, Section 3 of the United States Constitution, 
Congress possesses the ultimate power over management and use 
of lands belonging to the United States. If the Roadless 
Initiative is universally popular, why can't the Heritage 
Forests Campaign get it enacted by Congress through the normal 
legislative process? Administrative directives such as the 
Roadless Initiative bypass Congress and centralize policymaking 
authority within the hands of unelected bureaucrats in the 
executive branch. Foundation-funded advocacy groups make back 
room deals thus denying the average citizen a voice and input 
into the policy through their elected representatives in 
Congress. As a result, our Government becomes more remote and 
unresponsive to the needs of the average citizen.
    To whom is the Heritage Forests Campaign accountable? This 
Campaign is put together by foundations, not the participants. 
The grantees are accountable to the foundations that fund them, 
not even their own members. Foundations have no voters, no 
customers, no investors. The people who run big foundations are 
part of an elite and insulated group. They are typically 
located hundreds or even thousands of miles from the 
communities affected by policies that they advocate. They 
receive little or no feedback from those affected by their 
decisions, nor are they accountable to anyone for promoting 
policies which adversely affect the well being of rural people 
and local economies. Today's witnesses will tell us how their 
communities are being crushed by an inaccessible and faceless 
movement wielding great power and influence.
    The Economist is right to say that NGO's deserve much 
sharper scrutiny. I agree, but even more important is the issue 
of the undue influence being granted these groups by the 
Administration. As we progress through this and future 
hearings, I believe it will become clear that this isn't an 
issue concerning the environment--not at all--but rather one 
concerning power and its use for political ends, with rural 
communities being trampled in the process.
    [The prepared statement of Mrs. Chenoweth-Hage follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.001
    
    [GRAPHIC] [TIFF OMITTED] T7408.002
    
    Mrs. Chenoweth-Hage. And now the Chairman recognizes Mr. 
Smith, the Ranking Minority Member, for any statement he may 
have.

STATEMENT OF THE HON. ADAM SMITH, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF WASHINGTON

    Mr. Smith of Washington. Thank you, Madam Chair. I think 
there are some good things that we are going to discuss today, 
and some issues that are very legitimate to raise and to talk 
about. There are also some things that I am troubled about 
about this approach.
    What is good, and what I think is very fair to raise, are 
issues of policy. There are a variety of different 
environmental policies, the Roadless Initiative being one of 
them; what is the proper use for our public lands--I think all 
of those things should be discussed as broadly as possible in 
as many open hearings as is humanly possible--and I think all 
of that is very good.
    What I am puzzled about is why we seem to think, whether 
you agree with them or not--and we live in a democracy, and 
part of being in a democracy means that people you disagree 
with have a right to express those opinions and have a right to 
advocate for those opinions in just about any way they see fit 
within the law--the Pew Trusts and a variety of others are 
doing just that. You may disagree with what they are doing. You 
may disagree with their policies and, if you do, I would 
strongly urge you--as, in fact, you have done--to form groups 
with opposite opinions, and lobby your Members of Congress, and 
lobby the Administration, and go about the democratic process 
the way it should be done. But for us to have a hearing and say 
that a group of people who happen to advocate a particular set 
of policies that some folks don't like, somehow need to be held 
up to higher scrutiny than any other group that is advocating a 
policy, is a little bit ridiculous to me.
    When you look at environmental policy, I hear all the time 
from the other side, ``Oh, corporations have undue influence''. 
You know, back in the early part of the Republican Congress in 
1995 and 1996, there were endless accusations that corporations 
were actually drafting the amendments or drafting the 
legislation that was going to affect environmental policy, and 
at the time I was not as troubled by that as most people. I was 
troubled by some of the policies, I will grant you, but the 
fact that citizens of our country were out advocating for a 
position, trying to exercise influence, is what this process is 
all about. I mean, to hold these people up and say, ``No, you 
are not supposed to do that'', as I said, is just ridiculous.
    And it seems to me that the focus of this hearing is saying 
that these trusts, charitable trusts--individuals, really--who 
come together to advocate for a position don't have a right to 
do so is ridiculous. They absolutely have a right to do so. And 
if you disagree with them, organize on the other side, lobby 
your Members of Congress, lobby the Administration, and try to 
get that position changed.
    Now, it was mentioned the Roadless policy is not 
universally popular. Absolutely, it is not. I can tell you in 
my area it is not. I have people on both sides of that issue, 
many who strongly advocate for it for a variety of different 
reasons, many others who think that it is an absolutely 
horrible idea. And I have heard from both of them, and that is 
great. I hope I continue to hear from both of them, and all 
sides in between and beyond, and I hope the Administration 
does, too.
    Now, it is quite possible the Administration will adopt a 
policy that some folks don't like. It is quite possible that 
Members of Congress sitting up here will adopt policies that 
these folks don't like, and they will scream bloody murder 
about it, and that, too, is fine. But it is not fine to stand 
up here and say ``How dare these folks advocate for a 
position''. That is what we do in this country. That is what 
makes this country so great. People have a right to advocate 
for whatever positions they believe in. They have a right to 
marshall their resources toward doing that within the bounds of 
campaign finance laws, but they have the absolute right to do 
that.
    So, I hope that the bulk of this hearing will focus on some 
of these policies. I think we are going to have some excellent 
testimony from folks who are affected by these policies and who 
will challenge some of them, and then we, as lawmakers, as we 
are, will make a decision on what is right, what is wrong, what 
we think is in the best interest of people. But these folks 
have a right to say their piece, the Pew Trust and all the 
people who are affiliated have a right to say their piece.
    And I will make one closing comment. I think we, as 
legislators, have this tendency whenever we are losing an 
argument, to attack the process, and I submit to you that that 
is to our own detriment. Just as in the 1995 and 1996 years 
when people on the other side were attacking not just the 
policies but the process, who were saying, ``Gosh, it is just 
horrible that these corporations are talking about 
environmental policy, that proves the whole system is 
corrupt''. Flip it around, you have people saying, ``Look at 
the way these environmentalists are advocating policies, that 
is just horrible and an abuse of the process''.
    Both sides, when you do that, you damage the whole process. 
You damage your own ability to pass an issue because back in 
1995 and 1996, if it was the environmentalists saying the 
process was flawed, well, now, if they start to get the upper 
hand and win using the same methods that their enemies used 
before, they have indicted a process they are now participating 
in. The process works fine on both sides.
    Advocate, push, use your influence, lobby, do what your 
democracy allows you to do, and I hope you will come out on 
top, but let us not condemn the process just because we happen 
to lose an argument. I think that is very damaging to democracy 
and very damaging to the people's belief in our democracy, 
which is suffering from just such a problem right now.
    So, I hope the hearing will focus on issues and not 
criticizing people for merely advocating things that they 
believe in.
    Mrs. Chenoweth-Hage. I ask for unanimous consent for Mr. 
Nethercutt and Mr. Cannon to sit in with this Committee at this 
hearing. If there is no objection, so ordered.
    I will now introduce our panel. I feel we have a very 
outstanding panel today, and I look forward to hearing from all 
four of you.
    Mr. Ron Arnold is Executive Vice President of the Center 
for the Defense of Free Enterprise, Bellevue, Washington, and 
author of a number of very enlightening books, and one that 
prompted this hearing. Welcome, Mr. Arnold.
    Mr. Jeff Lyall, Disabled Outdoorsman from Catawba, 
Virginia. Welcome.
    And Mr. Antonio DeVargas, Officer of Rio Arriba County Land 
Planning Department, La Madera, New Mexico, and it is really 
good to see you again. Welcome.
    And now I would like to ask Mr. Nethercutt to introduce the 
next witness.
    Mr. Nethercutt. Thank you, Chairman, and thank you for 
allowing the members of the Subcommittee to sit for a few 
minutes to take a moment to introduce Diana White Horse Capp.
    I must say, as a member of the Appropriations Committee on 
the Interior Subcommittee, it helps us, Chairman, to have this 
oversight assessment that goes on in an Authorizing committee 
and the Resources Committee to help us understand a little 
better appropriate appropriations for the expenditure for 
taxpayer dollars. So I am delighted to have a chance to sit in 
this hearing for a time.
    But it is a pleasure for me to introduce Diana White Horse 
Capp this afternoon to the Subcommittee. She is a resident of 
Ferry County, Weshington, in the northeastern corner of the 5th 
Congressional District, which I represent. This is some of the 
most beautiful country in the State of Washington, and Diana is 
certainly a part of the landscape. She has been very active in 
Federal land management and property rights issues. Her diverse 
heritage and culture have given her great insight into these 
important issues. She is an asset to our community in Eastern 
Washington, and I am delighted that she could be here today, 
and welcome her on behalf of this Subcommittee, and proudly 
representing the east side of the State of Washington. Thank 
you, Madam Chairman.
    Mrs. Chenoweth-Hage. Thank you, Mr. Nethercutt.
    As explained in our first hearing, it is the intention of 
the Chairman to place all outside witnesses under the oath. 
This is a formality of this Committee that is meant to assure 
open and honest discussion and should not affect the testimony 
given by the witnesses. I believe that all of you were informed 
of this and were sent a copy of the Committee rules. So, if you 
will stand and raise your right arm to the square.[Witnesses 
sworn.]
    Mrs. Chenoweth-Hage. The Chair recognizes Mr. Arnold for 
his testimony.

 TESTIMONY OF MR. RON ARNOLD, EXECUTIVE VICE PRESIDENT, CENTER 
   FOR THE DEFENSE OF FREE ENTERPRISE, BELLEVUE, WASHINGTON; 
    ACCOMPANIED BY MR. JEFF A. LYALL, DISABLED OUTDOORSMAN, 
CATAWBA, VIRGINIA; MS. DIANA WHITE HORSE CAPP, CHAIRMAN, UPPER 
COLUMBIA RESOURCE COUNCIL, CURLEW, WASHINGTON; AND MR. ANTONIO 
DeVARGAS, OFFICER, RIO ARRIBA COUNTY LAND PLANNING DEPARTMENT, 
                     LA MADERA, NEW MEXICO

                  TESTIMONY OF MR. RON ARNOLD

    Mr. Arnold. Madam Chairman, Members of the Committee, my 
name is Ron Arnold. I am the Executive Vice President of the 
Center for Defense of Free Enterprise, a nonprofit organization 
based in Bellevue, Washington. The Center does not accept and 
has never received Government funds.
    Madam Chairman, I would like to thank you for holding this 
hearing today. It is timely, indeed. My Center recently 
completed a book-length study on the finding of environmental 
initiatives and their impacts on rural communities. The book is 
titled Undue Influence: Wealthy Foundations, Grant-Driven 
Environmental Groups, and Zealous Bureaucrats That Control Your 
Future.
    In a nutshell, the message of Undue Influence is that the 
environmental movement is a three-cornered structure beginning 
with tax-exempt foundations which devise multi-million-dollar 
environmental programs to eliminate resource extraction 
industries and private property rights. The foundations direct 
their funds to the second leg of the triangle, environmental 
groups with insider access to the third leg, executive branch 
agencies. This powerful ``iron triangle'' unfairly influences 
Federal policy to devastate local economies and private 
property.
    In the brief time since Undue Influence was released last 
October, so many new outrages have come from the executive 
branch that they demand separate attention. Therefore, my 
Center has documented these new developments in a special 
report titled Power To Hurt, which is being released at this 
hearing. You will find it attached to my written testimony.
    If you will turn to page 4 of Power To Hurt, you will see 
how the first leg of the triangle works. Joshua Reichert, the 
Pew Charitable Trusts' Environmental Director, once wrote, 
``For considerable sums of money, public opinion can be molded, 
constituents mobilized, issues researched, and public officials 
buttonholed, all in a symphonic arrangement''.
    Madam Chairman, there is evidence that the Pew Charitable 
Trusts planned an end-run around Congress and arranged the 
Clinton Administration's new policy to eliminate access to 
almost 60 million acres of Federal land. They did it by an 
initiative they called the Heritage Forest Campaign. Pew grants 
of more than $3 million have gone to the second leg of this 
triangle, the National Audubon Society. Audubon funneled the 
money to 12 other environmental groups under its supervision. 
You will find the list on page 5.
    Audubon got a letter of support signed by 170 members of 
the House of Representatives for their access closure program. 
One wonders how they did that without using tax-subsidized Pew 
money to lobby Congress.
    But that was not enough. Audubon hired the Mellman Group, 
Inc., the President's own pollster, to produce results saying 
that the public favored wilderness over jobs. They had to 
justify destroying thousands of rural jobs for an urban 
movement's political victory.
    Audubon gave those poll results to the third leg of the 
triangle, the White House Chief of Staff. Shortly thereafter, 
President Clinton sent his October 13, 1999 memo to the 
Secretary of Agriculture calling for permanent roadless status 
for those 60 million acres of Federal land.
    Audubon was able to produce this controversial result 
because its new Director of Public Policy is Dan Beard, who 
came straight from the Clinton Administration, where he served 
as head of the Bureau of Reclamation.
    Pew is only one of dozens of foundations orchestrating our 
lives behind the scenes. The Turner Foundation last spring 
approached a cluster of environmental groups offering a $5 
million grant to create a new group that would enhance their 
mailing lists by adding legislative districts, voting records, 
party affiliations and other political data for each name, 
which would be prohibitively expensive for individual groups to 
do by themselves. That new group, called the Partnership 
Project, is now compounding its members' electioneering power 
at the ballot box. The facts about the Partnership Project are 
on page 6 of Power To Hurt.
    If there is any doubt that the foundations are deliberately 
planning the elimination of resource extraction, one has only 
to examine an actual grant proposal to a wealthy foundation. 
Madam Chairman, you will find the full text of the grant 
application that created the Southwest Forest Alliance 
beginning on page 15 of Power To Hurt. The disastrous results 
of the Coalition are spelled out in shameful detail on page 9. 
Only little operations totally dependent on government timber 
were destroyed, not the big corporations that own their own 
private timberlands.
    Madam Chairman, in my researches I found that every segment 
of America's resource extraction economy--food, clothing and 
shelter--has been targeted by some coalition funded by wealthy 
foundations. This is an intolerable program of rural cleansing. 
Foundations are not accountable to anyone. They are totally 
unregulated.
    Madam Chairman, these are serious charges. The Center urges 
Congress to investigate the undue influence documented in Power 
To Hurt.
    Thank you again, Madam Chairman, for holding this hearing.
    [The prepared statement of Mr. Arnold follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.003
    
    [GRAPHIC] [TIFF OMITTED] T7408.004
    
    [The information referred to follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.005
    
    [GRAPHIC] [TIFF OMITTED] T7408.006
    
    [GRAPHIC] [TIFF OMITTED] T7408.007
    
    [GRAPHIC] [TIFF OMITTED] T7408.008
    
    [GRAPHIC] [TIFF OMITTED] T7408.009
    
    [GRAPHIC] [TIFF OMITTED] T7408.010
    
    [GRAPHIC] [TIFF OMITTED] T7408.011
    
    [GRAPHIC] [TIFF OMITTED] T7408.012
    
    [GRAPHIC] [TIFF OMITTED] T7408.013
    
    [GRAPHIC] [TIFF OMITTED] T7408.014
    
    [GRAPHIC] [TIFF OMITTED] T7408.015
    
    [GRAPHIC] [TIFF OMITTED] T7408.016
    
    [GRAPHIC] [TIFF OMITTED] T7408.017
    
    [GRAPHIC] [TIFF OMITTED] T7408.018
    
    [GRAPHIC] [TIFF OMITTED] T7408.019
    
    [GRAPHIC] [TIFF OMITTED] T7408.020
    
    [GRAPHIC] [TIFF OMITTED] T7408.021
    
    [GRAPHIC] [TIFF OMITTED] T7408.022
    
    [GRAPHIC] [TIFF OMITTED] T7408.023
    
    [GRAPHIC] [TIFF OMITTED] T7408.024
    
    [GRAPHIC] [TIFF OMITTED] T7408.025
    
    [GRAPHIC] [TIFF OMITTED] T7408.026
    
    [GRAPHIC] [TIFF OMITTED] T7408.027
    
    [GRAPHIC] [TIFF OMITTED] T7408.028
    
    [GRAPHIC] [TIFF OMITTED] T7408.029
    
    [GRAPHIC] [TIFF OMITTED] T7408.030
    
    [GRAPHIC] [TIFF OMITTED] T7408.031
    
    [GRAPHIC] [TIFF OMITTED] T7408.032
    
    [GRAPHIC] [TIFF OMITTED] T7408.033
    
    [GRAPHIC] [TIFF OMITTED] T7408.034
    
    Mrs. Chenoweth-Hage. Thank you, Mr. Arnold.
    The Chair now recognizes Mrs. White Horse Capp for her 
testimony.

            TESTIMONY OF MS. DIANA WHITE HORSE CAPP

    Ms. Capp. Madam Chairman, Committee Members, thank you for 
this hearing.
    I am Diana White Horse Capp, from Ferry County, Washington, 
4.6 million acres in the Kettle Mountains, 7200 people. I am 
Chairman of the Upper Columbia Resource Council.
    Madam Chairman, history shows the elite gain power by 
pitting the masses against each other. Our Constitution, based 
on the Iroquois Great Law of Peace, is intended to prevent such 
abuses.
    Elite foundations now funnel their wealth to environmental 
groups who pit the masses against each other. Rural Americans 
are condemned as savages just as Natives once were. Rural 
Natives and whites work in the same occupations. Our welfare is 
connected. The south half of my county is Colville Reservation. 
On the north half, Colvilles and other Native descendants live 
in peace with whites. The community is intermarried. We cannot 
afford the division these foundations instigate.
    The environmental elite use Native people. They preach 
about Tribal Rights and promise to restore justice. Yet they do 
little for Native people but use them as poster children to buy 
the clout of Treat Rights in their lawsuits. Local activists 
courted favor on the Reservation and the Colville Indian 
Environmental Protection Alliance emerged. This is a foundation 
grant handled by Winona LaDuke, a Native recruiter from 
Minnesota, daughter of the late Sun Bear, and it is targeted to 
fight people like me in Ferry County. LaDuke's webpage here 
says that the Colville group she funds is opposed to gold 
mining on the Reservation. But this article from High Country 
News says that that same group successfully lobbied the Tribal 
Council to oppose Crown Jewel Mine. Madam Chairman, the Crown 
Jewel Mine is not on the Reservation, it is 30 miles away, 
minimum. This kind of deception puts a smear on the Tribe's 
name. These activists have come in and they have stirred up 
political upheaval on the Reservation. I am told that there are 
Tribal members who are intimidated and they would like the FBI 
to step in.
    The environmental elite use the grassroots groups to 
destroy our rural culture. Our county is crippled by their 
attacks on timber, mining and ranching. Jobs are very scarce. 
Our children feel hopeless. These elite have really raped our 
children's future. These grants target Ferry County, along with 
the others I have shown, with $105,000 just to silence the so-
called ``incivility'' of people like me concerned with human 
rights. These grants go through Environmental Media Services, 
and that outfit is headed by Arlie Schardt, Al Gore's former 
Press Secretary. It looks pretty political to me.
    Slick media activists hound urbanites, screaming that rural 
cultures destroy the planet when, in fact, we feed and shelter 
them. The 1998 National Wilderness Conference announced its 
plan for Wilderness designation of the Kettle Range. Ferry 
County is the Kettle Range. Their millions wage a high-dollar 
war for Wilderness in Ferry County along with Kettle Range 
Conservation Group. Our county is beautiful, and they covet 
that beauty enough to rape our culture. We don't want to be 
squeezed out. This cultural genocide must be acknowledged. 
Cultural genocide is why the Kootenai Tribe has joined Idaho's 
fight against Wilderness. This petition by Bret Roberts of the 
Ferry County Action League has already collected 2,000 area 
resident signatures against Wilderness designation.
    What is worse is that Federal insiders reshape policy to 
destroy rural cultures. There is a map here that shows some of 
the plans coming at us that are going to squeeze us out. 
Colville National Forest's Public Affairs Officer took vacation 
time to campaign for more Wilderness. Pacific Biodiversity 
Institute boasts that Government agencies request their 
wilderness maps. And, indeed, here is the Wilderness Society 
map in a local Forest Service plan, and it says ``For planning 
purposes''. This is a grant to an environmental group that says 
that this group's lynx study will be used by the Forest Service 
for management purposes. This Nature Conservancy job ad says 
that their biologists write policy on Indiantown Gap Military 
Reservation. That really rubs salt in the wound for me. 
Indiantown Gap was taken away from my mother's people in 1932 
by Government troops. I don't want something like that 
happening to my children, too.
    Madam Chairman, this genocidal juggernaut must be stopped. 
Thank you.
    [The prepared statement of Ms. Capp follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.035
    
    [GRAPHIC] [TIFF OMITTED] T7408.036
    
    [GRAPHIC] [TIFF OMITTED] T7408.037
    
    [GRAPHIC] [TIFF OMITTED] T7408.038
    
    [GRAPHIC] [TIFF OMITTED] T7408.039
    
    [GRAPHIC] [TIFF OMITTED] T7408.040
    
    [GRAPHIC] [TIFF OMITTED] T7408.041
    
    [GRAPHIC] [TIFF OMITTED] T7408.042
    
    [GRAPHIC] [TIFF OMITTED] T7408.043
    
    [GRAPHIC] [TIFF OMITTED] T7408.044
    
    [GRAPHIC] [TIFF OMITTED] T7408.045
    
    [GRAPHIC] [TIFF OMITTED] T7408.046
    
    Mrs. Chenoweth-Hage. Thank you very much, Ms. Capp.
    The Chair now recognizes Mr. Jeff Lyall. Jeff.

                 TESTIMONY OF MR. JEFF A. LYALL

    Mr. Lyall. Thank you, Madam Chairman and members of the 
Committee. I am honored to have the opportunity to testify 
before you here today. My name is Jeff Lyall. I am 32 years of 
age, and I live in the Blue Ridge Mountain region of Southwest 
Virginia.
    In June 1991, I received a level C5-6 spinal cord injury as 
the result of an auto accident. I was an avid outdoorsman. I 
liked to hike, backpack, camp, hunt, fish, et cetera, mostly on 
National Forest lands in Virginia and North Carolina.
    Madam Chairman, I still enjoy the outdoors, but wheelchairs 
are poor off-road vehicles. So, in 1995 I modified a Jeep CJ to 
become my new legs and feet, and this gave me access to the 
outdoors once again. However, not long after that, I discovered 
that the vast majority of off-highway vehicle roads on National 
Forest lands in my area have been closed down. Now I can't 
enjoy the outdoors by the only means available to me, and 
neither can anyone else with a mobility impairment.
    In the Blacksburg and New Castle Ranger districts where I 
live in Virginia, there are some 66 gated National Forest off-
highway vehicle roads, which represent 110 miles of potential 
forest access, but there is a problem. Of these 66 roads, only 
nine are open during certain times and zero are open year 
round.
    Hikers and mountain bikers can use them anytime they like, 
but because my feet and those of some of my friends consist of 
four wheels and a motor, we are denied access. If that is not 
discrimination on the basis of a disability by an agency of the 
Federal Government, nothing is.
    Carla Boucher is the attorney for United Four Wheel Drive 
Association, which is an international organization that 
represents four wheel drive enthusiasts. She is bringing a 
lawsuit against the forest Service on road closure issues. She 
has documented that less than 2 percent of all forest visitors 
use Wilderness areas, but those areas take up about 18 percent 
of all National Forest lands.
    On the other hand, off highway users, who represent 35 
percent of all forest visitors, traditionally use roads on less 
than 2 percent of Forest Service lands. So, it seems that the 
Forest Service caters to 2 percent of the visitors to 
Wilderness areas, while closing roads that take up less than 2 
percent of the total National Forest System.
    In the Fall of 1998, I began talks with local National 
Forest officials. I discovered that the Forest Service has 
adopted a policy they refer to as ``Obliterate Roads'', meaning 
they intend to gate and destroy as many off-highway vehicle 
roads as possible. Since these roads are the only viable access 
to these public lands by a mobility-challenged person, this is, 
in effect, a Federal Policy of Discrimination against the 
estimated 54 million disabled people in the United States, not 
to mention the millions in the senior community who enjoy the 
outdoors but are not able to travel as they once did.
    Mrs. Boucher found that 76,300 miles of Forest Service 
roads are now closed, which represents one in every five miles. 
Just last year the Forest Service closed 683 miles out of 800 
miles of off-highway vehicle roads in the Daniel Boone National 
Forest, effectively eliminating motorized access to this area 
as well.
    Within the past year, three off-highway vehicle roads in my 
own backyard, which have been open since the 1950's and 1960's, 
were bulldozed and gated, cutting off my access to these areas 
also. In essence, the Forest Service is saying, ``if you can't 
walk, we don't want you in our forests''.
    This has got to stop. And the people behind it have to be 
stopped. Mrs. Boucher has found that these road closures have 
been pushed by environmental groups funded by large foundations 
and working with Clinton Administration insider.
    Mrs. Boucher found that the National Audubon Society pushed 
the President to permanently preserve 450 million acres of 
roadless areas. The Pew Trusts funded the Audubon Society, 
which will funnel more than $3 million to 12 environmental 
organizations to pressure the Forest Service to shut down more 
roads.
    So, I now understand that it isn't simply a line officer 
with the Forest Service who is shutting me out of our National 
Forests. It isn't even simply a matter of some local or 
national environmental organization trying to shut down the 
forests. It is large, rich foundations such as the Pew 
Charitable Trusts that are discriminating against me and the 
entire disabled community by funding environmental groups to 
push policies such as ``gate and obliterate''.
    I cannot fight them alone. I am respectfully requesting 
congressional investigation into the involvement of large 
foundations in making land management policy for the Forest 
Service.
    Thank you for the opportunity to testify before you today.
    [The prepared statement of Mr. Lyall follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.047
    
    [GRAPHIC] [TIFF OMITTED] T7408.048
    
    Mrs. Chenoweth-Hage. Thank you very much, Mr. Lyall.
    The Chair now recognizes Mr. Antonio DeVargas. Ike.

               TESTIMONY OF MR. ANTONIO DeVARGAS

    Mr. DeVargas. Madam Chairman, members of the Committee, my 
name is Antonio DeVargas. I am the President of La Compania 
Ocho, a for-profit, minority-owned business in the logging and 
processing of timber, located in the small mountain village of 
Vallecitos, New Mexico. Unemployment in Vallecitos and the 
surrounding communities is more than 20 percent.
    Madam Chairman, I thank you for holding this hearing today 
and am honored at the privilege of being invited to testify.
    La Compania Ocho operates with the Carson National Forest. 
As a direct result of frivolous litigation brought by Forest 
Guardians, a Santa Fe-based, self-proclaimed guardian of the 
forests, La Compania has been severely crippled in its ability 
to work. Although the Federal courts have consistently ruled in 
our favor, the delays created by Forest Guardians have had a 
devastating impact on La Compania Ocho and on the villages 
which surround Vallecitos. Forest Guardians has been able to 
pursue its vindictive and punishing litigation campaign because 
of the grants it and its allies have received from certain 
large foundations.
    This campaign against our way of life and our efforts to 
create a local, sustainable economy has been based on half-
truths, distortion, and outright lies and has been propped up 
by the seemingly endless supply of money for litigation. 
Numerous foundations have been involved in supporting the 
campaign to destroy the Hispanic village lifestyle. For 
example, the Pew Charitable Trusts has funneled money to the 
New Mexico Audubon Society under the auspices that the money 
would be used to benefit the villages of northern New Mexico, 
including those in the Vallecitos area. In fact, those moneys 
were used to try and destroy our villages.
    Foundation money has also been used to create coalitions, 
the member groups of which are often like Potemkin villages, 
organizations consisting of only or two people. The people 
involved have been able to successfully create the impression 
for their funding sources that they are mass organizations with 
large bases of support in the coalitions. One example is a 
group called Carson Watch, based in Penasco, New Mexico.
    When I refer to the false information and distortion of the 
truth that are disseminated by these environmentalists, I am 
referring to their ``mantra'' that the forest is being clear 
cut and that harvesting of timber exceeds the growth of the 
forest.
    As an example, I would like to present figures that are 
documented on a 73,000 acre tract of land in the Carson 
National Forest in the El Rito Ranger District. In 1986, our 
organization requested a site specific inventory in the 
Vallecitos area. This inventory revealed that this tract of 
land had 380 million board feet of timber, that the forest was 
growing at the rate of 12 million board feet per year, that 9 
million board feet could be harvested sustainably, and the 
forest plan allowed for the harvest of 7.2 million board feet 
per year.
    Since 1994, less than 4 million has been harvested and, due 
to appeals and litigation brought by various environmental 
groups funded by organizations mentioned above, that figure has 
dropped to less than 1 million per year for the past 3 years. 
There has been no clear cutting of timber in this area in my 
memory or the memory of my parents or grandparents.
    Another area in which the lies and misinformation are 
utilized is when the funding proposals assert that these groups 
work with local and indigenous communities. Nothing could be 
further from the truth. In fact, on the few occasions that they 
have engaged local villages from affected communities, what 
they say that they plan to do is the exact opposite of their 
intentions, and the only reason these engagements even occur is 
so that they can document that they did meet with the 
community.
    The fact that there was no consensus and that strong 
opposition to their plan was expressed is never documented in 
their proposals and so they present a very rosy picture that 
gives the appearance of cooperation and collaboration with 
local villages but, in fact, was a manipulative ploy to 
misinform the funding sources and the general public.
    We, the people of New Mexico, would like to see the U.S. 
Congress take swift and decisive action to put an end to this 
abuse of privilege, and restore our ability to create an 
economy based on access to the natural resources that are an 
integral part of our custom, culture, tradition, and right to 
the pursuit of happiness. Our commitment in response is to be 
good and responsible stewards who will make sure that our 
activities are sustainable environmentally, economically, 
culturally and in concert with the tenet of protecting our 
heritage for future generations.
    Thank you again, Madam Chairman, for holding this hearing 
and affording me the privilege and honor of presenting my 
testimony on behalf of my company, my village, my county, and 
the countless other rural people whose lives have been 
devastated by the abuse of the Endangered Species Act and other 
environmental laws that are well meaning but are being abused.
    [The prepared statement of Mr. DeVargas follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.049
    
    [GRAPHIC] [TIFF OMITTED] T7408.050
    
    [GRAPHIC] [TIFF OMITTED] T7408.051
    
    [GRAPHIC] [TIFF OMITTED] T7408.052
    
    [GRAPHIC] [TIFF OMITTED] T7408.053
    
    [GRAPHIC] [TIFF OMITTED] T7408.054
    
    [GRAPHIC] [TIFF OMITTED] T7408.055
    
    [GRAPHIC] [TIFF OMITTED] T7408.056
    
    [GRAPHIC] [TIFF OMITTED] T7408.057
    
    Mrs. Chenoweth-Hage. Thank you very much.
    I am going to step out of the order of things, the manner 
in which I usually conduct this hearing, simply to make a 
comment. Usually, the Chair recognizes other members for 
questions at this time, but I just want to say that I have been 
a Committee Chair for going on my fourth year now, and of all 
the oversight hearings that we had held--and we have held a lot 
of them--this may be the most remarkable of all of the 
hearings.
    The testimony that I have heard today is very startling, 
and I agree with the Ranking Member's assessment about this 
country, America, being a land where people can still lobby and 
have access to their elected officials, but I guess I just 
depart a little bit in expressing my concern that it is known 
to all of us who work in this world of politics, that money is 
the ``mother's milk'' of successful politics, and therein lies 
the touchstone and the reason why we are having this hearing. 
When you see a charitable trust that amounts to $4.9 billion, 
who can fund one program and one organization to the tune of 
millions and millions of dollars. I am sure that Mr. Arnold, 
Mr. Lyall, Ms. Capp and I have never had the benefit of being 
so well funded.
    Usually, these organizations have to scramble and pass the 
hat. I see some union people in the audience today. Even they 
had to take leave from their jobs to come back. People pass the 
hat and send people back to Washington, but it is sad to 
recognize--and this didn't happen just in this Clinton 
Administration, believe me. I want you to know I would be 
holding this hearing if Ronald Reagan were still President, if 
George Bush were still President, because some of this started 
in those Administrations. But without regard to who is sitting 
in the White House, this is a malignant mess and the metastasis 
is growing very quickly, and it is destroying rural America. It 
is destroying lives. And I guess some day we in the Congress 
have to come face-to-face with the fact that those who have a 
lot of money either have a lust for power or care very little 
about this being the ``land of opportunity'' for others, too, 
who may not be as well off as they are. And because this 
Congress funds grants that eventually make their way into the 
organizations that prevent those who live in rural districts 
from achieving the success that many of these who are heads of 
these foundations have been able to enjoy, we have 
jurisdiction, and we have a responsibility.
    This still is the ``land of opportunity'' for everyone, no 
matter whether you were born of privilege and parents who head 
foundations or whether you were born a carpenter's son or 
dairyman's daughter, like I was. So, I thank you very much for 
your testimony. I think you are very courageous and brave for 
bringing this issue to us.
    And now the Chair recognizes Mr. Peterson for his 
questions.
    Mr. Peterson. I thank the Chairwoman. I come from the 
eastern part of this country, but I come from what I call the 
``eastern West''. My district is northern tier Pennsylvania. It 
is rural. It is the most rural district east of the 
Mississippi. We timber, oil was discovered, we mine for coal, 
we manufacture, we process oils and chemicals, and we farm, and 
my view is they are all under attack--at least they are where I 
come from.
    But I guess I would like to ask a quick question, and make 
a few more comments. Those who you speak of, foundations and 
Federal agencies who work together to common goals, I hear 
often their No. 1 issue is urban sprawl. Would you agree with 
that, that one of their top issues is urban sprawl? Is that 
what you hear also?
    Mr. Arnold. Yes.
    Mr. Peterson. But I claim and tell them often they are 
causing it because, as they force the people who timber, the 
people who produce oil, people who mine for coal, people who 
manufacture/process, and our farmers who are being devastated 
today as we speak, as they leave the rural lifestyle, they go 
to the urban/suburban areas to try to make a living, and they 
cause the urban sprawl. And so while they destroy us, they are 
also destroying their own backyards, which in my view makes 
little sense.
    I guess a question I would like to ask is, the use of 
lawsuits is a very popular ploy, whether it is to stop 
timbering or stop any kind of rural economics, and I often find 
those who propose the lawsuits never seem to have a job or at 
least a visible employer. In your research and work, any of 
you, have you found how these people--are they indirectly 
funded by somebody? It always seems like it is somebody hanging 
out that gets a university professor to pro bono the lawsuit, 
and the process starts with no investment and often shut down 
many operations.
    Mr. Arnold. Congressman Peterson, let me try and answer 
that as quickly as I can. The short answer is, yes, they are 
getting money from somewhere. I would have to refresh my memory 
to get the numbers, but I think in your area, in the Allegheny, 
you have a thing called the Allegheny Defense Fund, if I am not 
mistaken.
    Mr. Peterson. That is correct.
    Mr. Arnold. It has no visible means of support, but it does 
have a means of support. If you look carefully into the grant 
giving of a well known environmental group called Heartwood in 
Indiana, you will find that grants go from there, funneled 
through Heartwood to that little group, to do the interesting 
things they do in your area, and the money comes from a group 
of foundations we call the ``Usual Suspects'' at my Center 
because their names show up everywhere that the kind of thing 
you are talking about happens, somebody with no visible means 
of support suddenly has a ton of money to sue people for things 
that you wonder why they are suing them.
    Mr. Peterson. Well, they also have expertise because they 
are better at PR than most of us who get elected. They get 
quoted continually in the papers as if they are experts, and as 
if they are local folks, yet nobody knows them, nobody sees 
them, they don't belong to anybody's church, they are not a 
part of any community that I am aware of, but yet they 
constantly speak as experts on these issues as if they had 
credentials.
    I guess I would just like to quickly mention the other 
issue, the ``Roadless'' issue, which is sort of the current 
issue, and you so carefully explained how this was promulgated.
    But I have tried to be fair about this issue. I have tried 
to be thoughtful. But spending a lot of time in the woods 
myself--I grew up spending a lot of time in the forest, and I 
still do--and I know in the rural area I live, the people that 
spend time there, when an area is roadless, very few people 
enter it. Is that true? Very few people use--most people my age 
don't even want to be on a roadless area very far for fear of a 
health problem. I have always had good direction. My father 
would go a mile from the road and he would always get lost, so 
he never traveled--though he was not fearful, he didn't travel 
very far from a road because he would get lost. He had no sense 
of direction. I have always had a good sense of direction, 
could figure out how to get home, but I know in hunting you go 
a mile from the road, you are alone. There is nobody there. I 
mean, if there is not a road, you have closed the forest to 
human consumption, except a very few hikers--percentage of 
population, it wouldn't be even a fraction of a percent that 
would go in. Do you figure that is an accurate observation?
    Mr. Arnold. I do, and you are out in the woods a lot more 
than I am.
    Mr. Lyall. Yes, sir. On this whole issue, that is my point 
of view. Like a person who can walk, they have the option, they 
can go wherever they want to go, just as I used to, sir. Now, 
to a disabled person, a mobility challenged person, the only 
access that we have to the outdoors is through free existing 
roads. I mean, that is just it. And what access is there is 
just a very, very small part--like where I live it, talking 
about these roads here, if every one of these 66 roads opened 
up to give disabled access to the forest, that would open up 
approximately 120 acres. And in the two ranger districts where 
I live, there are 400,000 acres. And I have been dealing with 
the Forest Service trying to open up these roads to 120. I have 
asked for 120 out of 400,000 acres, and I have been getting a 
very hard time with that. I mean, I have not just been dealing 
on a local level, but I have also been dealing on a national 
level.
    One gentleman I was talking with in the Forest Service up 
here in DC., we were talking about this issue, and he was 
telling me about, well, our policy might be different than what 
it is now, but we get a lot of pressure from these groups like 
Mr. Arnold has been talking about, that I don't know nothing 
about. And as far as from the disabled community's point of 
view--you know, I have done research--and right now there are 
approximately 54 million disabled people in the United States, 
but we are spread out. The disabled community is interwoven 
throughout the fabric of America--big city, small town, rural, 
rich, poor--and it is not an organized group, and therefore it 
is not given any consideration to, which is an abomination, in 
my point of view.
    Mr. Peterson. Thank you. Well, I think anybody who has had 
any health problems, anybody who is aging and are not quite as 
strong as they might have been at one time, you are really 
limiting our forests to a very few people.
    I guess the frustrating thing that I find is that rural 
people--and I don't know that much of America is aware of what 
is happening to rural America. I intend to be outspoken about 
it, but rural people have little ability to fight major 
foundations and Government agencies combined.
    I was at a hearing this morning where one of these 
Government agencies--and I will leave it nameless--was asked by 
the Chairman of a Committee, an important Committee, 
Appropriations Committee, if they were willing to give that 
Committee 60 days' notice on purchases of land they were going 
to make--and I would have thought not approval, just notice--
and the head of that organization paused and stuttered and 
stammered and tried not to answer the question. I mean, where 
are we when we have Government funded agencies who think their 
decisions should not be reviewed by Congress, let alone the 
public? And I think that shows the elitism that we have that 
the common goal they have and the good they think they know is 
so great that the people be damned, and that is not what 
democracy is about. That is not what this country is about. But 
it is what is happening in this Administration and departments 
of Government and with the help of foundations, and I applaud 
all of you for being willing to investigate and document as you 
have.
    Mrs. Chenoweth-Hage. Thank you, Mr. Peterson.
    The Chair recognizes Mr. Smith, and I want to say that 
since we have one panel today, I have been rather lenient on 
the lights, and we will have a second round. Mr. Smith.
    Mr. Smith of Washington. Thank you, Madam Chair. First of 
all, I want to say--I don't want to ask a lot of questions 
about the policy except to say that I think the statements that 
are made about the policy battles going on in this country are 
very well made.
    There is a definite disagreement about how we should handle 
our public lands, and I think it has been laid out fairly well 
what the concerns are about the current policy, and that is the 
impact that it has on rural America. And I will even say that I 
agree with a significant chunk of that assessment. We have a 
significant problem in this country where rural America is 
suffering economically while the rest of the country does very 
well and, as public policymakers, we need to figure out some 
way to change that. There are a variety of different avenues to 
get there, but we are not there now. And I think it is 
perfectly appropriate to raise challenges to the policies that 
would exacerbate that problem and figure out how to solve them.
    What I am curious about is the approach that says people 
who disagree with me on a policy do not have a right to 
advocate that policy, because I hear this all the time. In my 
10 years in politics, it seems like undue influence is 
basically that influence that is exercised by the person who 
disagrees with me, and I hear this from both sides. I mean, 
everything that has been testified here, we could take all four 
of you away, put four environmentalists up there, and have them 
talk to us about corporate trusts and, believe me, I don't 
think corporations are underrepresented in terms of how much 
money they put into trusts. Many of them, timber industry, 
various industries who are interested in resource extraction 
fund a trust to do precisely the same thing that the 
environmentalists are trying to do on the opposite side. This 
is not peculiar to one group.
    So I think it is a little unfair to hold a hearing that 
focuses on one group as if they have invented something brand 
new in public policy advocation that is horribly upsetting the 
balance of the process. As far as having access, that is always 
an issue. And Democrats can sit up there and squawk about all 
the Republican access on a variety of different issues.
    So, what I am curious about is, with all this stated, what 
should be the policy? I mean, are we saying that the Pew Trusts 
does not have a right to exist? Are we saying that basically 
trusts such as that--and keep in mind that when you are doing 
this, you are going to paint a pretty broad brush. I don't know 
who funds, I don't even know if you are a nonprofit trust, or 
who it is that funds that, or whether or not it is public--and 
there are a lot of different trusts advocating a lot of 
different positions out there.
    What structurally and fundamentally is wrong with that 
funding process, and if you could put aside for a moment the 
environmental aspect of it, how should the law be changed, and 
how should these people not have the right, in essence, to 
spend their money and use their time to advocate what they want 
to advocate for? And, yes, I direct this primarily to Mr. 
Arnold.
    Mr. Arnold. ``Undue influence'' is the name of a crime. 
That is why it is the title of the book that I wrote. It is 
also the name of a civil tort. Those can be handled in a court.
    I am petitioning for redress of grievance not before a 
court, but before Congress, which is a fundamental right that I 
have.
    Mr. Smith of Washington. Absolutely.
    Mr. Arnold. And as a citizen and as an executive of a 
nonprofit 501(c)(3) with my 990's right here for your 
investigation. Our total income, none of which was from 
foundations, for 1999 was $26,812. I take no compensation and 
never have since I have been there in 1984.
    Mr. Smith of Washington. I doubt seriously your trust is a 
large part of the problem. There are others, however.
    Mr. Arnold. But to answer your question about what do you 
do, how do you change the law, one thing, I think, is that the 
matter of fairness can be addressed by the IRS. It has done a 
considerable job of making these trusts transparent because 
there are recent regulations that require divulging of where 
the grants went that are actually taken seriously for the first 
time, and one of the reasons I was able to produce this book is 
because the documents were finally available without spending 
many, many thousands of dollars going through the foundation 
centers' records to find where those grants were. They did not 
have to give me their 990's, now they do, but they don't have 
to tell me where their investment portfolio is, so that if I 
want to find out the W. Alton Jones Foundation--which I do have 
their 990's for 1993 but not since because they won't give them 
to me--that if they have investments in Georgia Pacific to the 
tune of about $1.4 million, in Louisiana Pacific to the tune of 
about $1.2 million, and in Western Mining to the tune of 
something like 600,000 shares--and I would have to look to see 
what those numbers really were--I would like to know that. I 
think that is simply a matter of public transparency, and I do 
believe that the law should be changed so that it doesn't 
matter who--it is me, them, anybody--where the money comes from 
should be visible to the public.
    Mr. Smith of Washington. I think that is a very good 
answer. I guess I would just close by saying I think making it 
more transparent and apparent to folks where advocates are 
coming from, where they are getting their money, and where they 
are sending their money, is something that I can certainly, 100 
percent, support. Again, I think it is a little unfair of this 
hearing to point out people who advocate for an environmental 
position and say that they are somehow doing something 
different than what a lot of different advocates are for a 
variety of different positions. I can assure you, they are not. 
They are living by the rules as they currently exist. 
Corporations, people on both sides of this issue are doing 
that, and I would hope in the interest of balance in terms of 
how we approach this issue, that folks in the audience and on 
this panel understand that if we want increased transparency so 
we know where the money is coming from that influences issues, 
we shouldn't single out any one group. There are quite a few 
different ones who deserve in depth analysis to figure out 
where that money is coming from, and I applaud, frankly, 
efforts like Mr. Arnold's to expose that, at least let people 
know what is going on, but I don't want to stop the process of 
democracy and folks being able to advocate for positions that 
they believe in, even if we may disagree with them. Thank you, 
Madam Chairman.
    Mrs. Chenoweth-Hage. Mr. Cannon, you are recognized for 
your questions.
    Mr. Cannon. Thank you very much, Madam Chair.
    First of all, I would like to thank the panel for being 
here today. Mr. Lyall, in my district we have the new Grand 
Staircase-Escalante National Monument that was done just 3 
years ago, and just in the last couple of months the 
Administration has come out with its plan for that area and--
surprise, surprise--90 percent of the roads in that area have 
been--by the way, that is a 2 million acre area--and 90 percent 
of the roads have been illegally shut down, and that area now 
has as its only recourse the courts to sue the Administration, 
which they are doing over that issue.
    Ms. Capp, in my district I have the largest number of 
Native Americans. I have the Ute Tribe and the Navajo Tribe in 
the southeast of the state--in the northeast is my Ute Tribe. 
And, Mr. DeVargas, you mentioned the unemployment in the 
Vallecitos area. The unemployment in our Native American area 
is about the same, between 20 and 40 percent unemployment. And 
just last year--this year, this cycle--the budgeting by the oil 
and gas drilling companies in that area plummeted from about a 
proposed $96 million to virtually nothing. I think two wells 
will be drilled in that area where 20 or 30 had been planned 
before.
    So, when we talk about the pain that is being inflicted on 
rural areas, it is not that we as public administrators have to 
do something about that, this Administration is causing the 
pain. I mean, the pain wouldn't exist unless there was an 
affirmative and aggressive action to do so.
    About a year ago, Patrick Kennedy, who is the Chairman of 
the Democratic Congressional Campaign Committee, now says that 
we who are friends of the Democratic Party have written off 
rural America. The next day, the Minority Leader, Dick 
Gephardt, pointed out that he--that is, Patrick Kennedy--didn't 
mean to say that.
    Now, Mr. Gephardt didn't say that Patrick Kennedy didn't 
mean what he said, he just pointed out that he didn't mean to 
actually say it because, in fact, that is, I think, the 
difference between parties at this point in time.
    I might just point out one thing for the record. There is a 
difference between tax-exempt foundations that pump money into 
public activity and private corporations that pay taxes. 
Normally, I ask questions, I don't get off on my soapbox in 
these circumstances, but let just add one other fact.
    We are now going through a remarkable renaissance of 
individual responsibility and opportunity in America largely 
caused by the Internet and the access that individuals have to 
information, and I personally want to thank you, Mr. Arnold, 
for the answer to your question, which Mr. Smith also agreed 
with, when you talked about transparency. I have this great 
faith in the American public. If they have access to 
information, they will make the right decisions. I don't care 
how anybody attempts to influence anybody about anything, I 
care about the hiding of those attempts. And perhaps now I can 
just shift into a question.
    Can you give us a little background, Mr. Arnold, on the 
Heritage Forest Campaign--that is, who initiated it, how was it 
set up, how successful has it been, and why?
    Mr. Arnold. Let me try to do that, Congressman Cannon. The 
understanding that I have, according to the documents from Pew 
Charitable Trusts and according to their Website, is that it is 
titled a Pew Initiative, which tells me that it was the 
brainchild of Joshua Reichert, a single individual who is the 
Environmental Director of the Pew Charitable Trusts.
    He is typically the model of the ``coalition''. His whole 
way of thinking is that you can't just do things with one 
organization, you must have a coalition. And in order to make a 
coalition work, as the Environmental Grantmakers Cluster of 
Foundations discovered to their dismay in 1992 when they tried 
a different model and it didn't work, you have to have a single 
money funneler, a fiscal agent that can actually get on top of 
a bunch of other groups that actually get a lot of the money, 
and tell them what to do. In other words, the marching orders 
come from the top--in this case, Joshua Reichert--they go down 
to National Audubon Society, they go from there to 12 
organizations which, according to their own board minutes of 
their own meeting of the National Audubon Society, they say 
they are ``supervising'' 12 other environmental groups.
    Now, I am not quite sure what the IRS would think about 
that--one 501(c)(3) supervising other 501(c)(3)'s. Now, my 
board would not allow me to be supervised by anybody, not for 
very long. I would give notice that I didn't work there 
anymore.
    So, that is a very remarkable thing about what I found in 
their minutes of their own Audubon Society Board meeting which, 
incidentally, you will find verbatim exactly as I copied them 
from their own meetings, on page 10 of Power To Hurt.
    Let me, if I may--I don't know how much time I have here--
it says--and this is from Dan Beard, the man who was formerly 
in the Clinton Administration. ``There are 60 million acres of 
1,000-acre-plus plots in our National forests that are still 
roadless''--and a comment on that, they are in no such way 
roadless. They have things a lot of people drive vehicles on, 
they just don't qualify under a very mushy definition that 
suits their political purposes for what does it mean, a 
``road''.
    ``There is no hope of congressional action to preserve them 
as wilderness. Administrative protection is possible. We have 
raised the issue's visibility in the White House, but it is not 
enough, so we did a poll using the President's pollster. He 
sent results to White House Chief of Staff--poll shows that 
Americans strongly care about wilderness to the extent of 
favoring it over jobs. Even Republican men in inter-mountain 
states supported at the 50 percent level. The Administration 
has said they will take some kind of action. We hope for an 
announcement from the President of some kind of administrative 
protection. We probably won't get all 60 million acres, but if 
we did it would represent the biggest chunk of land protection 
since the Alaska Lands Act. The Pew Trusts is pleased with the 
campaign so far. Second year funding will take it to January 
2001, $2.2 million for about 12 organizations under our 
supervision''--what is that about? ``Outside magazine this 
month has a good cover article. Our visibility and credibility 
among fellow forest protection organizations has been raised. 
Comment from John Flicker''--he is the head of Audubon, that 
means that he made this comment himself--``This grant came to 
us because of Dan Beard's reputation and good name''. Well, I 
didn't say that, I got that out of their board minutes.
    OK. So I think that gives you the most thorough answer. 
Just read their own documents and see what they are doing. The 
thing about it is, you have to know where to look. The average 
person who goes into Audubon's Website couldn't find that. Why 
not? Why don't we know about this stuff as it is going on? I 
want to know who is trying to put all of my members out of 
business before and while they are doing it, so I can do 
something that will counter it. That is just not fair, and that 
is something that those transparency laws certainly could do 
something about, fair notice.
    Mr. Cannon. Thank you, Mr. Arnold. I note, Madam Chair, 
that the light is not illuminated, but I suspect my 5 minutes 
have passed, and so I yield back.
    Mrs. Chenoweth-Hage. Thank you, Mr. Cannon.
    Mr. Udall is recognized for questions.
    Mr. Tom Udall. Madam Chair, thank you very much. I 
initially would just like to submit a statement and ask 
unanimous consent to submit a statement for the record.
    Mrs. Chenoweth-Hage. Without objection, so ordered.
    Mr. Tom Udall. Thank you. Mr. DeVargas, welcome and welcome 
to the entire panel. I would like to direct my questions 
primarily to Antonio DeVargas.
    La Compania Ocho is not the first company to lumber in the 
sustained yield area, is that correct?
    Mr. DeVargas. That is correct, Congressman Udall.
    Mr. Tom Udall. Could you tell me the company that was 
logging in that area prior to when you set up?
    Mr. DeVargas. Prior to us setting up, it was a corporation 
that was a subsidiary of Hanson Industries, Ltd., and the name 
of it was Duke City Lumber Company.
    Mr. Tom Udall. How would you differentiate your business, 
this lumber operation, from the lumber operations of the 
corporations that were your predecessors in the area?
    Mr. DeVargas. They were a very large corporation. Hanson 
Industries, Ltd. is based in London. They had pretty much a 
colonial mentality over the people there. They were very 
predatory in their practices not only in terms of their 
employment practices over the people there, but also in terms 
of how they did their lumbering.
    There was strong opposition from the local community to 
their methods and the extent of harvesting that was occurring 
and, in fact, the local communities were consistently fighting 
Duke City Lumber Company and the Forest Service.
    Mr. Tom Udall. And could you compare your approach--I think 
you have stated the earlier actions of the other corporations, 
the foreign corporations--how you approach this and what the 
reaction of the local community is?
    Mr. DeVargas. I believe that the local community being 
land-based and being rural and being from there and being 
vested in the land is much more--I think we are better 
stewards, and I think that we have a greater respect for the 
land because we cannot see destroying the land of our 
ancestors. Our village, as many of them, are 400 years old. The 
Native American villages are even older than that. And there's 
logging going on and timbering going on on the reservations in 
New Mexico, and nobody is arguing with the levels of harvest 
there, and it is because the people from there do care about 
the land and the water and the air. Corporations from outside 
the country or from outside the region don't have that same 
responsibility to the locals.
    Mr. Tom Udall. Now, Mr. DeVargas, you talk about land-based 
and being there 400 years, and a lot of this is intertwined 
with the land grants, is it not, the Spanish Land Grants and 
the land grant issue in northern New Mexico?
    Mr. DeVargas. That is correct, Congressman Udall.
    Mr. Tom Udall. Can you tell this Subcommittee about the 
important role the land grants have in the traditional 
lifestyle of New Mexico's Hispanic villages and local 
economies?
    Mr. DeVargas. The land grants were the basis of community 
survival. Without them, it was not possible for communities to 
survive. The sovereign of Spain, when we were under the 
sovereignty of Spain, that government recognized that. When we 
were under the sovereignty of Mexico, that government 
recognized that. Under the sovereignty of the United States, 
that has not been recognized. So, we are not in any position to 
develop our own economy based on a sustainability for our 
villages.
    Mr. Tom Udall. Looking at the history of land grants in New 
Mexico, how has your business and the community's ability to 
support themselves been affected by what has happened to 
community land grants in New Mexico?
    Mr. DeVargas. The community land grants in New Mexico have 
been swallowed up by either large corporations or the Federal 
Government. They no longer exist in fact. They exist in the 
people's consciousness, they exist in the people's hopes and 
dreams, but in fact they don't exist, and this is what has 
rendered our community so helpless.
    Upon losing the land grants, basically what happened is our 
villages were condemned to the poverty levels that we now 
experience.
    Mr. Tom Udall. How were New Mexico's community land grants 
impacted by the way the United States implemented the Treaty of 
Guadalupe Hidalgo?
    Mr. DeVargas. The Treaty has never been implemented, Mr. 
Congressman. I believe that the Treaty was violated before the 
ink was dry.
    Mr. Tom Udall. Could you tell the Committee how that 
happened and what injustices were perpetrated on the people of 
northern New Mexico?
    Mr. DeVargas. The acquisition of the land by the Federal 
Government and private individuals were done through chicanery, 
outright fraud, just by dispossessing people, even through 
violence. There was a notorious organization that was based in 
Santa Fe during the territorial days called the Santa Fe Ring. 
It consisted of politicians, judges, and lawyers that just 
basically circumvented the laws, and really rendered the Treaty 
invalid. It has never been implemented. That Treaty has never 
been implemented. So, for the people there it has been very 
difficult. It has been very difficult to understand how a 
people can be discriminated in that manner, considering that in 
fact when the United States got its independence from England, 
from Great Britain, it would not have been able to, without the 
help of Spain. And, in fact, I have documents that show that 
all of the Spanish holdings, all the people that were under 
Spanish rule, were required to pay taxes to support the war 
effort for the 13 Colonies of the United States. New Mexico was 
very active in the Civil War and protecting the Union. Just 
about every person that I know--in my family anyway, my great-
grandfather fought in the First World War, my dad in the 
Second, my relatives in the Korean, myself in Vietnam, my 
cousins in the Persian Gulf War and other areas. The Hispanic 
contribution to the defense of this country is very, very well 
documented, and it just seems very strange that we would have 
to defend treaties of the U.S. Government in other countries 
when our Treaty has not been recognized.
    Mr. Tom Udall. Thank you, Mr. DeVargas. One of the things, 
and I know you know it very well, is that Treaty said to the 
people that decided to stay, the Treaty between Mexico and the 
United States of America, that the people that decided to stay 
in the United States--people were allowed to go back--but to 
stay in that area, that the United States would take the 
affirmative action of protecting their culture, protecting 
their property, and protecting their rights and their language. 
And, in fact, as you have very eloquently stated, that has not 
happened, and it is a great injustice that I think the people 
of northern New Mexico feel. I have taken a bill that was 
passed through the House of Representatives the last time 
around and introduced that identical bill on the anniversary of 
the Treaty of Guadalupe Hidalgo, and that bill is here in the 
Congress. I believe it is subcommittee, and I would just ask 
the Chair--I look forward to maybe working with you on that 
because I think these two issues are very intertwined, the 
issue that the panel has been asked to speak to today, and also 
this issue of the land grants is one that I think is a big 
injustice that needs to be corrected by the U.S. Government. 
Thank you, Madam Chair.
    Mrs. Chenoweth-Hage. Thank you, Mr. Udall. That was a very 
interesting line of questioning.
    And so it is clear then, in your opinion, that the Treaty 
of Guadalupe Hidalgo was signed, agreed upon, but has not been 
honored by this Government?
    Mr. DeVargas. That is correct, Madam Chairman, but I would 
like to go a little bit further and state that in my view the 
kind of injustice that was perpetuated against the people under 
that treaty, the same mentality that led to that is the same 
mentality that is driving the elite groups to now not only 
discriminate against Hispanics, but to discriminate against 
rural people in general, and I believe that many of the motives 
behind this is to disenfranchise rural people and make sure 
that the forests in the United States, in the western part of 
the United States, become playgrounds only for the rich.
    Mrs. Chenoweth-Hage. Thank you very much.
    The Chair recognizes Mr. Sherwood.
    Mr. Sherwood. Thank you, Madam Chairman. Mr. DeVargas, if I 
could continue in that line, and we will leave the Treaty of 
Guadalupe Hidalgo and go on to your settlement with the Forest 
Service in the suit of 1994. And I read that you were to be 
able to purchase 75 percent of the La Monga timber sale, and 
yet that has not happened, and I understand that that was a 
suit against race discrimination, retaliation and preferential 
treatment for Duke City Lumber Company, and you got a pretty 
good settlement, you thought at the time, out of that suit. But 
what has happened recently that has kept you from reaping the 
benefits of winning that suit in 1994?
    Mr. DeVargas. Mr. Congressman, there have been several 
factors in that, not the least that we had to fight the Forest 
Guardians in two Federal courts in Arizona, one Federal in New 
Mexico, and we had to go all the way to the Ninth Circuit Court 
of Appeals in San Francisco. For a small corporation like ours 
consisting of five people who had to mortgage their homes just 
to even found the corporation, it cost us enormous sums of 
money. And obtaining financing for a small corporation such as 
that during a climate where everything is litigated--in fact, 
La Monga sale has not all been put up at this point, we have 
purchased two portions of that. We have purchased 800,000 feet 
under La Monga whole timber sale, and we have purchased 450,000 
in the Bonito timber sale. And we have invested in our lumber 
mill, which is a small lumber mill, and we are going forward 
with it. However, the pipeline--every sale is appealed, and it 
is appealed indefinitely, and it is all very, very expensive to 
a small corporation such as us.
    Mr. Sherwood. What was their basis for stopping--for suing 
in court to have you stop your purchase of this standing 
timber, that they didn't want the timber cut, or what is their 
brief--what are their arguments here? I realize that is a 
complicated--but in short detail.
    Mr. DeVargas. Basically, they say it is kind of like a 
``mantra''--it is the last 5 percent of whole growth timber. 
That is what they say about every timber sale. They say it is 
the last 5 percent of old growth timber in that area, which is 
just simply not true.
    Mr. Sherwood. Describe the timber in that sale to us.
    Mr. DeVargas. That sale consists of mixed conifer, 
Ponderosa Pine, Douglas Fir, and white fir. It averages--the 
elevation is anywhere from 7200 feet to around 9800 feet. It is 
an area that has been logged before. It was logged very lightly 
in the past, more lightly than other areas. The prescriptions 
for logging on that sale, I feel, is a responsible 
prescription. It is something that the community can live with, 
doesn't feel it is an excessive harvesting. There has been no 
clear cutting, none whatsoever.
    Mr. Sherwood. It is a reasonably arid site, or if there is 
big timber it is not too arid. What are the problems that you 
have with logging, do you have erosion problems or siltation?
    Mr. DeVargas. I don't think we have any of those problems, 
Mr. Congressman. The arguments against logging La Monga is just 
that they don't want it logged, basically. It is kind of 
strange because we have a situation where they say they want us 
to do forest restoration work, such as thinning--and this is 
part of the deception that happens all the time--but then they 
initiate a zero-cut position. And our forests are overgrown. I 
mean, how do you justify zero-cut with thinning of the forest? 
It doesn't make sense to us.
    There is also a 150- or 250-acre environmentalist retreat 
located in that area, and so if the La Monga timber sale is put 
off-limits to grazing and logging, it would automatically 
increase the size of that particular retreat for 
environmentalists to 16,000 acres.
    Mr. Sherwood. What was the story behind the acquisition and 
sale of your wood processor?
    Mr. DeVargas. The Forest Guardians came up with what they 
considered their position to save the village of Vallecitos 
economically, and basically that position--it came out in the 
newspaper that that is what Mr. Hitt and the Forest Guardians 
wanted to do. And what it was really was a study that we had 
done ourselves. And so they were able to acquire something like 
$38,000 for a wood processor so that we could process firewood. 
They did that at the same time that they were filing a lawsuit 
that stopped all firewood cutting. And so we received a $38,000 
wood processor that we couldn't use. And we were tied up in 
litigation with the Forest Guardians over the firewood and the 
logging for almost 3 years. That machine was rendered totally 
useless.
    Mr. Sherwood. In your northern New Mexico villages, what 
other means of livelihood is there? What is the other industry 
besides the forest-related industries?
    Mr. DeVargas. It is either local government, city or 
county, schools, the Los Alamos National Labs, and Santa Fe is 
about 85 miles away where there is some manufacturing, very 
limited. That is about it.
    Mr. Sherwood. Thank you very much. I very much enjoyed 
hearing the panel.
    Mrs. Chenoweth-Hage. I want to advise the members that we 
have just been called to a 15-minute vote on one of the 
suspension bills, and then after that there will be a 5-minute 
vote on the journal. And I also want to let you know that we 
will adjourn for 30 minutes when I recess the Committee, and 
then we will come back and we will have a second round of 
questions.
    I do want to ask Mr. Arnold before we go, you have a 
section in your book on Undue Influence, a chapter entitled 
``Oh, God'', and it is very interesting. I think you have 
pretty well tied how the trusts are even moving into the 
churches to try to influence them. I am looking at page 101 
where it indicates that the Pew Charitable Trusts donated 
$135,000 to Christianity Today, ``to convene a forum on 
population and consumption issues among leading evangelical 
theologians and analysts, and to produce a special issue of 
Christianity Today on global stewardship''.
    Now, Mr. Arnold, it appears that there is a strange 
connection here. The Congress funds grants. These grants are 
acquired by these trusts. Then the money is used to have an 
influence that is a negative influence on our First Amendment, 
the separation--although it isn't included, the word 
``separation'' of church from state--nevertheless, the purpose 
was to separate the influence of Government in the churches, 
and it looks like the string is going right into the churches. 
Am I reading that right?
    Mr. Arnold. I believe so, Madam Chairman. I think the text 
there gives you enough to go on. This was a very truncated 
version of what I actually found, which was stacks and stacks 
of the ``best religion money can buy'', is what it added up to. 
And, of course, the foundations put piles of money in that 
isn't documented in here that, at your request, I could supply 
sheet after sheet.
    Mrs. Chenoweth-Hage. Would you please do so?
    Mr. Arnold. I will do that, Madam Chairman.
    Mrs. Chenoweth-Hage. We will recess the Committee right now 
for 30 minutes, and we will be back at that time and we will 
begin with questions from the Chairman and then go to the 
remaining members. Thank you.[Recess.]
    Mrs. Chenoweth-Hage. The Committee on Forest and Forest 
Health will reconvene.
    I would like to begin my line of questioning with Ms. Capp. 
Ms. Capp, I wonder if you could put the map up again. Mike, if 
you would do that. Thank you.
    [Map retained in Committee files]
    I was intrigued with this map although we didn't get much 
detail about the map. So, I wonder, for me and for the record, 
if you could go over that in a little more detail.
    Ms. Capp. For the sake of being able to hear me, I am not 
going to stand over there and point at it, Ron is going to 
point at it.
    As I said, what this map basically illustrates is the plans 
that are afoot that are really going to squeeze us out of Ferry 
County. And I want to point out that this map is in process. It 
doesn't even contain everything that is coming at us. In fact, 
we have regulations and campaigns coming at us so fast we don't 
really know what to address first.
    Basically, the left-hand side of the map is Ferry County. 
That white space you see there in the middle, that is not Ferry 
County. It is bordered by the Kettle River there on the right 
side. The yellow is proposed lynx range. The green is Forest 
Service land. The little sections that you see sectioned off 
there--some of them have numbers--are the Forest Service's 
ecosystem management plans that are being implemented which, 
when you look at what is being proposed in those plans, they 
bear an incredible similarity to the Interior Columbia Basin 
Ecosystem Management Project, only they seem to be implemented 
now on a chunk-by-chunk basis, one watershed at a time.
    You can't see very well there, but the Columbia and the 
Kettle River which flows through Ferry County--despite the fact 
that numerous biology experts and field biologists have told me 
that the Kettle River is not, nor has it ever been, bull trout 
habitat, we still have various people at the Federal and State 
level who would like the Kettle River to be bull trout habitat, 
so that is another thing that is threatening us. And one of the 
worst things about that is that--well, just for example, Dave 
Smith of the University of British Columbia is one of the 
people that I interviewed when I did a report on bull trout for 
the Kettle River Advisory Board, and Dave told me that in no 
uncertain terms the Kettle River is not bull trout habitat. Its 
natural characteristics are too low flow and warm temperature. 
In fact, a hydrological report that was done some years back 
for WYRA purposes states that the Kettle can exceed 16 degrees 
centigrade in the summertime with absolutely no human use 
whatsoever, and 15 degrees is the maximum for adult bull trout.
    So, one of the reasons that is important is because we have 
plans coming at us for endangered species or threatened species 
that aren't really even natural to our area. At any rate, the 
main point that I would like people to take from that map--now 
you can't see the lower half--is Colville Indian Reservation, 
and that is about--that portion of the county is about the same 
size as the top. The county is about 4.6 million acres. Only 15 
percent of that is private property. And this is a natural 
resource producing community. Those are the jobs that we have 
there.
    If we are squeezed out of the National Forest, there is not 
going to be any employment--maybe Job Corps will still be out 
there, although I don't know who would want to work there, but 
the rest of the employment in the county is Department of 
Social and Health Services, the school district, the county 
government--which, by the way, now is only open 4 days a week. 
So, if there is no other employment in the area, the school is 
going to go. In fact, one of the ways that all this has 
impacted us is that up in Curlew, the Curlew School District 
where I live, we have under 300 students, kindergarten through 
12th grade, very small school. Last year, we had to lay off 
four full-time teachers. Our first grade teacher now has 60 
students. We have teachers who are now doing the best that they 
can to teach subjects that never really were their forte. The 
whole community is really suffering.
    Mrs. Chenoweth-Hage. That is quite amazing. You know, the 
national environmental groups often say that our forests need 
to be protected from development. Are forests in your area 
threatened by development? And my second question is, is the 
lynx listed on the endangered species list, or endangered?
    Ms. Capp. Not yet, but there is a big push to get it 
listed. That is one of the things that is to frustrating about 
the massive amounts of money that these groups have to do their 
PR and the way that they can really twist the facts to get 
urbanites really to vote and petition rural people into 
oblivion.
    Their campaigns give the impression that our National 
Forests are--when they use the word ``development'', what comes 
to most people's mind is that we have factories and industry 
and suburban sprawl coming right up to the edge of these so-
called ``roadless'' areas which, in fact, we don't. I mean, in 
a county of only 7200 people, you can imagine there is not much 
of anything in the way of building.
    And the other thing is the way they carry on about 
development and roads. People in the urban areas get the 
impression that we have blacktop highways going through the 
National Forests and, of course, the Forest Service would be 
frivolous to be trying to maintain things like that but, in 
fact, we don't. What we have is a bunch of little one-lane dirt 
roads. So, no, there is no development threatening the National 
Forests in our area.
    Mrs. Chenoweth-Hage. Thank you, Ms. Capp.
    At this time I would like to yield to Mr. Peterson for his 
questions. He had some questions he was concerned about.
    Mr. Peterson. Thank you, Madam Chair.
    Mr. Arnold, and anyone else who wants to, but I want to 
make sure I understand what you are telling us. I haven't had 
time to read the book, but we have a picture here of large 
foundations like the Pew Foundation, who join hands and fund 
large national organizations like the Audubon Society, and who 
somehow collaborate with the Administration and the White House 
and the Vice President and the President's Environmental 
Council sort of become the War Room for these efforts. And they 
have ability, the Interior Department, the Department of 
Agriculture, EPA, smaller organizations like the BLM, the 
Forest Service and the Park Service all to manage information 
and manipulate public policy. Is that a fair assessment?
    Mr. Arnold. Congressman Peterson, you have that exactly 
right. I wouldn't change that in any way.
    Mr. Peterson. OK. Well, I also know something that 
surprised me here, I don't have a good audit of it of where all 
it is, but I know we spend a lot of money here in Washington 
funding organizations that have nothing to do with Government 
but who are very related to associations and organizations that 
represent different interest groups around the country, but 
they get a lot of Federal money. At the State level, where I 
came from and have more expertise, that didn't happen. We 
didn't fund our opposition or those who are promoting ideas.
    Are you aware of how Government tax dollars gets into this 
mix, too, besides the use of public offices where public policy 
is made?
    Mr. Arnold. Yes, sir, I do. As a matter of fact, one of the 
chapters is called Zealous Bureaucrats, and it deals 
extensively with that. The gist of it is that you can trace 
probably half a billion dollars in any given year, we suspect 
that there is probably four times that--that is based on a 
guess of a reporter from the Boston Globe, whom I respect quite 
well--$4 billion dollars we can't find. We can find about half 
a billion dollars, and it goes from groups like the Fish and 
Wildlife Service and the Fish and Wildlife Service Foundation, 
which is a quasi-Governmental group which gives grants to 
private environmental groups, some of which then come back and 
lobby. They are primarily for improvement of infrastructure on 
National Wildlife Refuges, such detailed things as that.
    On the other hand, you get grants from the EPA. Now, one of 
the things I will give them credit for is there is a Website 
that anyone can access, that lists their grants. The catch is 
they don't list all of them and, in fact, they don't list the 
most interesting ones, which you have to have special software 
and a computer beyond a desktop in order to access it, but the 
kind of money that we are seeing going from EPA goes directly 
to very advocacy oriented groups. It also gets back to them 
through the route of going to academics who see a particular 
issue--let us say, an air quality issue--they will go to an 
M.D. studying children's asthma syndromes, and then Carol 
Browner will, as the head of the EPA, use that in testimony 
saying that we have to stiffen up the air quality regulations--
which, as a matter of fact, did happen. And there are quite a 
few episodes of that nature documented.
    We have also heard, but cannot confirm and would urge this 
Committee do some investigation on it, that actually Mrs. 
Browner was, in fact, hosting on a regular basis foundation 
funders in her personal office, and telling them where they 
should be putting their money. Like I say, I can't verify that, 
I have that from a couple of whistleblower types who are not 
quite brave enough to blow the whistle, but that is something I 
think that should she be required to testify for other things, 
that certainly needs to be brought up.
    Mr. Peterson. But are you aware of where--you did mention 
several--but should we have a prohibition of tax dollars being 
utilized to fund any organization on any side of any issue? I 
mean, somehow there should be a firewall from Government 
funding advocacy groups? Now, I guess the question I wanted to 
ask and it slipped by me was, the Foundation, Fish and Wildlife 
Foundation, is that all tax dollars or is that a blend?
    Mr. Arnold. No, that is not. That is a combination of tax 
dollars and private funders, so as I say, it is quasi-
Governmental, so that there was one person who became a board 
member under very unusual circumstances, who donated a million 
dollars to the Fish and Wildlife Foundation. So, yes, private 
individual grants can go into it, and a number have, as a 
matter of fact. So, it is a mix.
    And to answer your first question, should there be a 
firewall, I am certainly no legislator, but I have hired enough 
lawyers to know that is a can of worms. I think that to go in 
that direction probably would invite prohibitions that would 
probably hurt really worthy causes. I think that protecting 
National Wildlife Refuges is a good idea. Using them as a way 
to put people out of existence is not a good idea. I am not 
able to see how you would differentiate in a law which has to 
apply to everybody that wouldn't really hurt a lot of good 
things. So, that one needs a lot more thought than I have given 
to it in order to be able to say, yes, you should do something 
that prohibits tax-exempt organizations from using tax money to 
lobby with. I don't know how you would actually do that.
    It would be nice to have that all visible and transparent, 
and that, I think, the simple matter of public disclosure is 
probably--for one thing, it would be a very popular issue. I 
can't imagine any citizen of the United States that likes 
things going on behind their back that influences their lives 
as much as is documented in this book.
    And so public disclosure, I think, really is the way to go, 
rather than strict prohibitions. Again, that is up to Congress, 
which is why we are talking to you because we need your ideas 
and your help as well as you getting ours. But I see the route 
into clarity on this going through public disclosure. If we 
knew while they were planning the Heritage Forest Campaign that 
they were going to do it, that there was a fair notice 
requirement when any large coalition got together--now, stop 
and think of what this Pew thing was. It was 12 groups working 
together. If those were for-profit groups, they would all be in 
jail. That is a clear violation of the Sherman Antitrust Act of 
1890, to do that kind of thing if you are a for-profit. And I 
am not sure that perhaps something of that nature about working 
in combines, or illegal--you know, price fixing for the for-
profits--how about policy fixing? I don't know if that even 
means anything under our Constitution, but there has to be some 
investigation of this coalition model. Nothing happens except 
in coalitions anymore, in the environmental movement, or any 
kind of what they call ``progressive'', more left-leaning type 
of movement, and what to do about that, I think, is let us lift 
the rock and ``let the sun shine in''.
    Mr. Peterson. Well, the frustration I have had is that they 
seldom want a public discussion. It is a mass manipulation of 
information, to then manipulate public policy, and it is a 
huge--it is like McDonald's selling hamburgers. I mean, that is 
what it is about.
    Earlier we talked about the sprawl issue, and somebody just 
handed me here--a polling company talks ``sprawl is now a 
bread-and-butter community issue like crime', said Jan 
Schaffer, Executive Director of the Pew Center for Civic 
Journalism, which sponsored the polling. Americans are divided 
about the best solution for dealing with growth, development 
and traffic congestion''. Well, I think part of our argument 
needs to be, and part of the discussion needs to be, that if we 
stopped squashing rural America, they wouldn't be moving to the 
cities to cause the sprawl.
    Mr. Arnold. Well, Congressman Peterson, let me also add to 
that, what in the name of Heaven are these foundations doing 
giving money to the media? Why is there such a thing as the Pew 
Center for Media? Are they buying newspaper reporters?
    If you take a look, in fact, in this book on page 99 and 
100, I documented that question. Here is a Public Media Center 
got $300,000 from Pew Charitable Trusts, the Foundation for 
American Communications got $75,000 from W. Alton Jones 
Foundation, the Center for Investigating Reporting got $105,000 
from the Schumann Foundation, on and on and on. There is so 
much money being poured into the media to assure proper 
environmental reporting, whatever that is, and you can imagine 
what their viewpoint is.
    Why are the media taking the money? I don't know that. And 
I do know--I worked on a newspaper----
    Mr. Peterson. I think they will take anybody's money. They 
don't have to stand for election.
    Mr. Arnold. That is true.
    Mr. Peterson. Of course, the number of people that watch 
the major media today is pretty small, in comparison, and I 
think it is because of their spin, not because--if they 
reported--I think the success of Fox News is very much ``We 
report, you decide'' has caught on because the media doesn't 
report, they tell you what portion they want you to know, and I 
think we all know that.
    I want to commend you for your work, all of you, for 
speaking out, but I guess, in conclusion, my biggest concern as 
a Member of Congress--when I was in State Government for 19 
years and I had a business for 26, so I come here with some 
experience--is the immenseness and the inability to put your 
arms around departments. I mean, it is like--I used to kid when 
I was in State Government about dealing with the Federal 
Government was like dealing with a foreign country, and I have 
been 4 years--and I am a bureaucracy fighter, I always was at 
the State level--but here it is like you can't get at them. I 
mean, they are huge. They are almost nameless, faceless 
agencies that have--and we here in Washington have almost no 
process in the regulatory process, and that is lawmaking 
without public discussion, and it is what people fought and 
died for a long time ago, but the regulatory process in 
Washington is totally out of control, and Congress has almost 
no ability to influence it, or at least doesn't, and I don't 
think anybody can argue with that.
    At the State level in Pennsylvania, we had a very effective 
agency that helped committee chairs and committees deal with 
regulations that were inappropriate, but you will find that 
presidents quickly find out that it is easier to regulate and 
write rules than it is to pass law because when you pass law 
you have to win a public debate. And, unfortunately, many of 
the problems we are fighting are because we have totally left 
go. Since Ronald Reagan, no one has had any influence on the 
regulatory progress, they have been totally free to write law 
and set policy without a public discussion, and we will pay 
down the road. Thank you very much.
    Mrs. Chenoweth-Hage. Thank you, Mr. Peterson, I appreciate 
your line of questioning.
    Your book is very fascinating, Mr. Arnold, and I wanted 
to--I have a lot of questions to ask you. I am going to ask you 
some now on the record, and then I will be submitting more 
questions to you in writing.
    It has always been just a strong tenet of the free-market 
system, freedom of enterprise, that when a company operates in 
their own self-interest, it is also to the self-interest and 
the betterment of those who work for them, those who can 
purchase their product, and so forth.
    In looking at those corporations' own self-interest, who 
are behind the Pew, Mellon, Alton W. Jones Foundations, all of 
those, why are they doing this? I mentioned in earlier comments 
that it was a growing metastasis, it is dark and ugly. What is 
their self-interest here? Have you been able to find anything?
    Mr. Arnold. Well, Madam Chairman, unfortunately, the answer 
is yes, I have. Probably the most obvious answer is if you have 
a large corporation in something that we have all been talking 
about, timber, and they are, let us say, a big landowner that 
has fee land that they own, clear title, and they have very 
little that comes off Federal lands in the way of timber supply 
for their mills, but surrounding them are all kinds of middle-
size and smaller competitors who go into the National Forest, 
take timber out, and compete effectively with that--sealed bid 
and all kinds of things. Now, if you were one of those large 
corporations, what would you do if you suddenly found that 
somebody was shutting down all of your competition on Federal 
lands? If I was a CEO, I would be like Harry Merlo, who once 
told the New York Times about 10 years ago, ``Why should I pay 
money for a lawsuit to fight the spotted owl issue? All the 
court has done is given me a legal monopoly''.
    Mrs. Chenoweth-Hage. And Harry Merlo was the CEO----
    Mr. Arnold. Harry Merlo said that out loud. He was the CEO 
of Louisiana Pacific Corporation at the time, which is a very 
large private landowner, and in a business sense he was 
absolutely right for his stockholders. Why should he spend 
money on something that is only going to put his competitors 
out of business? But, you see, that is one of those double-
edged swords.
    Now what do you do if the free market says ``I don't care 
if you regulate the other guy out of business, and I will give 
money'', as we are seeing many large corporations giving money 
to the Nature Conservancy which buys private land and then 
sells it to the Federal Government at a markup, to the 
Wilderness Society even, to any kind of environmental group 
that advocates the shutdown of all resource extraction industry 
on Federal lands. What are we to make of those corporations 
doing that other than there is probably some competitive 
advantage in it for them. They are not stupid. I can't imagine 
that is all out of altruism. I am sure they have figured it 
out.
    Mrs. Chenoweth-Hage. So that is how the dots connect, and 
that is why you made the comment about the Sherman Antitrust 
Act, it is creating a monopoly.
    Mr. Arnold. It is, Madam Chairman. I think that what is 
sauce for the goose is sauce for the gander. Why should not 
there be a nonprofit equivalent of that, only how would you do 
it without harming churches, the Civic Opera, hospitals? You 
see, that is where I am really hesitant to suggest such a 
thing, because it would hurt good people. There may possibly be 
a constitutional way to deal with those abuses, but it is the 
dilemma of a large society. There is no way you can run one 
without a bureaucracy, so you can't fight bureaucracy per se, 
you have to fight bureaucratic abuse. And how you target a law 
that precisely so that it does not hurt good people but stems 
abuses is a question I think Congress needs to tackle 
seriously.
    Mrs. Chenoweth-Hage. I am still trying to connect the dots 
on some of the National Monuments. For the record, can you 
advise this Committee as to how the foundations may or may not 
have--but probably may--have benefited from the Utah National 
Monument designation?
    Mr. Arnold. They created it, essentially. The Southern Utah 
Wilderness Society, in the person of Ken--and I don't know how 
to pronounce his last name, it is in the book--took Katy 
McGinty, several years before the designation of Staircase 
Escalante National Monument, to the area and spent 2 weeks with 
her convincing her that it ought to become wilderness, which 
was not within her power as Chairman of the President's Council 
on Environmental Quality to do, she couldn't deliver that, but 
she said, ``Let us see what we can do about a National 
Monument''.
    About the same time, a memo came from the Office of the 
Secretary of the Interior to the Solicitor, who is the head 
lawyer of the agency, asking to analyze what you needed to do 
in order to declare a National Monument without any 
environmental examination, with no public debate about the 
environmental consequences. This was the Clinton 
Administration.
    Why would the Clinton Administration, with Al Gore sitting 
in the second seat, ever want to do something without going 
through an environmental review? The only answer is, they 
wanted to act in secrecy. And in this case, they wanted to do 
what they did without anyone knowing it. As a matter of fact, 
the Resources Committee subpoenaed all of the resulting e-mails 
back and forth between the Interior Department and Katy 
McGinty's shop, including of her 12 or so assistants, about how 
are we going to fake up a letter so that the conditions that 
the Solicitor was told can be met. Those conditions were these: 
In order to declare a National Monument without having to go 
through environmental review, it had to come from the 
President's Office. Well, the idea for this one had come from 
the Secretary of Interior's Office which, if it does, becomes 
subject to the requirements of NEPA, the National Environmental 
Policy Act of 1969.
    And so Katy McGinty and all of her people spent nearly a 
year passing notes back and forth, trying to fake up a letter 
from the President of the United States to Secretary Babbitt 
saying, ``Hey, I have this great idea, and would you do this 
for me, and tell me all about this area that should be a 
National Monument''. Under those circumstances, if that was 
really the case, the President has the authority to, in 
essence, deputize the Secretary of the Interior to become part 
of the White House so it doesn't have to go through 
environmental review.
    So, in faking up this letter, which went through, I think, 
three or four drafts from the e-mails that your Committee was 
able to recover, it is very clear that they were lying through 
their teeth all the time. They knew exactly what they were 
going to do, and this Ken Raitt--I think is how you say his 
name, he was the person from the Southern Utah Wilderness 
Foundation--was back there with Sierra Club support, with all 
kinds of other support, some of which I do know and some of 
which I don't, from foundations and other environmental groups, 
pushing publicly that ``there needs to be a great land legacy 
kind of program coming from the Clinton Administration because 
we are really annoyed at you because you supported the Timber 
Rider, President Clinton, and so we may leave you hanging in 
this next vote'', which was the election of 1996. Clinton and 
Gore were both standing for re-election. The environmentalists 
were disaffected, and it looked like they were simply going to 
walk away and let them suffer the consequences.
    So, what do you do to bring them back? Of course you 
declare National Monuments, which conveniently, not too long 
before the election, finally did happen, without the slightest 
knowledge of anyone in the State Delegation of Congress from 
Utah. They had no idea this was going to happen. They weren't 
even invited to the ceremony, which wasn't even held in Utah, 
it was held in Arizona at the Grand Canyon, and a whole bunch 
of--hundreds of environmentalists showed up, who knew when to 
be there, and where to be, but nobody else in the country did.
    So they acted in secrecy. They told flat-out lies. And I 
haven't seen that published anywhere except in this book and in 
the Resource Committee's report. So, maybe media don't think 
that is news, but when something that corrupt goes on in an 
Administration, I think it is news.
    Mrs. Chenoweth-Hage. So to connect the dots from the 
foundations, it comes from the foundations into the Southern 
Utah Wilderness Society and from the foundations into the 
Sierra Club, who were working with and had prior knowledge of--
working with Katy McGinty and had prior knowledge of the final 
execution by the President of a National Monument.
    Mr. Arnold. Yes, they did.
    Mrs. Chenoweth-Hage. A lot of that land is land that was 
used by cattlemen, some of it was school endowment lands, but 
there was a huge, rich coal deposit.
    Mr. Arnold. And oil and natural gas.
    Mrs. Chenoweth-Hage. Right. Can you connect the dots from 
those who are behind the foundations to those who are now 
managing to control that resource?
    Mr. Arnold. Well, you get back to the law of supply and 
demand. If you know where your deposits of those minerals and 
valuable products are, and they are on private land or they are 
in another country where you can reach them, and somebody in 
Government wants to reduce the supply by locking up in some 
kind of designation where you can't gain access to it, what do 
you think is going to happen to the price of those products and 
the value of the remaining land?
    So, again, you don't see many corporations crying the blues 
over that because now their own private holdings are worth 
more.
    Mrs. Chenoweth-Hage. Ron, I want to get back to you. I do 
want to take care of a little bit of business here for Jeff 
Lyall.
    Jeff, I just read a letter that you wrote, a very beautiful 
letter, and you have asked that it be submitted to the 
Committee and made a part of the permanent record.
    Mr. Lyall. Yes, ma'am.
    Mrs. Chenoweth-Hage. Without objection, that will be 
ordered.
    Mr. Lyall. Thank you.
    Mrs. Chenoweth-Hage. Ron, we have heard how rural 
communities are impacted by the large foundations. Do these 
effects spread beyond the rural areas, and how does it affect 
the country as a whole?
    Mr. Arnold. It is a complicated question. I could give you 
the typical economist answer on the one hand and on the other 
hand, but I think in this issue there is no other hand. The 
answer is simple and straightforward. If you remove and destroy 
all resource extraction from the United States, what does that 
mean for where we get our supply of everything we can't get 
here? It has to be gotten elsewhere.
    We get most of our bananas--I don't know of anyplace in the 
United States that grows a lot of bananas--we get them from 
somewhere else. We haven't fought banana wars for a while. But 
there is a lot of petroleum setting in the United States you 
can't get at and, as I recall, we had a little war over oil not 
too long ago, Desert Storm.
    If we push timber offshore, if we push mining offshore, if 
we push farming offshore, if we push ranching offshore, food, 
clothing and shelter--you know, even environmentalists get 
grumpy when they miss dinner.
    So, I think are we going to be forced into facing something 
like timber wars with some other country to get their trees 
because we won't cut ours? It is not inconceivable. I don't say 
that that is what is going to happen, but if it happened with 
oil, why couldn't it happen with all the other things they are 
shutting out.
    So, is it affecting the Nation as a whole? Possibly, we 
don't know. I mean, my crystal is no better than yours, but as 
far as immediate impacts that you can see now, if you take 
people out of the country--you know that old saying, ``you can 
take the boy out of the country, but you can't take the country 
out of the boy''--well, when you take the boys and girls out of 
the country, you put them in the cities. Now, what does that do 
to concentration of population?
    We have seen in the State where I live, even an attempt to 
address some of the urban problems by sending welfare families 
into rural areas because the State Government seemed to be able 
to think, well, how do you help rural areas? You send them 
urban things. Well, that is not the answer at all. You stop 
preventing them from doing rural things, like cutting trees and 
growing cows and food and other incidental things like that.
    I think that a lot of people in urban areas simply haven't 
ever lived on the land. They have lost their roots not just to 
nature like the environmentalists claim, but to agriculture 
which grows all their food, to mining from which if it doesn't 
come from the ground it comes out of the water, so you have to 
have minerals to make fishhooks even when you get stuff out of 
the water. So, it is a matter of, like one engineer once told 
me, ``You know the problem with people in cities is they don't 
understand that everything--that things are made of stuff, and 
stuff comes out of the ground''.
    Now, I don't know any simpler way to say it, but that 
struck me because it is so on-target, and it is so much like 
the problem that you see in urban areas--and this is not a 
joke. There was a farm poster contest in San Francisco, and one 
little boy submitted a poster that said ``We don't need farmers 
where I live because there is a Safeway right across the 
street''. That is the kind of mentality you are up against, and 
yet when they see people coming in from the country--oh, that 
is a bunch of rubes and hicks, and we don't like them, and they 
make crowding and urban sprawl has become a big deal''--well, 
who is doing it? It is the people who thoughtlessly support the 
depopulation and the rural cleansing that environmentalists are 
promoting and advocating and actually producing with the help 
of the Administration. Long-winded answer to a short question, 
Madam Chairman.
    Mrs. Chenoweth-Hage. Thank you, Mr. Arnold.
    I wanted to ask Mr. DeVargas, what level of funding do the 
environmental groups have in your area, and how does it compare 
to the funding for the concerns that you represent?
    Mr. DeVargas. I know that they have about a million and a 
half dollars as of the last funding cycle that I had a chance 
to see, and we don't get anything. So, the comparison is really 
striking.
    As a former serviceman, one of the concerns that I have, 
that Mr. Arnold kind of alluded to, is that some of this stuff 
could really lead to some kind of danger to the country's 
security. If you kill the mining outfit, even just sinking a 
new shaft could take 5 years. If international shipping were to 
be disrupted by a serious war and we were totally dependent on 
all our raw products from somewhere else in order to fight a 
war, I think our national security is also at stake in a lot of 
these activities, and that is how I feel about it in terms of a 
threat to all of us. But in terms of the funding that we get 
for our activities, it is almost nonexistent.
    Mrs. Chenoweth-Hage. I wish my colleagues could have heard 
that answer. Can you tell us the story behind the acquisition 
and what you did, the sale of your wood processor, and now you 
have a new piece of equipment? I think you have already put 
that in the record, haven't you?
    Mr. DeVargas. Yes, I have.
    Mrs. Chenoweth-Hage. Tell me the history of the Mexican 
spotted owl in your area.
    Mr. DeVargas. There is none. There hasn't been any spotted 
owl. I believe in Santa Fe in the early 1800's, they were able 
to find one. In Taos, New Mexico, they said that they thought 
they had heard one. In the Hicorea area of northwestern New 
Mexico, they found two. They killed one of them to study it. 
That is the history there.
    Now, I understand there are spotted owls in southern New 
Mexico. I don't know what the populations are, but in the 
northern part of the State where I live, there are none. There 
are no spotted owls.
    Mrs. Chenoweth-Hage. What kind of impacts have the listing 
of the spotted owl had on your people?
    Mr. DeVargas. Well, there have been a lot of mill closures. 
The cattlemen are very severely impacted. The access to the 
natural resources--it is not just the listing of the spotted 
owl--I mean, the assault on the community is really broad. It 
is not just like the spotted owl. When the spotted owl loses 
its credibility because the biology doesn't sustain it, then 
they will go to the willow flycatcher, and when that doesn't 
work, when science reveals that the real threat to the willow 
flycatcher is not the cattle, but the cowbirds, then they go on 
to something else. And, really, what I see happening over there 
is just taking the people off the land. That is the real 
priority.
    Right now, the Bureau of Land Management and the Forest 
Service have enormous amounts of money to purchase land in the 
riparian areas. For us, what that does in terms of the impact 
on our county, it is manyfold. For one thing, it continues to 
take away our tax base, the people's tax base. I mean, we have 
numerous wilderness areas in New Mexico, quite a few, and they 
are underutilized because, as mentioned earlier, people just--
there is not that many people who are going to walk up there. 
Just in my area, there is probably over a million acres just in 
our area. There is the Pecos Wilderness, there is the San Padre 
Park, there is Wheeler Peak, there is Bisty Badlands, 
Bandolier, and it just goes on and on.
    Between the National Parks, the Monuments, pretty soon 
there is not going to be any land to support a tax base, and 
that affects our schools in the payment-in-lieu-of-taxes 
program because our county receives--most western counties that 
are surrounded by Federal land receive 25 percent of the 
revenues that they get in payment in lieu of taxes. Well, 
recreation doesn't bring us anything in lieu of taxes. The 
revenue from hunting and fishing licenses, they don't go to the 
counties, those go to the State Game Commission.
    So, whenever you don't have grazing and you don't have 
logging or any kind of extractive industries, you have no 
payment in lieu of taxes. When 70 percent of the land is in 
Federal hands and you don't get payment in lieu of taxes, your 
county's budget is just really bad.
    Mrs. Chenoweth-Hage. Well, Mr. DeVargas, I want to thank 
you for coming all the way out here to deliver your testimony. 
I want to thank all of the witnesses for their fine testimony 
and coming so far. Ms. Capp, you came clear across the country. 
Mr. Lyall, you came in, too, thank you very much. And, Mr. 
Arnold, I want to thank you.
    Before I close the hearing, I want to begin with Mr. Lyall, 
and ask you to respond briefly to one final question for me. 
What is the most important thought that you want left with this 
Committee and on the permanent record?
    Mr. Lyall. I think, ma'am, we just, like all the witnesses 
here--people--how can I say this, how would I like to--people 
are on the bottom of the totem pole when the environmental 
organizations, the Forest Service policy, when you look at all 
the policies, people are on the bottom of the totem pole. And 
why I say that, I deal with a gentlemen back home, they offer 
me a lot of excuses and they will tell me things like resource 
preservation. And what that means is that dirt, in their eyes, 
is more important than the quality of lives of millions of 
people.
    I am here trying to represent and trying to improve the 
quality of life for millions of people who are already behind 
the 8-ball to start with, and dirt is given more consideration 
than that. And that is why I have a problem with that. And back 
home where I am from, I know a family--who wishes to remain 
anonymous--but they have a 17-year-old daughter with cerebral 
palsy, and they just got down--I think it took them over 2 
years--a big fight with the Forest Service and some Virginia 
State Land as well. They gave these people an awful time just 
so they could get access for their daughter to use a motorized 
golf cart so that she could get into the outdoors around their 
house. She lived in the middle of some Forest Service land and 
there were some roads on it that they wanted to be able to take 
their daughter on. What is the big hurt? The road is there. Let 
them use it. And they gave these people, I mean, an awful time. 
It is really a shame what they did to them. And that just comes 
down to when resources, things like--well, they are important, 
I will give them their place--but when those things take 
precedent over the quality of people's lives, I don't think 
there is any excuse for that.
    Mrs. Chenoweth-Hage. Thank you, Mr. Lyall.
    Mr. Arnold, what final thought would you like to leave with 
the Committee?
    Mr. Arnold. Madam Chairman, I would like our country to 
wake up and realize what is being done to them by this ``iron 
triangle'' of wealthy foundations, grant-driven environmental 
groups, and zealous bureaucrats. Simply understanding that will 
do more to dry up that influence and to put it in a proper 
perspective and to reduce it to a manageable level, I think, 
than just about anything else.
    Mrs. Chenoweth-Hage. Thank you, Mr. Arnold.
    Ms. Capp?
    Ms. Capp. Well, there are basically two things that I would 
like to say. The first is something that I would like minority 
people and Native Americans in particular to understand, and 
that is just as these groups use certainly animal species as 
what they call ``flagship'' species, they use Native Americans 
as ``flagships'' species. And this sounds outrageous, but I am 
going to say it because I believe it--after seeing the billions 
and billions of dollars that these people have access to, I 
believe that they could have ended the problem with the Hopi 
removal a long time ago, had they wanted to, but I believe that 
the Hopi served as a great ``flagship'' species for them to 
rally other Native Americans around, to get them to fight, in 
particular, mining, which if we abandon environmentally 
responsible mining here, we are going to be getting our mined 
products from other countries where mining may not be done 
responsibly. So that is one thing that I really want to be 
looked at, how minority people are being used against one 
another and against their neighbors.
    The other thing is that what I see happening now is it is 
currently manifesting what I clearly see as genocide against 
rural people in general. That is what is manifesting now. But I 
believe that down the road, if this trend continues, it is 
going to result in the economic devastation of this country, 
which of course will mean the devastation of our security. It 
is very important to me that this huge group of environmental 
grantmakers make their investment portfolios visible. It is 
hard to imagine that they are not somehow profiting from this.
    Mrs. Chenoweth-Hage. Thank you. Thank you very much, Ms. 
Capp.
    Mr. DeVargas.
    Mr. DeVargas. I guess the most important thing that I would 
like to come out of here is that it doesn't matter if you are a 
rural dweller with a limited education and walk around in dirty 
blue jeans because you work in the woods or with cattle, or if 
you are a Native American and dress a little bit different. 
What I would like to see is the end of the demonization of 
people.
    Whenever people are demonized, to me, that is a prelude to 
a war, to being able to allow mass society to have no empathy. 
So, I just think that the leastest of us should be treated the 
same as the ones with the mostest of us.
    Mrs. Chenoweth-Hage. Very, very well said.
    In closing, I again want to thank you and express my deep 
gratitude to you for the investment that you have made in at 
least exposing this issue, this problem, and we have made great 
strides forward just in your willingness to expose the issue.
    I am still baffled, and I will continue to search for the 
reason that the grantmakers who get together and make plans for 
the policies of ultimately negatively impact rural communities 
and human lives. I keep thinking that they do operate in their 
own self-interest, we know that, whether it is for good or 
whether it is for not so good, but I have to ask what is their 
self-interest because the forests are being destroyed. It is 
like wanting to take the car and they shut the car down and 
take the keys away and run the car out of gas, they are not 
going to be able to start that car again. It is like killing 
the goose that laid the golden egg while the golden egg is 
still being laid, and the golden egg is the American economic 
engine that has thrived so well because of mutual respect for 
human beings, people who could live together in peace and 
respect. The dehumanization of the people is a very appropriate 
term because that is exactly what is happening. What is 
frightening is if people can get together and plan policies 
that impact humans without a care in the world for that human 
being.
    So, like John Adams said, this form of government was put 
together to be run by people who are lawful and moral people, 
and when we lose that kind of integrity, this is what has 
happened.
    I still think that because people collude at the 
grantmakers' meetings and various other meetings, because they 
use the kind of power that they do, because they involve 
Government, that there is a huge civil rights case there, or a 
huge RICO case there. And even if the case were put together, 
this legal system, judicial system, has got to develop the 
judicial will to right this wrong. And I just pray to God that 
this judicial system has the kind of will that it had when it 
passed the Sherman Antitrust Act.
    So, this will not be the end of my hearings on this issue. 
The Committee will continue to investigate, ask for more 
congressional investigations, asking for transparency reporting 
in actions by these grantmakers is a proper course. I will do 
my best to influence leadership along this line. I would ask 
that you work in your communities, to impress your Congressmen 
individually along this line. Openness in Government is so 
vitally important.
    So, with that, I want to remind you that the record will 
remain open for ten working days, should you wish to add 
anything to your testimony or add any amendments to your 
written testimony, please work with my Committee staff, feel 
free to do so.
    I will be submitting questions in writing to you. With 
that, again I want to thank you, and this hearing is adjourned.
    [Whereupon, at 5 p.m., the Subcommittee was adjourned.]
    [Additional correspondence follows:]
    [GRAPHIC] [TIFF OMITTED] T7408.058
    
    [GRAPHIC] [TIFF OMITTED] T7408.059
    
    [GRAPHIC] [TIFF OMITTED] T7408.060
    
    [GRAPHIC] [TIFF OMITTED] T7408.061
    
    [GRAPHIC] [TIFF OMITTED] T7408.062
    
    [GRAPHIC] [TIFF OMITTED] T7408.063
    
    [GRAPHIC] [TIFF OMITTED] T7408.064
    
    [GRAPHIC] [TIFF OMITTED] T7408.065
    

```