Manifesto Multilinko
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Monday, October 19, 2009
everything you need to know about capitalism

It's hard to have a conversation about forestry practices in the redwoods without hearing the name of Charles Hurwitz, CEO of Houston-based Maxxam, Inc. In 1985 Hurwitz orchestrated the hostile takeover—underwritten by junk bonds provided by the financier Michael Milken—of Pacific Lumber, which had been run conservatively by the Murphy family since 1905. By leaving some of their old growth standing, the Murphys, men who learned the lumber business from the chain saw up, had planned to sustain their timber harvest and jobs well into the 21st century. "When the Murphys owned PL, they cared for their employees," Hall says.

With Pacific Lumber, Hurwitz inherited roughly 70 percent of the remaining old redwoods in private hands. In his first meeting with the employees, the dark-suited businessman told them—in a now famous quote—that he believed in the golden rule: "He who has the gold, rules." Hurwitz then proceeded to break up the company and sell its assets. He sold Pacific Lumber's office building in downtown San Francisco and a profitable welding division, and he cashed out the workers' pension fund, replacing it with an annuity from a poorly rated insurance carrier.

Most important for the redwoods, Hurwitz adopted a business model of clear-cutting, doubling—and some years even tripling—the annual amount of timber harvested from the company's holdings, which eventually reached 210,000 acres.

National Geographic - Redwoods: The Super Trees - October 2009
(quote from page 6 of the online article)