Explanation About Resources

Trees are a valuable commodity in anybody's country. But the guys that cut them down have to be paid enough to return later and buy lumber to build a house. This is the way it's supposed to work. For some reason it isn't working in third world countries. Find out why, please, and then tell me.
-Bob Milner

The third world isn't the only place where this isn't working. It isn't working anywhere.

The guy who cuts the trees down adds one unit of value to a tree that he cuts down. A tree that is cut down is worth more as a product than one that is not.

The guy who drives the tree to the mill adds one unit of value to the tree. A tree is more valuable at the mill ready to be cut in to lumber than a log in the forest.

The guy who operates the mill adds one unit of value to the lumber. Trees that have been cut into lumber are worth more than logs sitting at the mill.

The guy who drives the lumber to the train adds one unit of value to the lumber. Lumber at the train station ready to be transported is worth more than lumber sitting at the mill.

The guy who drives the train into the next province adds one unit of value to the lumber. Lumber in Sask, is worth more than lumber in BC.

The guy who drives the lumber from the station to the lumber yard adds one unit of value to the lumber. Lumber ready for sale at a lumber yard is worth more than lumber at the train station.

The guy who sells the lumber at the lumber yard adds one unit of value to the lumber. Lumber you own is worth more than lumber you don't.

The guy who builds the house adds one unit of value to the lumber. Lumber nailed together in the shape of a house is worth more than lumber in a pile.

The guy who sells the house adds one unit of value to the house. A house you own is more than a house you don't.

Than means that the lumber from one tree in the form of a house that you own is worth 9 units of value. That means if you want a house you have to cut down enough trees to build a house 9 times over just for the lumber that goes into the house. I'm probably forgetting lots of the people in the chain from forest to house, but you get the idea.

Finished goods are worth more than raw materials. When it comes down to it, finished goods now are worth more than finished goods later. Kind of like the time value of money.