Over the weekend, as residents of North Carolina prepared to batten down the hatches against Hurricane Isabel, they made a disturbing discovery: there is a plywood shortage. Just as bad, those who could get sheets of the stuff paid astronomical prices for it - $30 or more for a single 4X8 sheet that, just last spring, may have cost $12-15. Many observers believe that the immediate cause of the crisis is the commandeering of hundreds of thousands of sheets of plywood for the Iraq reconstruction effort. This summer, the Defense Supply Center ordered 766,498 sheets for use in Iraq. However, this may represent just a tiny fraction of the plywood being shipped to the war-ravaged country. A so-far undisclosed volume of the material has also been ordered by private contractors such as Halliburton, working under government contract.

Here at home, the plywood shortage is universal, from MAINE to California. Some places are harder hit than others. In TEXAS, homeowners who were hammered by this summer's historic hailstorms, found there wasn't enough plywood around to replace their trashed roofs - some waited weeks to close up.

The plywood industry has issued a statement that claims that the wood being shipped to Iraq represents but a small fraction of the total plywood produced and that "a variety of factors have converged" to create the shortage. But after doing a little digging, I have come to the conclusion that this claim amounts to a phony bill of goods. The same bill of goods sold to Americans in the past by the energy industry, or by various industries peddling other universally needed commodities (sugar, coffee and chocolate have experienced manufactured "shortages" in the past, too). These "shortages" always seem to magically disappear as soon as they achieve their goals. What are the goals? In the near term, the goal is, of course to raise prices outrageously and land a big, quick windfall in profits. The longterm goal is usually the securing of legislation favorable to the industry. The idea here is that the public, forced to line up for gas, do without coffee, or wait to fix their roof, will roll over and give the industry whatever it wants with a grateful smile. The reality is, how can there be a plywood shortage when, according to INDUSTRY STATISTICS, 2002 was a recordbreaking year for the material - over 40.34 billion square feet of plywood and oriented strand board churned out, with no slowdown occurring as 2003 progressed. Although new housing starts were recently at a 16-year high, which sucked up a huge amount of plywood, at the same time, nonresidential construction was way down, offsetting this trend in terms of net building materials used. In addition, exports of plywood were down. And, if, as the industry claims, the shipments to Iraq were not signficant in terms of net volume, then how can there be a nationwide shortage?

Here's the bigger picture:

The industry projects that production will exceed 42 billion sq. feet per year within five years. This means they need lots of wood. Lots and lots of wood. This means finding new sources of timber. This projected success also depends on the favorability of environmental regulations. At present, the EPA is considering imposing regulations pertaining to the toxic emissions which have been proven to be released by the glues used in plywood. These REGULATIONS are scheduled to go into force in early 2004.

What better way to fulfill all of these goals than to create a shortage. Not only can you jack prices up to what the market will bear, you can also use the desperation of homeowners as leverage to get logging and emissions regulations molded to suit your purpose. I predict that the industry will cry "hardship" and invoke the need to "step up production" to fill the public's demand as excuses to demand that the impending EPA regulation be killed or delayed indefinitely. I think we will also find that the bogus "crunch" will be used an excuse to permanently increase prices and to open more public lands to logging operations. There is no doubt at all that the wood products industry staunchly supports Bush. In one INDUSTRY NEWSLETTER, for example, employees are urged to vote for Bush as the "only candidate who understands" the environmental "needs" of the industry, while Gore is condemned an environmental extremist. The cozy relationship between the plywood industry and the Bush administration is hinted at by this free plug for the Engineered Wood Association (formerly the American Plywood Association) on the HUD WEBSITE.

Thanks to the "engineered plywood shortage", Americans may find, as they brace for Isabel, and then begin their own reconstruction afterward, that they will be paying twice and maybe even thrice for plywood - if they can get it. First, they are paying inflated prices - up to twice what the cost was last spring for a single sheet. Second, the contractors who are buying the plywood for use in Iraq turn around and bill the U.S. government - which, of course, is funded by the US taxpayer. You can bet that the invoice won't look like any Home Depot bill! Even as a write this, Halliburton, currently making hay while the Bush sun shines in Iraq, is under investigation by the SEC for gouging the government in the past for materials. In fact, while Cheney was the company's top exec,- ie, until right before moving his scam to Washington - HALLIBURTON charged the US government $86 for each 4X8 sheet of plywood!.