Sunday, January 14, 1996 Section: Books Page: 1

By: Joel Neuberg

THE LAST STAND: The War Between Wall Street and Main Street Over California's Ancient Redwoods By David Harris Times Books, 388 pp., $25

AT THE end of September 1985, Texas financier Charles Hurwitz succeeded in a hostile takeover of the Pacific Lumber company. A succinct paragraph in the Santa Rosa Press Democrat told the story: ''On Sept. 27, 1985, trading in Pacific Lumber shares closed at $33 a share. Three days later, Hurwitz' Maxxam stunned the timber industry by making a sudden takeover bid of $36 a share. The price was raised a few days later to $38.50, and after brief resistance by the old Pacific Lumber directors, a merger price of $40 a share was agreed upon.''

In ''The Last Stand: The War Between Wall Street and Main Street Over California's Ancient Redwoods,'' David Harris takes substantially more space to tell the details.

An old-growth California coastal redwood (Sequoia sempervirons) can reach an age of more than 2,000 years, a height of more than 250 feet and a diameter of more than 12 feet. Such a tree will contain thousands of board feet of valuable lumber (for some purposes and in some markets, the best in the world) and (even in 1985) might be worth more than $30,000. In just the right conditions in a virgin forest, there might be dozens of such trees per acre, along with smaller, but still valuable trees a few hundred years old, figuring the value of the standing timber at more than $1 million.

There are not many acres like that, but 3,000 acres of old-growth redwoods should be worth more than half a billion dollars. And in what came to be known as ''The Headwaters Forest,'' Pacific Lumber Company owned more than 3,000 acres of old-growth redwoods in September 1985.
Harris gives us some idea of how Hurwitz easily figured out what an undervalued property Pacific Lumber was - while the owners proved powerless to prevent him from buying what they did not really want to sell at a price that was higher than market but much less than the value of what was at that time a model sustained-yield lumber company. His story of the takeover, the transformation of Pacific Lumber into a leaner, meaner machine for making money (including a raid on the employee retirement fund), and the five-year war with environmentalists reads like a novel.
His cast of characters - Michael Milkin, Ivan Boesky, Hurwitz and the locals faced with the hometown California impact of financial moves made in Texas and New York - overflows with interesting people forced to make fundamental decisions about deciding what is right, and doing something about it. The book held my interest to the last page.

Harris writes an epilogue - 22 short squibs in 15 pages - that, like the fast-forward notes at the end of some movies, catch us up on what happened to the main characters in the five years since the war with the environmentalists ended. Practically his last word is a quote from a ''Doonesbury'' comic strip where Milkin lectures a business school class on the three principles of the Milkin Code: ''GREED WORKS! CRIME PAYS! EVERYBODY DOES IT!''

Yet it was not until I had read this last page that I realized I was a bit disappointed, and after a while I knew it was my expectations of Harris that were let down, rather than anything missing from the book.

Man of conscience

Many years ago, when Bill Clinton was opposing the Vietnam War from Oxford, Pat Buchanan was supporting the war and nursing a trick knee in the bars of the nation's capital, Newt Gingrich was furthering his academic career and avoiding service, and Dan Quayle was promoting the war but serving in the Indiana National Guard, Harris was serving a prison term in Lompoc for opposing the war and refusing to serve when drafted. (I was a Peace Corps volunteer in West Africa who opposed the Vietnam War and thought of myself as serving my country in my own low-profile way.) I had never heard of any of those other people. Harris was different: someone you could count on to say the right thing at the right time about the most important issues.
He was not evading the fundamental question of our generation: What do you do about the evil in the world? We read his published letters from prison. We read what he had to say about being American in the world (''Goliath''), about being a person (''I Shoulda Been Home Yesterday'') and about people, politics and the 1960s (''Dreams Die Hard'').

Vital issue

''The Last Stand'' is certainly about an important issue. What we do with forest resources in the United States is as important as any question of our economic (not to mention moral and spiritual) life. And the case of Pacific Lumber provides a perfect study of how our economic system allows a small number of people to gain control of those resources to enrich themselves at the expense of large numbers of people.

But telling the story as a novel weakens its impact. ''Last Stand'' gives us many points of view and moves from setting to setting without footnotes, endnotes or direct quotations. While this technique helps the reader to keep going, it often makes it impossible to discern who's telling the story.

Fairly early in the book, Harris introduces us to Ezra Levin of Kramer Levin Nessen Kamin and Frankel, Hurwitz' attorneys. ''Ezra, several years older than Hurwitz, was his consigliere, a quiet, professorial man.'' At that point it is fairly clear Harris (and not Levin or some other of Hurwitz' business associates) is the one who chose the term with Mafia overtones to describe the professorial lawyer. But farther down the page, it's harder to tell who is talking. '' . . . Levin did not credit his friend's fearsome raider's reputation. Levin, after all, was a securities lawyer who saw a lot of these big-time stock players up close. By comparison, Charles behaved like a rabbi. The guy was without any particular ostentation . . . '' Does Levin, an orthodox Jew, think Hurwitz behaved like a rabbi, or does Harris?

Even were Harris writing more directly, in the conversational voice of his earlier books, it may be too soon to write any kind of a finish to this story. Since Harris finished the book, there has been good news: Bill Bertain finally won a settlement of his 10-year-old class-action lawsuit against Maxxam ($150 million to Pacific Lumber shareholders), and Congress is considering plans to purchase the still nearly untouched ''Headwaters Forest'' for preservation. Yet this information in no way diminishes the rueful tone of Harris' epilogue: The core truth remains that Milkin, Hurwitz and other players have been able to take vast profits from resources that developed over millennia. With the stakes so high, a $150 million settlement is an acceptable cost of doing business.
The long view

Our society cannot offer a way to replace what is lost or even effectively deter others from following Hurwitz's lead. Neither the players nor the government regulators have a long enough view. The founders of Pacific Lumber had a glimpse of the future: Go slow; keep the business in the family, weave it into the community for decades (centuries if you can). Remember that you will live with mistakes for generations.