AlaskaReport.com



Sarah Palin vs Goliath



By John Enge - Ted Stevens will probably tell Sarah Palin to "butt-out" in regards to his work to shovel the value of Alaska's marine resources to the big multi-national fish processors. How they are going to reconcile their differences is anyone's guess. I suspect Sarah will hold her ground.

We just hope and pray that the Washington delegation will have the dignity to honor the will of the people of Alaska like they themselves had just been elected. After all, Sarah is a Republican too. And it's not her against them. It's the majority hiring someone to carry out their will and she will have plenty of help from people just like her.

Sarah Palin

This letter just arrived in my mail. People are really sour on Alaska politicians' past performance as you'll see. John McCain is pretty sour too. Happy reading:

"John,
The people of Alaska have spoken loud and clear, and I for one could not be happier. In looking at the turnout and the polling of voters, -people were voting against "corruption", and against the party incumbents that are linked to this system of corruption. People had to vote for anyone but a Republican in other states. Tony Knowles, as a 2 term former Governor, and strongly being endorsed by Veco, seemed to be too much of an insider.

Here in Alaska we had the opportunity to cast a Republican vote that spoke just as loudly against corruption, just as strongly against the party insiders. Palin is clearly not an insider and just as clearly her frank low key, anti-hype made her stronger - she did not promise the moon. So I really do believe her when she spoke out against Processor Quota systems -she did this early in her campaign, at some risk, and stood by her words. She said that separating Alaskan fishing families from the resources was inherently wrong.

While she was in Kodiak she listened to the locals explaining the irrationality of the Processors owning both the quota shares and the huge numbers of boats, and of their having total ownership of the pollock stocks. Many, including Trident's Chuck Bundrant, were frantically trying to undermine her chances of being elected. Our new Governor has a good chance of returning a fair playing field to all Alaskans, by allowing them to catch fish and crab without being ordered to sell their catch to the chosen few (at what ever low price they think their high priced lawyer/higher priced lobbyist think they can force down our throats by "fair arbitration").

Hell, I don't want or need arbitration, just give me back the American right of free enterprise that we had until that bastard Ted Stevens stole it in the middle of the night. One can only hope his son will spend a long time in jail. Who would have thought that fishemen could have been reduced to sharecroppers to the Multinational Corporations by buying one Senator. And I was so na´ve I thought he was representing Alaska, not Japan.

No one has yet told me why these huge companies like Trident, Nippon Suisan and Maruha need protection. They are vertically integrated mega-companies! Why does a company that already owns fleets of crab boats and huge pollock trawlers, very large factory ships, freight vessels and shore-based plants, that is the sole shore based operator in a required landing area for both fish or crab, need protection from an Alaskan fisherman selling his own fish or crab? How about it Chuck ?What about you "Uncle" Ted ?

The current Halibut and Black Cod IFQ program is working fine- in fact it is about the only good success story in the fisheries. If you have to give fish to fisherman vs open system then less market manipulation is far better for the people of Alaska. Companies like Trident Seafoods, which has the only plant in St. Paul, (and the only plant in Akutan, and the only plant in Sand Point, and owns both plants in Chignik), benefit from actual laws (made by earmarks) requiring all boats in the area to land crab there. How can this be?

How much money is lost to the Alaskan economy through low prices to fishermen? Just look at all the small towns that are shrinking. I would bet that if one charted the increasing number of Ted's earmarks in this arena against the decreasing price of fish, or with the decreasing opportunities to sell fish, or with the decreasing population of these towns, or with the decreasing number of independent, working Alaskan fishermen (vs. large company-employed men) - the inverse correlation would be obvious.

It is currently against the law for a crab fisherman NOT to sell his crab to one of these companies. In fact he has to agree to sell without negotiating a price. Only after after the season has started does he(maybe) get a soft price. If he does not like it his only option is arbitration - he cannot find another buyer to sell his crab to - EVER.

People outside the industry do not believe this - fishermen who have been working for 35 years, building up relationships and business savvy, can no longer sell their own crab to anyone not on the list. This list is now very, very short. I am sure the Russians have more freedom today than an Alaskan crab fisherman. Thanks Ted. I hope your boss Chuck got you a good Christmas bonus. Now, greedier than ever, these same companies are trying to jam through the Gulf of Alaska Processor-Controlled Groundfish Program (they keepchanging the name because Crab Ratz is so hated.)

People ask me what can a governor do? Consider the bills passed through Ted's earmarks - are they legal? Very likely all kinds of constitutional rights have been taken away from the people of Alaska. At the only hearing on Crab Ratz, which was invitational only. Even fellow Republican Senator McCain took action when he tried to stop Ted Stevens at that hearing, saying , "I do not see how creating Soviet style oligarchies would help Alaska, I thought we were against this kind of thing. Read what John McCain had to say here in opposition to Processing Quota http://commerce.senate.gov/newsroom/printable.cfm?id=217248

The Governor can and should order the vast legal resources of the state to investigate- and if appropriate- to bring suit against the companies controlling the markets in such an obvious way. (In these remote areas it is these same companies that set the price of fuel and bait, etc. Try fishing a small boat in the winter in Sand Point if you have butted heads with Chuck.) With the utmost respect to Governor Palin, and acknowledging what I am sure is an already full plate, I offer for her consideration- The Ten Best Steps the New Governor Could Do For Alaska:

1) Ask for resignation of all Alaska State employees, cabinet members, commissioners, Bridge Authority members, etc., who have been given a raise in the last 100 days. Remove all state officials that went on the last big junket to Asia last week with Frank.

2) Ask for the resignation of the North Pacific Fisheries Management Council members that are under control of the processor cartel, starting with the chairwoman, Stephanie Madsen, appointed by the former Governor of Alaska. Then move on to David Benson who tries to hide his real employer by listing LFS on his council seat listing (LFS is wholly owned by Trident Seafoods) since it no longer behooves him to call himself "governmental advisor for Trident".

3) Ask for NOAA to reconsider appointing recently-submitted Gerry Merrigan from Prowler Fisheries, as the co-owners John Winther and BartEaton are obviously closely related to Trident. Eaton is a partner of Trident.

4) Get a group of Alaskans that have no ties to the processors, and that cannot be bribed, to review and revise a fishery task force. Ask them to look into all regulations and red tape, and to answer why less than 14% of the fish currently harvested in Alaska is harvested by Alaskans.

5) Ask the IRS to work with MARD and with investigators from the State of Alaska to investigate how 3 large Japanese Seafood conglomerates, Maruha, Nippon Suisan and Nichero (through dummy corporations) came to own approximately 50% of the boats and of the pollock and crab quotas in the Bering Sea.

6) Replace the North Pacific Council members with active fishers.

7) Remove the head of Alaska Department of Fish and Game, McKie Cambell, who has been pushing openly for processors quotas and linkages, as it is (or should be) a crime for someone in his position to interfere with free enterprise.

8) Remove the oil company-related lawyers who are using the same political tactics as in the fishing industry, i.e. many of the top spots are taken by former oil industry lawyers , or wives of existing top oil company officials. The Alaskan people have had enough of the foxes guarding the hen house. Start with throwing out the Alaska Attorney General, David W. Marquez , 20 year employee and former Vice President and Chief Counsel of ARCO Alaska.

9) Charge the new Fisheries Task Force with looking into the salmon industry, the total control of the industry that has been gained through carefully manipulated processor consolidation. Of 280+ permit holders in Prince William Sound, now only about a third get to actually fish, and even then they are told when, where, and how much to catch. Why not just return to fish traps?

10) Clean house in the corrupt Republican Party Good Old Boy Club. Start by investigating the Crab Ratz money scandal, the insider land-buying deals both in Seward Sea Life Center and in the MacKenzie Point group, the Adak pollock scandal, and the reason why the state made not one charge in the biggest and longest illegal crab purchasing operation in the history of Alaska. This illegal action by the son of the man that made the very laws being broken. Think how many times Ted has publicly said his son was an expert in "crabbing".

How could Ben Stevens, as the chief officer of the company that circumvented laws for more than a year, not even be charged? Who intervened on his behalf, and how did they do it? Has the 3.4 Million Dollar fine ever been paid? Let's clean up our state, it can only be done from the top down with fearless leadership. We have seen what happens when the elected arrogantly think they and their children are privliged. Now we will have the chance.

Tony, when asked about Crab Ratz problems, said he would solve them by giving a million dollars or more to the Alaska Crab Coalition "to better market the crab." What a load of crap. How would giving money to a group owned and controlled by the crab processors help the independent fisherman? Remember, there was no problem for the last 30 years before the "Ted earmarked crab rider" known as Crab Ratz. Besides being Governor when Crab Ratz came into law, Tony also appointed Ben Stevens to his first seat after Ted arranged to have Drue Pierce promoted toWashington D.C.

Fisherman technically have the right to sell 10% of their crab elsewhere, but this is misleading and so small a percentage to be of not much actual value. Kodiak is the only port that has independent crab buyers, but as everyone knows you cannot afford to run all the way back to Kodiak with just 10% of a load after you have sat around waiting to offload, the deadloss would be huge. There is, in fact, no open market.

Crab Processor Quota Rider Statement by Senator John McCain. http://commerce.senate.gov/newsroom/printable.cfm?id=217248

"One of these policy riders is language that authorizes the Bering Sea and Aleutian Islands crab fisheries "rationalization" plan, which would divide 90% of that crab market among just a small group of processors. Under the provision, fishermen could only sell this crab to those few processors and, in turn, only those processors would sell to consumers. This legislative language has not been considered by the authorizing committees of jurisdiction, nor requested by the Administration.

Mr. President, this provision raises serious antitrust concerns. Again, it would require -- not simply allow, but require -- that crab fishermen sell 90 percent of their crab harvests to pre-determined processing companies. This precedent-setting action would violate anti-trust laws, limit competition in this seafood sector, and ultimately hurt fishermen and consumers. Fishermen around the nation have expressed strong opposition to this provision, as have at least a dozen newspaper editorial boards.

Before I go any further, I want to clarify the difference between "fishing quotas" and "processing quotas." Fishing quotas are allocation tools that allow fishermen to catch a certain portion of the overall allowable harvest. Fishermen could determine when and under what conditions to fish with such quotas, and fishing quotas have been widely recognized to benefit fishermen, the environment, and consumers. In contrast, processing quotas would allocate buying rights for the crab catch among a handful of processing companies, so that each would be guaranteed to receive a certain percent of the overall harvest.

Regardless of how efficient these processors are or what kind of price they are offering, they would have guaranteed market share. Under this plan, it would be illegal for fishermen to take their crab to other processors. Mr. President, this language could have far-reaching consequences, yet it was included in this "must pass" bill without ever having been considered or debated by the committee of jurisdiction, the Commerce Committee.

Fishermen throughout the nation object to the crab plan's individual processing quotas (IPQs) because the precedent-setting nature of this action could lead to IPQs in the processing sector of other fisheries. Indeed, "crab" boat owners and crew from all over the country- even from Arizona - have voiced their opposition to this proposal. I am aware of at least one crab fisherman who owns a fishing boat and a "catcher-processor" boat. He objects to this policy rider because it would make it illegal for him to sell his own catch to himself, so that the catch from his fishing boat could be processed on his processing boat.

According to the National Research Council (NRC), the General AccountingOffice (GAO), and the Department of Justice Antitrust Division, fishermen's concerns about IPQs are clearly justified. The 1999 NRC publication, "Sharing the Fish," found no "compelling reason to establisha separate, complementary processor quota system" to accompany an Individual Fishing Quota program. These findings were echoed by the GAO in its December 2002 report on IFQs, which failed to find that IFQ programs resulted in harmful impacts on processors in the halibut and sablefish fisheries that would warrant creation of an IPQ program.

Furthermore, on August 27, 2003, the Assistant Attorney General of the U.S. Department of Justice Antitrust Division wrote a letter to the General Counsel of the National Oceanic and Atmospheric Administration(NOAA), in which he opposed the IPQ provisions of the "crab" plan, stating "processor quotas are not justified by any such beneficial competitive purpose" and that "The Department urges NOAA to oppose IPQ."

While the fisherman are up in arms, the processors are already counting their chickens, or in this case, "crab" harvests, and in turn, their profits. That is because the percent of the harvest that they will be able to process in the future is based on how much they have processed in the past under the free market environment. Regardless of future operational efficiency, supply and demand, or any other real-world factors, these processors will be guaranteed their allocation into perpetuity.

Consider, for example, one company that recently has processed roughly 20 percent of the Bering Sea and Aleutian Islands crab. This provision will assure that company continues to receive 20 percent of future harvests - worth on the order of tens of millions of dollars annually. Mr. President, for centuries, fishermen have used market forces to negotiate their dockside prices, and this has had the effect of maintaining competition and benefitting consumers. Processor quotas throw and enormous wrench in the free market machinery.

In addition to affecting the price-setting process, the "crab" IPQ plan also would effectively prevent new processors from entering the industry. If anyone wants to enter the processing sector, they would need to buy the processing rights from the few processors who would have processing quota. Considering all these facts, the Administration has officially stated its opposition to IPQs, as reported in the Sacramento Bee, Kodiak Daily Mirror, Anchorage Daily News, and Seattle Times.

The Administration's proposed language for amending the Magnuson-Stevens Fisheries Conservation and Management Act clearly specifies that processors could own fishing quota, but does not propose a separate quota system divvying up processor quotas. As I said earlier, let me also mention that the editorial boards from at least 12 major newspapers - the Washington Post, Washington Times, Boston Globe, Oregonian, Anchorage Daily News, Los Angeles Times, Honolulu Advertiser, Daily Astorian, Seattle Times, SeattlePost-Intelligencer, Portland Press Herald in Maine, and the Tampa Tribune - have come out against IPQs. Note that these newspapers include the entire west coast - even Alaska and Hawaii. I am submitting these for the record."


See more at John Enge's Blog

See John Enge's Previous Posts On AlaskaReport Here

John lived in Alaska for 50 years and has run commercial boats and processing plants. John also served as a loan officer and economist for a "fishing bank" and served as the only Fisheries Infrastructure Development Specialist the state has had. He has owned a marine design and fabrication business and created the best-selling "Passport Alaska." All photos on his blog are his own, unless so noted.

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