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How Economic Incentives Can Help the Maine Lobster Industry

How Economic Incentives Can Help the Maine Lobster Industry

From Pavel Gavrilov, for About.com

Tradition and Skepticism vs. Incentive Based Programs

The lobstermen of Maine have two Maine concerns: lobstering and making enough money to support their families. The feelings of a group of lobstermen in a local diner in Cape Elizabeth was that without lobstering they wouldn't have anything. None of them could see themselves in an office, not could they see themselves retiring soon (some of the men at the counter were in their seventies). They all had families that depended on the money that lobstering brought in. And lobstering does bring in a fair amount of money, with the 1999 values of catches reaching a record $185 million (Commercial Fisheries News 2001), and in 2000 catching another record of $187 million (Corson 2002, 2). They were all very skeptical of any system that could reduce the total number of lobsters caught yet still save them money. "There's no way that I'm gonna support a plan that cuts the number of lobsters I can haul. I don't care how much it helps, it doesn't help me. I need that money." These are the words of Larry Dunn, a lobsterman around thirty years old. But he seems to be the only one of the younger generation that feels this way. Others seem to be intrigued by the ideas of an incentive based system. Many thought the idea that they would buy or were issued rights to lobsters appealing since it meant that no other lobstermen could catch them. The scene showed that the idea has not reached all the small communities in Maine yet, but that it could gain support from the lobstermen themselves.

The real question has become whether or not incentive-based systems can actually work. The re-authorization of the Magnuson Act in the late 1990s put a moratorium on Individual Transferable Quotas (ITQs), for many reasons including the need for further research into the idea. Many remain skeptical of the idea, mainly because of what happens when you reduce the number of quotas and thus lobsters one can haul: unemployment (Townsend 1996, 31). Lobstermen don't like being unemployed anymore than anyone else, and thus many of the small time lobstermen are fighting to keep their jobs by refusing ITQ systems.

This view is contradicted in the case of the Maine lobster some would say. With ITQs, the problem becomes different: while lobsters may be conserved as a resource, lobstermen such as the ones in Maine are cut out by larger fishing conglomerates and those that receive the original permits. The examples of other ITQ programs in Alaska and Australia are not relevant in the case of the Maine lobster because they don't address these concerns.

    "Additionally, as one might expect, ITQs have radically altered the social conditions governing use of the resource and the nature of economic opportunity. There is a tendency towards concentration of ownership; except for the first generation of lucky fishermen who receive their ITQ free from the government, everyone else has to make a large financial investment simply for the right to fish. The traditional approach of starting out in a small skiff and building up sweat equity is obsolete with ITQs. This is very disturbing to most people in the fishing community; they see their children's, and often their own future under ITQs, as the employees of a bank or some other well-endowed rights' owner, rather than as independent fishermen (Wilson 1996, 37)."
This explains why the Maine Lobster Zone Management Law was accepted by lobstermen all over the state. Since these zones are managed by councils of lobstermen, who then submit proposals to the Maine Department of Marine Resources (MDMR) and the other legislative bodies in Maine. This allows them to make sure that the lobstermen will be taken care of in their zone. These councils can make sure that lobstering practices are not only conservative in their nature, but that individual lobstermen are allowed the freedom that so many of them relish. The problem with all ITQs is that there is some tradeoff between freedom and effective use of the program. This becomes the problem with implementing the system, though the management councils have the ability to look into this.

Be Sure to Continue to Page 4 of "How Economic Incentives Can Help the Maine Lobster Industry".

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