Fish & Wildlife | Ecotrope

Catch shares: How to split a $40 million slurpee

Ecotrope | Nov. 15, 2011 noon | Updated: Feb. 19, 2013 1:34 p.m.

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OPB’s Vince Patton explains the biggest change to groundfish regulations on the West Coast in 50 years on this episode of Oregon Field Guide.

If you’ve been following my reporting on catch shares, you already know that this is a new system that gives fishermen a percentage of the total catch to fish, or trade or sell.

You know it’s like a cap and trade system for fisheries, and that the Obama administration has recommended it as the best way to avoid overfishing and the dangerous race for fish across the country.

But you might not have heard how it’s like splitting a slurpee. Or how it likens fish to pork bellies and sub-prime mortgages.

NOAA administrator Jane Lubchenco defends the Obama administration's policy advocating catch shares for all fisheries ... with a slurpee analogy.

NOAA administrator Jane Lubchenco defends the Obama administration’s policy advocating catch shares for all fisheries … with a slurpee analogy.

The takeaway? Catch shares can create a stock market for fish. They can allow bigger boats to buy out the smaller ones. They can allow big banks to buy the rights to fish and speculate on their value. They can turn fishermen into sharecroppers for whomever owns the shares of fish.

But they don’t have to.

They can also give individual fishermen more control of their catch as well as the incentive to fish efficiently with less bycatch thrown overboard and fewer impacts on protected species. They can boost the price of fish, help rebuild fish stocks, and make fishing safer.

It all depends on how you design the program. And that – in the U.S. at least – depends on which political appointees are sitting on the regional fishery management council. Let’s break these points down:

How is a catch share like splitting a slurpee?

Lubchenco herself relayed the slurpee analogy to justify the administration’s policy of recommending catch shares for all U.S. fisheries.

“Let’s say you have two kids, and both of them want a slurpee. You can give them each their own slurpee or have them share one big one. If you have them share one big one, they’re both going to drink as fast as they can beat out the other guy get more and probably get brain freeze. Bad consequences happen.”

Instead of letting the “kids” share one slurpee, she explained, you can divide the slurpee into two cups. Each of the two kids gets half the surpee to drink at their own pace.

“Traditional fisheries are often called a race for fish,” she said. “The gun goes off at beginning of the season, and everybody goes out as fast as they can. You get bigger and bigger boats so you can beat everybody else who’s competing for that resource. And the result is an intense race for fish. Catch shares is a different management tool in which, based on past fishing history commercial fishermen are allocated a certain fraction of the catch.”

How are catch shares like pork bellies and sub-prime mortgages?

But “sharing is not what catch shares are about,” said Daniel Pauly, a professor for the Fisheries Centre & Zoology Department at the University of British Columbia. B.C. had a groundfish catch share program years before the U.S. did.

The key elements that make catch shares work are putting a cap on the total harvest for the fishery and dividing that total into fractions for individual fishing boats to catch. Letting everyone dive into the fishery without those allocations leads to a glut of fish on the market, lower prices, too many boats and accidents at sea, he said.

Pauly said the problem comes when you give those shares of fish away in perpetuity and, “the more deadly thing,” when you make them transferable.

“The transferability of annual quota would make them like a commodity like anything else – like pork bellies,” he said. “The experience of transferability has been very negative because the shares can’t be kept in the hands of the fishermen. They move to the capital. They move to the banks and are speculated on just as people have speculated with sub-primes.”

Iceland’s catch shares were bought by a bank that went under in 2008, said Pauly.

“Iceland didn’t know anymore: Where are our catch shares? Who has the right to catch our fish?” he said. “In B.C. where I live, 80 percent of the fishermen are employees of firms that own shares. They have been totally taken out of the fishing sector and are now in the hands of the banking sector.”

Not as simple as a slurpee cup?

Lubchenco said each catch share program can be designed to prevent consolidation. All you have to do is put a cap on ownership.

“Not all catch shares are the same,” she said. “The design is important. As we have more catch share systems coming on line, we are finding that each one is so complicated oftentimes you don’t get it right from the get-go. This potential for consolidation was not included in the original design.”

Moreover, she noted, the catch share programs are not mandatory. Each fishery management council chooses whether or not to go down that road.

But Jim Donofrio, executive director of the Recreational Fishing Alliance, said the devil is in the details of who gets appointed to the management councils. And, he said, the administration didn’t listen to state governors or Congress when it came to pushing its catch shares agenda.

“Since the Obama administration, what’s happened is we’ve lost incumbents,” he said. “The administration said … We’re going to put people on this council until we can get the agenda through – get catch shares through. It’s a huge political issue. It’s not as simple as drinking out of one slurpee cup.”

The $40 million slurpee

There were actually several other interesting conversation topics within this discussion that I’ll touch on later. But this debate over how catch share programs are structured, who sets the agenda and who benefits in the end was quite on point with the debates I’ve heard among fishermen and managers on the West Coast.

I hadn’t heard the slurpee analogy, but if you apply it here, the groundfish fishery is like a $40 million slurpee.

Out here some of the widespread concerns with regard to the new catch share program groundfish is how many shares – or cups? – will be consolidated among West Coast ports, how much of them will be controlled by seafood processors and The Nature Conservancy, and whether fishing communities should get their own to keep the local fishing industry intact.

Anyone else craving 7 Eleven?

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