Protecting Tomorrow's Harvest: Developing a National System of Individual Transferable Quotas to Conserve Ocean Resources
By Carrie A. Tipton
INTRODUCTION
Until very recently, access to the majority of the fishery resources in the United States has been available to anyone with a rod and a hook. While the general public has become more aware of the plight of “photogenic” species such as dolphins and porpoises, the real catastrophe of the seas is the lack of conservation techniques for renewable fish resources, which continue to decline every year despite limitations on the total allowable catch. The difficulties behind the conservation and management of common and migratory resources are exacerbated by their very nature and have led to untold managerial headaches and environmentalist heartaches -- those who sacrifice to conserve do not reap the benefits of such conservation. Instead, each market participant has an incentive to collect as much of the fishery resource as possible, because the escapable nature of the resource combined with the lack of tangible, divisible property rights for fishery participants ensure that any fish not collected by one fisherman will be collected by another. The resulting “race to the resource” plaguing many national coastal fisheries is in essence a race to the bottom -- overcapitalization and overutilization of a given fishery lead to a decline of the resources harvested, with the worst case scenario being commercial extinction of valuable fish species.
The United States' system of management, a confusing blend of federal and state regulations and entry and effort limitations, is termed an Olympic system. The guidelines in an Olympic system are innocuous enough -- regional management bodies establish yearly catch quotas to regulate the harvesting of major fisheries stocks, and then determine certain times of the year when these quotas may be harvested by industry participants. However, the effects of the current system on the viability of the stocks and the safety of fishing vessel crew members has led to criticism that characterizes the Olympic system as “a parody of how you would rationally design a system to get [fish] out of the ocean and into the market.”
Under the Olympic system of national fisheries management, a fisherman's property rights in a fish do not vest until the fish is lying on the deck of his boat. Thus, the incentive is to capture as many fish as quickly as possible before other fishermen overexploit the fishery, leaving stock population levels too low to continue profitable operation. The focus of participants in the industry moves from taking the total available quota limits to removing fish more quickly than anyone else, and fishermen invest in ever-increasing technological means to capture more fish in a stock of ever-declining proportions. In a situation where plentiful resource stocks ensure economic security for every participant, the need to race for fish is absent. However, the combination of overfished and exploited conditions currently found in many of the world's fisheries, inefficient and unprotective management practices by global economic leaders (including the United States), and non-cooperation of the international and domestic fishing industries when faced with conservation demands, has created a global marine environment depleted in natural resources. Although global waters once supported an abundant and diverse marine life, many viable populations of fish species have recently decreased in size to a point of commercial or actual extinction. Currently, fourteen of the most economically valuable species, including swordfish and Atlantic bluefin tuna, are threatened with commercial extinction.
Despite the economic value of a healthy marine environment, policy makers remain reluctant to make protection a priority. Viable alternatives to the general U.S. system are available, and are being implemented with success in a few small American fisheries. Given the increasingly political nature of federal natural resources management, however, national adoption of a sensible and efficient means of harvest, one promoting a conservationist model while supporting a profitable, albeit smaller, fishing industry, has been stalled. At a time when many U.S. fisheries are facing a crisis of declining stocks, it is important to implement a national management program based on empirical data detailing the specific requirements for maintenance of sustainable fish stocks rather than political and commercial interest group preferences. Any new program should allow for both a reasonable profit for those individuals allowed to participate in the fishery and for the reasonable conservation of oceanic species. Conservation of a species not only preserves the economic benefit to the industry, but also ensures that future generations of human consumers will benefit from a healthy and profitable sea. A national market-based system of individual transferable quotas (ITQs) would help to solve many of the foreseeable problems in domestic marine species management, as demonstrated by the successes in model foreign systems such as New Zealand, and the smaller-scale successes of current American fisheries' experimentation with the program.
This Note analyzes the United States' current use of an Olympic fishing model, as compared to the benefits of a working system of individual transferable quotas, and proposes national implementation of a framework of interworking ITQs. By looking to the successes of the ITQ system in the Mid-Atlantic Surf Clam and Ocean Quahog Fishery, even in its small scale, certain general principles can be extrapolated to a broader analysis of this management technique and its workings in the American system. Starting with the background behind the Magnuson Fishery Conservation and Management Act and its provisions, in Part II the Note discusses the implementation of current regulatory measures under the Act. Part III details the safety concerns and losses in human lives and fish resources, and Part IV presents an overview of the ITQ plan, an alternative to the American system of management. The Note looks in particular at the ITQ program in New Zealand and models in Australia and the United Kingdom, as well as the existing small fishery successes in the Mid-Atlantic Surf Clam and Quahog fishery in the United States, to rebut criticisms surrounding broader domestic implementation of a national ITQ program. Finally, Part V of the Note suggests several adjustments and amendments to existing operational ITQ models, in order to create stronger enforcement mechanisms and to answer lingering concerns from different user groups.
Until very recently, access to the majority of the fishery resources in the United States has been available to anyone with a rod and a hook. While the general public has become more aware of the plight of “photogenic” species such as dolphins and porpoises, the real catastrophe of the seas is the lack of conservation techniques for renewable fish resources, which continue to decline every year despite limitations on the total allowable catch. The difficulties behind the conservation and management of common and migratory resources are exacerbated by their very nature and have led to untold managerial headaches and environmentalist heartaches -- those who sacrifice to conserve do not reap the benefits of such conservation. Instead, each market participant has an incentive to collect as much of the fishery resource as possible, because the escapable nature of the resource combined with the lack of tangible, divisible property rights for fishery participants ensure that any fish not collected by one fisherman will be collected by another. The resulting “race to the resource” plaguing many national coastal fisheries is in essence a race to the bottom -- overcapitalization and overutilization of a given fishery lead to a decline of the resources harvested, with the worst case scenario being commercial extinction of valuable fish species.
The United States' system of management, a confusing blend of federal and state regulations and entry and effort limitations, is termed an Olympic system. The guidelines in an Olympic system are innocuous enough -- regional management bodies establish yearly catch quotas to regulate the harvesting of major fisheries stocks, and then determine certain times of the year when these quotas may be harvested by industry participants. However, the effects of the current system on the viability of the stocks and the safety of fishing vessel crew members has led to criticism that characterizes the Olympic system as “a parody of how you would rationally design a system to get [fish] out of the ocean and into the market.”
Under the Olympic system of national fisheries management, a fisherman's property rights in a fish do not vest until the fish is lying on the deck of his boat. Thus, the incentive is to capture as many fish as quickly as possible before other fishermen overexploit the fishery, leaving stock population levels too low to continue profitable operation. The focus of participants in the industry moves from taking the total available quota limits to removing fish more quickly than anyone else, and fishermen invest in ever-increasing technological means to capture more fish in a stock of ever-declining proportions. In a situation where plentiful resource stocks ensure economic security for every participant, the need to race for fish is absent. However, the combination of overfished and exploited conditions currently found in many of the world's fisheries, inefficient and unprotective management practices by global economic leaders (including the United States), and non-cooperation of the international and domestic fishing industries when faced with conservation demands, has created a global marine environment depleted in natural resources. Although global waters once supported an abundant and diverse marine life, many viable populations of fish species have recently decreased in size to a point of commercial or actual extinction. Currently, fourteen of the most economically valuable species, including swordfish and Atlantic bluefin tuna, are threatened with commercial extinction.
Despite the economic value of a healthy marine environment, policy makers remain reluctant to make protection a priority. Viable alternatives to the general U.S. system are available, and are being implemented with success in a few small American fisheries. Given the increasingly political nature of federal natural resources management, however, national adoption of a sensible and efficient means of harvest, one promoting a conservationist model while supporting a profitable, albeit smaller, fishing industry, has been stalled. At a time when many U.S. fisheries are facing a crisis of declining stocks, it is important to implement a national management program based on empirical data detailing the specific requirements for maintenance of sustainable fish stocks rather than political and commercial interest group preferences. Any new program should allow for both a reasonable profit for those individuals allowed to participate in the fishery and for the reasonable conservation of oceanic species. Conservation of a species not only preserves the economic benefit to the industry, but also ensures that future generations of human consumers will benefit from a healthy and profitable sea. A national market-based system of individual transferable quotas (ITQs) would help to solve many of the foreseeable problems in domestic marine species management, as demonstrated by the successes in model foreign systems such as New Zealand, and the smaller-scale successes of current American fisheries' experimentation with the program.
This Note analyzes the United States' current use of an Olympic fishing model, as compared to the benefits of a working system of individual transferable quotas, and proposes national implementation of a framework of interworking ITQs. By looking to the successes of the ITQ system in the Mid-Atlantic Surf Clam and Ocean Quahog Fishery, even in its small scale, certain general principles can be extrapolated to a broader analysis of this management technique and its workings in the American system. Starting with the background behind the Magnuson Fishery Conservation and Management Act and its provisions, in Part II the Note discusses the implementation of current regulatory measures under the Act. Part III details the safety concerns and losses in human lives and fish resources, and Part IV presents an overview of the ITQ plan, an alternative to the American system of management. The Note looks in particular at the ITQ program in New Zealand and models in Australia and the United Kingdom, as well as the existing small fishery successes in the Mid-Atlantic Surf Clam and Quahog fishery in the United States, to rebut criticisms surrounding broader domestic implementation of a national ITQ program. Finally, Part V of the Note suggests several adjustments and amendments to existing operational ITQ models, in order to create stronger enforcement mechanisms and to answer lingering concerns from different user groups.
