JAMES N. SANCHIRICO
SUSAN S. HANNA
Sink or Swim Time for
U.S. Fishery Policy
Immediate action is
needed to turn the
tide in favor of
sustainability, but
more fundamental
changes are
essential as well.
Marine species residing in U.S.
territorial waters and the men and
women who make their livelihood
from them are at a critical juncture. Many species are overexploited and face additional threats
from land-based pollution, habitat damage, and climate change.
The U.S. government agency in
charge of fishery management, the
National Marine Fisheries Service (NMFS), reports
that of the 259 major fish species, 43 have population levels below their biological targets and another 41 are being fished too hard. Still unknown
is the extent to which our actions affect the nature of
food webs and ecosystems, with consequences yet to
be determined.
The vessels and fishing power of many U.S. fisheries exceed levels that would maximize economic
returns to society. Competition for fish leads to low
wages, dangerous working conditions, and shorter
and shorter fishing seasons. Short seasons with large
James N. Sanchirico (sanchiri@rff.org) is a fellow at Resources
for the Future in Washington, D.C. Susan S. Hanna (susan.
hanna@oregonstate.edu) is professor of marine economics and
a member of the Sea Grant Extension Program at Oregon State
University and a member of the Science Advisory Panel of the
U.S. Commission on Ocean Policy.
FALL 2004
catches, in turn, force fish processors to invest in facilities that can
handle large quantities but run at
partial capacity for most of the
year, creating boom-and-bust cycles in local employment. With
supply gluts, most fish are processed and frozen, even though
consumers might prefer fresh fish
throughout the year.
Two recent commissions were set up to study U.S.
fishery management and, more generally, ocean stewardship. In 2003, the Pew Oceans Commission released its review of the status of living marine resources, and in 2004 the U.S. Commission on Ocean
Policy released its preliminary report assessing both
living and nonliving marine resources and a full array
of ocean and coastal uses. Not since 1969, when the
Stratton Commission produced a report that recommended creation of the National Oceanic and Atmospheric Administration (NOAA) and laid the groundwork for the 1976 Fishery Conservation and
Management Act (FCMA), has U.S. ocean policy been
subjected to a systematic and broad-scale assessment.
The next year or so will be a defining time for
U.S. fishery policy. As of August 2004, about 40 bills
with one or more recommendations from the commissions had been introduced in Congress. Four bills
are major pieces of legislation that would reorganize
45
the way U.S. fishery management is practiced. The
president is also required by law to respond within
90 days after receiving the U.S. Commission’s final
report, which was due in September 2004.
We believe that when considering the recommendations of these reports, the question for policymakers is not only the direction of change for fishery
management but also its sequence. Which changes
will serve as building blocks for longer-term change?
Getting the answer wrong could impede improvements in marine ecosystem health and the livelihoods
of those directly dependent on them, especially if efforts directed at long-term institutional changes, such
as a new Department of Oceans, distract attention
from more immediate issues. Uncertainty about the
nature of the changes and the responsibilities of various agencies and regulators could remove incentives
for taking action now to improve the situation.
Basic first aid teaches one to stop the bleeding
first. Indeed, we need to address the immediate problems of U.S. fisheries by setting hard limits on
catches, allocating the catch to individuals, separating
the decisions regarding catch limits and allocation,
and allocating shares of the resource to the public at
large. The two commissions also recommended these
changes. None of our solutions, however, require
major legislation or institutional reorganization, but
rather could and should be done with a presidential
executive order.
Once those acute issues have been addressed, efforts to make longer-term, fundamental changes are
more likely to succeed. Two of the more important
proposed changes are reorienting fishery policy toward ecosystems and reorganizing the institutional
structure of ocean policy. Discussion about these necessary reforms should begin now, but implementation should proceed slowly.
Addressing immediate problems
U.S. fishery management is conducted at a regional
level by eight regional fishery management councils
with oversight by NMFS and the secretary of Commerce. Council voting membership comprises state
fishery managers, a regional representative of NMFS,
tribal representation (only for the Pacific region), and
individuals (mostly representatives of different sectors of the commercial fishing industry and sportfishing groups, including charter and recreational inter46
ests) nominated by the governors and selected by the
secretary of commerce.
The councils develop fishery management plans
pursuant to national guidelines in the FCMA (now
called the Magnuson-Stevens FCMA) and other laws.
These plans include decisions on total allowable catch,
allocation of the catch among different types of fishers,
and controls on fishing effort, such as gear restrictions
and area and season closures. The decisions regarding allowable catch of a particular species are based on
recommendations from scientific advisory panels, factoring in socioeconomic and ecosystem effects.
Our immediate concerns center on incentives,
the determination of allowable catch, and the allocation of this catch among the various stakeholders, including the commercial fishing industry, recreational
fishers, and the public.
Ending the race for fish and aligning incentives. In the years since FCMA took effect, most U.S.
fisheries have been managed under command-andcontrol regulations that govern the total size of the
catch, minimum fish size, type of gear, season length,
and areas open to fishing. When the allowable catch
is subject to competition, fishers have no ownership
over the fish until they are caught. This creates a race
for fish.
The historical record shows that without effective
controls, the race will continue until fish stocks are depleted and fishing and processing capacity are in excess of profitable or sustainable levels. Declining assurances about the future create incentives to catch as
much as one can now. Conflicts among competing
interests for limited resources also increase. Both factors lead to greater sociopolitical pressures to increase
allowable catches in the short run. More now and
more for everyone is an easy solution. In other words,
we are currently managing our fisheries such that the
incentives for fishers (and sometimes for regulators)
are at odds with long-term sustainability.
What can policymakers do to end the race for
fish and better align the incentives of those utilizing
the resource with sustainability? As a first step, we
recommend that fishery management plans explicitly address incentives, especially fisheries with too
many boats and fishing power. Plans should consider
approaches that pair responsibilities with rights
through contracting and develop mechanisms to
strengthen accountability among fishery participants.
ISSUES IN SCIENCE AND TECHNOLOGY
FISHERY MANAGEMENT
Plans also need to consider the application of incentive-based tools,
to create the expectation that such
a policy would be in place by a
specified date. A presidential executive order could make incentive-based tools the default approach, so that a council would
have to justify why a plan did not
include such tools.
One promising approach to
ending the race for fish and aligning incentives with long-term stability is the allocation of harvest
rights, as in an individual fishing
quota (IFQ) system. IFQs limit
fishing operations by allocating the
total allowable catch to participants
based on historical catch and fishing effort. By guaranteeing fishers a share of the
catch, this approach significantly reduces incentives
to engage in a race for fish. Both the Pew and the
U.S. Commission reports recommend such programs
but would change the word from fishing or harvest
“rights” to terms conveying the idea that fishing is a
privilege of access granted by the government.
Currently, there are approximately 75 IFQ programs in the world, including four in the United
States. Almost all have allocated quota in perpetuity
and gratis, based mainly on past catch history. The
Pew Commission proposes that quotas be periodically reallocated using a combination of catch history, bids in the form of offered royalty payments on
catch, and conservation commitments by the bidder.
Periodic allocations can work if the period is long
enough to provide security and stability to the fishing
operation. Requiring individuals to pay for the privilege rather than getting their shares for free should
also be considered. Some programs assess fees and
use the funds to cover the costs of management, such
as data collection, scientific research, and onboard
observer and other enforcement programs.
One major benefit of IFQ programs is the relaxing of controls on season length, which give fishers
the ability to shift from maximizing quantity to maximizing the return on their allocations. For example,
since the introduction in 1994 of an IFQ system in
the Alaska halibut fishery, the season length has
grown from two 24-hour openings
to more than 200 days. One study
found that the ability to time fishing trips when port prices for halibut were higher, combined with
the elimination of gluts of fresh
product, increased the price per
pound by more than 40 percent.
Other benefits are potential reductions in capacity and costs. For
example, when transferability of
the shares is permitted in an IFQ
system, the least efficient vessels
find it more profitable to sell their
quota rather than fish. Over time,
this should reduce excess capacity
and increase the efficiency of vessels operating in the fishery. Because of these gains, we believe
that the potential for trading harvest rights needs to be
considered for each fishery.
Many have argued that transferability increases
consolidation in the industry. This has happened in
practice, but consolidation is desirable, because overcapacity is a legacy of the race for fish. A smaller,
more profitable industry seems like a better solution
than severe restrictions on fishing, such as those in the
New England groundfish and west coast rockfish
fisheries. Regardless, economic transitional effects
of market-based approaches to reducing capacity can
be lessened with complementary tools, such as vesselbuyback programs in which government pays the
fisher to retire their boat.
Concerns about the distributional composition of
the industry, such as loss of family-owned operations,
could be addressed in the design of the programs. The
Pew Commission, for example, argues that quotas
should be allocated across different groups (new entrants, and small, medium, and large vessels) and that
trades across groups should not be allowed. Restrictions on trading, however, reduce the potential for efficiency gains. Besides, it is not clear that the public
supports the goal of preserving family-owned fishing
operations or that such a social engineering policy is
best implemented through restrictions on trading.
Past experience with IFQs offers lessons for designing new programs. First, flexibility mechanisms,
such as the ability to lease one’s quota and divide it
One promising
approach to ending
the race for fish and
aligning incentives
toward long-term
stability is the
allocation of
harvest rights, as in
a quota system.
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47
into any amount, must be built into the system so
that fishers can match catches with holdings. Second, allocating rights to catches that are measured at
the time of landing requires strong monitoring and
enforcement to deter fishers from discarding fish at
sea. And finally, the quota allocation process is difficult and costly but can be successful if it is transparent and includes means for resolving conflicts.
Another rights-based approach that can end the
race for fish and correct incentives is a fishing cooperative, in which fishers are granted legal authority to
collude to determine the allocation among them. Sen.
Ted Stevens (R-AK) helped institute such a system
for the Alaska pollock fishery, one of the largest fisheries by volume in the world. Implemented in 1998, the
pollock cooperative is generally viewed as a success.
Finally, an executive order should provide funds
to investigate methods of allocating rights to recreational fishing interests. Although each recreational
fisher has a small impact on a fishery, aggregate catch
totals can be significant. According to NMFS, nearly
17 million recreational marine anglers make about
60 million fishing trips to the Atlantic, Gulf, and Pacific coasts per year. The best means of allocation to
ensure that recreational catches remain within limits
will most likely vary with each fishery.
Setting catch limits. Management decisions regarding the appropriate annual catch level are fraught
with uncertainties regarding the level of fish populations, species’ growth processes, and the effects of
environmental factors, such as climate variability and
ocean conditions. Stock assessment reports incorporate
these factors along with data from fishery catches and
research expeditions. In many of the smaller, lessvaluable fisheries, however, very little information
exists other than catch totals. Based on single-species
stock assessments and socioeconomic considerations,
councils set annual allowable catches with the goal
of meeting a target fish population level. Councils are
required to manage for a level of fish stock biomass
that can produce the maximum yield over time.
Some of the councils decide not to implement
an explicit cap on catches for a particular fishery, but
rather attempt to use controls on fishing effort as an
indirect means of controlling the annual take. The
New England council, for example, prefers to limit a
vessel’s days at sea to achieve a target biological
catch for groundfish. New England fishers prefer this
48
approach because they are free to catch as much as
they can within their time limits. As one fisherman
stated, “No one tells a farmer how much crop he can
grow.” These indirect approaches are very inefficient
means of achieving target population levels.
What can policymakers do to strengthen harvest
controls? We recommend that hard caps or total allowable catches be set for all harvested stocks for
which biomass size can be estimated and that these
caps factor in incidental catches of marine mammals
and ecosystem effects. Once the total catches are set
to address ecosystem effects, which themselves are
often uncertain, explicit precautionary buffers for single species might still be needed.
Rather than capping all stocks, the Pew Commission recommends that fisheries with indirect
means to control harvest should be evaluated every
three years to ensure that they are meeting the conservation goals of the regional plans. Both commissions suggest that precautionary buffers to address
the uncertainties be built into the process. The effectiveness of aggregate catch limits in maintaining the
conservation objectives of a fishery management plan
is tied, however, to the degree to which incentives
are addressed. That is, a cap with no individual allocation will just result in a race for fish.
Separating allocation and conservation decisions. Many scientists argue that precautionary measures proposed to accommodate uncertainty in setting aggregate catches often succumb to short-run
economic considerations in council decisions. Because the councils include representatives of industry
and state agencies whose constituents have a financial
stake in the outcome, many have raised concerns that
the council process is akin to the fox guarding the
hen house. The U.S. Commission, for example, concludes that council membership is often unbalanced
among interests and that the long-term interests of
the public are not best served. Of course, it is difficult
to quantify the results, but even removing the perception of a conflict of interest seems worthwhile.
To that end, both commissions recommend taking
actions to insulate harvest decisions (how many fish
can be taken) from allocation decisions (who harvests
what, when, and where). The goal is to prevent shortterm economic, social, or political considerations from
overwhelming scientific considerations regarding recovery and sustainability of stocks. A bill to reform the
ISSUES IN SCIENCE AND TECHNOLOGY
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councils, recently introduced in the
House by Rep. Nick Rahall (DW.Va.), contains provisions addressing conflicts of interest and
broadening membership to include
nonfishing interests.
The U.S. Commission believes
that reform can be accomplished
within the current institutional
structure by introducing a much
stronger role for independent scientific advisers in setting allowable
harvest levels. The Pew Commission, on the other hand, proposes
a set of regional ecosystem councils that would oversee NMFS conservation decisions, which would then be required to
undergo scientific peer review.
In the Pew model, the role of the regional fishery
management councils would be limited to allocation,
with fishing industry participants charged with developing allocation plans for fisheries under strict
operational guidelines and oversight. The call for
oversight recognizes that just separating these decisions is not enough. The biological health of the system depends not just on the total catch but also on
the type of gear and where it is used. The Pew report, for example, recommends limiting bottom trawling, which it likens to clearcutting forests because of
its effects on the sea floor, to regions currently trawled
and eventually instituting a total ban on the practice.
We, too, recommend that conservation and allocation decisions be separated. Like the U.S. Commission, we believe that actions should be taken to
distance these two decisions within existing regulatory
requirements. We also agree on the need to strengthen
the oversight of the council appointment process and
the training of new council members. These steps
should be done in anticipation of new statutory requirements that will be developed at a later date.
We also recommend that monitoring and evaluation
of fisheries management be significantly strengthened
and include regular assessments of biological, economic, and social performance. Current approaches are
limited and do not necessarily review progress toward
meeting integrated fishery management objectives.
Allocating resources to the public. Federal and
state laws regulating the use of marine resources are
implemented by government agencies subject to the public trust doctrine: Managers are the exclusive
public trustees and stewards of marine resources, which belong to
every citizen. The objective of
fishery management has for the
most part focused on maximizing
the returns from catching fish.
Nonconsumptive use values, such
as marine biodiversity, that the
public might consider important
have not been factored in. One
way to incorporate marine biodiversity value into fishery management would be to allocate some of
the resource to the public at large, either by setting
aside areas or portions of the catch each year. Given
that the resources belong to every citizen, allocation
is used here in a symbolic rather than literal sense.
Compared with land, few of our waters are protected from exploitation. There is now a movement to
change that and create marine reserves, areas closed
to all extractive uses. A highly visible part of the Pew
Commission report recommends legislation that
would mandate the creation of a network of marine reserves throughout the seascape. The U.S. Commission
sees marine protected areas as most effective when
they are designed in the broader context of regional
ecosystem planning and used in conjunction with
other management tools.
We recommend developing methods for incorporating broader values, such as marine biodiversity
conservation, into fishery management. This would
include allocating areas of the ocean for marine biodiversity conservation that are limited in their uses.
One such method is to establish a robust stakeholder
process in which fishery managers engage fishers,
environmentalists, and other concerned citizens in
decisions about where to site marine reserves that
will have the greatest benefit at the lowest cost to
fishers. But for fishers and others to participate effectively, the decisionmaking process needs to be decentralized and information exchanged at the regional
or local level. It may also strengthen accountability for
implementation and increase the likelihood that
everyone will benefit.
Allocations to the public should be made simul-
Over the long term,
the ability to sustain
marine fisheries
will require a more
systematic adoption
of ecosystem
approaches.
FALL 2004
49
taneously with the allocation of the catch to the individual fishers. Combining the two processes would
lessen any economic transition effects due to closing areas to fishing and might increase the probability of buy-in from the fishing industry.
Addressing longer-term problems
Many marine scientists place the blame for current
problems on the single-species approach to fishery
management and the tendency to favor higher catch
totals for sociopolitical purposes. Over the long term,
the ability to sustain marine fisheries will require a
more systematic adoption of ecosystem approaches.
Before this can occur, however, a flexible and adaptive management system needs to be in place, which
in turn requires greater integration of management
through structural reforms.
Adopting ecosystem approaches. Like the two
commission reports, legislation proposed in the 107th
and 108th Congress has emphasized the need to design ecosystem-based management plans. Although
many definitions exist of what constitutes ecosystem
management, the concept is that fishery management
decisions should not adversely affect ecosystem function and productivity.
From an operational standpoint, however, many
hard questions remain, such as what an actual ecosystem management plan entails. In addition, ecosystem-based management involves difficult trade-offs,
and there is not likely to be one “right” plan. For example, California sea otters have an appetite for
abalone, whose low population levels have led to restrictions on commercial fishing. One way to increase
abalone stocks would be to cull sea otters, whose
populations are rebounding after the otters were listed
in 1977 as threatened under the Endangered Species
Act. But a save-the-sea-otter group might weigh
things differently and come up with another plan.
Which plan should managers follow? Which objectives take priority?
Much work needs to be done to develop practical
guidelines for implementing ecosystem-based management. These include measuring to the extent possible ecosystem processes and functions, implementing precautionary buffers, assessing trade-offs, and
incorporating economic values. In addition, methods
should be developed to allow trade-offs and different
interpretations to be resolved in an open and fair demo50
cratic process rather than mandating and constraining the political process or leaving the courts to decide.
Accordingly, we recommend that NOAA, in consultation with other agencies, the councils, and a scientific advisory committee, develop operational guidelines for implementing ecosystem-based management.
The U.S. Commission suggests incorporating ecosystem approaches within essential fish habitat designations and bycatch management. (Bycatch is the incidental taking of nontarget fish, marine birds, or marine
mammals.) It recommends, for example, that essential fish habitat designations be changed from single
species to multispecies and eventually to an ecosystembased approach. It also suggests that plans address the
broad ecosystem effects of bycatch, not only of commercially important species but also of all species.
We agree that an effective ocean policy must be
grounded in an understanding of ecosystems. Ocean
and coastal resources should be managed to reflect
the relationship among all ecosystem components and
the environments in which marine species live. Although many questions remain, it is clear that ecosystem management needs to cross existing jurisdictional
boundaries and, ideally, promote learning, adaptation,
and innovation. We should also encourage stronger
user-group participation in cooperative management
and experimental approaches to management.
Both commissions take an ecocentric view, and
we agree that this broader view is necessary to improve both the ecological and the economic health
of our fisheries. However, we would not stop there.
Because just as there are benefits from taking an
ecosystem approach, there are potential economies
of scope in incorporating seafood markets, fishing
community economies, aquaculture, and other marine sectors in fishery management plans.
Reorganizing institutions. Fishery exploitation,
degraded habitats, ecosystem damage, and losses to
fishing communities are the visible symptoms of the
problems of fishery management performance. Many
have argued that over the long term, the resolutions of
these problems and the change to ecosystem approaches are possible only through fundamental structural reform in laws and organizations. We agree that
there is a need for streamlining the process, consolidating marine governance under one roof, and clarifying the goals of fishery management. A coherent
ocean policy will remain elusive as long as approxiISSUES IN SCIENCE AND TECHNOLOGY
FISHERY MANAGEMENT
mately 140 laws and a dozen agencies and departments have jurisdiction over various aspects of marine ecosystems.
How should policymakers undertake such reform? The Pew
Commission finds the system itself
fundamentally broken; the U.S.
Commission concludes that with
better coordination and reorganization, the problems can be addressed.
Of course, there is no guarantee that
either approach will succeed.
To implement an ecosystem
approach, the U.S. Commission
recommends the establishment of a
national ocean policy framework
that includes national coordination
and leadership, a regional approach, coordinated offshore management, and a strengthened and streamlined federal
agency structure. This framework would establish
within the Executive Office of the President a National Ocean Council and a Presidential Council of
Advisers on Ocean Policy to coordinate and harmonize ocean policy at the highest levels of government.
These efforts could focus high-level attention on
ocean and coastal issues and provide leadership in
developing ocean policy, coordinating ocean and
coastal programs, and helping federal agencies move
toward ecosystem management. The U.S. Commission also recommends the formation of additional
committees and offices, plus processes to improve
intersectoral and interregional coordination.
To improve coordination across jurisdictional
boundaries, the U.S. Commission recommends the
voluntary formation of regional ocean councils through
processes developed by the National Ocean Council.
The purpose of the new regional ocean councils would
be to coordinate state, territorial, tribal, and local governments in developing regional responses to issues.
To support these councils, coordinated regional ocean
information programs and regional ecosystem assessments would need to be undertaken.
The Pew Commission argues for a National
Oceans Policy Act. This legislation would create an
Oceans Agency that would subsume NOAA and all of
its subcomponents, the marine mammal programs of
the U.S. Fish and Wildlife Service,
the ocean minerals program of the
Department of Interior, the coastal
and marine programs of the Environmental Protection Agency, the
aquaculture programs of the U.S.
Department of Agriculture, and the
coastal protection programs of the
U.S. Army Corps of Engineers.
Along with the new Oceans
Agency, this act would establish a
permanent national oceans council within the Executive Office of
the President.
Such a National Oceans Policy Act would also create regional
ecosystem councils, charged with
developing and implementing
ecosystem and zonal plans that encompass all the potential uses of
the marine environment: oil and gas exploration, offshore wind farms, aquaculture, and commercial and
recreational fishing. The plans would be approved by
the Oceans Agency. To prevent overrepresentation of
industry and recreational fishing interests in fishery
management, the Pew Commission recommends that
the ecosystem councils be democratic and representative of the “broadest possible range of stakeholders.” The act would also change the traditional focus of
management plans from harvested species to ecosystem function and productivity.
To both commission reports, we would add that
more attention should be paid to the long-term need to
develop the human capital of fisheries management.
We need to prepare for the future of fishery management by developing programs that train tomorrow’s
decisionmakers and educate future fishery scientists.
The existence of the two commissions is a signal
that the United States is on the cusp of significant
change in managing marine resources. The fundamental agreement between the two commissions is
that we can do better in our management of the
oceans. Marine resources do not need to be threatened, and fishing businesses and the communities
they support do not need to go the way of old-growth
logging towns. Future generations can enjoy the
bounty of the oceans much as we do today. Reversing
the current trends, however, will not be easy. There
Begin with actions
that can be
accomplished
quickly through a
presidential order
and that do not
require major
legislation or
institutional
reorganization.
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51
will be many conflicts along the way.
Recommended reading
S. Hanna, “Strengthening Governance of Ocean Fishery Resources,” Ecological Economics 31 (1999):
275-286.
S. Hanna, H. Blough, R. Allen, S. Iudicello, G. Matlock and B. McCay, Fishing Grounds: Defining
a New Era for American Fishery Management.
Washington, D.C.: Island Press, 2000.
S. Iudicello, M. Weber, and R. Wieland, Fish, Markets
and Fishermen: The Economics of Overfishing.
Washington, D.C.: Island Press, 1999.
J. N. Sanchirico and R. Newell, “Catching Market
Efficiencies: Quota-based Fishery Management,”
Resources, No. 150, Spring 2003 (available at
http://www.rff.org/rff/Publications/Resource_
Articles.cfm).
J. N. Sanchirico, “Marine Protected Areas: Can They
Revitalize Our Nation’s Fisheries?,” Resources,
No. 140, Summer 2000 (available at http://www.
rff.org/rff/Publications/Resource_Articles.cfm).
“It’s a marine sanctuary, not a gated community. And I’m moving into it.”
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