GloucesterTimes.com, Gloucester, MA

October 7, 2011

One fisherman's plight — and catch shares' toll

By Richard Gaines
Staff Writer

Around the inside shore of Massachusetts Bay, vestiges of America's earliest industry, small fishing boat businesses, are disappearing from scenic harbors, Hull to Scituate, Plymouth to Cape Cod, before our eyes.

In the last year, about one third of the 32 boats in Sector 10 — one of the business cooperatives organized in Gloucester by the Northeast Seafood Coalition — have ceased fishing.

A year hence, that number will be much higher, says fisherman Stephen Welch, himself included. And eventually, if things don't change, just about the whole sector will be gone, he says.

Welch's story is not unlike Gloucester's, which lost 21 boats from the groundfishing fleet last year. The fleet now numbers just 75, according to a study by the NOAA science center.

Welch was interviewed this week while servicing his 55-foot gillnetter, F/V Holly and Abby, at the Gloucester Marine Railway on Rocky Neck.

"We're off 50 to 60 percent," said Welch, who is 50 and began commercial fishing as a teenager. "I'm too young to retire, and it's not right to lay people off. I've got five guys working for me now. There were eight at the peak."

Welch was the only fisherman to testify at this week's Senate Commerce Committee hearing in Boston that was organized by U.S. Sen. John Kerry. But studies of his sector by the state, University of Massachusetts-Dartmouth and NOAA scientists, which were reported in written testimony, verify Welch's analysis.

Welch and his colleagues in Sector 10 are in the spotlight now due to mounting concerns about the impact on the state and regional economy of Obama administration fisheries policies, established under Amendment 16 to the Magnuson-Stevens Act.

The amendment is the framework that includes the catch share management system, whose primary backer, NOAA Administrator Jane Lubchenco, concedes will achieve a goal of fleet consolidation.

The format has transformed the New England groundfishery into an unregulated commodities market predicated on the trading of fishermen's "shares" or an allocated catch for each species.

While it was forged more than three years well in advance of the Obama presidency and his choosing Lubchenco to head NOAA, it was under the prodding of an alliance of global conglomerates — including Wal-Mart, giant nonprofit organizations and their corporate backers — that more than $500 million poured into directing and shaping fisheries policies toward privatization.

And the primary lobbyist was the Environmental Defense Fund, whose vice chairwoman was marine scientist Lubchenco, before she took over as chief of the National Oceanic and Atmospheric Administration in early 2009.

In practice — as Welch sees it, and as scientific studies show — size matters in commodification. A powerful tilt toward concentrations of capital and away from the mom-and-pop fishing boat businesses exemplified by Sector 10, and that dominate Gloucester's fishing fleet, is well underway.

In scale, Sector 10 reflects most of the working boats showing "Gloucester" on their stern, and the erosion of their cash flow margin and opportunity to remain active speaks to the problems faced by the local boats under catch share/sector fishing.

In his written testimony, Welch detailed how Amendment 16 changed the currency on the face of the permits, substituting catch history for days at sea.

This had the effect of favoring the bigger "trip" or off-shore boats that continued to harvest the distant banks over the past decade, while the day boats were kept out of closed inshore closed areas during rebuilding.

So, when the government decided to base permit allocations on past catch histories, the little boats lost out.

For Welch and the fishermen of Sector 10 as well as the day boats of Gloucester, the aggravation is palpable.

To rebuild cod stocks, NOAA established a series of closed areas that rolled northward in the spring, but taken altogether were effective at keeping the inshore boats off the most accessible banks all spring.

As a result, Welch and similar fishermen discovered that the inability to harvest the inshore grounds meant — once landings history was selected as the determining factor in the catch share allocation, they were denied the right to catch the same fish in the present and future.

"We were denied access to our nearby stocks," he wrote to the committee, "and then we were punished for not having that access."

A closely related problem that is helping to cull down the size of the fleet is the nature of commodity trading.

In the groundfishery of Amendment 16, the commodity being traded is the allocations — or catch shares.

In principal, the buying and selling of rights to catch different species in theory allows capital to put all the shares to the best use via market dynamics.

In practice, however, the small boat businesses — like Welch and his colleagues — don't have the money to buy added quota and supplement their meager allocations. So instead of working, the marginalized become what Welch calls "armchair fishermen," and lease their measly allocations to the big boats as they gain more and more control of the fishery.

After the first year of catch share/sector fishing, 12 of the 32 fishermen in Sector 10 decided to stop fishing and lease their quota, further fueling the consolidation and shifting the industry from a multiplicity of boat businesses to a smaller number of bigger businesses and bigger boats.

"It is our conclusion," Paul Diodati, the director of state marine fisheries, wrote in testimony about a case study of Sector 10 that "the catch share system caused significant consolidation of revenues among fewer vessels, and has caused severe economic strain among the majority of fishermen."

"The Amendment 16 sector system has virtually destroyed my fishing business — at no fault of my own," Welch said.

Richard Gaines can be reached at 978-283-7000, x3464, or at rgaines2gloucestertimes.com.