31 



I will say that all of the council's seem to be having some diffi- 

 culty in preparing economic analyses that are related to allocation 

 decisions. These are very difficult things to determine, whether the 

 country is going to benefit by a loss of jobs in one sector and the 

 creation of jobs in another sector. 



Mr. KoPETSKi. Well, let me just conclude with this question 

 which is somewhat similar to what the chairman was asking. 



After these four Federal employees in Washington threw out this 

 cost-benefit analyses that was done out here, you folks did not go 

 back to the council and say, "We don't like your economics." 



Mr. Johnson. We didn't have time. 



Mr. KoPETSKi. You didn't have time. 



Mr. Johnson. The fishery opened on 



Mr. KoPETSKi. You believed the bureaucrats in Washington over 

 the months of study and thought that went on out on the west 

 coast? 



Mr. Johnson. The data and the study that were done on the west 

 coast were part of the data that was used by the people in Wash- 

 ington. It's not unusual for a decisionmaker to want to rely on the 

 people who they work most closely with, who they can sit down 

 with and receive a briefing from. 



There were briefings provided to Diana Josephson and to Dr. 

 Nancy Foster, who was the Acting Head of the Fisheries Service at 

 the time, as to what these economic issues were and what the pro- 

 fessional staff was telling her. 



I don't think Steve Freese, who I have known for a number of 

 years, necessarily disagrees with the conclusion that was reached 

 in Washington. The conclusion that we got from the field study 

 was that there was a very slight benefit. 



In fact, maybe I could read into the record what we were told so 

 you might understand it. 



Chairman Wyden. Mr. Johnson, let us put it in the record. If you 

 want to highlight a couple of points, that would be fine, but we will 

 put it into the record as well. 



Mr. Johnson. Well, it's very brief. 



Chairman Wyden. Go ahead. 



Mr. Johnson. It says, 



Although the cost-benefit analysis tentatively favors shoreside processing by the 

 smallest of margins, when estimates are projected over an infinite time horizon, it is 

 of limited value to analyze alternative allocations because of lack of key informa- 

 tion. 



Differences in added value resulted from secondary processing of whiting waste is 

 the major difference between the two sectors, but data on secondary processing are 

 also very weak. 



In general, lack of actual data, combined with current high levels of volatility in 

 whitefish markets overwhelmed any differences in the net benefits between alterna- 

 tives. 



Mr. Johnson. That being the case, we looked at our published 

 guidelines and concluded that we could not support the decision. 

 We would have been legally vulnerable in court had we approved 

 it. 



Chairman Wyden. So, you said you didn't have time to really do 

 your own economic analysis. I can tell you if Congressman Ko- 

 petski and I are faced with constituents who are about to be put 



