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research is needed to evaluate and quantify these concerns. 



Topic 5; Policy uncertainty and potential impacts on investment and 

 costs. 



This is another important issue, but one which is difficult to 

 quantify. During the past four years I have observed the fishery 

 management process and its associated politics. By its nature U.S. 

 fisheries is highly political — decisions are not determined 

 solely by an elite group of scientific managers but result from a 

 pluralistic policy process — a process generally in accord with 

 the legislative intentions of the Magnuson Fishery Conservation and 

 Management Act (Sylvia 1992) . 



One of the issues which concerns me as an economist interested in 

 public resource management, is the high degree of policy 

 uncertainty characterizing the Pacific whiting policy process. 

 During the last four years, fishery policy actors (including 

 members of the Pacific Fisheries Management Council (PFMC) , 

 fishermen, processors, and community leaders) have made 

 considerable investments based on their personal assessments of the 

 policy outcomes likely to result from this process. In fact, from 

 a given advocate's perspective, a necessary prerequisite to improve 

 policy outcomes was to demonstrate his/her sector's (e.g., on- 

 shore, off-shore) capability to efficiently use the resource. For 

 example, the on-shore component, while employing underutilized 

 capacity in existing processing plants and fishing vessels, 

 invested approximately 20 million dollars in new processing and 

 product quality control equipment (Radtke, personal communication) . 

 This investment was made at some risk to investors, given that the 

 outcome of the policy process was not finalized. Yet this risk was 

 considered reasonable and necessary given the nature of the policy 

 process and the personal assessments of businessmen and policy 

 "entrepreneurs . " 



The recent decision by Commerce to overturn the Pacific Fisheries 

 Management Council's latest whiting plan, has expanded the process 

 and increased policy uncertainty. Reasonable, investment decisions 

 by private and public entrepreneurs have now been put into 

 jeopardy. Increased time and capital must now be expended on 

 affecting policy outcomes at not only the regional, but also the 

 national level. The result will be wasted investment — resources 

 which would have been devoted to improving production and marketing 

 of whiting products will be devoted to securing access to the 

 resource. 



In my opinion it is critical that an activist Department of 

 Commerce announce their philosophies, initiatives, and intentions 

 in a manner which allows industry members and policy participants 

 the time to make adjustments in private and public investment 

 behavior. Announcements on the opening of the season result in 

 losses in regional and national welfare, and quite frankly, are 



