Rodney M. Fujita, D. Douglas Hopkins, and W.R. Zach Willey

Many of the world's fisheries are overexploited, in decline, or depleted. Furthermore, we know little about the status of as many as 30 percent of the U.S. commercially exploited fish populations because their conditions have yet to be scientifically assessed.

As a result, marine fishery managers have allowed huge numbers of fish to be caught without understanding how such harvests affect the ability of many fish populations to replenish themselves. Moreover, many fisheries have been managed in ways that encourage overexploitation.

Such management is risky, not only to fish populations, but also to the economic well-being of people who depend on fishing for their livelihoods.

Total annual worldwide fish harvests nearly tripled over the past 30 years. At the same time, the world's fishing fleet steadily boosted its harvesting capacity—measured in terms of the number and catching power of vessels. Today, the worldwide fleet is capable of catching fish at double the rate that would be sustainable if all fish populations were healthy.

But not all fish populations are healthy. In fact, about 40 percent of the U.S.-managed fish populations whose status is known are now overexploited. Some populations—including Atlantic haddock, cod, yellowtail flounder, and many southeastern Atlantic reef fish—have been decimated.

Beyond reducing fishers' harvest levels, declines in fish populations also may cause adverse ecological impacts that result from removal of vast quantities of living organisms from complex marine ecosystems.

Losses in fish populations are inexorably linked to a decline in the economic well-being of U.S. fishermen and their communities. According to the U.S. National Marine Fisheries Service, as of 1993, overfishing in the United States has kept fishery yields at about two-thirds of their potential. The result is lost opportunities for commercial fishermen to catch more fish, which has precipitated the loss of tens of thousands of jobs in the United States.

In fact, the number of lost fishery jobs in the United States and Canada may soon exceed 100,000. Meanwhile, recreational fishermen have also experienced a decline in their catches—with a corresponding loss in jobs and income associated with the sport-fishing industry.

Fishery declines have been caused by several factors. The degradation and loss of fish habitat—including wetlands, estuaries, coastal waters, and even inland watersheds that sustain salmon and other fishes—have played a critical role. Such habitat losses may pose the greatest long-term threat to the viability of the world's fisheries. For now, however, flawed fishery-management strategies leading to overfishing are the prime cause of most fishery declines and collapses.

Misguided fishery management has contributed to declines in fish populations in two ways.

First, managers in many fisheries often ignore scientific recommendations for conservation and err on the side of maximizing short-term economic gains for fishermen. In so doing, they risk incurring long-term biological and economic decline. In some cases, managers may, in fact, allow—and even encourage—fishermen to overexploit fish populations despite scientific findings that suggest such practices are unsustainable.

Second, managers and fishermen lack sufficient incentives to curtail current overfishing, caused by a management system that leaves fisheries open to whoever wants to exploit them.

To succeed, a fishery's management system must be founded upon an understanding of the dynamics at work within and among fish populations. Nevertheless, few management schemes are based on such an understanding.

This is true in part because many of the oceanographic and ecological factors that control the abundance of commercially exploited fish populations have not been adequately studied. It is also due to the fact that all fisheries experience natural, yet somewhat unpredictable, variations in their populations.

Thus fishery managers cannot often predict with confidence the distribution and abundance of fish. Furthermore, even the most basic methods for acquiring vital management information—such as determining the number of fish available for catching—are fraught with uncertainties. For example, faulty survey methods resulted in gross overestimates of the number of salmon in the Pacific Northwest, which in turn has contributed to overfishing.

In the face of such enormous unknowns, prudent management should minimize risks to the fish populations and ensure sustainable, long-term economic activity. The setting of catch limits, when used in combination with other conservation tools, such as license limitations and individual transferable quotas for fish-harvest privileges, provides a way to achieve this goal in many fisheries.

Currently, many fisheries are managed through setting total-allowable-catch (TAC) limits for the season.

Though seasonable limits represent a sound management strategy in concept, the process of setting them is highly politicized in some fisheries, and the advice of scientists and conservationists is often ignored.

For instance, the Magnuson Fishery Conservation and Management Act, the federal statute under which marine fisheries are managed, allows regional fishery-management council members, many of whom are fishing industry representatives, to modify the sustainable catch levels estimated by scientists.

In modifying scientific estimates, regional councils may take into account "any relevant economic, social, or ecologic" factors. Typically, catch limits or fishing-mortality targets are increased, even though such increases may adversely affect fish stocks in the long term.

Not surprisingly, fisheries in which conservative scientific advice on seasonal limits has been heeded—including the North Pacific fisheries—are fisheries that remain the healthiest. Meanwhile, fisheries in which such scientific advice has been ignored, including the New England groundfishery, have been devastated.

To resolve these problems, fisheries management must be amended in several fundamental ways. First, fishery management must be based more consistently on the best available scientific information. This can be achieved by refusing to allow managers to modify or ignore scientific recommendations; increasing scientific peer review of management decisions; including representatives of nonfishery interests on fishery-management councils; and increasing public participation and oversight of fishery management.

Second, managers should be required to adopt a precautionary approach, erring on the side of long-term sustainability instead of short-term economic gain.

Third, protection of entire ecological systems that support fisheries should be made a management priority.

Effective fisheries management requires more than just the creation of conservative, scientifically based catch limits or fishing mortality targets. Any successful management scheme also mustaddress the economic incentives that are created by open access.

Most fisheries in the United States and around the world are open access—that is, they're open to all who want to exploit them. While conventional management programs may limit the number and type of fish fishermen may catch, they often do not control the number of fishermen exploiting the fishery resource.

In open-access fisheries, fishermen know that any fish they leave behind in the interest of conservation most likely will be caught by someone else. Thus, they have a strong incentive to catch as many fish as quickly as possible. As a consequence, they race for fish.

Open-access policies governing fisheries and subsidies to the fishing industry have encouraged the participation of too many vessels. And too many vessels chasing too few fish increase the pressure to catch fish as quickly as possible. In many cases, these circumstances lead to overcapitalization, a situation whereby fishermen overinvest in fishing equipment to maximize their harvesting capability and enhance their competitive edge.

As a fishing fleet becomes overcapitalized, it can reach the total-allowable-catch limit in less and less time—further intensifying the race for fish. This hastened pace results in shorter seasons, declining profits, and compromised safety for fishermen.

For example, fleets harvesting Pacific halibut and sablefish possess several times the capacity needed to catch the seasonable limit for those species in a year. For this reason, seasons now last less than a month off the coasts of California, Oregon, and Washington and, until recently, spanned just a few days in Alaska. Under these conditions, fishermen are forced to fish as intensely as possible under sometimes dangerous weather conditions. Many have lost their lives in the frantic race for fish.

If the only goal of fisheries management is to limit total catch, a conservative, scientifically credible seasonable limit backed by effective enforcement may prove an adequate way to conserve a target fish population. However, other environmental problems arise as a result of the race for fish. Among them are:

• "Ghost fishing" through which fish are captured and killed by discarded nets and other articles of fishing equipment that are abandoned or lost in the sea.
• Habitat damage caused by reliance on gear and fishing practices that show little concern for their impact on marine ecosystems.
• Excessive catch and mortality of undersized fish and non-target species, also known as "bycatch."

Open access and the race for fish—combined with overcapitalization and brief seasons—result in low profit margins. Low profits, in turn, lead to political pressure to relax conservation regulations. High market prices for target fish tend to exacerbate this situation. For example, in 1992, in the race for valuable red snapper in the Gulf of Mexico, fishermen eager to fill their nets pressured the Gulf of Mexico Fishery Management Council to re-open the season after the seasonable catch limit was reached.

One would think that the cure for problems associated with open access would reside in limiting the number of fishermen who can participate. Moratoria on new entrants to fisheries have been imposed, and eligible fishermen have been required to obtain licenses. However, in many cases, such strategies have not ended the race for fish nor stemmed over exploitation. Why?

First, the pressure to harvest fish often continues even after the number of fishermen is reduced because fishermen still have strong incentives to catch fish as quickly as possible. Fishermen recognize that fish left in the water for conservation can still be caught by their competitors.

Second, efforts to limit access through allocation of commercial fishing licenses are perceived as equitable only if most fishermen who apply receive a license; otherwise, such practices may be tainted by the suspicion of favoritism. As a result, managers often feel pressed to grant licenses to more fishermen than the fish population can sustain.

For example, a limited-entry plan for the Alaskan Pacific halibut stock backfired and actually increased the number of licenses by more than 70 percent. Similarly, a limited-entry plan for the Maine lobster fishery increased the number of licenses from 7,000 to 10,000.

Fishery managers have sought, without sustained success, to address these problems by combining limited access with other management tools, including taxes, fees, and restrictions on the power, size, and capacity of fishing vessels and other fishing equipment. Unfortunately, such regulations do not effectively address the fundamental cause of over exploitation: the persistence of economic incentives to overcapitalize and overexploit.

In practice, it has been difficult to establish a level of taxation that would be equitable yet stiff enough to reduce the overall fishing effort. In addition, because higher taxes often cut into profits, many fishermen will try to sidestep such measures or demand that catch levels be increased to a point at which they are no longer sustainable.

The combination of limited-access rules and input controls such as gear restrictions and vessel-capacity limitations also have failed to cut down on fishing efforts.

Faced with burdensome regulations that seek to micro-manage their businesses and make them less efficient, fishermen have strong incentives to use their ingenuity to get around such obstacles. For example, limits on fishing days can be overcome by fishing more intensely with high-speed winches and by locating fish more effectively with sophisticated fish-finding equipment.

Virtually all inputs need to be restricted, because incentives to increase inputs and bolster fishing power will continue as long as fishermen are not guaranteed a certain share of the total catch.

Individual transferable quotas, or ITQs, which guarantee individual licensed fishermen a percentage share of the total allowable catch, have been successfully used to manage overcapitalized fisheries.

The first step of effective individual-transferable-quota management is to establish a total catch limit. This level must be set conservatively low each season to account for scientific uncertainty and natural variation. Any management scheme is bound to fail if the seasonable limit is set too high.

Next, percentages of the seasonable limit are allocated to fishermen in individual quotas that add up to 100 percent of the limit, based on some equitable distribution formula negotiated by managers and all stakeholders.

If share quotas are to address the problem of overcapitalization, however, they must be transferable. Indeed, if quotas are transferable, shareholders who wish to leave the profession can sell their quotas to other fishermen. As a result, the fleet is downsized through private financing when one licensed fisherman purchases the quota of a colleague who wants out of the business.

Such an arrangement, which has been implemented in many countries, including the United States and Canada, alleviates the need for government buyouts of overcapitalized fleets. This aspect of transferable quotas makes them particularly attractive, given the current constraints on government budgets.

Individual quotas also create incentives for conservation by giving quota holders a direct stake in the long-term health of the fishery. Indeed, as fish populations increase, seasonable catch limits can also increase, automatically increasing the size—and therefore the value—of individual transferable quotas.

As an overall management tool, individual quotas have improved compliance with seasonable catch limits, increased reporting accuracy, decreased bycatch, curbed ghost fishing, and reduced habitat damage due to lost gear.

As an added bonus, individual-quota management often dramatically increases profits for quota holders. For example, in 1991 net income rose by an average of $9,200 (U.S. dollars) per vessel in the British Columbia halibut fishery and a whopping $157,000 (U.S. dollars) per vessel in the British Columbia sablefish fishery as a result of individual-quota management.

The bottom line is this: individual quotas have effectively ended the race for fish in many fisheries, including the Alaska and British Columbia sablefish and halibut fisheries, the Ontario Great Lakes fresh-water fisheries, the Wisconsin Green Bay yellow perch fishery, and the Australian southern bluefin tuna fishery.

Many of the criticisms cited by those who oppose individual quotas are common to all fishery-management strategies.

As with other initiatives to control harvest levels, enforcement is difficult. Moreover, individual quotas could, on the surface, exacerbate such problems as high-grading, which involves the sorting of higher-grade fish from the lower-grade fish and then discarding the latter. The reason is that when fishermen can only catch a certain number of fish, it would seem to be in their interest to bring to shore only the highest-quality and highest-priced fish.

Another problem is this: to date, individual quotas have been based in part on fishermen's catch records—in other words, larger vessels have, in most cases, been eligible for larger quotas. Such criteria can penalize efficient fishermen who choose to operate smaller-capacity vessels.

Yet, quotas can be devised in a way to address some of these concerns. Allocation formulas and quota restrictions can be designed to reward selective fishing—for example, by granting larger allocations to fishermen who demonstrate ecologically sound fishing practices. Conversely, fishermen who engage in practices that undermine conservation goals could face smaller allocations in the future.

Moreover, future individual-quota programs should be designed in a way that prevents fishermen from inflating their catch records in an effort to become eligible for a larger allocation.

There is also the risk that such a system will eventually lead to undesirable levels of industry consolidation as larger fishing enterprises buy out the quotas of smaller fleets or as smaller fleets pool their resources.

Consolidation can improve the overall economic efficiency of a fishery, but it also can lead to a shift from small, independent owner-operators to large corporations. Various mechanisms are being used to keep such consolidation in check. Among them are regulations that restrict transfers of individual quotas to certain vessel-size classes and that place caps on the total number of quota shares a single company or corporate entity can own.

Bycatch is a serious problem in many fisheries, including shrimp fisheries and Pacific groundfish fisheries. The best approach to managing bycatch is to prevent it at its source by encouraging selective fishing practices and penalizing those who practice non-selective techniques.

To some extent, these problems can be controlled by rewarding fishermen who practice selectivity—as verified by National Marine Fisheries Service observers—by offering them larger initial quota shares.

Individual-quota management also can be combined with conventional measures to reduce bycatch. Fishing, for example, could be restricted at locations where bycatch rates would be high because both target and non-target species are intermingled. For instance, crab bycatch in a walleye pollock fishery could be avoided if trawling were restricted to midwater depths.

Transferable bycatch allowances could help give fishermen the flexibility they need to adjust to changes in fish distribution while keeping overall bycatch levels under sustainable caps.

Individual quotas alone cannot solve all fishery-management problems. Scientific understanding of fish populations must be improved, and where data on fisheries are thin, we should err on the side of caution and restrict the impacts on a fishery.

Furthermore, the discretion of fishery managers to modify or ignore scientists' recommendations of appropriate catch levels—often in the interest of fishermen's short-term economic gain—must be restricted, particularly in over-exploited fisheries. And bycatch, high-grading, and habitat degradation must be reduced if the marine ecosystems that sustain fisheries are to recover.

Management through a system of quotas remains the most promising tool for reducing the over-capitalization and overfishing that now threaten the sustainability of many conventional fisheries. However, because of our lack of experience with these management tools, we must develop quota programs cautiously.

Indeed, a rush to develop such programs without guidelines could inadvertently cause serious problems. For example, fisheries could become dominated by gear types that lead to high rates of bycatch and overexploitation. And traditional fishing ports, historically dominated by small vessels owned and operated by independent fishermen, could be controlled by large corporations if adequate protection is lacking.

With experience and systematic evaluation, however, quota management will likely become an effective tool for creating sustainable fisheries and protecting the resources so vital to the U.S. commercial fishing fleet and to marine ecosystems.