Maine lobster


If the Confederates could have turned the Union flank at Gettysburg, things might have turned out differently. But they ran into the stubborn men of Maine.

Maine has never been much of an economic power. It's a state where "agriculture" refers to maple sap and blueberry bushes. And lobster, of course.

Back in the 1990s, some Democrat in Washington decided to "tax the rich" by placing a luxury tax on yachts. It didn't have much of the desired impact on the yachtsmen: They just bought and berthed their pleasure craft in Barbados, or the south of France. It sure played Ned with a lot of boat-builders, though. Threw them right out of work. And they weren't "the rich." A bunch of off-season lobstermen down the coast of Maine, for the most part.

Now here's another recession, and another Democrat with a learner's permit who thinks he can fix things by raising taxes. And who's paying the price ... again?

When people cut back on fancy eating, they may switch from steak to hamburger. This doesn't bother the cattlemen so much. But there's no "cheap cut" on a lobster.

Lobster sales are down, which means there's a surplus. Prices are tumbling.

Prices for lobster plunged last year to levels not seen in 20 years, reports The Associated Press, leading Greg Turner of Scarborough and a growing number of other Down East lobstermen to sell from the backs of pickups, from garages, and even on Craigslist. By going directly to consumers, lobstermen say they can make roughly $1 more per pound than what they get from lobster dealers.

Lobstermen averaged just under $3.50 a pound for their catch in 2008, down from $4.44 in 2007, with prices falling to under $2.50 a pound in some places last fall. The outlook isn't bright this year, either.

In the past couple of weeks, lobstermen were selling one-pound lobsters for about $4.25 to $5.25 a pound out of the backs of their trucks on local streets. At the same time, Portland-area seafood shops and supermarkets were selling one-pounders for about $4.99 to $6.99 a pound.

This means lobstermen are actually making matters worse for themselves, the established retailers argue.

In a recent letter to state fishery officials, a group of 13 dealers and retailers said the direct-sales trend is "counterproductive for harvesters, the resource and the state." They say retailers in particular are at a competitive disadvantage because of their overhead costs.

By selling lobster at rock-bottom prices, lobstermen are forcing retailers to mark down their prices, the letter says. To make up for the lower prices, lobster dealers will have to pay lobstermen less -- thus driving down lobster prices even more. "By selling their catch directly to consumers, harvesters may be temporarily getting a higher price for their own catch on that day, but they are really forcing down the boat price in their area," the letter states.

That sounds like a good description of the way free competition works, pushing down prices for consumers, while squeezing out middlemen who can't justify their markups. In a worst case -- barring government interference, like some rule that you lose your "permit" if you stop lobstering for a year or two -- the free-market solution would ease the least competitive lobstermen out of the trade for a while. Supplies would drop below demand, and prices would start to rise again, luring more men back to the water.

But if all the dealers and retailers wanted was to explain the rules of supply and demand, why would they bother getting together to write a letter to "state fishery officials"? Might they be seeking some new law that would make it illegal for the lobstermen to sell their product to any but a small number of "licensed" wholesalers?

If the retailers find their overhead too high, they're free to reduce their overhead, or to advertise to the public the advantages -- if they can dream up any -- of buying from them, instead.

Alternatively, they can drain their lobster tanks and sell more blueberries.

A new set of restrictions on where the lobstermen can sell their catch does not sound like a recipe for restored prosperity for anyone -- except those who can afford to go visit state lawmakers with checkbooks in hand.

 

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