Ben Muse

Alaska's gold production is up

Elizabeth Bluemink reports: Alaskan Gold production highest since 1916 (Anchorage Daily News,  November 8, 2009). 

 

Fort Knox mine.  Source: Kinross Gold Corporation.

In  summary:

Alaska produced about 800,000 ounces of gold in 2008 - the largest amount since 1916 ( High as that output is, Alaska currently only accounts for ten percent of U.S. gold production).  Almost all, about 84 percent, came from two mines - the open pit Fort Knox mine near Fairbanks, and the underground Pogo mine near Delta Junction.  About five percent of the gold came from small scale placer mining.

It's getting relatively more expensive to live in rural Alaska

The cost of living differential between urban and rural Alaska has increased since 1985 - an important reason is the introduction of "big box stores" in urban Alaska. 

Pat Forgery has a nice piece in today's Alaska Empire summarizing testimony to the Alaska House Finance Committee by McDowell Group economist Jim Calvin: Urban, rural cost divide widens.  The McDowell Group was hired by the state to look at regional cost-of-living differentials.  This study will be used in labor negotiations.

In summary:

Daniel Libby visits King Island, 1867

Construction of the trans-Atlantic telegraph cable pushed the limits of 19th Century technology.  In the 1860s construction was begun on an alternative telegraph line to Europe - across Alaska, under the Bering Strait, and across Russia.

Capt. Daniel B. Libby was in charge of a telegraph construction team that wintered at Port Clarence on the Seward Peninsula in 1867.   Libby was 25 or 26 at the time.  

The Bering Strait. Port Clarence is the embayment to the southeast of the cape (Cape Prince of Wales) on the American side. (Wikipedia)

In March 1925 a roughly dressed man visited the Juneau law offices of  James Wickersham.  The man, Libby's son, needed money to get to Copper River where he understood he could find work as a welder.  He had a packet of papers - his Dad's papers from the Port Clarence days: letters, records, pictures, and a five by seven inch brown notebook with a diary for 1867.  Was Wickersham interested? 

Apparently Wickersham was; the diary was in the Wickersham papers for many years, and is in the Alaska State Historical Library today. 

On June 20 1867, Libby had taken a trip to King Island.  The telegraph construction team that had spent the winter in Port Clarence was beginning to run low on food.  The trip to King Island was evidently part of a larger effort to find food:

King Island, June 1912

William Van Valin was a school teacher at Sinuk, Alaska, during the 1911-'12 and 1912-'13 school years.  Sinuk is on the Bering Sea coast of the Seward Peninsula to the west of Nome, not far from King Island. 

In June 1912, he went walrus hunting in a small powered schooner with a party of Eskimos.  From Sinuk they traveled east to Nome to pick up another passenger, then went west, across the Bering Sea to the Siberian Coast. 

On June 8, they reached King Island and spent two days there.  Van Valin was a sympathetic and careful observer.  He wrote about his visit in his book,  Eskimoland Speaks, published in 1944.  For reasons explained at the end of the post, I' m assuming this trip was in June of 1912 (if I'm wrong it's not by more than plus or minus one year).

As the schooner approached King Island one of the first things he noticed was masses of birds wheeling around the rocks:

Eleven Reasons the Obama Administration's Chinese Tire Decision Was a Bad One

At least the administration was embarrassed, releasing its decision late on Friday to minimize publicity. 

The Obama administration has decided to impose import duties of 35% on imports of low cost Chinese passenger and light truck tires (U.S. to Impose Tariff on Chinese Tires, Wall Street Journal).  These are scheduled to drop to 30% in a year, and 25% in another year.

Here are eleven reasons this is a bad idea:

1. It limits competition in the U.S. tire market, and it will increase costs to U.S. consumers.  Tires will cost more.
   
2. It will increase the costs of making things in the U.S.  Things made with tires (cars and trucks) will cost more.
   
3. It will increase the costs of our exports.  Anything we make with these tires and then export will cost more.
4. The tax is imposed only on tires from China.  Foreign producers in other countries, who will not be subject to this tax, will benefit.  Actually, this will limit the damage done to U.S. consumers and producers, but then, what was the point?
   
5. It is counterproductive to impose a tax on consumers, increase the prices they face, and reduce their incomes and consumption, during a serious recession.
6. This is a regressive tax, it will fall proportionately harder on poor and middle-income people than on the rich.
   
7. The world has been struggling to avoid the reductions in demand associated with protectionism during this recession.  This action undercuts these efforts. 
   
8. The Chinese can retaliate with respect to other U.S. goods.
   
9. This may violate administration promises not to impose new taxes on persons with lower incomes ("Middle class families will see their taxes cut – and no family making less than $250,000 will see their taxes increase.").  This promise probably was only meant to apply to the income tax, and was itself a bad promise in any event.  But what is the value of the promise to taxpayers if the protection it offers only applies to one tax and not to others?  This new hidden and regressive tax on U.S. consumers wasn't the place to start breaking the commitment.
   
10. We need Chinese help on a lot of issues, its not worth imperiling that for 5,000 jobs (see below).  As Jonathan Weisman noted in the Wall Street Journal story on this issue: "The United States needs China to help float a U.S. deficit expected to reach $1.56 trillion this year. Mr. Obama is also likely to seek new sanctions against Iran to combat its nuclear program, and China's vote on the United Nations Security Council is pivotal."
11. Holding workers in industries making low cost tires doesn't keep them in an industry in which we are likely to be able to compete internationally.  Even if you think industrial policy is a good idea, this is bad industrial policy.

The request for the tariffs (tax increase) was pressed by labor interests, but oddly, according to the Wall Street Journal story above, not by the tire industry: "Notably, the tire industry didn't join the case -- tacit recognition that it has long ago left the US market for the low-end tires at issue."

The number of jobs lost in recent years seems small: "Meanwhile, four U.S. tire plants closed in 2006 and 2007. Three more are planned for closure this year. There were 5,168 fewer workers in the U.S. tire industry in 2008 than there were in 2004."

Cross-posted from The Custom-House.

Edit Sept 19 - editorial but not substantive change to point 9.

King Island and the Russian Fur Traders, 1822

When westerners began to visit the Bering Strait, they were touching the jugular of a thriving trade in furs between America and Asia. 

Furs from central and northern Alaska, and from as far east as Canada's Mackenzie River drainage, made their way west, from one set of hands to another, through a network of Native fur traders.  The furs were funneled through the Bering Strait, made their way across Chukotka and Siberia, to Russian and Cossack traders, southeast down the Lena River, across and around Lake Baikal, and into China.  On the backhaul blue beads, tobacco, knives, axe heads, and iron ware, made their way east.

King Island was just south of the Strait, and King Islanders were active middlemen in this trade.

John Bockstoce, the historian of the northern whaling industry, has a new book out on the 19th Century northern fur trade: Furs and Frontiers in the Far North.  In Furs and Frontiers he describes a visit by Russian explorer/traders to King Island in 1822.

The Russian-American Company probed north into the Bering Sea and the Bering Strait from its bases on Alaska's Pacific coast, looking for ways to intercept the trade and its profits.  In 1822Vasily Stepanovich Khramchenko was sent north in the brig Golovnin to survey Norton Sound and the Bering Strait.

King Island and the Great Sickness: the Terrible Summer of 1900

In the summer of 1900 King Island was hit hard by disease.  R. Newton Hawley, surgeon on the U.S. Revenue Cutter Bear, visited the island in July and again in August and published a short account in 1901 (The World's Work, search for "Arctic Cliff Dwellers").

The Bear off Cape Romantzoff in early June, 1900.  About a month before she reached King Island.  Source: U.S. Coast Guard Historian’s Office.  

The Bass River Road Net - Late 1832

The towns of Massachusetts were systematically mapped in the early 1830s in response to a state mandate.  Forested and open areas, roads, and significant buildings were identified (although the surveyors and their methods differed somewhat across the state).  Harvard University's Harvard Forest program has created a free online tool that makes it possible to overlay information from these 1830 surveys on a modern USGS topographic map. 

You can access the mapping tool here: 1830 Massachusetts Map Viewing Instructions (but pay attention to caveats - reproduced at the end of this post).  This is easy to use, here I've used it to create a map of Bass River - between Dennis and Yarmouth on Cape Cod - in the early 1830s.  The river appears rather faintly in a modern USGS topo map.  The 1830s roads are superimposed as brown lines, wooded areas in the early 1830s are superimposed as dark green areas:

Alaska's recession so far

Source: Alaska Department of Labor

So far, Alaska has gotten off relatively lightly.  Good times or bad, Alaska's unemployment rate is normally higher than the national rate.  But not this recession.  Eleven possible reasons:

The Ticket Economist

A new blog about the economics of ticket scalping: The Ticket Economist:

I used to hate ticket scalpers and the practice of scalping until I applied the age old lesson ‘keep your friends close and your enemies closer’ to scalpers. Following this I became interested in figuring out whether scalping was really good or bad. Decision: before the Internet, it was bad, now it is good. If you follow the writings on this site you will eventually understand why (I am not crazy).

Briefly, I am not an economist. I earned a social sciences degree from a small liberal arts college in the Boston area.  From 2006 to 2007 I researched and wrote a thesis paper examining the economics of ticket scalping on the internet with the exceptionally patient guidance of an economist at Harvard Business School. When I am not writing about ticket stuff and purporting to know a lot about buying tickets, I run a small technology company that has nothing to do with event ticketing....

Writings on this blog should cover ticket scalping, ticket resale, translating academic babble into terms people like you and I can understand.

Hat tip to Michael Giberson at Knowledge Problem.

Edits: July 14 - added text to block quote, corrected title of Knowledge Problem.

The End of the Bass River Bridge Corporations

In 1869 there were two carriage bridges running east-west across Cape Cod’s Bass River.  A lower bridge connected the villages of South Yarmouth and West Dennis where Route 28 crosses the river now; an upper bridge connected South Yarmouth and South Dennis higher up the river, at the location of the current Highbank Bridge. These were both toll bridges built and operated by private corporations created by the state in the early 1830s. They were the only toll bridges on Cape Cod in 1869 (Swift, 1897).

In 1870 the state made Barnstable County, and the towns of Yarmouth, Dennis, and Harwich, responsible for buying out the corporations and maintaining the bridges. Why did it do this after almost 40 years of private operation? Were the benefits of this greater than the costs? Who gained and who lost? I may never be able to answer these questions fully but here is a progress report (Here's a pdf version: The End of the Bass River Bridge Corporations):

King Island and the American fur traders

Americans began trading in the Pacific in the 1780s. Trade was interrupted by Jefferson’s embargo and the War of 1812, but subsequently small American ships crisscrossed the ocean with cargoes of furs from the Pacific Northwest, sandalwood from Hawaii, copper from Chile, ginseng from the U.S. Appalachian Mountains, and silk and tea from China (Old China Trade).

Far to the north, beyond the Aleutian Islands and the Bering Sea, Eskimos, Chukchis, and Russians traded across the Bering Strait. Furs from America moved west, in exchange for glass beads and iron. Coastal and island Eskimos were active intermediaries.

Briefly, in 1819 and 1820, Americans from the Pacific tested the waters in the Bering Straits: two American brigs, the General San Martin and the Pedlar, explored regional trading opportunities. King Island flits into sight in journals and reports of these visits.

Sled dogs to snowmobiles

In the early 1990s, Alaska's Board of Fisheries had to address a controversy over the feeding of subsistence fish to dogs used for commercial purposes.  To provide some background, David Anderson prepared a paper on the use of dog teams in the Yukon River drainage, and their fish consumption, for the Alaska Department of Fish and Game's Division of Subsistence.    Anderson described the evolving role of dog sledding in the regional economy: The Use of Dog Teams and the Use of Subsistence-caught Fish for Feeding Sled Dogs in the Yukon River Drainage, Alaska.

Coastal Eskimos had been using sled dogs for a long time prior to contact with the West:

Integrating Peanuts

From The Edge of the American West: Black people can’t swim, &c. Don't skip the comments.

Stronger individual property rights do reduce overfishing

Christopher Costello, Steven D. Gaines, and John Lynham find that fisheries with individual fisherman's quotas are less susceptible to overfishing: Privatization prevents collapse of fish stocks, global analysis shows.  The actual title of the article in Science is "Can Catch Shares Prevent Fisheries Collapse?" I haven't found a link to the original article or an earlier working paper yet.

The "privatization" here is the assignment to a right to a share in the seasonal or annual harvest.    A fisherman with an individual and transferable quota has an asset whose value depends on the long-term health of the fish stock, and a greater incentive to care about that stock.

The abstract:

Recent reports suggest that most of the world’s commercial fisheries could collapse within decades. Although poor fisheries governance is often implicated, evaluation of solutions remains rare. Bioeconomic theory and case studies suggest that rights-based catch shares can provide individual incentives for sustainable harvest that is less prone to collapse. To test whether catch-share fishery reforms achieve these hypothetical benefits, we have compiled a global database of fisheries institutions and catch statistics in 11,135 fisheries from 1950 to 2003. Implementation of catch shares halts, and even reverses, the global trend toward widespread collapse. Institutional change has the potential for greatly altering the future of global fisheries.

And in conclusion:

Although bioeconomic theory suggests that assigning secure rights to fishermen may align incentives and lead to significantly enhanced biological and economic performance, evidence to date has been only case- or region-specific. By examining 11,135 global fisheries, we found a strong link: By 2003, the fraction of ITQ-managed fisheries that were collapsed was about half that of non-ITQ fisheries. This result probably underestimates ITQ benefits, because most ITQ fisheries are young.

The results of this analysis suggest that well designed catch shares may prevent fishery collapse across diverse taxa and ecosystems. Although the global rate of catch-share adoption has increased since 1970, the fraction of fisheries managed with catch shares is still small. We can estimate their potential impact ifwe project rightsbased management onto all of the world’s fisheries since 1970 (Fig. 2). The percent collapsed is reduced to just 9% by 2003; this fraction remains steady thereafter. This figure is a marked reversal of the previous projections.

Despite the dramatic impact catch shares have had on fishery collapse, these results should not be taken as a carte blanche endorsement. First, we have restricted attention to one class of catch shares (ITQs). Second, only by appropriately matching institutional reform with ecological, economic, and social characteristics can maximal benefits be achieved. Nevertheless, these findings suggest that as catch shares are increasingly implemented globally, fish stocks, and the profits from harvesting them, have the potential to recover substantially.

The Environmental Defense Fund reports here: Catch Shares Key to Reviving Fisheries.  New Study Shows Innovative Approach Can Help Solve Overfishing.  Here's Costello's website with background information on the study: Can Catch Shares Prevent Fisheries Collapse?

Revised Sept 19 to add a comment about how individual quotas give fishermen a greater interest in the long-term health of the fish stock.

From Kandahar to Kijaki

The Chinese built the generator, the Russians flew it into Kandahar, the British negotiated for permissions to transit, the British and the Danes created a diversion, the Canadians, Americans, Australians, Afghans, and British fought their way with it for 100 miles through the Taliban, the Americans and French provided air support, and the Chinese will install it.  Development in Afghanistan: how to install more generating capacity in a dam: Development through combat.

Revised Sep 5.

The old aerial polar bear hunt in Alaska

From the late 1940s until the early 1970s hunting guides in Alaska took their clients in airplanes out over the Chukchi and Beaufort Sea sea ice.  When the guides found a bear on the ice, they would try to land and give their clients a chance to hunt.  At times the planes were used to herd the bears towards the waiting hunters. 

The hunt and some of its economics were described by U.S. delegations to early (1965-1974) international meetings on the status of the polar bear.  I think that much of the following material was prepared by Jack Lentfer, a government bear biologist who attended these meetings. 

Here is a map for orientation.  The hunts originated in six or seven small communities in Northwest Alaska.  Little Diomede Island, which you will read about, is right in the Bering Strait.

The aerial sport harvest began sometime in the late 1940s.  In the years before that most hunting had been by Alaska Natives for subsistence and income (Polar Bear Management in Alaska; Jack Lentfer, Third International Conference on Bears, 1974):

King Island, 1880

A few days ago I posted on a visit to King Island by the U.S. Revenue Cutter Corwin in 1881 (A Visit to King Island, July 12, 1881). 

The Corwin, under Captain Calvin Hooper, also visited in 1880.  Hooper's report was published in 1881: Report of the Cruise of the U.S. Revenue-Steamer Corwin in the Arctic Ocean .

Hooper supplied his own illustrations - here's his picture of King Island from about four miles to the south:

 

Hooper's description:

A Visit to King Island, July 12, 1881

The U.S. bought Alaska in 1867, but it really didn't have much of a presence there, and especially not in more remote areas like the Bering Sea, for many years.  The Treasury sent a revenue cutter into the Bering Sea in 1870, and again, nine years later, in 1879.   

In 1880, the revenue cutter Thomas A. Corwin entered the Bering Sea under Captain Calvin Hooper.  At Hooper's recommendation, regular annual cruises by revenue cutters were began in 1881.  Hooper and the Corwin made the 1881 cruise.

In the late 19th Century these patrols were the face of the U.S. government in the Bering Sea.  The cutters had a lot of jobs.  They tried to interrupt the regional trade in liquor and rifles, investigated vessel disappearances, conducted search and rescue efforts, provided logistical support for the census, moved people around within the region, helped the shipwrecked get home, suppressed fur seal poaching, shipped reindeer from Siberia to the U.S., and carried out geographic and scientific research. 

Science was important right from the start  In 1881, John Muir was the cruise glaciologist.  On a shore stop at the western Alaskan port of St. Michael, the Corwin picked up an employee of the U.S. Signal Service, the naturalist and ethnographer, Edward Nelson.    The Coast Guard, a successor agency to the Revenue Service, dates its participation in oceanographic work from this trip.  Captain Hooper, made several attempts to gather information about currents from the Bering Strait (Oceanography in the Coast Guard).

 

The Corwin in 1885.

The Corwin had left San Francisco on May4 and arrived at Unalaska in the Aleutians on May 17.  Thereafter she performed various missions in the Bering Sea and Arctic, arriving at St. Michael in Norton Sound on July 4.  She departed St. Michael on July 9 and sailed north and then west along the south side of the Seward Peninsula.  She arrived at King Island on the morning of July 12.

Arctic Economics

I've pulled various posts dealing with the Arctic and copied them into a new site called Arctic Economics.  I'm going to use that weblog to explore the economics of global warming induced Arctic climate change.

The Senate Would Like an Investigation of the Coconut Road Earmark

In 2005 the President signed legislation that Congress hadn't passed. 

The bill in question authorized money for transportation projects and earmarked a lot for particular projects. Sometime after Congress passed the legislation, and before the President signed the bill, someone secretly rewrote one of the earmarks.  This was the Coconut Road earmark for highway work in Florida (Allocating scarce resources among competing transportation projects, Ben Muse, August 25, 2007).

There's some reason to believe Alaska's only Congressman, Republican Don Young, who was Chairman of the House Transportation Committee at the time, was involved. 

I'm reminded of this because the Senate voted 64 to 28 yesterday (Apr 17) to ask the Justice Department to look in to what happened: Justice asked to probe Young earmark (Erika Bolstad, Anchorage Daily News, Apr 18).

Thursday, support for the Justice Department investigation, sponsored by Sen. Barbara Boxer, D-Calif., drew an unlikely coalition of Democrats and Republicans, many of whom said they were concerned about the integrity of their legislative process. Twenty of the votes of support came from Republicans, including Sen. Mitch McConnell, R-Ky., the Senate minority leader.

House leaders had a muted response to the Senate vote, but indicated they were concerned about what had happened. House Speaker Nancy Pelosi, D-Calif., said Thursday that the matter should be taken up by the House ethics committee. The Republican House leader, Rep. John Boehner, said he also had no objections to an investigation....

Young is connected to several ongoing investigations.  He has spent $1.1 million from his campaign fund recently on lawyers: Young's legal fees surpass $1 million (Erika Bolstad, Anchorage Daily News, April 16).

The "Justice asked to probe..." story above notes an interesting constitutional question:

Fewer Fishermen

Sport fishing isn't as popular as it used to be in the U.S. 

The Fish and Wildlife Service conducts national surveys of fishermen and hunters every five years.  The surveys from 1991 to 2006 have been done in a consistent manner.  Here are the key numbers for total anglers, freshwater anglers (Great Lakes and non-Great Lakes) and saltwater.  All measured in thousands:

Climate Change and Outdoor Recreation

What  will we do for fun outdoors, as global warming increases average temperatures, rainfall, snowfall, and sea levels?  John Whitehead at Environmental Economics reads the tea leaves in a series of three posts:

Over-Exploiting the Arctic Animal Commons

Robert McGhee (The Last Imaginary Place. A Human History of the Arctic World) doesn't think the original Arctic peoples were modern Western conservationists:

A Land of Milk and Honey (If You Know Where to Look)

Lots of explorers entered the Arctic and died there because - among other things - they couldn't find anything to eat.  Sir John Franklin led two expeditions to disaster; on the first his followers ended up eating each other for lack of anything better. 

That wasn't a problem for the locals.  Robert McGhee (The Last Imaginary Place. A Human History of the Arctic World) points out that the Arctic had real productivity advantages for a hunting people: