Saturday, July 22, 2006

Alaska's Ballot Measure 2 Will Gouge The Cruise Ship Industry

Just as Alaska has been gouging smokers, we now have a faction that wants to gouge the cruise ship industry once again. Unfortunately, this faction managed to sucker enough voters to sign their petition and so it's on the August 22nd primary ballot here in Alaska. Read an excellent report from SitNews in Ketchikan, published on July 12th. Also read the proposed Ballot Measure 2 itself here.

As is the custom and tradition with any Alaska ballot measure, official statements of support and in opposition by the respective sponsors are included on the ballot. Supportive sponsors include the Juneau-based Responsible Cruising in Alaska (RCA); the Campaign to Safeguard America's Waters (C-SAW ) an Alaska-based project on the Earth Island Institute; Karen Jettmar of Equinox Wilderness Expedition (which bills itself as "Alaska-Vegetarian" and "Gay-Friendly"); and the San Francisco-based Bluewater Network.

Click here for the full statement of support. Here are the critical points:

Supportive Premise: The cruise lines should follow Alaska's taxation and pollution rules like everyone else. This initiative protects our fisheries and helps pay for cruise ship impacts on Alaskan communities by establishing/requiring the following measures:

1). $50 Passenger Tax: Proponents contend the impact upon passengers will be minimal. Based on their assumption that a typical cruise costs $3,000, they don't believe an extra $50 by itself would be enough to deter prospective visitors. They further justify it by citing similar costs to Alaskan travelers who visit Outside, and state that Federal law requires the tax revenues to be spent on "servicing the industry".

2). Meet Alaska Water Quality Standards: Proponents claim that cruise ships are the only major polluters not required to have a permits and meet all Alaska water quality standards. They state that every major cruise line has felony convictions for dumping, tampering with pollution control equipment, or falsifying records. They want to place an independent marine engineer observer aboard every vessel to monitor for compliance. Their premise is the cruise lines inherently cannot be trusted to obey the law.

3). End Tax Evasion: Proponents claim the cruise lines evade taxes by virtue of a specialized income tax exemption for revenue from foreign-registered ships. They want the cruise lines to pay the same taxes that local businesses and U.S. registered vessels pay on income and gambling profits.

4). Support Local Businesses: Proponents claim that cruise line promotions are presented as "advice" (required by a 1994 Alaska law mandating disclosure to passengers by cruise lines when they receive commissions for promoting shore-based enterprises) when they are really "advertisements". Presumably this is unfair to local businesses unable to afford the steep advertising commissions. Cruise lines would have to disclose the size of their commissions under this initiative.

And here is the full statement of opposition. The sponsor is Alaskans Protecting Our Economy, an umbrella organization comprised of dozens of businesses and individuals, to include the prestigious Alaska Chamber of Commerce. Here are the critical points:

Oppositional Premise: Ballot Measure 2 is a direct attack on Alaska's economy. It will hurt our tourism industry--a growing industry and the fourth largest employer of Alaskans. Additional taxes, lost jobs, and more lawsuits in Alaska are not the answer. Ballot Measure 2 deserves a "No" vote on August 22nd.

1). Opponents claim the measure would mandate four additional new taxes including a statewide head tax of $50 per person, $100 per couple, and $200 for a family of four. By itself, the impact is marginal. But when coupled with head taxes imposed by local communities, it adds up, and the cumulative effect, exacerbated by rising fuel costs, could drive tourists away.

2). Opponents claim it would force the disclosure of confidential business information about Alaska's small businesses to competitors everywhere, hindering pre-purchase of tours, and imposing a uniquely harsh standard not required of any other class of Alaska businesses.

3). Opponents claim the measure, in general, would increase costs, discourage tourism, and reduce spending at our local businesses. They remind us that tourists already pay millions of dollars in taxes and fees on plane tickets, hotels, restaurants, tours, and shopping. In addition, this industry spawns over 26,000 local jobs.

4). Opponents claim it will unleash of flood of litigation. Lawyers will be allowed to file suit and collect up to 50% of any fines collected. Even "citizens" lawsuits will be permitted, so a person could strike it rich in court and extort thousands of dollars from a cruise line for little more than a 39 cent stamp.

5). Opponents claim it could exponentially increase the amount of red tape, bureaucracy, and size of state government by creating yet another state bureaucracy.

Analysis: Ballot Measure 2 actually has a number of commendable aspects that, individually, could be implemented legislatively over an extended period of time, and, if moderated somewhat, with minimal burden to the cruise ship industry. However, as it is currently written, I must consign Ballot Measure 2 to Davy Jones' locker. Here's why:

1). Too Comprehensive: The proponents witch-hunted the entire cruise ship industry with a fine-tooth comb, scarfed up every nitnoid quirk and nostrum they didn't like, dumped it into a hopper, and out popped a ballot measure. In short, they want to solve all the perceived problems of the industry in one fell swoop without regard for the disruptive effect upon an entire industry. The Anchorage School District tried the same approach several years ago, piling every construction and rehab project, including the first cut of the Eagle River High School, into a single $100 million plus ballot measure, and it crashed and burned. Deservedly so. And likewise this ballot measure should meet the same fate.

What's wrong with addressing some of the individual issues such as water quality and "tax evasion" through the normal legislative process?

2. Too Bureaucratic: This measure grows government unnecessarily. The last thing we need is another bureaucracy. And placing maritime engineers aboard cruise ships as "monitors"? That equally penalizes the innocent and the guilty. Note how proponents of this measure deliberately applied the provocative adjective "felony" preceding the phrase "convictions for dumping, tampering, etc.". This implies the authors of this ballot measure look upon industry as the enemy and impose the Marxist presumption of guilt upon them.

3. Too Expensive: A $50 dollar local head tax tacked on to a $3,000 cruise may seem negligible. However, add on a $50 Alaska head tax, and now it becomes a total of $100 in head taxes. The more of these "head taxes" you pile on, the less affordable a commodity or service becomes. This has been a hallmark of environmental extremism - make life more expensive and burdensome for a growing number of people. When much of the Pacific Northwest was placed off limits to logging because of the spotted owl, it wasn't $300,000 per year lawyers who lost their jobs - it was $30,000 per year lumberjacks. The environmental movement is anti-working class, not by intent, but certainly by extent, as it is dominated by high-skilled, high-priced intellectuals whose intellectual supremacism makes them insensitive to and even downright contemptuous of the working class. This $50 head tax, combined with the rest of this measure, may make a cruise to Alaska too expensive for working class people.

4. Too Litigious: We've seen how much of a nuisance just one Ray Metcalfe can be (ask Ben Stevens). Now imagine dozens of little Ray Metcalfe wannabes running amok, suing at the drop of a hat. The increase in pre-emptive paperwork maintained by a typical cruise ship would be exponential. If a crew member so much as takes a dump, they'll have to write a memo for record in case some "citizen" litigant who wants to make a quick score off the industry decides to make it an actionable item in the future. The industry will be choked by a constant, permeable fear of litigation. Many companies settle without admitting culpability simply because of the sheer costs of litigation; here in Anchorage, United Freight was recently browbeaten into just such a settlement. And awarding 50% of a judgment to the lawyer - that's insane! This must be a thinly-disguised welfare program for lawyers.

The answer is simple. Vote Alaskan - Vote No On 2!

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  1. I just cancled my tickets for this summers trip!
    If you people don't want us to come to your town and spend money then we won't!
    Good luck with that in the future.

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