OPEN LETTER: FREE ENTERPRISE By David G. Hanger November 30, 2013
As U.S. politicians and elected officials, I assume that all of you have had numerous opportunities to stand before large groups of individuals, business people and individual constituents both, and have extolled in elaborate detail the virtues of capitalism and free enterprise. Indeed, it would surprise me considerably if each of you has not repeatedly extolled the virtues of capitalism and free enterprise. The question of the moment, therefore, is why do your constituents, good U.S. citizens all, get so little of it; in fact are being terribly victimized by the crudest of monopolists this very moment? Fuel and freight prices fundamentally affect every individual and every business living or operating in Alaska, and for reasons that I do not begin to comprehend freight service in Alaska is now the domain of one operator and the same is true in Southeast for fuel. The consequence is predictable: We are all being ripped off to the max and then some. My understanding is that monopolies are illegal in this country, so why are these interstate monopolies operating on your supposed turf? During the course of this fall I have been south helping a friend recover from a severe case of alcoholism, a lengthy and frustrating endeavor. In the course of my days I buy gasoline locally, but even more so get to watch free enterprise in action, as all the gas stations and ice houses compete with each other and quite literally daily adjust their gas prices, throughout the course of this fall ever downward. But the price of gasoline in Southeast Alaska is sky high and never changes. For the first time in five years I took a short holiday this summer and drove across country to attend the sesquicentennial ceremonies at Gettysburg. Gas prices ranged from $3.15 to $3.35 on that trip, which concluded right about July 15. Prices spiked somewhat in the next six weeks, so through Labor Day what had been $3.15 to $3.25 went up gradually and by increments to $3.45 to $3.55; then after Labor Day the prices dropped considerably and rapidly, and have continued dropping since. In my opinion, the only benefactor in Southeast Alaska is the wholesaler who has kept the price at $4.29 a gallon, despite all price decreases to him, and has stuck the whole wad that is the difference in his pocket only. The magnitude of this ripoff is profound. Ketchikan is the town where they say there are more cars than people, which may indeed be true, and there are round about 15,000 living here. Seven thousand vehicles consuming a mere 10 gallons a week of fuel consume 70,000 gallons of fuel. The current markup in K-town is basically $1.50 a gallon more than is being paid down south right now. I filled up for $2.88 a gallon a few days back, and the other car here was filled up for $2.78 a gallon. Joplin, Missouri, prices in mid-October were a reported $2.87. If you do the math at just $1 extra a gallon, the rakeoff is $70,000 a week, $280,000 a month, and more than $3 million a year. I think Ketchikan consumes considerably more than 70,000 gallons a week, thus I would not in the least be surprised when considering boat fuel, equipment fuel, and heating fuel that the aggregate ripoff is anywhere from $30 million to $60 million a year. All from a little hick town of around 15,000 population. With the merger of Northland and AML my understanding is we now have one freight service for all of Alaska, and just exactly how is that supposed to benefit Alaskans? Prior to these two bunches moving in and closing out Boyer Barge a decade ago, the price for barging a car from Seattle to Ketchikan, or vice versa, was $274. Today it costs more than $1200 to do the same thing. How does that benefit Alaskans? In a decade when inflation for the decade was no more than 30%, and probably lower, the price increase for freight services that we have endured is 500%. Hell of a job you people are doing sitting on your asses while our economy is slowly being wiped out by unfettered greed!!! But this last step is far worse than that. We now have both “restraint of trade” and “prior restraint of trade” with these monopolies operating unmolested on your watch, and both are illegal as hell. Nor are the job losses imminent from this monopolistic activity; they have already occurred in considerable numbers, and more are about to occur. One multi-million dollar business that operates exclusively locally has already quietly put its property on the market and will shut down because of this damned freight monopoly; they are so disgusted; and about eight very good jobs are about to be lost. Multiple tugboat crews have already lost their jobs, and none of these jobs are nickel-dime jobs. I can account for 13 lost jobs already with average salaries of $60,000 to $70,000 a year. That by the way is with two phone calls. Many more jobs are threatened. What are you going to do about this mess? Allow me to emphasize right up front that this is a totally non-partisan issue. Of the 13 jobs aforementioned as lost, nine or ten are held by Republicans, the rest Democrats, so this has nothing to do with politics from this side of the table. It has everything to do with your gravitas, your sense of responsibility, your concern for your constituency, and whether or not you actually believe in the capitalism and free enterprise you are supposed to represent. Do advise us how much these people or their organizations are financially benefitting you, and, please, provide us also with that information for the Washington state Congressional delegation. Whose pockets are being lined by these people, so that some of you or all of you are looking the other way? I think in this instance all of us have every right to know how deep each of your hands is in this cookie jar because every one of us is paying for it in spades. In this instance I will go so far as to say failure to answer this question honestly and succinctly will lead most of us to conclude that your hands are full of cookies from this particular cookie jar. Please otherwise advise us who authorized the merger of Northland and AML? What was your involvement? If not involved, why not? What do you think about this con job? Do you think this is a good deal for the citizens of Alaska? Why? How? What are you going to do about it? If you believe in capitalism and free enterprise, the imperative is that you deplore monopolies, and will either destroy them or neutralize them via price controls when they appear on your turf. Otherwise, what do you believe? Your constituents will be watching closely. Sincerely: David G. Hanger
Received November 29, 2013 - Published November 30, 2013 Viewpoints - Opinion Letters:
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