The CHAIRMAN. But the price is predetermined, isn't it? Mr. McKERNAN. The price is negotiated beforehand, yes. The CHAIRMAN. But ownership gives them greater flexibility to move, to participate in other activities, whereas if you are just a fisherman employed on a boat, you are stuck there with what the owner of the boat wants to do as far as places are concerned or fishing is concerned?

Mr. McKERNAN. Yes. And I believe that many of these ownerfishermen now, formerly were union members and they have felt that becoming owners has deprived them to some extent of the bargaining power that they had before under their union membership. So that the union has tended to become weaker, and these owner-fishermen have tended to, in a sense, lose their rights at the bargaining table, because the union can no longer represent them.

Now this is the problem that this bill, or at least some sponsors of this bill would like to correct.

The CHAIRMAN. In other words, when they move into a limited or an owner status, they lose some rights as fishermen, bargaining rights, and they haven't got quite the complete owner rights, but they are kind of in between; is that right?

Mr. McKERNAN. That is correct.

The CHAIRMAN. They kind of applied for membership in the club and they haven't been taken yet.

Mr. McKERNAN. Yes, I believe that is a good summation of the situation.

The CHAIRMAN. But they had to do that for their own protection in many instances, or they felt that they did?

Mr. McKERNAN. I believe that was their point of view.

The CHAIRMAN. That is all. Thank you.

Senator BARTLETT. Mr. McKernan, you said some of the cooperatives sell capital stock to crewmembers?

Mr. McKERNAN. Yes.

Senator BARTLETT. I wonder if any of that capital stock is ever sold to the public?

Mr. McKERNAN. I am not aware that it is. Mr. Stolting?

Mr. STOLTING. Senator, it is not sold to the public. The Fishery Cooperative Marketing Act specifically states it applies only to producing fishermen.

Senator Bartlett. So if the public wanted to get in on the act, they would not be able to do it under the law.

Mr. STOLTING. No; the cooperatives, as a matter of policy, don't sell common stock to the public. There are some cooperatives, though, that do sell to the public preferred stock, or a type of security that doesn't permit participation in the policymaking decisions of the organization.

The CHAIRMAN. But they can transfer theirs, can't they?

Mr. STOLTING. Transfer stock?

The CHAIRMAN. Suppose they have an ownership. Can't they transfer it? Suppose a fisherman wanted to transfer it to his family, his wife, or something?

Mr. STOLTING. Yes. That is correct.

The CHAIRMAN. It would not be a public sale, but it could be a private transfer.

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Mr. STOLTING That can be done.

Senator BARTLETT. Pursuing that, let's say a crew member had $1,000 worth of stock, or at least he considered it to be worth $1,000. And the association said no, it is only worth $900. Could he go to his wife's cousin and sell it for $1,000?

Mr. STOLTING. Senator Bartlett, he could go to his wife's cousin and borrow the money, but he would have to take the stock out in his own name, as a producing fisherman.

Senator BARTLETT. I see. Mr. McKernan, for the benefit of the laymen who may not understand your use of the term, will you give an explanation for the record of what you mean by the "lay" system? Mr. McKERNAN. In most or many fisheries of the United States, the lay system means that the fishermen benefit from the catch, the fishermen and the captains and boatowners have a system of receiving a certain percentage from the catch. The boatowner may take 50 percent of the value of the catch, and the fishermen may divide the other 50 percent. I am using this as an example only, Mr. Chairman. But the lay system as it applies to fishermen means the participation by all members of the crew and the owners in the profits from the catch.

Senator BARTLETT. I am sure this is an important clarification for the record.

Do you know of any other group of people who are in the same situation as these fishermen?

Mr. McKERNAN. I suppose some farmers may well participate in the profits of the harvest as fishermen do, but I don't think they are in exactly the same position. I believe the fishermen are in a very unusual and I might add somewhat precarious situation insofar as benefiting from the products of their labor is concerned.

Senator BARTLETT. They can't present any united front in seeking a price for the product they catch.

Mr. McKERNAN. No; and under the present circumstances it seems to be difficult in some fisheries, and this is especially true in the case of the Alaska fishery, where the salmon all come in at once, the price must be predetermined beforehand, and the fishing occurs over a very short period of time. One can't really alter the thing, or negotiate or bargain during the course of the season, because if one does this, why, you miss the run. You can't go back out there and find the fish 2 weeks later, as you can in some other fisheries of the United States. If you aren't tooled up and aren't out fishing when the run comes through, you have missed it.

There are peculiar circumstances in the Northwest salmon fishery that do not exist anywhere else in the United States.

On the other hand, I hasten to add that I think some of these problems exist in some other segments of the industry, although it is not quite so clear in some of them.

Senator BARTLETT. Why aren't you so sure that if S. 1054 were applied to all segments of the fishing industry, that that industry would benefit?

Mr. McKERNAN. Well, I am not sure that under some applications of S. 1054 there would not be interference with fish coming into the markets in cases in which it must be sold immediately. Some of the auction systems around United States now provide for this very prompt disposal of the fish at the marketplace. And this is na

question that comes to mind, that comes to my mind, that any attempt to provide for a fixed price might actually have an adverse effect on getting a good fresh product to the consumer promptly.

The other problem is the balance in some fisheries between vessels or people that have large investments in vessel owners, if this bill were to pass. That is, it might be and here again I am not saying necessarily that it would, because I think it is a very complicated and difficult question to answer-but it does seem to me that the man who has a large investment in vessels might find himself in between a more powerful bargainer in the unions and the processor on the other hand. He might in a sense find himself in the middle of these two. And it is not clear to me that this piece of legislation and its application throughout the United States would allow for a reasonable distribution of power between the three elements involved, the unions on one hand, the boat owners on the other hand, and on the third hand, the buyers.

Senator BARTLETT. Why do you recommend, Mr. McKernan, or at least suggest that the committee consider the advisability of limiting bargaining to individual buyers, as stated in the concluding sentence of your statement?

Mr. McKERNAN. I didn't quite catch the question, Mr. Chairman. Senator BARTLETT. I refer to the final sentence in your statement. Why do you suggest the committee consider this limitation?

Mr. McKERNAN. Here I was trying to perhaps look for some way to get around the antitrust implications that have been raised by Justice Department and others within the executive, Mr. Chairman. I am convinced in my own mind that generally speaking fishermen must have an effective bargaining position. And I am quite certain that in some places they don't have. Yet I must in all truthfulness say that I am not completely satisfied with all aspects of this bill and its implications on antitrust laws.

Therefore this is an attempt to provide one possible solution to the antitrust implications of the bill itself.

Senator BARTLETT. The record is very clear that up to this point. I have not uttered the word "Alaska." You did several times, but since you did, I am going to ask you, with the chairman's permission, something about the Bristol Bay red salmon run this year.

How many fish came into the bay?

Mr. McKERNAN. I believe that when the figures are all in, talking now about red salmon alone, because there are a few pink salmon mixed in with the catch, that there will be between 55 and 60 million fish that will have entered the bay, about 25 million of them to have been caught, and the remainder to have escaped.

Perhaps this will be the biggest run in the history of Bristol Bay, at least the biggest run that has been measured with any accuracy. Senator BARTLETT. Bigger than 1938?

Mr. McKERNAN. There is pretty good evidence that this is bigger than 1938.

Senator BARTLETT. What were the predictions on the part of the Americans?

Mr. McKERNAN. There were a number of predictions. The prediction that was accepted, generally accepted, was for about 27 million fish, plus or minus about 9 million. So the predictions were low. There were some later predictions based upon high seas evidence earlier in the year, in fact in May, which raised this prediction and

gave indications of a run of perhaps as much as 40 million fish. But our prediction methods were not accurate enough to give us confidence that there would be a run of this size.

Senator BARTLETT. Do the Japanese make any independent predictions?

Mr. McKERNAN. The Japanese used our data, and in a conference of scientists they came up with an estimate quite close to ours, about 28 million where ours was 27 million. But the prediction was very close to ours.

On the other hand, they were using our data. They had none of their own.

Senator BARTLETT. They don't have any data of their own, upon which to formulate predictions?

Mr. McKERNAN. I think there is quite good data in the high seas catch records of those fishing boats that are fishing in the area of heavy intermingling, but this data has not been put in a form where it can be usefully analyzed and put into computers and estimates made from it.

We have started to do that this year, and this later estimate I mentioned, which did indicate a larger run than previously predicted, this came from using data from the high seas fishing boats of Japan. And I suspect, Mr. Chairman, if I can speculate a moment, that the reason it underestimated the very large run was the fact that the run was made up of small fish, fish that had spent only 2 years in the ocean, and perhaps a smaller percentage of these fish had migrated farther west of the provisional abstention line than usual, so that in estimating the size of the run from the catch records of the Japanese, you would tend to underestimate on that basis. I think there was some effort made to correct this, because we judged that a smaller proportion of the run would go west, but I suspect we undercorrected. Senator BARTLETT. On the average, didn't it take 16 fish to make up a case, instead of the usual 12?

Mr. McKERNAN. Yes, as I understand the fish were smaller and it took 16 point some fraction fish per case.

Senator BARTLETT. Mr. McKernan, was there sufficient escapement in each of the streams entering Bristol Bay?

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Mr. McKERNAN. I think the general answer to that is "Yes." haven't seen the final figures and I don't have them, the data, clearly imprinted upon my mind. But I think most river systems achieved quite adequate escapement. And of course the Kvichak system, the big Iliamna Lake system, achieved a very heavy escapement. Of course there will be speculation, as in 1960, that there is too much escapement. But I am a little more conservative in that regard than some. From the escapement in 1960 that everybody judged as being too high, we got this record run. So I think that the optimum escapement is still unknown and I don't know that we can tell yet what the optimum escapement is into these great inland lake systems.

But at least there was a tremendously heavy escapement. I was in the bay area and saw this escapement in Iliamna Lake and it was really quite tremendous.

Senator BARTLETT. Was fishing good for each of the river systems? Mr. McKERNAN. No. The fishing was not so good. Some river systems, the fishing was only modest, and relatively poor. For example, in the Nushagak system, a very important system, because it

is adjacent to the town of Dillingham, the fishing was not particularly good.

Senator BARTLETT. What other systems weren't good?

Mr. McKERNAN. I don't think the Togiak system was too good, which lies to the north and west of Nushagak. The Ugashik fishing was only moderate. The rivers that produced the major runs were the Egegik and the Naknek-Kvichak systems. The other districts were only average or below.

Senator BARTLETT. Do you have any explanation to account for this, for the heavy run in some places, and the modest or poor run in others?

Mr. McKERNAN. No, I don't. There might have been selective fishing on the high seas, of course. One must remember that the fish, the size of the fish expected in some of these other river systems were normal. That is, larger. And there is no question about the fact that the high seas fishery is a selective fishery, it will select out the larger fish. If I could be permitted to speculate, I would say that the high seas fishery did catch a disproportionately high share of these river systems which had only moderate runs. They did this because the fish were larger, and the nets, the gil nets that the Japanese used in the high seas could be expected to be more efficient toward the larger fish and less efficient toward the smaller fish, which were in much greater abundance.

So I think that this might explain the fairly moderate runs in some of the other systems.

Here again I am speculating, Mr. Chairman, and I have no direct proof of this. But nevertheless this is what I would judge from what knowledge I have.

Senator BARTLETT. Did you say the bulk of these fish were 2-year fish?

Mr. McKERNAN. They were two-ocean fish. That is, they had spent 2 years in the ocean. They spent 3 years in the lakes. You may remember the life history of Sockeye is that they spawn in tributaries to lakes and the young fish come down and spend a period of time in these lakes. Now the great abundance of the young in Lake Iliamma and Lake Clark, that is, the lakes of the Kvichak River system, apparently meant that these young fish were not ready to go to sea at their normal time, so they stayed in the lakes 1 year longer. They stayed 3 years in the lakes. That is the 1960 escapement of fish that produced this run. And these fish came down and stayed in the lakes 3 years, and migrated out in the spring, and then they spent two summers in the ocean, and returned this year.

Senator BARTLETT. Are we to infer from what you say that they lived a normal lifespan then, but spent 1 additional year in fresh water?

Mr. McKERNAN. Yes.

Senator BARTLETT. Did you suggest, Mr. McKernan, that on account of this abbreviated stay in salt water many of these fish might never have gone west of 175° west longitude and placed themselves in a position where they could be caught by the Japanese?

Mr. McKERNAN. Yes. Our scientific data indicates that when the fish spend a longer time in the ocean, they tend to migrate a greater and greater distance from the American shores.