Many people in Haines will respond to news of $20 million to rebuild Lutak Dock as great news and a Christmas present from Uncle Sam.
They’re wrong. It’s neither of those things. The taxpayer bailout of the dock amounts to a corporate subsidy to Alaska Marine Lines and others in the shipping and freight business. It’s also a huge slice of government pork served up to contractors who move dirt in Haines.
But more importantly, the $20 million represents a lost opportunity to use a rare infusion of public money on genuine public needs in Haines.
That $20 million could have bought our town improvements a lot more deserving than an expanded freight dock, including new floats at our expanded downtown boat harbor, a new firehall and police station, or re-construction and paving of borough roads destroyed in last December’s storm. The leftover change could have replaced the pool’s ventilation system, expanded the library to create a non-claustrophobic assembly meeting space, or permanently surfaced on our town’s running track.
The $20 million is the biggest single pile of cash ever to land in this town. Nothing like it will come for a long time. Worse, we won’t even be able to ask federal representatives for that kind of money again for years. The response would be, “Well, Haines got $20 million in 2021. You’ll have to wait a while for your next turn.”
How the Lutak Dock remained at the top of the Haines Borough’s list of priorities despite the fact the AML agreed two years ago to rebuild the ramped freight dock at its own expense is an enduring mystery, but we know this much: Influential people wanted it. Those people included the owners of the town’s lumberyards and grocery stores who are afraid that without public subsidy of a dock here, their freight charges would go up.
But that’s exactly how freight docks work in every other community in Southeast Alaska. Freight companies – Alaska Marine Lines, Samson Tug and Barge Co., or other private shippers – own and operate their own docks. Presumably, the cost of maintaining those docks is included in the shipping costs that grocery stores and lumberyards and other businesses pay to get their goods.
In turn, those costs are passed onto consumers in the prices they pay at stores.
It appears that Haines business owners are afraid that if taxpayers didn’t subsidize the dock, and if dock costs instead are added at the point of sale, prices at their stores would get prohibitively high. Instead, prices at their stores stay competitive and consumers pay twice for goods – once at the store and again with their contribution to maintaining a freight dock at Lutak.
This arrangement works because consumers aren’t likely to consider the price they pay maintaining the freight dock when they look at the price of goods at local stores. At stores, we see only the store’s price tag.
The price of gasoline in the United States works the same way. Americans pay some of the lowest fuel prices of any Western nation, but we also pay millions or billions to maintain our friendship with, and/or to bomb the hell out of Mideast nations to secure cheap oil.
When filling up their tanks, U.S. consumers look only at the posted price for gas; they don’t consider how big a portion of the taxes they pay to the federal government is spent to keep the country in the cheap fuel. Only one fraction of the true price of gasoline is visible to consumers, and oil companies like that arrangement very, very much.
In the same way, the biggest customers of AML are only too happy that Haines shoppers don’t see the full price they pay for groceries and household goods. In the end, consumers pay the full price by buying goods at local stores and also paying for and maintaining a very expensive dock.