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East Sand Island

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Move the Terns

Environmental groups have tried for two years to breach four hydroelectric dams on the Columbia River's main tributary, the Snake River, in an effort to give fish easier access to spawning grounds. But both Republican and Democratic members of Congress from the Northwest are opposed.

The story that follows has so complicated this issue it has to be told chronologically.

· During the 1980s, the Columbia River ship channel, some six miles east of Astoria, Oregon, was dredged by the U.S. Army Corps of Engineers and the sludge was piled in an area that later became Rice Island. Over time, this grew into a 220-acre island.

· In 1996, two scientists from Oregon State University made a shocking discovery. They wondered why millions of the 85-100 million baby salmon released were disappearing before they reached the sea. They began inserting tiny radio transmitters into some of the fish above the dams. Their theory was that most of the fingerlings were killed by the hydroelectric dams or were eaten by larger fish in the Pacific Ocean. When they checked the droppings of some of the 20,000 Caspian terns on Rice Island, they found 40,000 tags. It was estimated that between 6 and 25 percent of all the hatchery fish were eaten by the birds.

· The engineers had created tern heaven. Normally, terns move from place to place since they lack a steady food supply. Rice Island is sited right next to where millions of hatchery fish swim by every year on their way to the ocean. The fish, used to being fed in the hatchery, have the habit of swimming within three feet of the surface. Terns have lethal fishing habits. Their eyesight is remarkable. They tuck in their wings and smack their prey dead on under three feet of water. They mate for life, and under ideal conditions can live for 25 years.

· The government was promptly sued by fishing interests. Fishermen figured that since the government created the problem, they could fix it.

· What to do? The terns could not be shot or driven off because of migratory bird laws. So the plan was to make another home for them. Accordingly, the Corps engineers planned to move the terns to East Sand Island some 13 miles west of Rice Island. In April 2000, they began their "tern harassment" program. The island was planted in wheat, which the terns hate. Plywood drawings of eagles, their mortal enemy, appeared. They put up plastic silt fences to disturb the bird's nesting area and were preparing to use floodlights to disrupt their sleep.

· They were immediately sued by the Audubon Society of Seattle.

· Lately, raccoons and possums have mysteriously appeared on both islands. Both creatures love to steal eggs and eat chicks. No one seems to know how he or she got there, not even the fishermen.

The situation is now in legal gridlock.

Source: John J. Fialka, "Terns Join Dams as Salmon's Foe - But Don't Tell Gore," The Wall Street Journal, August 11, 2000, p. A16.
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please answer the 5 questions below:

1. Is this a business failure or a government failure?
2. Will trying to move the terns from Rice Island to East Sand Island create a situation of increasing marginal opportunity costs?
3. Of which of the six roles of government is this an example?
4. Which of the two islands has the greatest comparative advantage in depleting the salmon population?
5. Which of the two islands has the lower opportunity cost in depleting the salmon population?

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1. Is this a business failure or a government failure?
This is a government failure. The dredging of the ship channel was not a business venture but was done by the Corps of Engineers. Their action of piling the sludge without proper evaluation of its consequences is a government failure. The government should have evaluated several sites before they created Rice Island. The government did not evaluate the effect of Rice Island on its environment. Moreover, since Rice Island had become home to Caspian terns, the government should have investigated the effect of terns on the environment.
It is the role of the government to ensure that its actions do not cause externalities that harm business. In fact, one of the six functions of the government is to create positive externalities.
2. Will trying to move the terns from Rice Island to East Sand Island create a situation of increasing ...

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