The Nation's Pulse

Beach Economics

As the economy flounders...

By 6.10.08

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SEA ISLE, N.J. -- The big news down the beach from us in tony Avalon is the fight over a mega-mansion that's being built on the dunes by a potato chip magnate from Pennsylvania.

For the rest of us, there's a "Keep Off the Dunes" sign, but for Utz Quality Foods Inc. President Michael Rice and his wife, Jane, the marketing vice president of the Hanover, Pa., snack-maker, the high dunes in Avalon were the perfect spot for their opulent new summer residence.

When completed, unless it's stopped in mid-construction by Obama's EPA or a lawsuit by Save Avalon Dunes, a litigious group of local anti-mansion property owners, the snack king's 40-room beach house will include 15 bathrooms, maid's quarters, 10 bedrooms, indoor and outdoor swimming pools, a movie theater -- all told, 14,000 square feet, six times the size of the average U.S. home, at an estimated cost of $20 million, 20 times the $1 million price of the average Avalon house.

More pedestrian, the economic news at Frank's Boat Rentals on the bay in adjacent Strathmere is that minnies are $7.01 for half a pint. That's for 24 average-sized minnows, or maybe 15 extra-big ones, enough to keep a fisherperson in flounder-attracting bait for a day of average biting.

The penny in the $7.01 price is so the sale comes to an even $7.50, with Jersey's 7 percent sales tax, up from 6 percent in 2006.

Last year, the government-regulated season for summer flounder, also known as fluke, ran from May 26 though Sept. 10. This year, running from May 24 through Sept. 7, the season is one day shorter -- two days longer in May and three days shorter in September. The government's goal is to cut the total number of flounder caught per season.

Also designed to reduce the catch, the minimum "keeper" size for summer flounder this year is 18 inches, up from 17 inches last year. Per person, the total flounder catch allowed is eight fish per day, the same as last year.

An 18-inch flounder weighs about two pounds. After cleaning, that's roughly a pound of fillets. Figuring the $75 per day boat rental, $7.50 for bait and a maximum catch of eight fish, say at 18 inches each, that's more than $10 a pound, not counting bug spray -- or $20 a pound if you catch four. Not so good when fluke fillets are selling for $15 a pound in the supermarket and with no sales tax.

Food for "at-home preparation" is exempt from Jersey's sales tax (someone should sue the state to make minnies tax exempt since they're just food to get food for at-home preparation).

In other money news, the daily beach passes in Sea Isle this year are $5, a hike of 25 percent on last year's $4 fee. You pay even if you don't stick your toe in the ocean. The charge is for walking or sitting (except Wednesdays, when it's free).

The daily beach fee is a dollar higher in more-posh Avalon and free in less-posh Wildwood.

In casino news, citizen pressure is rising in Atlantic City to get rid of the 20-foot statue of communist leader Vladimir Lenin that stands outside the front door of Red Square, a Russian-themed restaurant in the fully-capitalistic Tropicana. Protest leader Al Garrett says the statue is an "insult to our American vets." Adding to the problem, the Tropicana recently celebrated the grand opening of its new Havana Rooftop Slots.

In other casino news, the National Labor Relations Board certified last week that the dealers at Trump Plaza Hotel and Casino voted overwhelmingly to join the United Automobile Workers (UAW) in last year's disputed election. The certification came on the same day that General Motors announced that production will shut down at four U.S. plants that make SUVs and pickup trucks, idling 8,000 members of the UAW.

What that means for the UAW is fewer Hummers and more blackjack dealers, except that total employment in Atlantic City's casino hotels is currently 41,000 people, down from 49,000 in 1997.

And bad as high gas prices are for GM, the Memorial Day traffic to Jersey's beaches by official count was up 25 percent over last year. At 20 miles-per-gallon and $4 a gallon, the 60 mile ride from Philly is $12 -- $3 cheaper than a pound of flounder.

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About the Author
Ralph R. Reiland is the B. Kenneth Simon professor of free enterprise and an associate professor of economics at Robert Morris University in Pittsburgh.