State officials block private ferry companies from competing on Lake Chelan
Government officials “protecting” a business from legitimate competition by allowing it to operate as a monopoly is a scary thought but it is exactly what is happening to a private ferry company on Lake Chelan right here in Washington. Fox News has the full story.
From the scenic waters of Lake Chelan in Washington state, comes a battle over big government that could sail all the way to the U.S. Supreme Court.
This issue is whether Cliff Courtney and his brothers, who live and operate a tourist resort in the isolated village of Stehekin, have a right to compete with a government-sanctioned ferry monopoly.
“Economic liberty, in this case, is the right to make a living,” says Cliff Courtney. “The lake is our maritime highway; it’s our only access in.”
The only way to Stehekin is by float plane or ferry, which is owned by the Lake Chelan Boat Company. Two boats run the full length of the 50-mile lake once a day in the summer. During the off-season, service drops to one boat trip three days per week. The company’s owner, Jack Raines, has so far successfully fought any and all competition.
“That would eat away at the profits of this company,” says Raines, “and make it more difficult for us to run in the winter.”
The ferry needs to have 25 passengers to break even. During the tourist season the two ferries, which can carry more than 400 passengers between them, are usually packed. But during the winter there are only a handful of days the ridership pays for all the expenses. The Courtneys argue if there was competition, services would be better and ridership would increase year-round, bringing in enough business for two companies to survive.
Allowing the monopoly is Washington’s Utilities and Transportation Commission. Asked by the legislature recently to defend its position, the commission wrote, "a single, regulated provider can maintain service without the threat of having customers drawn away by a competing provider."
The Institute for Justice, which is arguing the Courtneys' case in the 9th Circuit Court of Appeals, says that violates the 14th Amendment and the Founding Fathers' principle of economic liberty.
“This case seeks to end not just Washington’s attempt to monopolize ferry service on Lake Chelan,” says Michael Bindas of the Institute of Justice, “but all efforts by government to block or impose obstacles to entrepreneurs.”
Both sides agree some monopolies make sense, such as railroads and utilities. This fight is over bureaucrats picking winners and losers elsewhere at the expense of free markets and those pursuing the American Dream.