Europe’s Fisheries Stuck Behind the Iron Curtain

It takes a revolutionay to see the light, reject state socialism, and see that the ownership of property is key for a free and  prosperous society. It takes a particularly brave soul to introduce the idea in fisheries.

Individuals Owning Property Is Bad?

The idea seems preposterous. But, former Commissioner Maria Damanaki, did just that. While the reform of the Common Fisheries Policy, as put forward by the Commission was in the main backed, Member States, the fishing catching industry and most (although not all) NGOs banded together to generate the idea that modern property rights should not be used in fisheries.

By modern, I mean the idea that individuals can own and trade property with limited interference from the State. After the demise of communism in most of the world, the economic ideas of North Korea, that reject the idea that individuals should hold property rights, own farms and housing, have been soundly discarded. In any other area of economic life, people who wanted a return to the economic middle ages would be laughed out, but not in fishing.

 Feudalism Alive

What people do not realise is that fisheries is often one of the last vestiges of  feudalism backed up by state protectionism. I am not talking about the flow of taxpayers money (which we call subsidies) that in any countries props an otherwise bankrupt industry. I am talking about two stranger realities.

First, the ownership of the quota in fisheries is often held by the government. The property right is held not by the individual, as one would with a company, farm or house, but with the State. In Ireland, the government hands the quota out each year at their discretion. In the UK, fishermen learned, after going to court, that it was the government, and not the fishermen, who owned the quota.

Second, all too often the details of who holds the quota is secret.  The UK government and industry fought off a campaign by Greenpeace and others to have the details made public. It took the common sense of the former UK  fishing Minister, Richard Benyon MP, to reveal the information.

Big Profits For Some

Fishing quotas are big business. The right to fish the sea is valuable. Leasing the stock brings returns often in excess of 10% or more. Those are returns that only some of the best hedge fund managers could secure.

Despite this less than clear form of ownership banks continue to loan money to fishermen based on the guarantees drawn from the quota. And, fishermen buy and sell quota in a less than public, but never the less profitable, market for quota.

There Is An Alternative

But, there is an alternative. In California, the US NGO  The Nature Conservatory were allowed to buy  the quota in Morro Bay, California. They were able to buy a lot of it. But what they did with it is remarkable. They leased the quota back to the local fleet. But, they placed conditions on what fishermen did when they went fishing.

The fishermen did not like this. Rich outsiders were coming in and telling them how to fish.  This NGO would only lease quota to boats that used selective fishing gear and  demanded that the vessels use CCTV to ensure that the rules were complied with.

I suspect the fishermen were angry as hell. Rich outsiders had turned up on their patch, bought up what they saw as their quota, and imposed rules upon them they did not want. But, with private property rights protected in the US, they didn’t have government to turn to as the government no longer owned the quota. It was now in the hands not of self-interested venture capitalists, but of philanthropists,  who wanted to bypass the indolence of the regulator, politician and fishing lobbyist, and drag the industry into the 21st-century.

Unsurprisingly, it all worked. The industry prospered, the stock, in an and in all likelihood the value of the quota of style skyrocketed, and the idea of returning to the past would be laughed away.

Why Europe Should Follow

 Philanthropists and venture capitalists should be able to do the same thing in Europe as they can in America. But, governments, all too often beholden to the interests of fishing industry trade associations, will stop this.

Even countries that have introduced ITQs, all too often introduce national ownership rules. Of course, whilst the idea of nationality requirements and residency rules are contrary to EU basic principles, it will not be easy to drag some of  the industry into the  21st Century.

Interestingly, many fishermen realise this to be the best way forward. They want ITQs, they see the benefits, they know it works.  And, it is clear that if governments allowed the progressive investment community to enter into the market, stocks in the North Sea, the Baltic, and other parts of Europe’s seas and oceans, could be bought, and preserved.

Time for Government To Step Out

 The challenge is for government to remove itself from the equation.

The government’s track record on fisheries stock conservation is in most cases a poor one. As anyone who has witnessed the EU’s annual quota setting exercise, ministers  seem more interesting in appeasing their industry by briefing their industry representatives, before, during, and after negotiations, and I’m sure there have been cases when governments signed in fishing industry representatives as part of the government delegation.

It was not surprise that the former Greek Revolutionary Communist, Maria Damanaki,  took the opportunity to work with The Nature Conservancy when she left office. She has seen the future, and she knows it works.

The Brussels game is changing – are you?

The rules of the game in Brussels have changed.  President Juncker’s Commission has a very new political agenda, and one which it intends to apply with new rules on how the Commission works.

NGOs and others seemed to be caught off guard when these rules got changed. Some seem to refusing to accept that the rules have been changed, or are hoping that the rules  will get changed back. That is either wishful thinking or delusional.

The signs of the changes in the rules of the game had long been advertised.

In campaigning and lobbying I see the side-effects of those who don’t want to change.

Is the System Really Broken?

Several years ago when I worked at WWF, I worked on the annual fishing quotas adopted in Brussels at the end of December. When I started I was surprised to learn that, despite a lot of lobbying from NGOs, quotas were adopted year after year that ignored scientific advice.

I could not understand why. I was told that “the system is broken”. It sounded plausible but I needed to check. I am by nature sceptical and curious.

I learned by speaking to key players that the key decisions were in reality taken far earlier in the year before WWF had started work, and often imposed by Norway, who we had never spoken to.

When  we adjusted our game, and spoke with the Norwegians, and started far earlier in the year, the result was a lot different, and we got what we wanted.

Head in the Sands in Brussels

The European Commission’s ‘jobs & growth’ agenda is very different. And, unless you have had you head in the sand, things will be very different.  There is no appetite to table popular if stupid proposals under Juncker.

However, a lot of people still can’t be bothered to spend 30 minutes reading the new rule book.  I would hate to read the regurgitated advice they are giving  (advice that was is likely similar to that given under Prodi, let alone Barroso).

For example, a client was faced with proposed restrictions on their business, which for all intents and purposes would close them down. What was happening looked they everything Juncker’s political guidelines were against. And, when this was flagged to the right people, sanity was seen, even at a late hour.

Change or Perish

Changing the game tactics is often seen by some as a personal affront. Some people have been playing the same game in the same way for ever. They think that there is only one way to play.  They are wrong.

Values are of course permanent: integrity, decency, concurrence.  However the ideas and techniques used to win only stand the test of time based on one simple criteria: do they work. If they do not, the solution is simple, get rid of them.

Copy Charles Darwin

Charles Darwin is often cited as saying “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”

Charlie Munger has many good ideas. One I like a lot is the idea of “Invert, always invert.” He suggests that really hard problems can be solved if approached backwards. This answers often come from trying to  discredit your assumptions. It is not for the faint hearted, but the faint hearted should try another job.

What Game Are You Playing 

It’s dangerous to be stuck in one technique, one perspective, one idea about what works. It’s even worse if the game you’re playing, has the rules changed, and you either fail to notice that the rules have been changed, or you play on just pretending things are the same. When you lose, which you will, you will likely blame some unique conditions, or an off day. You’re likely not realise the reason you lost is that the game has just changed, and you are no longer in the game.

A Not So Public Consultation

Today, DG SANTE published some of the responses to their public consultation on EDC.

You can see their news here.

The strange thing is the submissions are anonymous.

To save you time, I have uploaded the large file.

edc consultation

Other public consultations I have followed (see here on CFP) have seen the Commission putting the responses online in full.

This consultation is also stranger than most because seemingly no public agency has made any submission.

And, if you would like to improve your Spanish or German, you can see exactly the same response copied out and submitted several thousand times.

 

 

How the Commission adopts proposals.

President Juncker’s Commission has new working rules that help concentrate power in the hands of the President.

[spiderpowa-pdf src=”http://www.aaronmcloughlin.com/wp-content/uploads/2015/02/COM-SG-instructions-COM-working-methods-2014-20193.pdf”]COM SG instructions COM working methods 2014-2019

I have sought to summarise these new procedures in a process chart.

[spiderpowa-pdf src=”http://www.aaronmcloughlin.com/wp-content/uploads/2015/02/Idea22.pdf”]Idea(2)

When examples come to light, I will develop a case study.

Feedback and examples appreciated.