Avoiding regulation and voiding our youth

One of the major functions of the state is to protect its citizens from each other. It does this in part through regulation. See, for example, Russell Wangersky’s column in The Telegram June 27th: “Cutting red tape can lead to disaster.”

Wangersky, in a teaching moment, made it quite clear that regulations/standards are put in place for our protection; that the standards are often there in the first instance because of some accident/disaster; and that doing away with these regulations could very well lead us back to the place from whence we came.

Russell’s context was the cutting of regulation by the government of Newfoundland and Labrador. I would like to take his thesis to the global level.

In 1919, the United States began the modern era of flags of convenience by allowing the registration of its passenger vessels under Panamanian flag. It did so because the American regulations prevented the sale of alcoholic beverages under its own flag. It wasn’t long before other owners and countries recognized that they could skirt their own regulations by following the American lead.

Many also recognized they could not compete with these companies and they had to follow suit. In the 1950s, the rush to flags of convenience flags began in earnest. Today, much of the world’s shipping is registered under these flags.

Owners discovered that the flags of convenience countries not only accepted lower health and safety standards than their own countries, but offered tax regimes that could only be dreamed of at home. There was a major fly in the ointment, however.

As the flags of convenience continued to expand in number and in size, the tonnage of the ships themselves became gargantuan. With the decrease in standards and the increase in carrying capacity, it wasn’t long before disaster struck. When the 200,000 tonne Amoco Cadiz grounded on the Portsall Rocks near the French coast on March 16th, 1978, the grinding of steel and the smell of oil could be heard and smelled around the world.

In 2017, China has pretty much become the “workshop” of the world. Money, it seemed, did not care who owned it and it is totally without conscience.

The modern era of ship regulation and management was not far off. The European countries had seen what lack of standards and regulation could do.

In the early 1980s, these countries — within the framework of the International Maritime Organization — set up a port state control system that basically restored regulation and standards to the world’s fleet. But not before the traditional fleets and the jobs associated therewith had all but disappeared from the developed world.

And what international shipping could do, the rest of the world’s businesses could do in spades, and do it they did. As the individual countries making up the flags of convenience nations sold their sovereignty one ship at a time, China began selling its own — one factory space at a time. In the late 1980s, it was clear that the major companies within the developed world were moving their businesses or contracting their business to concerns in communist China.

In 2017, China has pretty much become the “workshop” of the world. Money, it seemed, did not care who owned it and it is totally without conscience.

And one of the major attractions of China and other Asian nations continues to be that they allow companies from the developed world to carry on their businesses while avoiding the much higher standard of health, safety and wages that is the norm in their own countries.

And look what this avoidance has done to the world balance of trade and industry! Look at the lawlessness and dangers it is creating around the world. From our very own central Newfoundland to the rust belts of the U.S. and Canada to the suburbs of Paris, Nice and Hamburg, many of our youth find only unemployment/underemployment and hopelessness; all of this in the name of lower standards and greed.

What is to become of the world’s youth?

To come nearly full circle, Judge Leo Barry has reminded us in the context of the killing of Donald Dunphy that adhering to regulations and standards are vital with respect to policing. And many are asking: would Muskrat Falls have happened at all, or if so, would it have turned into the albatross that it has, if it were all done within the purview of the PUB?

Wayne Norman St. John’s