Deregulation is one of neoliberalism's five big initiatives (free trade, privatization, service cuts, and tax cuts make up the rest). And it shows how successfully the neoliberals have framed the issue.
Who in their right mind would want more red tape?
Well, for starters, pretty much anyone who flies in Canada, eats food, drives a car, uses prescription drugs, or lives some place that could catch fire. That's just the short list.
All you really have to do is think about the profit motive and imagine that there were no regulations to moderate its impact. That's what regulations are mostly about: attempting to manage the greed unleashed by capitalism. And neoliberalism is all about demolishing that management system and replacing it with corporate self-regulation. ("Self-regulation" being right up there on the list of modern oxymorons.)
Virgil Moshansky is so prominent in the field of improving aviation safety that he received Canada's highest recognition for his work when he was named a member of the Order of Canada in 2005. He recently felt compelled to intervene publicly at the Commons Transport Committee, warning that recent cost-cutting and what he called the complete abandonment of government oversight of private airlines were creating the perfect conditions for more airline disasters. Moshansky issued a now-famous report in 1989 on a crash that killed 29 people in Dryden, Ontario, which recommended major changes at Transport Canada
Now he says most of those changes have been lost: "Regulatory oversight is not being merely reduced. Except for limited focused audits, it is being systematically dismantled." The approach now is self-regulation: handing over virtually every aspect of aviation safety to the big companies. And this when airline deregulation has made competition even more cutthroat and the motivation to cut corners that much greater.
The concept that drives this deregulation train is referred to as "risk management." In the good old days of government in the public interest, a different principle prevailed: the precautionary principle. That held that, if it looked like there might be a problem, then you assumed in your decisions that there would be a problem. In other words, the goal used to be: err on the side of caution. Now we err on the side of profit.
A short trip down neoliberal memory lane is in order here. The conflict between risk management and the precautionary principle was highlighted back in the 1990s with some very high-profile cases in which Canadian scientists--dedicated to protecting the public from dubious drugs--were harassed and bullied by the federal government, essentially for doing their jobs.
In 1996, Michele Brill-Edwards resigned from her job as a federal drug reviewer at the federal Health Protection Branch (HPB) because of what she considered to be undue industry influence in the drug approval process. She left in a dispute over a controversial heart drug called nifedipine, claiming that her superiors in the HPB ignored independent research showing the drug could actually cause heart attacks rather than prevent them.
At about the same time, five scientists assigned to evaluate BGH (the Bovine Growth Hormone developed by Monsanto) had serious concerns about its long-term effects, which had not been thoroughly studied. However, when they refused to approve the drug, they were put under relentless pressure by their superiors.
One of the five scientists, Dr. Chiv Chopra, went before a Public Service Staff Relations Board to complain. In response, one his managers threatened to ship him and his colleagues to other departments where they would "never be heard of again" if they didn't hurry their evaluations of BGH.
In both cases, the companies owning the patents were paying Health Canada for the testing. And, as clients, the firms expected positive results.
Federal spending on the HPB was cut by Paul Martin from $63 million in 1993-94 to $22 million in 1998. That money was replaced by corporate "fees." By 1998, 70% of the agency's drug review budget came from corporate "clients."
David Dodge, put in charge of "restructuring"--read corporatizing--Health Canada explained: "The regulatory approach is an old-fashioned way to deal with risk... We have to operate in the face of uncertainty. The [current] process is now geared to not making decisions. Risk management is about maximizing benefits and minimizing risks." In other words, let’s apply a strictly corporate model to protecting the health of Canadians.
The deregulation madness eventually has consequences. Planes fall from the sky. Or, as is happening lately in the U.S., people get poisoned by bad food. In the past six months, hundreds of people have been made ill or dead by contaminated lettuce, spinach and, most recently, peanut butter.
U.S. news stories highlight the fact that the Food and Drug Administration (FDA) is now conducting just half the number of food inspections it was doing in 2003. Michael Doyle, Director of the Center for Food Safety at the University of Georgia, has said, "We have a food safety crisis on the horizon." Overall food inspections have dropped by half, but inspections of U.S.-produced food has dropped 75%--to just 2,455 inspections in 2006.
When the FDA responds to criticisms, you see the same kind of language as that used by David Dodge and other "restructuring" gurus: it's all about risk management. Indeed, in the 1990s the Canadian government took radical steps that not even the corporate-dominated democracy of the U.S. dared consider. It gave to the Canadian Food Inspection Agency a dual mandate: it was now not only responsible for protecting Canadians from contaminated food; it was also responsible, in partnership with business, for promoting trade in Canadian agricultural products. The government's zeal for promoting trade led it to institutionalize a conflict of interest that undermines food inspection.
It can only get worse, given two initiatives that are currently working at increasing the speed and breadth of deregulation. The first is the deep integration initiative--now formally called the Security and Prosperity Partnership of North America--which aims to harmonize all such inspection systems to create a "single North American economy." The SPP, driven and guided by the powerful Canadian Council of Chief Executives, is the biggest single initiative in deregulation. According to New Democrat MP Peter Julian, "We're looking at potentially 300 different areas where Canada is accepting lower American standards."
The deregulation thrust goes under the Orwellian name of "smart regulation"--a term and a process thoroughly debunked by the CCPA. The CCPA's Bruce Campbell pointed out: "Growing incidence of cancer, rising asthma rates, and greater neurological disorders suggest that untested environmental toxins may be a big part of the problem. Under current regulatory methods, it could be decades before substances thought to be toxic, but not proven conclusively in a scientific sense, are banned or even restricted."
The second initiative is TILMA, the B.C.-Alberta investors' rights pact that hands over responsibility for deregulation directly to business.
The two measures, in fact, work hand in hand. Because a great deal of regulatory activity in Canada happens at the provincial and municipal level, harmonizing at the level of national governments still leaves thousands of regulations in place. There are strong suspicions that the federal government had a hand in pushing Albert and B.C. to take the first step in bringing all the provinces (and municipalities) into a massive deregulation project that would smooth the way for deep integration.
As evidenced in the U.S. FDA example, deregulation can go on even without legislation and with the public none the wiser. All you have to do is slash the number of inspectors and the law or regulation can be made all but useless. All of this is being done to enhance "competitiveness"--except that there is no hard evidence that deregulation will have any impact other than to put Canadians at ever greater risk.
(Murray Dobbin is a Vancouver-based journalist and commentator who is also an elected member of the CCPA’s board of directors.)