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The Rena disaster and response: a study in neoliberalism’s failures

Written By: - Date published: 2:00 pm, October 26th, 2011 - 24 comments
Categories: disaster - Tags: ,

The Rena. A Neo-Liberal failure.

Nearly three weeks ago now a container vessel grounded on Astrolabe  reef near Tauranga, New Zealand.

Shipping accidents like the Rena are entirely at the door of Neo-Liberal economics.

The foreseeable results   of Globalisation, de-regulation, the endless search for the cheapest, the socialisation of risks and the privatisation of benefits..

Tired, overstressed, low paid  crews,  cheaply built and maintained ships, inadequate or ignored regulation and excessive workloads are the norm at sea.

Flags of convenience exist entirely so that shipping companies, and shippers, can reduce the costs: of corporate and income taxes, safety  standards, operating standards, crew conditions and wages and build standards of shipping.

They allow a competitive race to the bottom to see who can become the cheapest.

There is no reason whatsoever to use a flag of convenience if you intend to operate a vessel to a high standard. There would not be any cost savings.

The constant struggle to maintain cheaply built ships, designed and built for a 15 year life. Is bad enough when they are new.  5 or 10 years  beyound their design life , keeping them going is a 24 hour a day job.

Low wages, mean that high quality well trained crew find other work ashore or in higher paid work like the oil industry.

Masters and Chief engineers are often the only properly trained and skilled members of the crew, with the numbers made up of cheap labour with dodgy qualifications.

It is common for crew to be on board working shifts with less tha 8 hours off a day for more than 9 months.

Training standards are variable, with a noticeable drop in the standard of training, even from first world countries.  At the same time crew numbers have been dropped so there are not the personnel available to babysit and train.

Seafarers are expected to rest in ships with levels of noise and vibration that would have been totally unacceptable thirty years ago.  Ashore in NZ it is illegal to get people to work, let alone sleep, in those conditions

In New Zealand, Masters who refuse to sail because of broken equipment or rough weather and crew members who refuse to falsify rest hour,  maintenance, safety  and leave records are protected by our employment laws.

A sacking for those reasons, in New Zealand,  would be a legitimate case for unjustified dismissal.

On FOC ships  they are sacked or their contracts are simply not renewed.

The worst of it, since the 1980’s and Governments cave in to the farming lobby on Cabotage, in NZ, even local shipping companies, whatever their intentions , are also cutting standards to compete with cheap overseas shipping.

The contradictory statements and outright spin coming from Maritime New Zealand and National are excuses for delay, not reasons.

I know, that given the resources, pumps, tugs, helicopters, barges, hoses and other equipment available in Marsden point, Tauranga and Auckland, oil could have been pumping off the vessel within 24 hours of the grounding.

We know the ship had power and heating to the bunker tanks for the first few days.

It was obvious to mariners that with damage forward and the depths below the ship she would be aground for many weeks, if she could be refloated at all.

Given that,  power and fuel oil heating would be lost if the ship was more damaged, bad weather was forecast within a week and the ship was only supported along half her length, making breaking up in bad weather almost certain, getting the oil off should have been top priority.

MNZ’s on scene commander has the legal powers to commandeer equipment, vessels and personnel to avoid oil pollution.

Ships piping can be adapted to pump overside to a barge within a lot less than 4 days.

Heating would have been on for at least the tanks in use. Takes less than a day to heat further tanks.

If the pipework was too damaged to use, which was highly unlikely for the after bunkers, portable pumps and generators could have been choppered to the vessel within hours.

While the oil was hot almost any pumps could have been used at rates of hundreds of ton an hour. Instead of a specialised displacement pump, required, after it had cooled.

Any barge or vessel capable of holding oil, which there were several around, could have been used to pump into, initially.

Awanuia does not take 4 days to go to Marsden point, empty, and return to Tauranga. More like 8 hours to Marsden point. About 7 to discharge and no more than 12 hours to Tauranga.

Bunker piping is available on the wharf in all three ports.

We have Mates, Masters and engineers in NZ that have years of experience on pumping fuel between ships and making things work in adverse conditions.

When we have a valve failure in a tanker we do not leave it sitting around for 5 days at 60k plus a day while we wait for an overseas expert or for negotiations with insurance companies.  . We open a manhole and pump it out using a salvage pump.

If fuel pipes or anything else fails at sea we fix it.

The whole thing is an in indictment on the lack of preparedness of MNZ, helped by lack of funding and lack of experienced and qualified seafarers in the top ranks.

It has become obvious that MNZ had no idea of the personnel and equipment, already on hand, that could be used.

Strange, considering that some of the skilled personnel work for MNZ.

This episode has also exposed the lack of preparedness and equipment for a serious spill. Due to lack of funding.  To keep the costs of oil pollution levies, and hence shipping costs down.

Successive Governments have been told many times  the race for the cheapest shipping costs makes more of this sort of accident inevitable. They all failed in their duty to prepare for it.

Appointing chair polishing ignoramus as bosses in MNZ, allowing substandard FOC ships, many of which which would not be allowed on the EC coasts, to  starving emergency response planning and equipping of funding, is at the door of all our Neo-Liberal Governments since 1984.

The ineptitude and lack of preparedness does not make me confident of their ability to monitor deep sea drilling.

– KJT

24 comments on “The Rena disaster and response: a study in neoliberalism’s failures”

  1. Mighty Kites 1

    Clutching at straws aren’t we? Sad that the overwhelming majority of ordinary NZers have nothing but contempt for your rabidly socialist Unite rent-a-crowd stopping tax-paying citizens from using parks across the country?

    • aerobubble 1.1

      I don’t want your fancy light bulb spin, stop telling us what we think.

    • toad 1.2

      Think you are the one clutching at straws MK – KJT is an experienced seafarer who knows his stuff. He’s put me right a couple of times when I have made mistakes about maritime law in blog comments elsewhere.

  2. JS 2

    You could make a similar case for neo-liberal failure for the Pike River mining tragedy and now the gas pipeline breakdown. Years of fragmentation, privatisations, getting rid of staff with insititutional knowledge and expertise, and no one taking responsibility.

    • Rob 2.1

      Yes exactly, because there were absolutely no disasters encountered before this neo-liberal revolution, or if they did happen there was no loss of life, or any slight mess to clean up. Yeah Rite.

    • Jenny 2.2

      You could make a similar case for neo-liberal failure for the ……..

      – Auckland Powerboard privatisation that saw hundreds of lines workers sacked letting the aging transmission cables feeding into the city to decay, eventually plunging the city centre into darkness. –

      ………Years of fragmentation, privatisations, getting rid of staff with insititutional knowledge and expertise, and no one taking responsibility.

      etc. etc. etc.

  3. Nick C 3

    There is obviously a need to both have efficient international shipping which uses scarce resourses efficiently (minimises cost), and make that shipping safe with minimal risk. To an extent these are conflicting goals. The real question is which system creates the best incentives to get the best mix of both: Capitalism or an unnamed alternative?

    Capitalism has obvious advantages provided that the correct incentives to minimise risk are in place. Compaines have an incentive to minimise cost. There are also incentives to minimise risk: Cost of damage to capital, loss of cargo, loss of company reputation. So there are clear incentives not to produce at the lowest possible cost by doing things like picking a random drunkard off the street and making him captain because he will do it for lower wages, or building boats held together with chewing gum because its cheaper than welding metal.

    The proper role of the government in a capitalism system is to internalise the external costs of the accident, further increasing the cost of not minimising risk. E.g. lay criminal charges against the captain, making the shipping company pay for environmental damage and loss of business. If this is done properly, and theres no reason that ‘neo-liberalism’ stops these sorts of ‘polluter pays’ regulations and systems of tort law, then you will have a capitalist system which appropriatly balances the efficient use of scarce resourses and the minimisation of risk.

    At very least you cannot blame capitalism for the flaws in International Maritime Law.

    Besides: What is your alternative? Have a ‘Ministry of Shipping’ who have a legal monopoly over all shipping in NZ. You might want to think of the perverse incentives on politicians before you propose that.

    • framu 3.1

      just curious nick – why are you in the main talking about capitalism, when the post is about the failures of neo-liberalism?

      surely neo-liberalism is a subset or style of capitalism.

    • Richard 3.2

      It seems public sentiment is turning back towards a positive attitude towards the government’s handling of the situation. The salvers are making good, steady progress, and the bad headlines are more or less gone. Looks like milking this one may not go anywhere; still it was worth a try, guys!

      Also, blaming this on “neo-liberalism” seems kinda stretching things a bit, I mean, until now the biggest ship that sank here was the Mikhail Lermontov: I think that you’d agree that it would be implausible to blame that on communism as an ideology. 

      • Rob 3.2.1

        I think what is unfortunate is that there is obvously no intent on this site to keep updates on how the recovery of the oil is, or the great work the team is doing in the oil transfer project. The whole programme here is too point blame. It almost seems like you are wanting a massive oil slick to occur.

        For the record it looks like 650 odd tonnes has been transfered through no small effort on behlaf of that recovery team. I think these guys are incredibly brave and are working under extreme conditions. These workers deserve our support.

        • KJT 3.2.1.1

          The recovery team are doing a great job.

          A job which would have been a lot easier, and less dangerous, if it was started when it should have been.

        • Craig 3.2.1.2

          As for the conservative contributors to this post, I’d ask them to think carefully about how responsible, best practise private sector businesses operate to reduce risk to the general public, significant interest groups, employees, local citizens and communities, employees and stakeholders (through lost profit). They monitor the local strategic environment and adapt accordingly in the case of forseeable new circumstances, and minimise risk to others. That is precisely what the current government should have done beforehand in this context.

          Yes, the local clean-up staff are to be applauded for their courage and tenacity. However, they would not have been put at risk had the government had any semblance of suitable maritime environmental risk policy in this context.

      • Colonial Viper 3.2.2

        Also, blaming this on “neo-liberalism” seems kinda stretching things a bit, I mean, until now the biggest ship that sank here was the Mikhail Lermontov: I think that you’d agree that it would be implausible to blame that on communism as an ideology.

        What are you an idiot?

        If a ship was flagged in Liberia and sinks while operating in NZ waters, why would we blame the Liberian economic system?

        When what is to blame remains our deregulation and non-enforcement of local maritime standards, allowing vessels to operate below par.

  4. prism 4

    Interesting post KJT. It is also interesting what contrivances people commenting use to step away from the main point of contention. What a load of right wing trolls have commented so far.
    While it is always possible for something to go wrong, as evidenced by the Wahine tragedy, if there isn’t avoidance of regulations and following safety measures, plus cost-cutting, the possibility of problems is limited. And that is the main point when considering the Rena, not arguing about whether the response to the actual disaster could have been a little faster.

    Thinking about inept management resulting in disasters and protracted and expensive clean-ups is relevant. We have seen the trend to generic management appointees too often instead of looking first to those well-versed in their chosen sector.

    However the Rena response is a positive contrast to the slowness and apparent amateur lack of expertise and inaction over Pike River, the heavy-handed martial law approach in Christchurch and the disgraceful debacle of the building standards agency and the leaky homes syndrome.

    • Rob 4.1

      “Thinking about inept management resulting in disasters and protracted and expensive clean-ups is relevant. We have seen the trend to generic management appointees too often instead of looking first to those well-versed in their chosen sector”

      So sort of like sending Chris Carter to sort out corruption in Afghanistan.

  5. Craig 5

    Exactly. The Key administration is ideologically driven to decimate public sector capacity, without due regard for any risks to the general public, the liveable environment, adjacent small businesses, iwi and other key stakeholders. The Rena disaster is only the beginning if this is allowed to continue. However, this will also result in anger and distrust of the incumbent government that perpetrates this incompetence and failure of strategic risk management.

  6. These are all encompassing failures that present themselves in many environments. The Rena disaster was visibly obvious, but the state of our fresh water systems are just as chronic but largely ignored. Just how bad do things need to get before the same level of urgency is applied?
    http://localbodies-bsprout.blogspot.com/2011/10/waituna-revisited.html

  7. mik e 7

    well with all the biosecurity breaches its a wonder we ever get ahead.So why would you cut staff at biosecurity,when we know that free trade laissez fair brings other costs that are shifted onto the taxpayer when the cost to our economy is counted up its not small bickies in times of tight budget.leaving our commodity based ag sector vulnerable.

  8. Colonial Viper 8

    KJT – frakin stella mate.

    • rosy 8.1

      +1. Great post KJT. I’ve had it in mind to summarise your comments on this topic for my own future reference. I’ve found them well-reasoned and informative.

  9. locus 9

    KJT, thank you for such a well-informed and well-reasoned post. I am confused by the defensive bumbling bleats from the likes of MK and NickC, and their failure to look for or be interested in finding the root causes for this disaster leaves me bemused.

  10. johnm 10

    Neo-Liberalism’s creed is the free market is best and operates to give the lowest costs and highest profits with little or no government oversight or regulation. Profits privatized losses and disasters socialised to the people and environment.
    Some more examples:
    1. The bankers’ Ponzi scheme in league with compliant governments bailed out at the expense of the Public.
    2. You export your nation’s manufacturing to Asia for the cheap labour thereby increasing corporate profit while 47,000,000 of your countryman exist on food stamps : a sort of human wave Rena oil spill externalised by a system of greed that no longer wants them.

    A race down to the bottom line of more profit at any risk and cost to those except yourself.

    Key is a symbol of the system: an ex currency speculator from a gone bust Merrill Lynch outfit.
    The voters buy his salesman charm: which is sell yourself first smiling, waving,good grooming, nice suits,affable all is always well manner, and sure as sun up the suckers will buy it!

    Oldest trick in the book!!!

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