Herring and Class Struggle

Capitalism came late to Iceland. At the end of the 19th century this large, wind-swept, thinly populated island was made up of small towns, farms and seasonal fishing stations. Then European capitalists saw another Klondike in the herring-rich waters of the north Atlantic..

Sunday, 12 February 2017

Eight week fisheries strike bites hard as Iceland's establishment gets rattled

Icelandic fishers have been striking for two months and a report published yesterday by Iceland's Fisheries minister, Þorgerður Katrín Gunnarsdóttir shows just how much fishing is really worth to the government and employers.

Fisheries minister Þorgerður Katrín Gunnarsdóttir

The report notes that since the start of the strike on 14 December 2016:
  • The production and export of fresh whitefish has dropped by 40-55 percent and export revenue is down by 3500-5000 million Icelandic króna (ISK)
  • Some 312 million ISK in unemployment benefit has had to be paid out and contributions to the unemployment fund paid by workers are down by 126 million
  • The treasury is losing tax and fishing fees
  • Central and local government income has been hit by 3,565 million ISK, of which 2,998 million would have come from fishers and 567 million from fish processing workers 
  • If the strike were to continue over the capelin fishing season it would cost the economy a further billion ISK
The report also notes how much fishing workers are sacrificing to fight for their terms and conditions, as their disposable income has dropped 3,573 million ISK and the fish processing workers' income is down 818 million. If the fishing unions had united and stayed out indefinitely as planned from 10 November last year, the workers' could have won weeks ago. But it looks as though Iceland's ruling class is trying to find a way to end the strike and save face.

Páll Magnússon, head of the parliament, the Alþingi, Industrial Affairs Committee was interviewed by state broadcaster RUV last week. It was remarkable enough that he said that the government could intervene without banning the strike. Iceland governments have made fishing strikes illegal before but it appears to recognise now that the well of bitterness beneath this strike is too deep to risk banning it. Instead he suggested that fishers' food allowance could partly be treated as a travel allowance and not fully taxed.

Former Minister of Fisheries and Agriculture Gunnar Bragi Sveinsson, also raised the idea of reinstating fishers' tax breaks. These tax breaks, before they were abolished, went some way to recognise that fishing is hard and dangerous and makes huge amounts of profit for exporters and processing plant owners.

Remember president of seafood producers Samherji, Þorsteinn Már Baldvinsson? He wrote an article saying Icelandic fishers earn £100,000s a year and are better off than their Norwegian counterparts. He was also Chair of Glitnir investment bank when it went belly-up in 2008 and an article published in Iceland last year said that Þorsteinn Már and his ex-wife Helga S. Guðmundsdóttir had been paid some 3.5 billion ISK over the last six years from the company Steinn Ehf. which holds their shares in Samherji. These enormous profits, journalist Ingi Freyr Vilhjálmsson said amounted to nearly 6.5 percent of 2015's budget for the National Hospital in Reykjavik and almost 65 percent of the revenue of Iceland's National Radio or the wages of 13,500 people on the minimum wage in 2016.

The CEO of Grimsby fish market Martyn Boyers knew this strike would hit profits quickly, back in November 2016 he said,
It is not permanent, but it is a bad thing. Because of the way the system works we have fish on its way. It won't affect this week but it will the week after. The biggest issue is we don't know how long it will be. Will it be a day and they'll be back fishing tomorrow? Could it be a week?, A month? It will not be permanent, but the way business works now there won't be a really good period to cover the bad.
Boyers also pointed out that Norway, Ireland and Scotland would not be able to fill the gap left by the strike and said that the Grimsby Fish Merchants Association would be trying to put pressure on the Icelandic government to get the employers and unions to end the strike. 

Whatever pressure they have tried has not worked. Boyars was quoted in an article in British newspaper The Guardian yesterday.
Since January we have had virtually no Icelandic fish. We are currently down 75% on Icelandic fish in weight terms over the last five weeks. It’s putting pressure on jobs in the supply chain and availability in shops.
The Guardian is a middle class newspaper, which explains why the article is mostly most worried about the price of fish and the shortage of courgettes in Britain due to cold weather in Spain. Leaving aside this editorial idiocy, Fisheries minister, Þorgerður Katrín Gunnarsdóttir's report may have be intended to load pressure on the strikers but it also clearly shows that this strike can be won.

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