Published June 7, 2011

Four years ago, I wrote and researched a monstrous article that probably none of you read (‘The Crazy World of the Quota System (somewhat) Explained’, issue 11 2007). You likely didn’t read it because it purported to be an exploration-slash-explanation of ‘the crazy world of Iceland’s fishing quota system’, it was really long and technical at times, and Iceland’s fishing quota system is not a very interesting topic to most of you (in fact, most of you have probably stopped reading by now).

(Sidenote: if you are an Icelander and the fishing quota system isn’t interesting to you, more power to you, but do keep in mind that—regardless of the ‘creative industries’ (i.e. CCP’s) contribution—fisheries and how they are managed are pivotal to how life on this island will evolve, and by ignoring this you are basically ignoring every other issue that your might or should care deeply about. It all goes back to fishing).

However, as an Icelander, not being interested in the fishing quota system, how it works, who it benefits, who it affects negatively and how it does all those things is fairly understandable. It has been a heavily debated point of contention for this nation for well over two decades, and it is usually discussed, no, shouted about in a most boring, technical, complicated and obfuscated manner. A complex, million year old argument that people like to engage in by shouting unclear technicalities and odd sounding words at one another? Sign me up! But not really.

Why am I bringing this up? Well, Iceland’s government is currently trying to restructure the quota system in an ostensibly revolutionary manner. The proposed change is far removed from what the parties in charge promised in their campaign literature and speeches, but it seemingly still goes further in changing the controversial system towards something that might at some point prove superior to the one we have been embroiled in for far too long.

I say ‘seemingly’ since no one appears very sure of what it means exactly, and the opposing parties in this debate (the government and The Federation of Icelandic Fishing Vessel Owners, respectively) are both fighting heated PR campaigns to ensure their interests—the government wants people to think that it is keeping its campaign promises and being all hardcore (because this will maybe make people vote for it again) and TFOIFVO wants people to think the sky will fall if the system is changed (because it will mean this ultra-rich-ultra-powerful interest group will stand to lose a lot of its money and power, which is funny because if there’s one thing they’ve proved repeatedly over the last few decades is that they are horrible businessmen that deserve neither money nor power).

I won’t claim to fully comprehend the quota system, and I won’t claim to fully comprehend the implications of the proposed bill (again, finding a neutral assessment of it is really difficult, because—like in so many cases nowadays—the only people that seem to care have much vested interest in how it is perceived. We need a journalist, stat!). However, I will make some claims about my own position, based on what I have learned from being raised in a small fishing community and also from following news and stuff, and also having my fishing captain grandfather yell at me about it. In Q and A form. Right now. It’s what I think.

Is a fishing quota system necessary?
Of course! There is a limited amount of fish in the ocean (despite what you might have heard), and if we plan on going about harvesting it for food and profit, we will need to ensure that we don’t, like, catch every fish out there. That might render fish extinct! Of course we need to control how much is caught annually, and we need to do this based on sound scientific research and evidence.

What’s wrong with the current fishing quota system?
Nothing much. But then, so much. The problem isn’t that we have a system to control how much fish we fish, the problem lies in the execution.

What’s wrong with the execution then?
Well, firstly, the way the quota was handed out in the beginning is, at best, suspect. Perpetual rights to uncaught fish in the ocean were handed over to fisheries and vessels in the early eighties based on previous years’ ‘fishing experience’. If you wanted to start your own fishery after that, you had to buy or rent quota from the folks it had been allotted to initially.

Didn’t that make quota disproportionately valuable compared to caught and processed fish?
Yes, but that maybe wasn’t a problem. Until 1990, when they made the quota into a tradeable, mortgageable asset, effectively creating a ‘stock market’ for the sale and renting of fishing quota. Picture this: you own a fishery and some trawlers. And a lot of debt. Their total value is x million ISK, and your total debt is double that. You now suddenly have an intangible asset (“the right to catch, process and sell an x amount of fish annually) that you were given in the early eighties and that you may now mortgage, rent or sell for very tangible rewards. This is your personal property; the fishermen, workers and community who contributed to the ‘fishing experience’ that earned you the quota in the first place have no claim to it. You may do with it as you will.

And I am free to sell, rent or mortgage it as I will? I can sell it sans boat or fishery or staff?
You sure can! In fact, you can sell it without paying off the debt of your fishery, which will be unable to function without the quota and will have to rent overpriced quota in order to operate, maybe from the very people you sold it to!

And I get to keep the money?
Yeah. Pretty much. It isn’t heavily taxed. There’s now a nominal ‘resource tax’, but it’s… not very high. You can sell that quota and move to a warmer climate, leaving the community that fostered you to wither away. Or! You can invest in Reykjavík real estate development, shopping malls and banks (interestingly enough, almost none of the infamous ‘quota sellers’ went on to invest in the communities that fostered them)! You can even use it to buy a bank and transform it into a hedge fund if you want! In fact, neoliberal mogul Hannes Hólmsteinn Gissurarson has remarked many times that making the quota into a tradeable asset was a prerequisite of the financial bubble we all know and love (in the aforementioned article: “It has created a lot of capital, and is one of the explanations for the accumulation of capital abroad […] the fish stocks [that] were a common good before, and therefore valueless, as all common goods are, became a private good, and got valuable”).

Sounds great! I’ve also heard that this makes fishing more efficient, as the quota accumulates to those best fit to management, and thus creates more value for society. What a great deal!
Well, define value. I keep thinking back to 2007, when a couple of Norwegian officials visited Iceland to investigate the transferable quota system (Norwegians already have a fishing quota system, their quota’s just not ‘transferable’). There had been a lot of pressure in Norway to adopt the Icelandic system of tradeability, and these guys were sent here to research if it was a good idea.

After travelling the country for months, conducting their research, they were interviewed by RÚV radio show Spegillinn on their way home. They were asked: “Will you recommend Norway adopt our system?” Their reply: “No. While we have discerned that it does create a lot of capital, and we are interested in capital, we are also interested in keeping our small fishing towns populated. We feel that is efficient and valuable, too. If we were to recommend it, we would make sure that quota trading would be limited to larger fisheries and vessels selling to smaller ones, as it seems to have accumulated in a few large fisheries in Iceland. And this seems to have had a negative effect on your fishing towns”.

So what you’re saying is…
A system to control how much fish we catch is very important. Creating an intangible, yet tradeable, rentable and mortgageable commodity is not. It might appear efficient to harvest and process all our fish in a single monstrous and automated freezer trawler, but it really isn’t! By that same logic, it would be extremely efficient if all Icelanders lived in a single apartment complex in Breiðholt (how much would we save on heating and transportation costs? A lot!).

So what’s being changed now?
I’m not sure. Maybe we’ll have an article on it in our next issue. Maybe not.