The Mégantic Scandal: When neoliberalism morphed into neofascism

I just finished reading Mégantic: Une tragédie annoncée, a 338-page book (Montréal, Écosociété, 2018) by Anne-Marie Saint-Cerny, about the 2013 train disaster in Québec. This is the incredibly disgusting story of how the massive, neoliberal deregulation of financial services (“shareholder rights”), petroleum extraction, transportation of dangerous materials and just about everything else in the USA and Canada (including Québec), resulted in the highly preventable deaths of 47 victims in the village of Lac-Mégantic, near the border with the state of Maine. Saint-Cerny, a veteran researcher and militant with the “Société pour vaincre la pollution”, has done an excellent job in explaining how it came to be that a single, 10 000-ton train carrying a cargo of schist oil from North Dakota, originally intended to be delivered to the Irving Oil refinery in New Brunswick (east of Maine), managed to get away from its owners on a steep slope and blow up the central part of Lac-Mégantic instead.

Saint-Cerny’s book was prefaced by André Noël, a well-known investigative journalist who has  been working for the past couple of years with the Charbonneau Commission, researching the links between several large Québec construction companies and organized crime, corrupting mostly municipal politicians in the Montréal area. While the first part of her book concentrates on how the neoliberal form of capitalism took over most of the companies directly involved in the Mégantic disaster, the second part concentrates on how the deregulation business that had already set up shop in the USA also managed to eliminate initial government attempts at controlling dangerous practices in Canada as well. Not only at the federal level, notably in the Transport Canada bureaucracy, but also at the provincial level, involving the Québec government’s ministries of the environment, economic development and municipal affairs. The last section of Saint-Cerny’s work focused on the reconstruction of the village of Lac-Mégantic and its surrounding area, involving quite a bit of municipal corruption as well, some of it linked to some of the same companies being investigated by the Charbonneau Commission.

For most of the train ride from North Dakota, through north-central USA (including Chicago and Detroit), southern Ontario (Toronto) and southern Québec (Montréal), the railcars and locomotives were part of a Canadian Pacific Railway (CPR) train, which was then handed off to the Montreal Maine and Atlantic Railway (MMA) (that used to belong to the CPR) shortly after leaving Montréal. In the first part of her book, Saint-Cerny goes through all the gory details about how Wall Street activists like William Ackman, CEO of the Pershing Square Capital Management hedge fund, plotted to take over control of most of North America’s most important railways, such as the CPR, as well as most of the up-and-coming schist petroleum (“fracking”) firms, based largely in North Dakota, such as World Fuels Services Corporation, the source of the cargo involved in the Mégantic tragedy.

In the place of relatively paternalistic bosses from days gone by, those unscrupulous investors manoeuvred into power much more vicious, ultra-individualist managers, such as CPR boss Hunter Harrison (voted “railroader of the year” in 2015) and MMA boss Edward Burkhardt, merging most of the US railways into much bigger corporations, as well as taking over both of Canada’s most important railroads, the CPR and its main rival, Canadian National Railways. Individuals of that stripe then set about reorganizing those companies in order to save billions of dollars for shareholders, notably by firing most of their employees in favour of one-man crews instead.

As well as stringing together kilometre-long “unit trains”, dozens of “pop cans on wheels” (oil cars with very thin walls) pulled along by several locomotives, some of them in very poor shape, the lead locomotive in this case having been stuck back together (quite literally!) with epoxy glue, of all things. To save even more money, the tracks that they were running on were also severely under-repaired, particularly in mountainous regions like the border between Québec and Maine. In such difficult terrain, long-existing secondary bypass tracks were deliberately ignored, the locomotives were left running overnight, even at the top of really steep hills, without automatic brakes and with an insufficient number of hand-brakes being activated, and so on and so forth, in enormous detail. Literally hundreds of corrective procedures recommended after dozens of prior “accidents” all over North America were also ignored for the selfsame “economic reasons”. As if all that were not enough, it turns out that the Bakken, North Dakota, schist oil, which ought to have been classified as “extremely” or “very” dangerous when disturbed, was in this case only classified as “somewhat” dangerous on the official papers carried on every oil train in North America! (It was in fact “PG 1” and “PG 2” oil, not “PG 3” at all, “PG” referring to “Packaging Group”.) A deliberate fabrication that had to have been made by either World Fuels or by Irving Oil.

To broaden my own understanding of all this extremely dangerous, neoliberal corruption, I also consulted a second book, Bruce Campbell’s The Lac-Mégantic Rail Disaster: Public Betrayal, Justice Denied (Toronto, James Lorimer, 2018, 200 pages). Campbell is a former Executive Director of the Canadian Centre for Policy Alternatives, as well as a leading academic at both York and Ryerson universities in Toronto. This somewhat smaller work is also quite good concerning most of these same events, although it does not go into as much detail about the roles played in all of this by the Québec government and the local municipal elite, especially when it comes to the reconstruction part of the story. It is nevertheless a good complementary read to the Saint-Cerny book, each author providing more significant detail about one or another, sometimes quite technical, aspects of this story.

In her work, Saint-Cerny emphasized the leading role played by the Conservative government of Stephen Harper, that greatly accelerated Canada’s descent into all-out, ultra-individualism between 2006 and 2015. She particularly underlined the “contributions” of John Baird, who became one of Harper’s ministers long enough to totally privatize Transport Canada’s already indulgent “control” over the transportation of dangerous substances, delegating all the responsibility for safety to each company’s own private “inspectors”! The same Baird was initially recruited from the equally pro-business, Conservative provincial government of Ontario, where he had already adopted a neofascist attitude toward welfare recipients, resulting in the death of at least one pregnant victim, while under something akin to house arrest.

After his stint with the Transport ministry, Baird, ever bit as disgusting an individual as Ackman, Harrison or Burkhardt, went on to join the administrative board of (what else?) the CPR. Not  to mention a very successful Canadian mining company, Barrick Gold, itself responsible for extremely dangerous operations, especially in Africa. Saint-Cerny, however, also included the current Liberal government of Canada (since 2015) in her denunciations, showing the lengths to which today’s Minister of Transport, former astronaut Marc Garneau, has gone to resist any pressure to adopt any kind of active government role in guaranteeing transportation safety in Canada. (Who also seems to have applied the same complacent strategy toward the Boeing Corporation and the US government, at least over the past several months, in the 2018 Indonesian and the 2019 Ethiopian airline crashes, the latter tragedy including, among dozens of others, the deaths of 18 Canadian citizens.)

From Saint-Cerny’s point of view, the Mégantic tragedy was not an “accident”, nor an “incident”, but a crime, complete with a weapon (the train), ammunition (the oil), a motive (greed) and several well-known perpetrators (including Ackman, Harrison, Burkhardt and Baird). The criminals involved were not at all the three railway employees arrested by a SWAT team from the SQ (the Québec provincial police force), in front of the television cameras, all three of whom were completely exonerated later on by a local jury.

For the past several years, a citizens’ committee from the village has been trying to get large numbers of people to sign a petition calling for a full-fledged (royal) commission of inquiry into that horrendous event. Similar to the ones already set up by the federal government in response to several other crises in the recent past, many of which were a lot less serious than this one. Saint-Cerny also supported the call for such a commission of inquiry in her book, denouncing Garneau’s ongoing resistance to the idea. She also suggested that one of the main reasons why the government does not want to set up such an inquiry is because it would inevitably reveal that Transport Canada never had the slightest opposition to the company’s adoption of extremely dangerous policies like the one-man crew, in spite of repeated claims to have done just the opposite.

Another important aspect of Saint-Cerny’s book is the way in which she put the entire tragedy into a much larger context, by pointing out how it fits in so very well with everything else we know about vulture capitalism. The CPR itself was founded (1881) after a major scandal involving big-time investors from Canada, the UK and the USA providing a slush fund for Canada’s first Conservative government, right after Confederation (1867). From the very beginning, Canada has always been built around resource extraction and railways, the governments of the day being very much under the influence of classic, economic liberalism (laissez-faire), more or less the same ideology as today’s neoliberalism. Successive Canadian governments have always been very kind to mining and railroads in particular, adopting a feudal approach toward those two sectors. For example by letting major railroads control their own private police forces, that take precedence over the regular police whenever any railroad is the least bit involved.

In spite of, I might add, the often-declared support of some of those same governments for economic nationalism instead, which most often turned out (just like economic liberalism) to mean simply helping huge private investors “make” a lot more money than they otherwise might have made, but in a somewhat different way. It is true that there was a strong tendency, caused by increasingly heated conflict between rival empires all over the world for the control of colonies (and semi-colonies like China), for various governments to get more and more involved in economic and social policy (the beginnings of what later became the “welfare state”). A tendency that some historians have called a period of “neomercantilism”, from 1880 to 1980, reinforced by the unusual requirements of the two world wars, the Great Depression and the Cold War. In that sense, today’s neoliberalism, starting with the 1973 arrival of the economic advisors known as the “Chicago Boys”, in Augusto Pinochet’s military dictatorship in Chile, can be seen as simply a belated return to the classic economic and social liberalism of the first industrial revolution (1780-1880).

In both the USA and Canada, as well as in several other Western countries, the late nineteenth and early twentieth centuries (1885-1914) are also collectively known as “the gilded age”, a smaller period that was thoroughly dominated by a group of officially-legal crooks known as “robber barons”. But there is really not a great deal of difference between robber barons back then, like John D. Rockefeller and Cornelius Vanderbilt, and the current crop of similar barons denounced by Saint-Cerny and Campbell, such as Ackman, Harrison and Burkhardt.

Nor is there a great deal of difference either between the help provided for those barons by the federal governments of both the USA and Canada, back in the Gilded Age, and similar help being provided nowadays by those same public institutions. Besides deregulation, Saint-Cerny also mentioned several times in her book the financial aid that people like Ackman and Burkhardt received from semi-governmental institutions (that did not exist way back when), like the Canada Pension Plan and the Caisse de dépôt et de placement du Québec (a provincial pension plan for public employees). Campbell also made very similar observations in his own book.

Both Saint-Cerny and Campbell emphasized as well the international nature of all the leading characteristics of the Mégantic scandal, such as the involvement of guys like Burkhardt in railway consolidations not only throughout the USA and Canada, but also in both Eastern and Western Europe. Or the very large number of similar tragedies, an all-Canadian list of which would necessarily include the 1982 sinking of the Ocean Ranger petroleum platform off the coast of Newfoundland (84 deaths), the 1992 Westray mine explosion in Nova Scotia (26 deaths), the rural Ontario water contamination scandal in 2000 (7 deaths) and the 2008 listeriosis outbreak in Toronto (22 deaths). Similar compilations can also be made for every other country adversely affected by neoliberalism, such as the 2017 Grenville Tower fire in London, England (72 deaths).

To which I would like to add, for any people outside the Western world who may be reading this blogpost, that I am perfectly aware that tragedies of this kind break out even more often in most of the world’s (more numerous) poorer countries, the number of victims often climbing to much higher figures than the ones cited here. Those third-world tragedies, however, are just as often caused by neoliberalism in those countries as well, which is most often imported into those places by neocolonialism. Including in most of the world’s mainly non-Western, “state-capitalist” countries, where the economic power of the state is still somewhat stronger than the economic power of the private-capitalist sector.

Just like in late nineteenth-century Canada, most of the world’s current state-capitalist countries often claim to be using economic nationalism for “the common good”, but they somehow manage to include a great deal of neoliberalism in their projects as well. The elites in most of those countries are often quite rich and every bit as corrupt as the ones in the Western world, not to mention also being much more interested in empire-building for themselves than in sharing the wealth with any of their poorer compatriots. In many of those countries, disasters on the scale of the Mégantic tragedy unfortunately happen all the time and are not considered (at least not by the people in power) to be terribly unusual.

In the last section of her book, Saint-Cerny also went into considerable detail in describing how provincial and local elites in the Mégantic area succeeded in completely mismanaging the reconstruction of the village after the tragedy. To do that, on the suggestion of a local citizen, she borrowed the shock strategy concept from Milton Friedman’s “disaster capitalism”, as interpreted by a well-known Canadian activist, Naomi Klein. In the first place, 132 days after the explosion, the villagers still alive in Lac-Mégantic were indeed shocked when they saw new MMA trains running on the company’s re-built tracks, carrying exactly the same kind of cargo, in exactly the same kind of thin-skinned cars, riding right through the middle of town once again, even reproducing an even more dangerous loop through the most populated streets than the one that had so obviously contributed to the “accident” only a few months earlier.

Talk about disaster capitalism! The company, since then reorganized under a new name, had profited from the shock produced by the tragedy to reconstruct exactly the same conditions, in the same town, that had so profoundly upset the local population in the first place. Not only that, but the local town council, run by a very energetic mayor, and supported by all the members of the local elite, took advantage of the shell-shock (a kind of post-traumatic stress disorder) from which most of the ordinary local citizens were suffering, to rapidly displace the vast majority of the owners of the destroyed buildings and to reconstruct most of the new downtown a long way from the original site. That was originally located next to the lake that used to attract several thousand provincial tourists in days gone by. Loudmouth promoters were also imported from Montréal to convince some of the more gullible citizens that not just thousands, but millions of tourists from all over the world were going to flock to their isolated mountain village just to visit such a famous disaster zone!

The head of the local caisse populaire (credit union) and the managers of all the large stores and businesses in the area, most of which were just local branches of large Canadian and Quebec chains (“Québec, Inc.”), conspired with the town council to eliminate several of the old-fashioned local factories and reconstruct a new part of town in perfect imitation of the kind of “up-to-date”, single-story housing and commercial buildings that disfigure most of the ugly, uninspiring suburbs that have sprung recently up all over North America. In so doing, they were helped along by the Québec government, especially its economic-development and municipal affairs ministries, which rapidly adopted a new provincial law designed to help the local elite take over everything and run it their way. Which included setting up a phoney citizen consultation process, in the usual way, after all the major decisions had already been made.

Even Québec’s environment ministry was either too complacent, or totally outmanoeuvred, or maybe even betrayed by some of its own senior bureaucrats, to contribute anything useful toward cleaning up the original mess competently. Or even noticing that most of the petroleum that had not either burned off, or been recuperated by the MMA in railcars saved from the explosion, had simply run off and sunk to the bottom of the nearby lake and Chaudière River. It turns out that the environment ministry people did not initially believe the activists from the “Société pour vaincre la pollution” (Saint-Cerny, Daniel Green and other SVP stalwarts having shown up in town right after the tragedy) that the oil had accumulated at the bottom of the lake and the river. Because they did not initially believe the environmental activists’ claim that one of the oil companies had deliberately falsified the work-sheets accompanying the train. (PG 1 and 2 oil being much heavier than the fraudulently designated PG 3).

The Québec government, in those days under the nominal control of the pro-independence Parti Québécois (PQ), did not help much either by adopting an economic strategy that included fostering schist oil exploration in the Gulf of Saint Lawrence region, right before the extremely upsetting tragedy. That PQ strategy, I might add, could be seen as an attempt to help Québec curry favour among “the big boys” in the highly integrated North American economy. But it was most definitely not very well-timed, to say the least, since it certainly seemed to put the independence movement on the side of the very people who had caused the highly emotional, national tragedy that profoundly destabilized the entire Québec population. Why search for independence from Canada if it only means adopting the same disastrous, kowtowing strategy as the Canadian government, or the even more disastrous kind of neoliberalism practised in the heartland of the US empire?

So why did all the incredibly horrible things presented by Saint-Cerny and Campbell in their books about Mégantic, happen after all? Greed, though obviously an important cause, does not seem to me to be a sufficiently profound reply to the question about what motivated the managers and the major shareholders of the offending corporations. Nor does identification with the aggressor, though almost as important a cause as greed, seem to me to be a sufficient explanation for the supine attitudes of the political authorities in this overwhelmingly horrible event, and any of the other deadly events similar to the Mégantic disaster.

I think that if we want to come up with a more satisfying explanation for this kind of criminal-but-legal activity, we should start with the idea that treating millions of ordinary citizens in such a murderous and degrading manner, not just in North America but everywhere else in the world, helps to fulfill dominant personalities’ (investors, managers and top-rank bureaucrats) basic goal in life. Which is their fundamental, shared belief, providing them with their underlying motivation (their number one reason for wanting to get out of bed in the morning), that “We’re everything and you’re nothing.” This certainly seems like what all of this is really all about, an enormous superiority complex that requires continuous renewal of the consolidating conviction of the big shots’ personal self-worth, in “accidents” and “incidents” constantly befalling their increasingly numerous victims. Successful, superiority-confirming, wipe-out operations that turn out to be thousands of times more satisfying than any mere orgasm.

Pulling off a Mégantic, or a Bhopal or a Tchernobyl, yet another tragedy for “those lesser people” and never a problem for any superior person from “our gang”, that can always be covered up, with the result that no one from “our gang” ever has to pay any penalty whatsoever. Getting away with doing something like that: what a rush! It is not even accurate just to describe it as the business equivalent of multiple rapes committed by some wayward priest, nor even the business equivalent of multiple murders committed by some serial killer, that makes the perpetrators feel so good all over. It’s the getting away with it afterwards, a whole lifetime of power, that makes it so dizzily appealing. Appealing, that is, not to the domineering ones’ better natures, but to their primitive, carnivorous natures instead.

Which makes defending their system so incredibly important for these evil people, because they all know that everything they have in this world depends entirely on getting the world’s very numerous “inferior people” to accept their “inevitable” fate. Not only must every slave accept the assigned role of slavery, but every such slave must also do so, not just sullenly but enthusiastically. Simultaneously burbling along about the delightful democracy, the rule of law, the full employment and the abundant prosperity that we have all been so graciously given by our “betters”, in this great land of ours! Or whatever other romantic myths have been successfully sold to similar victims, even in countries led by people who find such over-the-top pretensions as “the rule of law” to be impossibly naive.

This whole process of dominant people’s sadomasochistic control over dominated people may even be somehow linked to French neuroscientist Sebastien Bohler’s theory about dopamine in his 2019 book Le bug humain. According to which a weird part of the brain called the stratium (controlling sensations of pleasure) always pushes aside the cortex (controlling reason), by inundating the body with huge quantities of dopamine, whenever the brain has to deal with (according to him) five particular situations: eating, sex, saving individual energy, social climbing or accumulating essential information.

Although this theory is supposed to apply to all human beings, I think it is reasonable to assume, given the kind of class-based societies in which everyone alive currently resides, that the world’s most deplorable people seem to get more than their fair share of inordinate pleasure out of the kind of primitive social domination that they seek, whenever they succeed in convincing their very numerous victims to accept as inevitable the dominant ones’ position at the top of the social-climbing ladder. Or, as Saint-Cerny put it in her book, quoting Québec humorist Boucar Diouf, the people running large capitalist firms are a lot like hyenas and other such carrion-chasing carnivores in their never-ending pursuit of maximum profit and the asphyxiating corruption that inevitably accompanies it.