The Bottom Line / What price am I bid?
Large food producers and marketing chains don't rest for an instant. If there's one thing that really drives them crazy, it's the requirement to mark the price on each and every one of their products, and they have been fighting this for years with all means at their disposal.
Large food producers and marketing chains don't rest for an instant. If there's one thing that really drives them crazy, it's the requirement to mark the price on each and every one of their products, and they have been fighting this for years with all means at their disposal. This time round, they have a supportive minister - Ehud Olmert.
Their objective is clear - to stop the price tagging of every product so the consumer won't know and won't internalize the price of each item. Then they will be able to hike prices without a reaction from consumers and rake in more profits.
When products aren't marked, consumers cannot compare different items in different locations. When they get to the till, they can't know if they are paying the price they saw on the shelf.
And when they get home, they are unable to compare the prices of identical products bought at different stores - and price differences between marketing chains are huge. The end result of not price marking products will be the significant weakening of competition, and hence more price hikes.
The director general of the Industry and Trade Ministry, Ra'anan Dinor, has proved himself unworthy of his position. Apparently, he doesn't understand the basic rules of free market economics that any first year student knows - the supreme importance of full, simple and readily available information.
Dinor has also proved that he can't learn from the past, and therefore the representatives of the Manufacturers' Association and the Federation of Israeli Chambers of Commerce managed to put one over on him with astounding ease. Yes, he did get quite a scare yesterday from the public reaction, and now, he's talking about a consumer poll and a combined system - but that's just throwing fat on the fire.
The major players in the foodstuffs industry and the marketing chains are talking about "a sophisticated electronic system." But the truth is, the "sophisticated" system is similar in principle to the old bar-code system. It makes no difference whether the price tag is electronic or manual - from their point of view, the key issue is that there should be no full price markings on each and every product.
After a 10-year struggle against the big bucks, the Knesset in 1998 passed the Price Marking Law, thanks to then industry and trade minister Natan Sharansky - to whom Olmert is the complete antithesis. Sharansky was looking out for the consumer; Olmert is looking out for the large manufacturer and tycoon. Sharansky waged war on the interests of the elites, the ones with the power; Olmert sucks up to them and dances to their beat - and screw the small consumer.
It's already too difficult to keep track of the benefits he is dishing out to the entrepreneurs. He allowed the Dankner family to get exorbitant building rights in Atlit and Eilat; he handed out NIS 65 million to Mozi Wertheim of Coca Cola; he prevented competition in the international calls market; he failed to reduce sufficiently the "transition fees" for cellular providers; and now, he wants to increase the prices of all goods in the economy.
Olmert loves the tycoons. It is much more pleasant to be in their company, with a fat cigar in your mouth, than to protect anonymous consumers. They should have grasped by now that their only economic purpose is to fatten the wallets of Olmert's friends.
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