Labor to change its tune on supermarkets
Labor to change its tune on supermarkets
The duopoly supermarkets have been put on notice by a government who had been reluctant to act on them until recently.
Supermarket giants Coles and Woolworths have been in the news this week, taking a battering from across the swathe of the Australian political spectrum. With the year-on-year profits building up and price gouging and skulduggery down to an artform, the friendly seal of public goodwill towards the duopoly supermarkets Coles and Woolworths has faded in a post pandemic economic environment. Spilling out in to mainstream public debate in ways not seen since the age of My Kitchen Rules and Masterchef pacified the Australian public to feel inextricably linked to the supermarkets via the unholy alliance of corporate advertising and reality television, the major party-political duopoly decided to jump in with the Prime Minister, seemingly putting the big retailers on notice to lower prices.
Picking up on the public disdain for major grocery retailers that has crept into the hearts of struggling everyday Australians post-lockdown, the Greens had moved in December to establish a Senate inquiry into allegations of price-gouging by Coles and Woolworths, signalling rough seas ahead for the mostly smooth sailing profiteers. In light of a rejected request to fast-track a nationwide review of supermarket conduct over a year ago, Labor was clearly late to the party on the mega-supermarkets, but its adjustment saw the Prime Minister call for tougher powers for ACCC to tackle supermarket prices, signalling that his party was clearing the way for a mandatory code on the supermarkets to pass on lower prices.
But before the new year, the Albanese government had developed a more favourable view of the retailers, making several friendly appearances in photos before the supply chains and distribution centres of the monolithic companies. No one in his party was kicking up a stink about runaway year-on-year profits, many were dining with supermarket executives throughout the year at industry dinners, and Labor’s warning to the exploitative supermarkets was generally kept to a singular half-cocked plea delivered by Senator Murray Watt: freeze the price of Christmas ham, or else.
For a while it looked like the Coalition would join the fray, with David Littleproud speaking to the price gouging supermarkets from the position of farmer at the farm gate, calling the supermarkets the “worst corporate citizens in this country”, but as the days proceeded, the opposition would end up settling on something different altogether: calls for boycotts over the perceived travesty of Woolworths pulling Australia day merchandise from its shelves. The Australian public, mostly pissed off at the inaction from both parties up until that point to do anything off their own backs to change anything and smelling blood in the water, shared their justified collective frustration for the monolithic food providers, finally gaining courage to take on the supermarkets, and there was nothing that Curtis Stone or any Ooshies could do to stop it.
Up until this point Albanese had ensured the trinity of corporate, media and government has continued unabated as it had under Scott Morrison. With no sweeping reforms in the budget to curb corporate profits and the ‘profit price spiral’ that has inflationary effects on the nations economy, and no indication that there will be any near-term cost of living relief other than the over-touted energy relief and rental assistance Treasurer Jim Chalmers hammers on about – Labor has left the circuitry of the previous model largely untouched, and without having the political courage to modify negative gearing or the Stage Three Tax Cuts, a tax on corporate profits looks to be out of the question.
While some were cashing in their super and making emergency mortgage repayment arrangements with the bank during the initial days and weeks of the COVID pandemic, the supermarkets, flush with profits and full of cheap product that they had harangued out of cornered farmers, set about making hay when the sun shined, jacking up the prices as the loyal Australian customer made sure that they were the first (and often only) destination in the restricted daily travel.
As the pandemic swept in in 2020, small businesses collapsed, low-wage workers were sent home without pay and laid off, but the supermarkets stayed open. Australian big business went into hibernation on bundles of Jobkeeper -- for a moment the Westfields looked like they may close forever -- and while many shopfronts were forced to shut, Coles and Woolworths were hives of activity, becoming beacons of corporate light and large vessels for funnelling money as they fed the creature comfort of winter lockdown cooking.
But decades of price gouging financially desperate citizens whilst underpaying farmers and growers have come to a head as the zero-interest-rate era has come to an end, and the growing disdain for the squeeze the public is enduring is finally putting pressure on the government to actually do something to curb the rapacious supermarket giants and their god-like market share. The power of major duopoly supermarkets are almost an abomination compared with competition in other countries throughout the OECD, and as Australians are going hungry, farmers are considering quitting, and the profits continue. The government’s statement, although better than nothing, may not be enough to fight this nationally significant issue.
The supermarkets have always enjoyed a more intimate connection through their customer base, many of whom choose to shop at the one of two options that are generally available in a neofeudal essential item marketplace. Customer loyalty has been a factor to the supermarket retail operation that is unique to the sector, but the price on the shelf for essential items is a unifying force among Australians from both sides of the political spectrum, and each Australian interfaces with the duopoly in their own intimate way, everyone has felt the expense rise continuously from week to month to year, and many have noticed that customer loyalty has not been rewarded on both sides of the farmgate.
Feeling the searing heat of an angry electorate, the major parties reactively splutter in unison reading the songsheets of focus groups on the supermarket, doubling back to align with the public on what is turning out to be an election issue, but they ultimately fumble the nuance of the with the same out-of-touch ignorance as always. Not much separates them from the duopoly supermarkets they tsk-tsk to after putting their hands in cookie jars together at black tie events run by business and industry lobby groups. As a corporate facing major party waltz plays out at fancy closed events throughout the parliamentary year, Australians stand outside in their millions and look at the seemingly random price of lemons and eggs a bit more, they notice what a packet of mince used to cost and boggle at the idea that a box of Shapes can cost $5 dollars, and they start to wonder if this iteration of a Labor government, just like their predecessor, cares more about corporate profits than about the cost of living.
The lack of choice is not only a frustration, it has become a direct modifier to our quality of life. For many, the duopoly is all there is, increasingly blamed as a stressor that is eroding the Australian way of life. Consumers have begun to show their resolve by sourcing produce from independent suppliers, showing their consumer anger with their wallets, but many don’t have that choice. The government needs to do more than guide the entrenched bad behaviours of the heavily profited supermarket giants, it needs to reform corporate profits tax, and to go one step further to break up market concentration across industry sectors nation-wide, to end, once and for all, the damaging culture of the Australian duopoly.
"With no sweeping reforms in the budget to curb corporate profits and the ‘profit price spiral’ that has inflationary effects on the nations (sic) economy"
Why would the government bother doing anything about the profit-price spiral when the Reserve Bank is whacking mortgage holders with interest rate hikes? Even though the much spoken about wage-price spiral hasn't existed for some years, it's the only tool the 'independent' bank has at its disposal. And it's oh-so convenient!
When the chips are down, all the parties will fall back in line.
The mainstream media depends on the advertising dollars that Woolies and Cole’s put their way (ditto with the banks, fast food companies, the gambling industry and other large retailers like Harvey Norman, to name the most significant and egregious players).
The Liberals, despite their MAGA/ Trumpian strategy of positioning themselves as populists and patriots, on the side of the ‘(White) Aussie Battler’ are themselves steeped in the establishment and want nothing more than unrestrained neoliberalism.
The Nats generally drop the farmers like hot coals when the resources lobby dictates it.
Leaving it to Albanese’s variant of the ALP, always a day late and a dollar short ensures only the pretence of reform. It currently lacks the political will, leadership & bravery to see effective structural and regulatory reform through to its logical and effective conclusion.
At the end of the day, all of the aforementioned parties are determined to make the working class bear the burden of austerity to offset the consequences of the current system with its structural inequalities and predatory capitalism.
Only rank and file driven change from within the ALP or a reorganisation of parliament externally imposed by a Greens / Teal balance of power will change the status quo.
Many, such as myself, seek to do the former from within the ALP but it now seems more likely that the catalyst of a hung parliament and genuine power sharing will come first. How this influences the internal politics of the ALP and its policy platform will be interesting to observe.