Just imagine if Australia (like Greece) had to be bailed out by the IMF, World Bank and say, China (that’s what Tony Abbott, Joe Hockey and sections of the Murdoch press were effectively claiming could happen with their now-abandoned debt and deficit dirges). What would we have to change, or be forced to change?
Well, look at the proposed agreement between Greece and the eurozone countries, which demand sweeping structural change across the Greek economy. From retail rules to product markets to labour market regulation, Greece has been ordered to clean up its act and change. And so micro is this management that the Greeks have been told to reform their bakeries. As Marketwatch.com commented: “It may seem like one of the most half-baked ideas to come out of the debt crisis.”
Marketwatch explained that the definition of “a bakery” was under review:
“Specifically, the very definition of a bakery as a place where ‘bakers’ mix ingredients, knead dough and bake loaves from scratch, as opposed to a ‘bread point of sale’ that might merely heat up frozen dough or just sell prebaked loaves. ‘The benefit from abolishing the definition would be the enhancement of competition by creating quality differentiations and by offering a broader choice to consumers,’ according to an OECD report on improving competition in the Greek economy released in 2013. The Greeks will also have to change rules and regulations relating to Sunday trade, sales periods as well as pharmacy ownership.”
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On that basis, if we had to accept a bailout deal, we in Australia would change our rules relating to pharmacy ownership, tax regulation, trading hours in the retail sector and newsagencies, and we would privatise the various remaining state-owned electricity networks. Some of this is very familiar, so are we Greece? No, but these demands expose a great concern with the terms of this agreement — the utter hypocrisy of the German and French telling another country that it has to change the very things that both countries won’t change, such as trading hours, shop ownership and location, pharmacy ownership and the selling of food.
Anyone who has tried to shop in Italy, France or Germany on a Sunday afternoon, buy food at certain hours and from some shops, or eat out in France on Sundays (the 35-hour week has wreaked havoc) will find restrictions and bans that are simply mind-boggling. And on the basis of trying to get more competition in Greek bread-making and selling, the French rules on bread and the German food purity laws are highly restrictive. France, Italy, Spain, Germany and Portugal have made use of the place of origin food laws across the EU to protect sectors of the economy in food and wine — some for good cultural reasons, but some for just a way of entrenching existing interests to the exclusion of consumers and competitors (and no doubt in exchange for payment).
Yes, Greece has done its best to avoid responsibility for its financial problems and has been doing that for years. But to find itself told to adopt competition laws that its creditors won’t contemplate for themselves is the height of cultural arrogance and deserves rejecting.