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TAS Country : February 17th 2011
4 Tasmanian Country Friday, February 18, 2011 TFGA www.tfga.com.au The wisdom' of Saul appalls TFGA matters with Jan Davis Former Tasmanian economist Saul Eslake who, frankly, is talking out of his backside when he talks about farmers profiteering from Queensland's spell of appalling weather.' I DON'T know who is making me more angry at the moment; there's no shortage of candidates. Tasmanian government agencies that buy their eggs and their electricity from outside Tasmania while encouraging consumers to support the ''Brand Tasmania'' program; Coles, Woolworths and their ilk undermining the whole fabric of Australia's farming industry with their unsustainable pricing of generic milk --- which is just the thin edge of the wedge; and former Tasmanian economist Saul Eslake who, frankly, is talking out of his backside when he talks about farmers profiteering from Queensland's spell of appalling weather. In the same breath, he advocates importing fruit to keep prices down. He might be a respected economics commentator, but he simply doesn't know what he's talking about on this matter. For those who did not read his comments, Mr Eslake told the Sydney Morning Herald that fruit and vegetable growers who had not been affected by the cyclone or flood were being ''plain greedy'' and ''exploitative'' in increasing their prices to cover any shortfall in supply caused by the weather events. There are several problems with his assertion. First, the market is the result of supply and demand. In an ideal market, the balance between supply and demand is what sets the price. If other growers are making profits in this situation, and it is a supply and demand economy, so what? We seem to take the hits all the rest of the time. There is no moral dilemma in making a profit when there is a legitimate profit to be made. I understood that making a profit was the key reason for being in business. But fruit and vegetable growers are price takers. They don't set the price that wholesalers and retailers pay them for their commodities. They have to take what they are given. If fruit and vegetable prices soar, as Mr Eslake suggests, then perhaps it is somebody else who is profiteering: the usual suspect, the middle man. Mr Eslake, the free marketeer, should take a look at the middle men to see who's making profits at the moment. It is they who take advantage of situations like. As the latest supermarket price war with milk demonstrates, the major retailers operate under a different set of rules to the market. Their rules. But the Eslake solution to alleged profiteering by Australian growers is what most alarms me. ''It doesn't have to be this way,'' he says. ''The government could minimise the impact of the Queensland floods and Cyclone Yasi on the prices of fruit and vegetables by allowing sufficient supplies to be imported until domestic production has recovered to normal levels.'' That's a brilliant idea. Let's open the floodgates to imported produce from anybody that can rustle up a ship to get to Australia. So all the years Australia has spent protecting its farmland from imported diseases will have been wasted, sacrificed at the altar of Mr Eslake's free enterprise remedy for the supposed ills brought on by Cyclone Yasi. If we were talking about the meat industry, would Mr Eslake be advocating opening the door to imports that could carry foot-and-mouth disease, or BSE or any one of half a dozen other nasties we can all think of? Will he be lining up to support farmers when they plough in orchards or vineyards affected by imported diseases? I don't think so. Australia's biosecurity should not be compromised to get around short-term supply problems. For a few weeks, we can eat some of our more exotic fruits rather than bananas; or coleslaw instead of lettuce. We are spoilt for choice in Australia --- and minor interruptions to our normal supply should not lead to panic- stricken ill-informed economic rationalist nonsense like this. Own a bright future SUMMER S NEARLY OVER! Our tractoriffic deals must finish February 28.
February 10th 2011
February 24th 2011