Israel Economy and Finance Ministers Bennett and Lapid established a joint committee to increase business competition and improve consumer welfare. Eliminating trade barriers to imported goods is a mandate of the committee to lower consumer prices. Salaries in Israel are inexplicably low in other than select sectors like bio-med and hi-tech industries. Taxes are insufferably high. This potent brew of high consumer prices and taxes, and low salaries, decreases parity between purchasing power and income. Working people and those on fixed incomes like pensioners and single parents struggle, suffer depression and exhaustion, emigrate permanently or work overseas extending the meaning of brain drain. Sales suffer from the toxicity of this brew stifling business growth and expansion. Knowing that companies fire with impunity replacing with younger workers when older ones wage and age-out makes consumers more thrifty. It also means having to choose between food or medicine, and having negligible disposable income for travel, purchasing homes, new clothes, entertainment, giving charity, and enrichment programs for children. Trouble “getting by” forces people into black markets. One Israeli woman with fifteen children confesses to not reporting her (religious) marriage to the government, so she receives extra cash and benefits preferring officials believe she is a single mother. Bloomberg News reports a trend gaining traction with Americans in financial jams from the years long recession selling their hair, breast milk, and reproductive parts. One young woman lists her auburn mane for sale at www.buyandsellhair.com. The stuck economy in the States has hair, eggs, and kidneys “among the top four auto refills for the Google search query, ‘I want to sell my…’” The low level of competition among businesses in Israel contributes to price fixing leading to the highest consumer prices possible before consumers revolt. The markets, like gasoline, cottage cheese, and coffee, find their level. Additional factors include the small size of the market, concentration of ownership in the hands of a few, regulatory overload, and exclusive agreements to corporations and individuals. Excessive custom duties like on e-commerce imports, import quotas, government price determinations, and unreasonable product standards on imported goods, contribute to anti-competitiveness further limiting consumer purchasing power. I contributed an article to the Gale Business Insights Handbook of Global Marketing published earlier this year. I recognize governments must protect their markets from foreign dumping of products at low prices destroying domestic markets. Florida tomato farmers faced this scenario two years ago in the great US-Mexican Tomato War. Government has an obligation to protect against low quality, substandard goods like Chinese drywall simmering with mold and mildew, and toys containing lead. It will be the task of the joint committee to enhance and build on the momentum for reform in Israel. Of utmost importance is to gain coherence of policies passed by the Knesset when they overlap with directives and administrative guidelines and existing legislation. The committee might develop a Consumer Price Impact Assessment required for proposed laws and regulations with input from agencies like Antitrust Authority and voluntary groups like Consumer Council. Among the consumer products that might benefit from de-regulation and more competition are pharmaceuticals, coffee, dairy products, cement, building materials, automobiles, and many agricultural products for starters. Government regulators and lawmakers need to take heart to
Shel Silverstein’s explanation of HELPING: “And some kind of help Is the kind of help That helping’s all about. And some kind of help Is the kind of help We can all do without.”
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