The Office of Fair Trading is concerned about supermarkets' pricing behaviour. The dominance of the four supermarket giants Tesco, Asda, Sainsbury's and Morrisons is to be investigated again, the third time in seven years. The stores control almost 75% of the £120bn grocery market and the OFT is asking the Competition Commission to investigate.
The watchdog said there was evidence that the buying power of big supermarkets could distorts competition and producers complain that they are squeezed down to selling at rock bottom prices. There are also concerns about planning rules and supermarket land holdings.
There is an underlying problem here which is being ignored. Where land is freely available, it is easy for individuals to start up in business, whether as producers or retailers. But where all the land is occupied, then ownership is effectively monopolised - unless there is a holding cost on land, such as a land value tax. In the absence of such a tax, there is every reason for supermarkets, house builders and all sort of other large corporate players to buy up land and sit on it whilst they wait to get what they want.
As long as Britain's present no-charge land tenure system continues, more and more of the economy will be concentrated into the hands of fewer and fewer agglomerates.
I wrote to my MP on two entirely separate issues recently. The first was to do with the replacement for the Inter City 125 train, which at £2.6 million per vehicle, is twice as expensive as it ought to be. The second concerned the benefits of a switch from business rate and Council Tax to a tax based on site values. In both cases, the replies were full of spurious, unsubstantiated assertions and completely flawed arguments. This is typical. You will not get an iota of sense from the government on any area of public policy at all - finance, economics, trade and employment, agriculture, housing, health, transport, energy. All junk. If you write to your MP you will invariably receive answers that are an insult to your intelligence, no matter what subject you are writing about. Of course they cannot understand statistics. They are innumerate. Whitehall is staffed with idiots with a high IQ. Look at their IT projects. And mind your purse, they will have that too.
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