“It Takes Money to Make Money”
Yet another example of the basic dishonesty of the North American economic model is the attitude of business towards competition. Ask any businessperson about competition, and you’ll find universal approval. However, once business is rolling, the first objective is to get rid of the competition. The legitimate way is by beating everyone else at whatever game you are playing. However, once you get to the top, the easier way is to influence regulatory bodies to create rules that only allow the big guys to succeed.
Interviewees on CTV’s Taking Stock with Amanda Lang this week made the point several times. Canada’s regulatory environment is slanted heavily towards monopolies, second-last in this category of the 38 0ECD countries.
Competition is Good for Everyone…Except Me.
Groceries
The most ludicrous argument anybody has heard on Parliament Hill this year is representatives of Loblaw’s and their ilk explaining how their record profits have nothing to do with the incredible rise in food costs.
Ask any commentator and you’ll find that the problem is not enough competition.
Telecom
The recent foofaraw in the telecommunications industry shows two separate opinions. Anybody with brains and a broader viewpoint can see that merging two of the largest players in the game won’t be to the advantage of the consumer. So why do the regulatory bodies keep approving it? Because they are applying the regulations.
Once again, the obvious conclusion we draw is that the regulations in Canada allow for too little competition.
I have mentioned the “extraordinary efficiency” clause, which translates to “If our merger creates an efficiency that puts us head and shoulders above the competition, we should be allowed to join.” A symptom of a system where success breeds success, and the rest of us lose.
Government
I have often argued that government is different from business and cannot be operated or judged on the same methods and standards. However, there is one situation where government can be faulted: lack of competition. In many of the services governments provide, they are the only game in town. Put into a business model, that is death to any service industry, because the need to consider the desires of the customer disappears. Good customer service dies soon after.
I’m not saying we should provide competition from the private sector. I’m saying the leaders in any system providing services to our citizens need to remember this factor. Otherwise, someone will find a way to compete, as has happened in the healthcare sector. Then, once again, the rich will get better service than the poor.
The Bottom Line: Money Talks Too Loudly
Our governments have allowed the larger players in many industries to influence the regulation of those industries to the detriment of average Canadians. Reversing this trend will result in a better, more affordable life for all of us, not just the select few at the top.