Oranges and Price Fixing

Press, Volume LXXII, Issue 21975, 26 December 1936, Page 10

Oranges and Price Fixing

Although it has been in operation for only a few weeks, the Government’s scheme for fixing the wholesale and retail prices of oranges seems to have aroused very general dissatisfaction. The Minister for Industries and Commerce, whose department is responsible for the scheme, is dissatisfied because in Wellington and Christchurch more than half the retailers are not complying with the regulations. The retailers are dissatisfied because they are unable (so they say) to make a reasonable profit at the prices which the Minister has fixed. Consumers are dissatisfied because oranges are still expensive and still in short supply. In fact, the scheme is a failure; and this, as Mr Sullivan admits, is a serious matter, since there is at present much sickness in the country. It is “ essential,” he says, that oranges should be made available “ at the low- “ est possible prices.” There will be no disagreement on that point. But it is not much use the Minister reading lectures to retailers about the iniquity of selling oranges at high prices when everyone is aware that there is a shortage of oranges and that the shortage has been created by a system of import restrictions. When a commodity is in short supply the price will rise, and no amount of government regulation will abrogate this sequence of cause and effect. Mr Sullivan is now threatening prosecutions. If he prosecutes every second fruitseller in New Zealand he will not make it any easier for people who need oranges to buy them. The most he can do by bringing retailers into court is to inflict substantial injustices, for it has to be admitted that, of all trades, fruitselling is perhaps the most unsuitable for a price fixing experiment. The fruitsellcr deals in perishable commodities; and if he is to make a reasonable living he must be free to balance an occasional heavy loss with an occasional extra margin of profit. The Minister might, of course, consider issuing a set of regulations to prevent oranges from going bad. They would be about as useful as his price fixing regulations.