The milk cartel

Just when we were inclined to forget that a Competition Commission even existed, news came yesterday that it had met to discuss the International Air Transport Association (IATA) suit against Hellenic Petroleum and Motor Oil, accusing them of harmonized practices in the sale of airplane fuel. The commission appears more responsive to complaints by powerful groups, while snubbing grievances by individual consumers who are robbed by oligopolies. A senior Economy Ministry official, a father of two, was recently complaining that he has to spend 292 euros per year on local, «fresh» milk. «One liter is sold in Germany for 79 cents and at equivalent prices all over Europe, while I have to buy it for 1.20. If Greece has about 1 million four-member families, that amounts to a yearly 300-million-euro loss of income for households and profit for oligopolies.» Repeated reports published in Kathimerini have exposed the unjustified discrepancy in milk prices between Greece and the EU average. Milk cartels are taking their toll on the free market and the Competition Commission does nothing about it. New Democracy ministers Dimitris Sioufas and Yiannis Papathanassiou claim that there is nothing they can do. Experience shows otherwise. In 1986, when Panayiotis Roumeliotis was minister of commerce, dairy food company Fage increased milk prices by 10 percent. The price hike was deemed to be arbitrary by the ministry and Roumeliotis asked Fage to revoke it. Fage turned down the request, claiming it had acted in line with free-market principles. «OK then,» said Roumeliotis, «it seems I will have to send in the health inspectors every day and should they find a single fly I will take your license away.» Fage backed down, which proves that Sioufas and Papathanassiou could do away with price fixing and protect consumers – if they really wanted to.

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