The price battle
When the first consumer boycott against price hikes in the retail market took place, Kathimerini greeted it with skepticism. The launch of the euro has been followed by price hikes, while inflation rates have been stubborn despite government efforts to contain them. But, one should not ignore the fact that some price increases are a result of contingent factors and, more importantly, one should not substitute much-needed counter-inflationary policies with instructions to consumers. Boycotts are ephemeral and, usually, fruitless, while the battle against inflation presupposes a pragmatic examination of the problem coupled with constant and consistent measures. During the Cabinet meeting yesterday, the government did not seem to want to adopt such policies. One could even say that the government chose to avoid the problem by focusing only on fruit and vegetables which, because of their seasonal nature and the damage done to production, are justified in some of the price hikes. The government measures themselves were limited to abstract pledges, while no suggested prices were announced – this was left to the industries’ good will. The situation leaves no room for complacency. Though the impression of soaring prices is somewhat bloated and despite the fact higher prices are, in some cases, the result of circumstantial factors, most European states are plagued by inflationary pressures. Fears are exasperated by the fact European economies have slowed down or even stagnated and, as a result, no government can follow the prescription of increasing interest rates without taking the risk of recessionary relapse. Greece is no exception. And what may today seem like provisional or isolated price hikes could well have dire impact at some crucial future conjecture. The government should not turn a blind eye to the problem nor try to tackle it with long-winded speeches and half-measures. It should instead analyze the various aspects of the problem and take clear-cut countermeasures. Nor is it true that such measures would undermine free-market competition. Price controls are preceded by a systematic monitoring of the market and by constant pressure on producers. The government used to carry out both practices but has long abandoned them. It is a mistake to dramatize inflationary pressure. Denying it, however, is even worse. The government has to monitor the market. Prices are not contained with rhetorical pledges.
