Competition

On Friday La Croix, a daily newspaper with Catholic leanings, carried a front page editorial about competition. Competition, it said, is in some ways a good thing: “it forces companies to keep on their toes….this stimulation is good for the dynamism of the economy …….” But for the consumer, the editorial insisted, competition has its downside, for “it puts the consumer in une situation anxiogène,” that is in a state of anxiety, worry, stress and possibly depression. In other words, choice is a bad thing.

I have heard many arguments as to why competition and its ultimate corollary, ultra-libéralisme, should be avoided, but never because it causes the ordinary citizen sleepless nights worrying which product to buy. I have heard many people claim that we are descending into a nanny state, but never realised that could include being spoon-fed with a single product to spare our poor, over-stressed brain cells having to choose. The idea that some people could consider choice to be a bad thing never crossed my innocent mind, brought up as I was in the belief that the soviet experience, of being offered just one brand of soap, or one newspaper, was not only pretty depressing, but what we must strive to avoid. Apparently, given the choice, some people prefer having no choice.

The topical interest of this editorial warning against the dangers of competition, thus against freedom of choice, was that as of this Sunday, the 1st July, the dreaded ‘c’ word has entered the French energy market: the monopoly enjoyed by the two nationalised power companies, Electricité de France and Gaz de France since 1946 is ended. Following the European directive, customers can now go elsewhere for their domestic energy. But this new freedom, La Croix suggests, while stimulating the companies, will unleash a further wave of anxiety on us poor, febrile, over-stressed individuals as we thrash about trying to decide whether or not to change our electricity supplier.

True, if choice there has to be, the two nationalised leviathans have made it easier, for if you terminate your contract with them you will never again be allowed to benefit from state regulated prices. Extraordinary but true, by choosing freedom of choice you close the door on price stability. The implication being that if energy prices soar in the same way as oil prices, the state will absorb some of the increase and keep prices below market level. That is, in the French mind, what the state does, it is a shelter, protecting the citizen from the nightmare storms of the market. In addition, those who chose the roller-coaster of the free-market will be in the unscrupulous, greed-led grip of those whose sole desire is to bleed you dry for their own profit. And there will be no escape, you won’t be allowed back in the safe cocoon of the state. The choice is yours.

The sermon in La Croix warning of the dangers of competition comes just a few days after president Sarkozy fought tooth and nail to have the clause about competition removed from list of new Europe’s core objectives. Competition, Sarkozy insisted, must not be part of Europe’s fabric, thus nullifying, it seems to me, the spirit of what is called the Lisbon Strategy or Agenda of 2000, whose aim was precisely to make Europe more competitive. Sarkozy demanded that the concept of competition be dropped from Europe’s revised treaty in order to appease that majority of the French population who voted against the old Constitution two years ago. Their various objections could be refined to a single word: competition. Debilitating, anxiety-inducing, stressful competition.

One Response to “Competition”

  1. Sergeant Howie Says:

    You can indeed have too many choices. Recent developments in psychology and economics have highlighted this. See for example :

    http://www.apa.org/monitor/jun04/toomany.html

    However, I agree this article is ridiculous. And so for Sarkozy’s insistence on removal of the competition clause (which however was in the Constitution, but not in the previous treaties if I remember well). It is true that prices may have been lower without competition, but as they should have been subsidized by taxes, the result in the end would have been more or less the same (even if we can complexify much more the economic analysis and find arguments for an electricity monopoly, albeit not this one).

Leave a Reply