When you go to buy a loaf of bread, is the nationality of the owner of the shop relevant? Should government be in the business of deciding who you can and can't buy your bread from? Is it the role of government to permit an Australian to sell you a loaf of bread, but to prohibit an American from selling you exactly the same loaf of bread?
The answer to all of these questions is yes, according to people like Greens leader Bob Brown, and Dick Smith.
The debate as to whether Coles Myer should be allowed to be taken over by an overseas bidder is, at its core, about these issues.
Discrimination against people because of their background is viewed as abhorrent in practically every social context -- except where that context involves foreign investment. And then in that case it seems quite acceptable to voice opinions that in any other environment would rightly be regarded as obnoxious.
A few days ago Smith provided his justification as to why the federal government should stop non-Australians buying Coles Myer. "These foreign owners will immediately start reducing staff numbers -- they'll do everything they can to get wages down so our food will be cheaper and that's what our consumers like. But, of course, long-term thinking it's bad because we're going to sell off all our wealth and all our profits will head off overseas".
Such thinking is so misconceived it's difficult to know where to begin. It is exactly the attitude that prevailed in Australia until tariffs were cut in the 1980s. Sadly, it is this sort of continuing hostility to free trade and the free flow of investment that consigns to poverty hundreds of million of people around the globe.
The cheapest loaf of bread available from Coles costs about $1.60. Many people shopping at Coles wouldn't particularly notice if the price of bread went up or down by a few cents. Politicians and successful entrepreneurs probably wouldn't. But many people would notice the difference. A person living on an aged pension of $208 a week would notice. So too would an 18-year-old in casual employment earning $10.70 an hour. A reduction of a few dollars a week in a family's grocery bill is a few dollars that can either be spent on something else or can be added to household savings.
It is hardly surprising that consumers like cheaper food. Cheaper food is one way they can improve living standards for themselves and their families. Households spend on average 20 per cent of their disposable income on food. As families move up the income scale their spending on food declines as a proportion of their total expenditure. Put simply, the cost of food is more important to poor people than to rich people. It is an obvious point, but it is one often forgotten. If a takeover of Coles Myer results in cheaper food, then all Australians should welcome it.
Businesses should be free to employ as many or as few employees as they think they require. And if a business is overstaffed, the business should be free to attempt to pass on to customers any higher costs in the form of higher prices. Customers should be free to pay higher prices to inefficient businesses if they so decide.
However, it is completely wrong for government to attempt to impose such a policy preference on the community. Yet this is what is suggested by those urging the federal government stop any takeover in the name of protecting jobs. A system based on jobs created by penalising consumers is a system that in the long run is unsustainable.
The claim that a publicly listed company such as Coles Myer contributes to "our" wealth, and that the company's profits are "our" profits is wrong. The company is not the government. We as Australians have no greater claim to Coles Myer than we do to the corner milk bar. The wealth of the company is not our wealth, and its profits are not our profits -- they are the property of the individual shareholders.
Beyond an emotional attachment to a brand name and a logo there is no national interest at stake in any takeover of Coles Myer by overseas interests. The best way to protect the national interest is by ensuring competition in the existing Australian supermarket duopoly. Foreign management might succeed in providing what so far Australian management has not.
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