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French Food Minister Both Lies And Misses The Point – Plus Ca Change

There’s a certain immutability to French politics, we’d not expect anyone in power to ever be telling the truth now, would we? Which is just what is happening here as the French agriculture minister insists that minimum prices for food won’t cost consumers more for their edibles. A claim which should be met with cries of “Tosh!” and a barrage of rotten rejects from the supermarket shelves.

The very contention that there should be minimum prices is all the proof we need that prices will be higher. For if the minimum is set at a level which won’t raise prices then there’s no point in having the minimum. Farmers already get more than a low minimum, having a low minimum would make no difference. Now, institute a higher minimum and what must be happening for farmers to gain more? Quite, consumers must be paying more.

[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””] France’s agriculture minister has sought to reassure households that food shopping bills would not jump dramatically after a rise in minimum food prices aimed at increasing farmers’ incomes came into effect. The measure introduced on Friday had been postponed by the government in December as France reeled from nationwide unrest and sometimes violent gilets jaunes (yellow vests) protests over high living costs and squeezed household budgets. Didier Guillaume said prices would increase on only 5% of products sold in supermarkets, including Nutella, Coca-Cola and granola – items retailers often sell at a discount to attract consumers. [/perfectpullquote]

No discounts means higher prices to consumers, there we are, he’s lying.

But he’s also entirely missing the point. The advance of civilisation is fueled by food getting ever cheaper. A reasonable estimate is that rent and food cost 80% of household budgets a century and a half ago. In 1960s America the food budget was some 30% or so of that household income – that’s how Molly Orshansky set the poverty line. Today, in the UK at least, food is some 11 to 12% of household income.

This process makes all of us out here much richer. And we’ve no evidence at all that we’ve come to the end of the process. Technology does march on, productivity rises and we all labour less for the calories we stuff ourselves with. This is a good thing.

Until, of course, some idiot Frenchman starts shouting this far and no further. For that’s what he’s doing. Insisting that a minimum price be charged is to insist that prices won’t fall in the future. It’s to deny the very thing which improves our lives, which creates the very idea of a civilisation in the first place.

But then a French politician impoverishing the rest at the behest of the farmers – plus ca change, c’est la meme chose, eh?

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Tim Worstall

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PJHH says:

February 2, 2019 at 10:36 am

the French agriculture minister insists that minimum prices for food won’t cost consumers more for their edibles

Now now Tim, that's not what he said. This is a politician you're talking about. Even in your quote, he said:

food shopping bills would not jump dramatically after a rise in minimum food prices

Now, his interpretation of dramatically may very well differ from that of les paysans, but it's clear that what he didn't say is that it won't increase at all...

Of course, as a politician, he's reverting to type, and outright lying here:

Didier Guillaume said prices would increase on only 5% of products sold in supermarkets

I'm going to go out on a limb here and suggest that's actually '5% of the items by type offered for sale' and not '5% of the items by volume actually sold'.

So a whole aisle of fresh fruit and veg not bought are included in the 100% of which this 5% is taken from.

Guillaume said the average household shopping bill would increase by just 50 cents a month.

No they won't. He's already said enough to contradict that. But there's more...

Elsewhere:

It means big food and drink brands can no longer be sold at cost price. Shops' profit margin must be at least 10%.
[...]
The law affects supermarkets and hypermarkets more than small local shops.

That is because the big outlets offer some popular brands at or near cost price, slashing their margins on those products, in order to lure customers, in a fierce price war. Their profits depend on big volume and high turnover.

And it has a new name, the Nutella tax:

an average increase of more than 6% on a basket of 24 consumer products

That's 6% on the whole basket, not 5% of the things bought as previously alluded to.

And this has more than the subtle gleam of French protectionism:

[The provision is to] stop the promotions made by large retailers on some of the most consumed food products, almost all of which come from outside the national borders.
[...]

" It is a price to pay to defend French products ", said the Minister of Agriculture, who added: " We still have enough agriculture in France, to stop buying products that come from America[...]