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overseas online shopping is "un-Australian"! « Previous | |Next »
January 10, 2011

I've been watching the big retailers (Myer, David Jones, Harvey Norman and Borders) publicity campaign against those of us who shop online overseas instead of buying from the local retailer. Their campaign---its all about the jobs being lost--- suggests that the difference is the lack of GST on overseas goods under $1000. They are pressuring the Gillard Government to axe the GST-free threshold on imports under $1000.

Yet this only affects about 3 per cent of retail spending. The real issue is poor service, lack of choice and double the prices, if not more, on imported goods. It is cheaper to buy Japanese camera gear or film online from the US than either online or in-store in Australia:

NicholsonHarveyNorman.jpg

Digital capitalism is going to effect the retail industry in the same way that it has the music industry, Hollywood, and the newspaper industry--a major transformation. That means they can no longer get away with double the price when the Australian and American dollar are at parity. Why should we pay double the price?

The global economy is here to stay and it will grow. That means the retailers profit margins are going to be reduced and they need to offer an online store if they want to grow their business. Australian consumers have wised up to the price gouging that has gone on for decades--they have become informed. It is the retailers who are living in a time warp.

Update
Joseph Schumpeter coined the phrase "creative destruction" to describe the process of churn whereby old companies, technologies, and industries die, to be replaced by new ones. Border's for instance, is an American firm that has never really successfully transitioned to digital, leaving it with a lot of physical inventory and real estate assets in the US that are rapidly becoming albatrosses with declining sales.

| Posted by Gary Sauer-Thompson at 8:01 AM | | Comments (8)
Comments

Comments

it is high profit margins and inefficiency not the GST that causes the electronic flight of consumers overseas. Consumers argue that while retail giants are calling for more taxes to "level the playing field", they are appear to be very slow to lower their prices when the Australian dollar rises -- boosting their profit margins.

A government advisory body has recommended that the costs of collecting a GST tax on imported goods under $1000 bought on the internet overseas would outweigh its benefits.

The domestic retailers are saying that if the government doesn’t collect the same duties and taxes from overseas retailers as it does from domestic retailers, then it push the latter to go overseas.

What nonsense. Are they going to go to India?

I guess we will forever tweaking "capitalism" as long as it's NOT EXACTLY what the capitalist elite want. So..... now they're saying that government meddling in the fabled "market" is a GOOD thing? Alllrrrighty then....

Quote from a recent article comes to mind:

"In good times, as in bad, capitalism is a system that places a small minority of people with one set of goals (profits, disproportionally high incomes, dominant political power, etc) in the positions to receive and distribute enormous wealth. Those people include the boards of directors that gather the net revenues of business into their hands and decide, together with the major shareholders in those businesses, how to distribute that wealth. Not surprisingly, they use it to achieve their goals and to make sure government secures their positions."

That para really hit's the (govt subsidised) nail on the head dunnit?

The "do what we want or it will cost jobs" line is trotted out yet again. When will we get a Govt. prepared to employ people itself in order to provide services - as Govt.-owned power, water, transport etc. corporations used to do (and in some cases still do)? And run an active labour market policy to help the displaced move to the new opportunities that Govt. is creating?

Surely that is the obvious response.

like many people I never go into bookstores anymore, as much as I loved browsing in them. Shopping online at Amazon is much more convenient--they actually have the books I want--- and eventually I will be able to order Kindle books straight from my iPad.

Most of my browsing is done in second-hand bookshops. I find much more interesting stuff there than in new bookshops. What will happen to those if electronic distribution of books (via Kindle etc.) becomes common?

What i want to know is why didn't the miners get the same reaction as the retailers? They take so much more out of our economy.