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The shopping basket, marketing and "social justice"

2022-09-12 | Spain
The shopping basket, marketing and

Does Yolanda Díaz and Alberto Garzón's basket have any substance?

As a policy against inflation and its impact on the budget of working families, no. The original approach was already shameless. Vice-President Díaz, accompanied by Minister Garzón, after meeting with Carrefour executives, made it clear:

Our approach is for the large distributors to reach an agreement and, through business margins, guarantee an affordable shopping basket for our country.

In other words, hypermarkets would be in charge of producing a basket of basic products with stable prices, which they could change practically every week in order to keep it at a stable price, supposedly at the expense of their "business margins".

Carrefour, however, is delighted. In reducing business margins? No, in the government getting involved in giving them a free marketing campaign. Department stores are masters of catalog demagogy. Their analysts tell them that the important thing is to get people into the stores, because in reality, it doesn't matter what the appeal is or whether it makes minimal margins: in terms of sales numbers and total margins, the increase in customers in the store more than makes up for the reduction in margins on a particular product or package.

In other words, no supermarket offer is going to reduce inflation, nor has the government convinced the employers to reduce their margins for the good of consumers, nor is there really anything more to it than marketing.

And the saddest thing is that, as the first basket published by the supermarket chain, it doesn't even have any substance... nutritional substance, that is. It is pure pantry stock with no fresh produce and absurd snacks. Light years away from a similar basket that offered by Carrefour in France and which contained 9 imperative fresh products and a carton of natural juice for 20€.

The selection, assuming it has been guided by the ministry of consumption based on what it identifies as the needs of the population, says a lot about how the government perceives its subjects: unable to cook or prepare a normal family menu, dependent on processed and canned food, living unstructured lives without even a shared meal schedule among family members. A dystopian image of atomization that may resemble what workers suffer in the USA but, fortunately isn't the mainstream reality in Spain. Yet. Because this type of initiatives seem to be shamelessly oriented to normalize what is known to be unhealthy in order to provide business to the industry.

Where do they now want us to look away from?

Food inflation in Spain

Like previous tricks of illusionism and other "cool stuff" from the Sánchez and Díaz government, the goal of this campaign is none other than to prevent us from looking at where the action is really happening. And the action is happening throughout the food chain, not in the offers of hypermarkets.

When, so far, the 15 essential foodstuffs have risen by 17% and according to the government's own press "a plate of macaroni costs at least 32% more than a year ago", the outlook for the remainder of 2022 and 2023 is quite grim.

If commodity and energy prices remain on the same strong upward trend, and taking into account the effects of the drought and its impact on lower yields, logic indicates that prices will continue to rise.

Gabriel Trenzado, general director of Cooperativas Agroalimentarias de España in 5 Días

For this reason, having fulfilled the game of illusionism of the basket, the government and the distribution employers' association are negotiating, behind closed doors, a higher price increase.

The companies are playing a pincer strategy. On the one hand, they want food distribution to be classified as an electro-intensive industry in order to pay lower electricity tariffs. On the other hand, to strengthen their position, they suggest to the government that if it wants to do something useful quickly, it should lower VAT on basic foodstuffs.

This second proposal is a tactical, negotiation-oriented position. Supermarkets would gain from the VAT reduction, because it would increase consumption without changing their margins. But they will not push for it if they get a concession in the BOE, such as the switch to electro-intensive status.

And the fact is that companies know that the government does not want to lower more taxes so as not to increase the budget deficit between income and expenditure and receive a reprimand from Brussels. Something that despite its demagogic hype matters more to the government than anything contributing to make it possible to put decent and sufficient food on the table for the thousands of working families who already have to choose between paying the electricity bill and making a decent purchase.

What does the basket mean in the framework of the Sánchez-Díaz coalition government?

Sánchez, Díaz and Calviño, the champions of social justice

Sánchez, Calviño and Díaz, champions of "social justice"

The basket, in itself little more than a demagogic buffoonery, is actually proof that the government does not intend to correct the damage done on wages by inflation. They believe they can afford to do so given their success in imposing, without worthy resistance, a fundamental transformation unparalleled since the 1980s. Because even though it may have gone unnoticed by most observers, absorbed by the communicative sleight of hand of Sanchism, the current government is managing to bring forward the road map that Spanish capital had been dragging along for more than a decade.

A real reset of accumulation which, thanks to a massive transfer of labor incomes, is recapitalizing by leaps and bounds the companies capable of receiving investments of a certain scale. All accompanied by a further substantial drop in total labor costs and wage incomes.

Companies with a lot of capital and relatively low salaries for the European market is the formula with which the bourgeoisie were thinking of facing the never-ending crisis that started at the end of the 2000s. Now, it is the reality on which they rely to insert themselves in the division of labor within the Euro-American bloc.

For Spanish workers, the legacy of the Sánchez and Díaz government is one more step towards the equalization of their conditions with those of workers in semi-colonial countries. A new fall in consumption with no possibility of recovery within the system, whose ultimate consequences in terms of access to the satisfaction of basic needs, from food to culture through housing, will unfold over the coming years.

The change in productive model and the workers, 6/7/2022

All wage and profit data indicate that the share of wages in national income is falling in 2022 already below the 2019 figures, which means it is falling faster than it has been falling since the 1970's. And it doesn't look like it is going to improve. It is no accident or unintended outcome. It is the core of the change in the production model.

As a palliative, Sánchez started peddling "social justice", the old papal slogan, adopted in the thirties by Italian fascists and falangists and in the forties by Perón. The idea has always been the same: to put an end to the antagonism between capital and labor on the basis of concessions on both sides towards a supposed "common good". According to the president, this is "the synthesis and the beating heart of the PSOE's political proposal".

The "miracle" of the basket and the prices of Díaz, Garzón and Carrefour is a preview of what is coming as examples of that "social justice" which the government claims to champion: noisy initiatives, suitable to fill pages of newspapers and hours of television... and perfectly useless to improve the situation of the workers because the most they manage to achieve is to coordinate with the marketing of the hypermarkets.