For once I would like to discuss a big issue.

The effect of the ideology of political parties upon the outcomes on the
man on the street in today's Australia.

Massive changes made by the Liberal Party during the Howard years
to the Trade Practices Act, have changed the way we view profit.

For example , "the notion of a quantifiable fair profit or fair margin ", no longer exists.
Profit margins were monitored by the Gov't (prior to the Howard years),
and this instrument was an effective anti-inflationary tool.

Today I visited a lock smith who charged me $6 to cut a key,
Last time I visited this same locksmith he charged me $30 to cut 2 similar keys.
This is legal now because the notion of margin is discretionary for the business operator.

Extending this principal to the big end of town, and we see petrol prices
fluctuating up to 18 cents litre in a day without any really adequate explanation.
There is no connection between cost and the pump price. The same petrol available
out the outlet, with or without transport, goes up and down in price.

Extend the same principle to the even bigger end of town, privatised essential services like
gas, electricity, water, tele-communications, transport, and then you should understand
more about why your billing is rising at 10 times the inflation rate, instead merely complaining about it.

The Trade Practices Act implemented by the Howard Govt allows margins to be discretionary for business operators
without any checks or balances, so the primary question for a business operator,
is now "how much profit do I want" not "how much profit is appropriate".

The price you pay for the same item, now depends entirely on where you are
buying it, at that time. cont..

As a consumer, this outcome makes me feel as though my Gov't is not looking after me
by ensuring that I'm getting a fair deal when I'm spending my money, and feel somewhat at the mercy of the individual business operator when doing so.

There are many sides to this discussion, but my point is, that this notion of market forces being "the be all, to end all solution,
and the basis for this ideology stuff is wrong; the truth is that market forces have little effect upon the the outcomes of most people.

It's the heavy weights who make their own decisions in our economy based upon their own perceived needs, and it's all packaged neatly by the media as being "for the greater good" which is of course the furthest thing from the truth.

Never mind all that now, it's all legal business practice.

Well there is an answer to your question it is called a super profits tax. You see one could panic and demand that this will destroy investment, cost jobs and be simply another great big tax, but the mining industry has already shown that this is rubbish. since the agreement profits are up, investment is steady with only a few dodgy projects shelved and now BHP want a carbon price set, they even hinted that a carbon tax would be ok.
If you set the profits tax at a reasonable cut in rate and give companies concessions for R&D, exploration, capital investment and employee bonuses (conditional that they are paid to workers not management) there is no reason a more moderate attitude wouldn't develop toward over profiteering.
Of course you would have to overcome an opposition that smelled an open door and a multi billion dollar industry intent on changing a government. We live in a democracy remember, the winner is the one that can fool/buy the population the best.

thinker2 I agree. There is a growing concern that governments no longer really represent the people. I am sure many politicians think they do but have an inability to see beyond the usual pressures and mainstream mantras of business interests etc.

This corporatisation environment and growing greed makes it difficult for small business too. The tendency for the rush for obscene profits often make it difficult for the small trader to compete, when the costs to his business are greater than what he can charge for product. Governments have further burdened small business with collecting taxes on their behalf.

Corporates continue the spin about profits and obligations to shareholders but their behaviour implies the shareholders are more a burden except when recruiting money. Shareholders can even be dispossessed of their shares through compulsory acquisitions and even their votes are not given sufficient weighting and often ignored. The people (CEOs and the like) who are meant to represent their interests are in it for themsleves often draining the companies through mismanagement and personal gain. A lot of wealth is funny money wealth and not productive.

The simple values of a "little bit for me and a little bit for him" like good old Con the Fruiterer have gone but I think the values are returning - there comes a saturation point.

thinker2
How do you distinguish between the fair price and the market price in any given transaction?

It seems we believe that a business operator can determine that, (the margin I mean) without any assistance at all,
although theoretically his sales are supposed to reflect his pricing in a competitive environment Jefferson.

The problem I have for example with this mindset is, "what if I am dealing with a business that is working a profit formulae
and their current existing situation requires that they make more GP from me than was the case with the previous customer"?.
Just because their business model requires this, or thats what they want at this time.

And I totally agree Pelican that small business operators are the most affected by margin manipulation at the big end of town
and petrol station operators would be worst affected, expected to be complicit in sleight of hand marketing.

Changes to the TP act could re-introduce the notion of ethics based upon a model of profits as a serviceable percentage of cost.

I cannot see how this could not be negotiated to a satisfactory position for all parties including the consumer.

I'm totally in favour of an RSPT nairbe and couldn't agree more.