By George Koumoullis
IN 1934, the men who made horse-drawn carriages sent a memo to Governor Herbert Palmer asking him to stop the import of cars because they posed a deadly threat to the families of at least 200 carriage-makers. They pointed out that other professions would be affected, such as the stratourarides (men who made a type of saddle for donkeys).
In 2016, Cyprus’ deputies have taken the baton from the carriage-makers of 1934 and insisted that shops stay closed on Sundays to protect workers and support small to medium business so that the economy can be reconstructed, revived, revitalised and so on and on.
Oddballs, short-sighted, narrow-minded and ignoramuses economically then and now. But while our grandfathers and great grandfathers were fully justified as they were living at a time when the dominant economic philosophy worldwide was protectionism and their education levels were not very high, there are no mitigating circumstances for our deputies’ short-sightedness, narrow-mindedness and cluelessness.
Undoubtedly, the majority of our deputies would do well to attend some educational courses on macroeconomics so they can avoid their inanities about “profitable semi-governmental organisations” and their hostile disposition towards big businesses which they are threatening with new, strict legislation with the aim of crushing them.
Someone should jolt our deputies out of their deep slumber so they can understand that the size of GDP and the demand for labour depend exclusively on the level of expenditure. To use a popular cliché, expenditure must be considered a patriotic act, particularly during hard times, because it increases the national income and creates jobs. In Cyprus private spending constitutes the biggest part (about 75 per cent) of national expenditure as investment is low and state spending has been cut as part of the consolidation of public finances.
Suppressing private spending, by forcing shops to stay closed on Sunday, which is the most convenient day for consumers to go shopping, we are on the one hand lowering our standard of living and on the other increasing unemployment, as it is possible 8,000 workers could be fired. Such a development would be an ordeal for workers – not protection – as it was their choice to work on Sundays.
If our deputies really cannot comprehend that restrictions on shop opening hours make our underweight economy even thinner and undermine the drive for development, then we have an acute socio-economic problem to address. Perhaps it is not the fault of deputies but of the small pool of capable people (given the small size of our country) from which we have to draw legislators.
The other argument used by deputies relates to the retail pie. The pie has changed, we are told by wise deputies, in favour of big stores and supermarkets. But the economy is just like nature. As Charles Darwin said, nothing in nature is constant, everything moves and everything changes. The same applies to the economy. Everything, with the passing of time, is subject to ongoing and gradual changes and distortions in a never-ending process of transformation and evolution from imperfect to improved forms. The decrease in small businesses is a feature in all countries in recent decades and is not down to Sunday opening, but to economies of scale enjoyed by big companies that allow them to offer their goods at lower prices than their small-size competitors.
It would seem that some deputies long for the Belle Epoque, which was dominated by tailors, cobblers, carpenters and mahallepi-makers, and cannot comprehend that the rise of the big shops is beneficial to the economy and consumers – assuming, of course, there are no monopolies which, nevertheless, are illegal. But small businesses also have a vital role to play as long as they adapt to the requirements of the times and remain competitive, e.g. greengrocers that specialise in top quality produce or hairdressers. As Darwin argued, it is about the survival of the fittest, which in this case means the companies that survive are those that adapt best to the changing economic environment.
As a consumer I could regale you with many more disadvantages of returning to the old shopping hours. Many working people would have a problem over when to shop. Consumers, generally, would have less available time to shop, therefore less time to compare prices of products which would mean they would pay a higher price for some items. The social cost should also be taken into account; the reduction in available shopping time forces all consumers to shop at the same time, causing traffic congestion with all its consequences.
It is widely rumoured that the motives of deputies, in wanting to close shops on Sunday, are either rusfeti-related or directed by vested interests. If either is correct, then Pharisee behaviour is like angelic honesty compared to the Tartuffe-like antics of our national saviours.
George Koumoullis is an economist and social scientist