The federal government's decision on Tuesday to "defer indefinitely" the key Harper Competition Review "effects" recommendation is not only inherently bad for competition. It also signals a disastrous incapacity to deliver economic reform in the face of interest group opposition.

Prior to Tuesday, the big business lobby - driven especially by Coles and Woolworths - crowded the corridors of Parliament with lobbyists, lawyers and executives seeking to strike down the Harper Review's recommendation to introduce an "effects test" into Section 46 of the Competition and Consumer Act. The far-fetched scenarios and idiosyncratic alternative legal proposals being promoted by them demonstrates that they do not understand the proposed law that they so vigorously oppose.