
Each military commissary loses an average of ~$6.7 million per year, subsidized by taxpayers all while having a worse selection and lower quality produce. You can run a government grocery store but ultimately it’s going to cost the average New Yorker more once you factor in tax subsidies due to lost efficiency.
That’s because by law, they can’t mark up their goods by more than a certain amount to cover their cost of goods. If you let NYC stores mark up a bit more just so they can cover operational costs and cost of goods, you should be fine. Ideally, these stores would operate at a large scale, and you gain efficiency in doing so, not lose it. There’s a reason Costco is profitable despite their low prices
Government-run grocery stores aren’t a new idea. They’ve been tried many times in many places. They never break even at first, because doing so would require charging higher prices than private grocery stores, which are more efficient. The difference between Aldi and a government-run store is that I’m not forced to pay for Aldi with my taxes.
You’re right, you’d need to build out the infrastructure and supply chain first, so there would be up front cost that someone needs to foot the bill for. But it can eventually reach a state where taxpayer money isn’t necessary. For example, both the FCC (effectively) and USPS are self-funded
Yes because those are the examples shoved down our throats to “prove it doesn’t work” the US also operates them at the state and federal level very successfully. NYC has their public markets. Kansas has one I believe. Poland, Romania, Sri Lanka, China, Iran, Vietnam, Bolivia, Denmark all have or have had government run grocery stores
NYC’s public markets are filled with private retailers. Kansas has a taxpayer subsidized grocery program. Poland & Romania had state monopolies on grocery stores that famously had shortages & rationing. Sri Lanka’s government stores are heavily subsidized by taxpayers. Chinese and Vietnamese grocery stores had food shortages and rationing. Bolivia had subsidies and shortages. Iranian state grocery stores are subsidized. I couldn’t find an example of government run grocery stores in Denmark.
Private grocery stores sometimes get subsidies and bailouts, but they do not need them and receive far less. My state (Florida) has given a total of $8.97 million dollars in grants and tax credits to Publix since 2000 according to goodjobsfirst.org thats a tiny fraction of the tax money that a single military commissary receives divided among 889 locations.
Self funded and net loss are not mutually exclusive. What I meant is that Congress doesn’t appropriate them any money. After looking further it seems like they do receive approx $50M for providing free mail-in ballots to overseas and blind voters, but that’s it. The rest is from postage, PO Boxes, shipping, etc
Thats true in the sense that they can keep going into debt, but lets be real none of the money they’re borrowing from the federal government will ever be paid off. USPS currently has $163.7 billion in debt and unfunded obligations and the postmaster general estimates they’ll be insolvent in 2027.
When is this number from? In 2022 they no longer had to pre-fund retirement 75 years in advance, and the debt they incurred from doing so ($57B) was forgiven. They could have spent that money on modernization instead, reducing their costs and increasing their ability to potentially break even
i havent read much of this thread, but i do find it very funny that #10 and so many people are so horrified at the proposal of city run grocery stores -- because what actually is it? its 1 grocery store per borough. 5 stores. a government service, not intended to be a profitable expandable chain. it is made to help alleviate money pressures on disadvantaged, vulnerable people in one of the most expensive places to live in an already hard economic time.
government services and programs are not profitable and really arent meant to be very often. SNAP isnt profitable, should that be shut down? should we just let people starve because the p&l isnt black at the bottom line? oh wait yes thats a real position people have, wanting others to starve
Giving grocery money to people in need isn’t exactly efficient either (and what about those who don’t qualify?) because of the markup those stores have. Large entities have access to bulk purchasing. The idea behind cutting out the private grocery store middleman is that you reduce the markup on the wholesale price
I think you’re taking the approach of someone who’s only taken a freshman year economics course. Your argument says nothing about induced demand nor anything about the price setting power of the government. Finally it’s only taking into account success as profit margins which is exactly what government agencies are not supposed to measure success on because they’re the only entity that is supposed to operate at a financial loss for the good of the people
Thats absolutely not how I define success. Read my earlier comments. It would be one thing if government stores were an efficient form of welfare, where it was the best use of tax dollars to help those in need, but thats simply not the reality. Study after study suggests that there are far more efficient ways to make sure people in need can afford groceries. If a program costs more money to taxpayers than a similar program that achieves the same goal I’d say that program is a failure.
If a government grocery store competes like any other retailer in a competitive market it will be a price taker. Theres only two ways it could flex any price setting power. It can either eliminate competition, which likely leads to less quality and choice, or it can set prices below cost through taxpayer subsidies.
Artificially low prices will lead to a higher demanded quantity and likely shortages or rationing without any legal price ceiling required. You’re never going to get the type of price moving power that Walmart has through efficiency because again, government grocery stores are not efficient.