Mamdani's Socialist Supermarket Will Be an Absolute DISASTER

Uh the first news item today comes uh from Mamani. So Mdani this week has um elaborated on his plans to open up cityrun supermarkets uh around uh around New York City and um so now we know a little bit more about what the plan is. Um and um you know cityrun city owned supermarkets is not exactly right. Uh so the city plans to own and control the locations. The city will dictate prices and operating requirements and the city will absorb most of the financial risk involved. But the city will hire private grocerers to actually manage the stores. So, uh they will be managed by private and what they're looking for right now is uh they're looking for bids. So, or or actually uh um uh what do you call it? Uh yeah, people proposing how they would run the store, what they would do, how much they would charge the city and all of that. So, they they've released kind of a a a a um proposal kind of their articulation, their vision for what the stores would look like. They've released out there. The idea is to have five stores ultimately. Um they've only identified two locations. One will be in in at the peninsula in Hunts Point. I don't know where that is, but supposedly that's a that's a pretty u low income area. Uh that's scheduled for late 2027. So that's going to be a year and a half uh if everything goes on plan. And then a second location will be in East Harlem that is scheduled for 2029. So I mean I just find this funny because you know the the all this fanfare about opening grocery stores and they're announcing now that they're going to open up a store maybe in three years. I mean these are little grocery stores. This is not some major construction project anyway. And then they haven't decided on three other other sites. So they're going to be five stores. The city's committing $70 million in capital funding for the construction and the buildout. So, I I I can't believe that they're actually building a whole new building uh there. So, we're probably looking at uh at uh I don't know, buying a uh a building and and renovating it to turn it into a grocery store. But we we will see. Uh, as I said, the stores are going to be privately operated operated. Uh, the idea, I think, is to have one operator for all five stores. Uh, operators will pay no rent and, uh, they will pay no property taxes. So, that'll give them, you know, that'll be an opportunity to make a little bit of money, I guess. Um, and, uh, the city's going to pay for all the initial fit out. So, their city will will buy the place. We'll fit it out, set it up as a grocery store, I guess, in consultation with the private operator. No sales tax, no rent. Um, but the city will dictate prices. Now, here's the kicker, right? There will be a cold basket of goods, produce, fresh meat and seafood, plus selected milk, eggs, bread, rice, pasta, yogurt, cooking oil, and similar products. I don't know what that means, similar products, but but staples like things that you need in order to cook a meal. They will all be those goods to be identified by the city will be sold at a 30% discount. 30% discount. Uh so um let me just see something. Uh so 30% discount. Now here's the thing. This of course be will be dictated by the city that you have to sell it at a 30% discount. Now, here's here's the here's the thing. The this is not going to be achieved the 30% discount by some incredible efficiency. It's not going to be achieved by squeezing the operator's profit margins. What are the profit margins in grocery stores? 2%. Maybe, right? The average profit margin is about 2%. So, you could get a 2% discount by squeezing their profit margin to zero, but 30%. Where is that going to come from? How are you going to get a 30% reduction in prices? And this is what makes this funny. If it wasn't so sad, what do you think is going to happen? Well, it's going to be discounted from market prices from what everybody else is selling them at. The discount is going to be market prices. So, every everything else is going to sell at market price except for these prespecified goods, which my guess will be expanded and expanded and expanded in terms of which goods will be at a discount. And they will sell at 30% from the market price. And uh the market price is easy because there's plenty of competition out there. So, New York products sell at pretty much the same price across the city. And a 30% discount will be achieved with what? The operators aren't going to take a loss. Why would anybody any private operator be willing to run a grocery store at a loss? So, how are they going to get a 30% discount? Well, the same way government always does these things. It's going to be subsidized. So the government is basically going to pay the grosser the full price for the goods and then the the grosser basically is going to pay it out uh going to sell it out a 30% discount. So you as the consumer will be able to pay buy a 30% discount, right? All the other so-called non-core products, we'll see how big the core is when these things launch, if they ever launch, will generally be sold at normal market prices. the discount is um is going to be universal. You walk into the store, you buy the goods, it's yours. Now, there was some question Manny was asked at a press conference the other day about, well, what about non New Yorkers? What about somebody driving in from New Jersey and buying stuff? And initially, he said, "We're going to have a special ID, you know, kind of a library card." A library card. anywhere special ID that identifies you as a New Yorker and only New Yorkers will be able to buy this. A huge backlash about this, right? I mean because I mean the left is very anti ID. They won't they don't even want IDs for voting, never mind for buying stuff in the supermarket. You're not going to track what I buy. This is a invasion of my privacy. >> So I'm not even retracted. So now there's basically anybody can go in and they can buy. The only thing that will be monitored is you can't buy bulk [laughter] because there's a incredible arbitrage here. I could go in there, buy stuff at 30% discount, and then go over to my bodega and sell it at a 30, you know, normal market prices and make 30%. U the stores will not sell alcohol, tobacco, or nicotine products. Not only won't these be core products, but they won't sell them at all. And they're also going to be expected to limit quote unhealthy food promotion. They can sell unhealthy food. They just can't advertise unhealthy food. How are they going to make a profit not selling unhealthy food? I mean, that's what people buy. Uh they won't be a butcher and a deli counter, although there will be the sale of fresh meat and seafood. So, again, not sure exactly how that works. Um, and oh, and the other thing is in the RFP, the request for proposals from private operators, they did mention that operators of these stores are going to have to offer best-in-class wages, best-in-class benefits, and they're going to have to enter something called the labor peace agreement. I don't even know want to know what that is. I I don't know what it is, but you can only imagine uh what the labor peace agreement actually uh involves. So, uh something anyway, these grocery stores are going to be very very very very very favorable towards labor. So, uh uh this is going to be this is going to be uh expensive for the operator to run. But don't worry, do not worry. The city's going to subsidize them. Now given this, you know, the city could just take the existing supermarkets out there and subsidize them, give them the subsidy off of the basic goods, you know, these core products and just pay them for that and and have them sell a 30% discount. U that would be possible, but of course the city couldn't afford that. here. You're taking a little store and it's not going to be very big and the volume is not going to be that large and there still I don't know how they're going to afford it and the city doesn't quite know how they're going to afford it. But um if they did it for every grocery store in every bodega in the in in in the in the five burrows, it would bankrupt the city completely. So, you know, uh the the government is going to provide these stores what's called an annual affordability payment that will cover operating deficits caused by the the the discounted basket. And biders are being asked to calculate how large that subsidy must be. So, part of the competition is, you know, what what you estimate that will be and and and what will happen if they miss on the estimates. I mean, this is so fraught with fun, crazy socialist stuff. Uh, you know, it's it's going to be it's going to be pretty amazing, right? So, at the end of the day, what is this? At the end of the day, like really all government programs at then, you know, this is a massive redistribution of wealth. So, it is a massive redistribution of wealth from taxpayers to the people who buy the core groceries at these grocery stores. Right? So, you know, people will go to these grocery stores, maybe even people will stand in line to get that 30% discount. But you know what will happen? What will happen? What's going to happen? What's obviously going to happen, right? They'll run out of the core stuff very quickly. They'll have to continuously get more core stuff because they'll be lions to get it. 30% is a lot. Uh you'll get a lot of low-income people going there to buy at a 30% discount. You'll just get a lot of people going there who maybe not even low income but just want the saving. What the hell? 30% discount. Some, you know, you'll stand in line. So you'll have to take into account the cost of standing in line, but again people are quite willing to stand in line for a discount. And um they'll sell they'll sell a lot of this stuff and uh this city will be massively redistributing wealth from taxpayers, people who fund the government to people who shop there. And the people who shop there could be rich, they could be middle class, and they could be poor. There's not going to be this is not means tested. Of course not. The people who voted for Mdani are not poor. Mandani was not elected by poor people. He was elected by middle class and upper middle class professionals in Brooklyn. So, um, they want the discount, right? Their cost of living is high. They want the discount. They'll stand in line, too. Now, the city is claiming that this is going to save uh families $90 a month. $90 a month. Um now I don't know on what basis they estimate this but again I you know if if people stand in line and uh the store doesn't literally run out but manages to resupply although I don't see how they can do that uh then it might be a lot you know it might be $90 a month but it might be on a lot more families than the city's estimating. Now, here's the thing. Five stores for the city of New York. I mean, have you guys been to New York? It's a big place. It's not a little. It's a big place. Five stores. Do you know how many grocery stores, you know, tell me in the chat, how many grocery stores, how many grocery stores does New York City have? I'm not talking about bodegas. I'll ask you about bodegas in a minute. I'm talking about real life grocery stores, [clears throat] you know, small, mediumsiz, and the big supermarkets. How many do they have in the in the city of New York? Anybody want to guess the number of grocery stores? And you could might as well guess the number of bodeas. Bedas are these little I don't know what you call them, little grocery stores, you know, just with minimal stuff. Uh we have a lot of bodeas, the equivalent of bodeas here in in Lisbon. Ian says,00. He's cheating. He looked it up. Ian's right. There were,00 grocery stores in New York City. There are 10,000 10,000 bodegas and we're going to add five and this is going to do what to grocery prices in New York City. I mean, some people will line up, but the,00 grocery stores are not going to lower their prices because of that competition from five grocery stores. I mean, that would be that would be ridiculous. And again, the five groceries are going to run out of they're going to have shortages of the staple stuff, the core stuff, the stuff that's a discount very, very quickly. So, the people who are going to benefit from this are going to be the people who work and live around the five locations. Nobody's going to taxi in and and maybe they'll take public transportation in uh for that. Ian doesn't get a price because he used Chachi PT and that that that doesn't count. Only if I use CHP does it count. If you use CHP it doesn't count. Uh I mean if you're working in the area, walking by the area, everybody gets it. It's not helping poor people. It's helping whoever whoever happens to be willing to stand in line to get the disco, including people from out of state, including tourists. Right. So, the stores promise deep discounts, but they also require unusually generous compensation, high wages, high benefits. Uh they also, I guess in the RFP, they were also requiring the grocery stores to source the groceries from quote preferred local and socially approved sources. I mean this just keeps getting better. Um they have to have healthy oriented merchandising and uh there's something about community programming and restrictions on profit profitable product categories like junk food. So every one of these things raises the cost, makes it more expensive, and increases the need for a bigger and bigger and bigger city subsidy. As we said, below market pricing is going to generate excess demand, right? um they uh the RFPs you know um anticipates demand management bulk purchase limits and a customer card but okay see even with bulk purchase limits you know this is uh Soviet style rationing are they going to decide how many eggs you can get is is buying two cotton is that bulk is buying [clears throat] half a cotton. Okay, maybe they'll sell eggs one at a time. I don't know. I mean, you're gonna run out of stuff at 30% discount. If meat is deliberately priced at 30% below a nearby store, they'll either run out or, you know, or or or they'll have to limit how many grams of meat you buy. There's no other way to do it. Rationing. Rationing. Anyway, um this is this is setting it up to be a disaster. Now, there's plenty of experience doing this, right? There's a there was a store in Baldwin, Florida, uh run by the municipality. It closed in 2024 because it couldn't break even. Now, here at least, the city of New York recognizes it's not going to break even, and it's setting aside money to subsidize it. It's just the subsidy is going to grow bigger and bigger and bigger and bigger over time, and at some point it won't be affordable. In Erie, Kansas, there was a city-run store that lost money and eventually just leased it to a private operator. Um, and uh, Kansas City's publicly backed Sunfresh closed in 2025 after extensive public investment, continued losses, and operational problems. What is it with Kansas City that they have so many governmentrun stores? I I wouldn't expect that to be Kansas. I'd expect Berkeley, but Kansas. U So, uh, you know, there's some other experiments. There's one in Atlanta, but unlikely unlikely that the one in New York uh is uh is going to work. So, uh we will see what happens. Um it's not clear where the money comes from, you know, the 70 million to build it and then everything else. Um and then of course there these conflicts. I mean, Manny says, "No, no, we're not going to allow out oftowners to buy." and then he has to retract it immediately. You can just imagine how kind of the the the leftist egalitarians, the anti- show me an ID uh uh uh you know, you're just going to push Manny further to the left. Those core set of products is going to expand and expand and expand and expand over time. uh and then they'll have problems just with the with the actual uh with the actual inventory management. So yes, a complete disaster socialist well it's not a disaster yet but it you know if you know anything about economics um supply and demand how economics works yes government can subsidize but when you subsidize something you get more of it so you get more discounts more people buying stuff and it just grows and grows and and the budget runs out the budget runs dry. Uh luckily they're only starting with one then two stores. I I my guess is by the time they reach two stores they'll shut they'll stop and they won't open the third and fourth and fifth floor store because the the the city budget won't be able to sustain it. Hopefully also by then since we're talking about way in the future uh Mdani will be out of office. That will be nice that Mdani actually loses.