There’s a reliable pattern in America’s progressive cities. First, the government buries businesses under regulations, taxes, and policies until they pack up and leave. Then, when storefronts sit empty and shelves go bare, those same politicians announce a crisis — one that conveniently demands even more government. The arsonist puts on the fire chief’s hat. Nobody claps, but he doesn’t care.
We’ve watched this routine play out with housing, policing, and public transit. But one American city is now running the playbook on something far more basic — the food on your table. And the arithmetic behind it tells you everything you need to know. This isn’t a miscalculation. It’s a blueprint.
From Fox News:
Thirty-five years after the Soviet Union collapsed, the Communist bread line is poised for a comeback in the Big Apple, as Mayor Zohran Mamdani announces his government grocery stores will be undercutting real groceries by 30%. Not to worry, socialism will work this time.
The announcement came during a press conference on July 27, where Comrade Mamdani promised 30% discounts for “essential” products at his new city-run grocery stores. The problem, of course, is grocery stores are in a razor-thin industry, sporting profit margins of roughly 2%. And that’s with competent management, which New York City government is decidedly not famous for.
A self-described socialist mayor — a man who has publicly boasted that socialists “understand economics just as well as the capitalists who came before” — is sinking $70 million of public money into government-run grocery stores priced so low that no private competitor can survive. He knows what comes next. That’s the whole point.
A discount designed to kill
Grocery stores earn roughly two cents of profit per dollar. Mamdani is promising customers 30 percent off. Even if city bureaucrats somehow matched the operational efficiency of Walmart or Aldi — and let’s be honest, nobody believes that — taxpayers would still absorb at least 28 cents of loss on every dollar spent. That’s not a discount. That’s a demolition project with a receipt.
It gets worse. Mamdani’s stores enjoy city property tax exemptions and a bottomless credit line from the public treasury. The bodega owner on the next block? He gets nothing. He pays rent, insurance, property taxes, and every fee the city’s regulatory army can dream up — then watches the government open a competing storefront selling goods below wholesale cost.
A reporter actually asked the obvious question: what stops people from buying these subsidized groceries in bulk and reselling them at a profit? Thirty percent below retail beats wholesale pricing, after all. Mamdani’s administration offered a vague reference to a “library card-esque” tracking system. No specifics. No enforcement mechanism. Just hand-waving where a policy should be. Inspiring stuff.
From Caracas to Kansas City
If you’re experiencing déjà vu, trust your instincts. Hugo Chávez launched Venezuela’s government grocery network, Mercal, in 2003. Initially, it was a smash hit — more than 70 percent of households shopped there. Then reality arrived. Shelves emptied. Lines wrapped around blocks. Corruption exploded. By 2014, participation had cratered below 40 percent. The government’s fix? Assign shopping days by ID number. Track purchases with fingerprints. Require a birth certificate before you could buy diapers. Just your standard grocery run in a socialist paradise.
We don’t even need to cross borders for proof. Kansas City dumped $18 million into a government grocery experiment that ended up selling rotting food to the people it claimed to help. Chicago torched $26 million running seven stores straight into the ground. And New York already has its own trophy case of government-run failure. The MTA — which replaced profitable private transit lines — now bleeds $11.7 billion per year. That’s roughly $3,000 per household, every single year, just to keep the trains limping along.
But sure. Groceries will be different.
Breaking things on purpose
What separates Mamdani from your garden-variety incompetent politician is that he’s told us exactly who he is. He’s a socialist who believes government should control commerce. The inevitable destruction of private grocery stores isn’t some unfortunate side effect he failed to anticipate. It’s the outcome his ideology requires.
As Heritage Foundation economists E.J. Antoni and Peter St. Onge wrote, “The hallmark of socialism is it breaks things, then uses the detritus as an excuse to break more things.” Once private grocers fold and New Yorkers have nowhere else to shop, Mamdani owns the leverage he actually wants — a city dependent on the state for its most basic daily need.
The real solutions aren’t mysterious. Slash property taxes for grocers. Reform zoning laws so a new store doesn’t spend years begging for permits. Enforce shoplifting laws. Cooperate with the more than 11,000 bodegas and grocery stores that already feed this city rather than waging economic war against them. None of that requires $70 million or a single government-run banana stand.
New Yorkers deserve grocery stores that outlast a mayor’s press conference — not a socialist experiment with an expiration date printed on every taxpayer-funded plantain.
Key Takeaways
- Mamdani’s 30% discount guarantees taxpayers lose at least 28 cents on every dollar spent.
- Government grocery programs have failed everywhere they’ve been tried, from Venezuela to Chicago.
- Subsidized city stores will devastate private grocers who can’t compete against limitless tax dollars.
- Free-market fixes like tax relief and zoning reform would expand food access without the waste.
Sources: Fox News, Reason.com
