10 ms·

NYC to open municipal grocery store in 2027

59 points by DarkContinent 5mo ago

hnthrowaway0315 5mo ago
Not a new idea and the intention seems to be good. I wonder how will the implementation go. Where does the stores source merchandises? What is the volume of the five stores in total? How do they plan to offer a better price -- is it a percentage lower than some other stores, or something else? What if they have to run them with a loss? Such and such.
halflife 5mo ago
This sounds extremely non economically viable. The municipality which has monopoly on land taxes and costs will compete with stores that must pay taxes and rent? Won’t it just cause neighboring stores to close? Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers?
- tacostakohashi 5mo ago
  I think that's essentially the entire point, considering that most of the economically viable grocery stores already exist.
- asdff 5mo ago
  Major grocers are more inclined to form cartels on price than to engage in organic competitive action. These businesses are too large and incentives too perverse for free market dynamics to apply anymore.
  - gruez 5mo ago
    >Major grocers are more inclined to form cartels on price than to engage in organic competitive action. Even if we take at face value that this is happening, their margins are famously low (ie. low single digits[1][2]) that any improvements are likely negligible. In the best case scenario where they're run as competently/efficiently as a normal grocery store, but don't take any profits, you'd be saving like 50 cents on a $10 pack of ground beef. Of course, all of this would go out the window if it's less efficient, either due to government incompetence[3], or lack of scale. [1] https://www.macrotrends.net/stocks/charts/ACI/albertsons/profit-margins https://www.macrotrends.net/stocks/charts/ACI/albertsons/pro... [2] https://www.macrotrends.net/stocks/charts/KR/kroger/profit-margins https://www.macrotrends.net/stocks/charts/KR/kroger/profit-m... [3] https://en.wikipedia.org/wiki/Noe_Valley_public_toilet https://en.wikipedia.org/wiki/Noe_Valley_public_toilet
    - ceejayoz 5mo ago
      > https://en.wikipedia.org/wiki/Noe_Valley_public_toilet https://en.wikipedia.org/wiki/Noe_Valley_public_toilet Mamdani has clearly taken lessons like these to heart. https://www.nytimes.com/2026/04/07/nyregion/how-to-build-a-rest-stop-for-delivery-workers-in-a-hurry.html https://www.nytimes.com/2026/04/07/nyregion/how-to-build-a-r... "The Transportation Department workers arrived at 9:15 p.m., right on time. Mr. Boyce and his crew were ready, having fitted the roof and rear wall panel 30 minutes before. By Monday, the structure was nearly complete. “This is all like synchronized swimming,” Mr. Mansylla said. “To build a structure in New York City in, what, 48 hours? That’s as fast as it gets.”
      - gruez 5mo ago
        Your article doesn't say anything about cost, only that it got built fast. Every time the toilet example gets cited, the punchline is the cost, not how long it took, although that was appalling as well. From the wikipedia article: >The toilet's original proposed cost of $1.7 million inspired media coverage and criticism of the San Francisco government.
        ceejayoz 5mo ago
        Sure... because it was a prefab and still took two years at that cost.
        b112 5mo ago
        Plus, the cost of building includes a lot of permits, inspections, studies, and money to sldo so. Taxes too. Was all this waived?
        ceejayoz 5mo ago
        I'm a firm believer that part of progressivism needs to be reining in these sorts of NIMBY obstacles.
        b112 5mo ago
  - KK7NIL 5mo ago
    Those are pretty extraordinary claims with very little evidence. And, even if they are true, the obvious solution would be to enforce the already existing antitrust and competition laws, not to have the government directly engage in commerce.
    - darth_avocado 5mo ago
      Why is government directly engaging in commerce such a controversial topic. The government already does it in various forms: VA hospitals, Medicare price negotiations, government subsidies in agriculture, owning 10% of Intel etc.
      - philipallstar 5mo ago
        I wouldn't argue that the US healthcare system is so good that no market distortion can be detected from its current structure.
        asdff 5mo ago
        >Charges $100 for a tylenol because insurance or medicare will blindly pay for it Yup no distortions here just good old fashion free market!
        philipallstar 5mo ago
        Indeed.
    - asdff 5mo ago
      Too much to write in a HN comment so here is a substack post (1) probably worthy of its own HN post. And how is that the obvious solution? You see who is in the Whitehouse and you think this is a champion of antitrust and lifting up the little man? Quite the opposite. NYC government is a separate entity than federal government with different limits to its powers. They can't do anything about cartel behavior. They can, however, open a municipal grocery store. The government engages in commerce all the time. If we took that argument to its logical conclusion there would be no libraries as they compete with book stores. There would be no armies as they compete with Blackrock mercenaries. No public transit as it competes with private transit. No public events as that competes with ticketmaster. No public schools. No public universities. No scientific research grants. No sheltering or feeding the poor. No treating the sick. No treating veterans. No bridges. No roads. No harbors. No anything. What really would be the role of government after we stripped it of all its potential influences on the world of commerce? I can't even imagine what might even be left... No, it seems a big role in this country for government is facilitating conditions for commerce. Educating the populace such as to upskill the nation's labor pool. Building roads free for businesses to use in transporting goods to market. Treating the sick before they get so ill as to be an undue burden on the medical system that threatens its entire latent capacity. Offering cheaper food seems in line with that. People aren't going to use the spare money to throw into a river; they will use their extra money to circulate back into the economy probably in more productive ways than Kroger buying back its stock or its executives or shareholders squandering it on oysters and boat fuel. 1. https://grocerynerd.substack.com/p/grocery-update-17-how-grocery-cartels https://grocerynerd.substack.com/p/grocery-update-17-how-gro...
  - woah 5mo ago
    Oh, that must be why the grocery business is wildly profitable
    - ceejayoz 5mo ago
      Low margins, high volumes. Walmart has low margins. Walmart is also wildly profitable.
    - asdff 5mo ago
      You know what they say about massively consolidated multinational corporations with tens of thousands of employees and millions of square feet in real estate: no one making money there.
  - ilaksh 5mo ago
    I wonder if there is a way to improve pricing more systemically by combating some of this. Or if there could be some kind of network and information protocol that could provide a decentralized alternative. Maybe there could be an Internet protocol or NYC Internet protocol that food suppliers could list low price items with. Independent stores could order from here, shipped to their store, or maybe one or two city warehouses where they could pick up. Maybe another system where suppliers could voluntarily detail cost disruptions, allowing government or other organizations insight and sometimes the possibility of helping alleviate those issues etc. I mean the government already spends a lot to subsidize retail food purchases. Maybe another idea is just a very easily accessible new app for credits that is NYC only? It's just that making a single store puts all of the logistical and other issues onto one government department and location, which has been shown in socialist countries to break down. I am all for a few more socialist policies (I am lucky to have survived this long on outsourcing rates without a consistent healthcare plan), but it definitely needs to be a contemporary effort and not some centralized 1950s model.
    - asdff 5mo ago
      This is probably not far off from how things already work in distribution. Most restaurants are ordering from the same food wholesalers in a given region. When I go to more "independent" grocers or local chains they still have much of the same offerings as major grocers in my area, so I'm guessing they also order from the same sets of distributors (or lease shelf space to the same groups). And I'm not talking just the packaged stuff. But when certain varietals come in e.g. Cosmic Crisp apples, its like all the grocery stores in the area are getting the Cosmic Crisp apples over the next few weeks with the same sticker and all. I know for stuff like seafood there is a saturday night 1am fish market near our harbor where significant volume is sold wholesale to restaurants and grocers (but also individuals interested in filling a chest freezer). So I think already there are just few places to order food wholesale in a given region so those prices are probably somewhat even. Then of course you go to vons, kroger, ralphs, save4less, the local korean grocer, and see different prices for the exact same commodified product like Cosmic crisp apple or 6 pack of coca cola, there is your markup that comes from the grocer itself on top of the regional wholesale price. Grocers like to have flexibility in markup to play psychological games like rotating sales, coupons, and offer rewards programs. Seems that sort of finagling isn't tolerated at the next level of abstraction in business to business sales. Cost disruptions might be good to put the blame on who exactly in the chain is gouging prices. At the end of the day, the eggs in the egg shortage were not more costly to produce than beforehand. And the egg farms that were culled of their hens, were probably not that much of an anchor on operations given that they probably were not consuming their usual power, water, farmhands probably all laid off, land bought and paid for probably decades ago by this point, way out in marginal farmland where property taxes are probably quite low. Certainly not enough to quadruple the price of eggs. And how interesting how Trader Joes still sold $2.99 dozen racks during this whole crisis.
  - halflife 5mo ago
    That may be, but you can direct subsidies towards inverse relation to the store’s income. You can even add extra taxes for large chains. But as others said, groceries are working on minimal margin. And all of them work with the same wholeselles (except those with vertical integrations), and this is a nation wide problem.
    - asdff 5mo ago
      >That may be, but you can direct subsidies towards inverse relation to the store’s income. You can even add extra taxes for large chains. Not really imo. Private market passes costs to consumers and leverages subsidy offers to achieve rat race outcomes out of competing local governments off each other. It is how you end up with the classic case of a city courting some business but offering enough tax abatement where the city isn't actually getting anything out of the business, and once the abatement expire the business just leaves for somewhere else that will cut them a better deal. City ends up hostage to the business demanding ever more favorable incentives and removal of all taxes (there's been free trade zones established in the middle of ho hum suburbs, stuff brought in there doesn't even count as imported to the US).
      - halflife 5mo ago
        Interesting. I think it really depends on the competitiveness of the market. In a highly competitive market, every cost saved would be passed to the consumer, obviously this is simplistic microeconomics and doesn’t actually works this way. In my city, there’s a supermarket approximately every 150 meters. Food cost is high, but for the entire country. Actually research shows that food cost is higher in low density towns where there is much less competition.
- wahnfrieden 5mo ago
  In some neighborhoods there are only luxury grocery options. Groceries also form cartels as the other commenter mentioned. The biggest grocers in Canada did it for many years until they were penalized for it (though it’s likely still continuing in other ways - the same players are now under investigation for selling underweight meats) The estimated cost to consumers from bread price-fixing was $4-5 billion
  - halflife 5mo ago
    It’s about supply and demand. Luxury grocers provide a shopping “experience”, where low cost grocers do not. In a luxury neighborhood it would make sense the shoppers are looking for experience more so than low cost.
    - wahnfrieden 5mo ago
      The neighborhoods I'm talking about also have many people living in poverty or near it. Looks like you live in Israel which is perhaps less integrated / more segregated than Brooklyn (I don't know though, I haven't been to see first hand)
    - rsynnott 5mo ago
      What’s a ‘luxury neighborhood’? In any large city, most central areas are generally a bit of a mix; “this is only for rich/poor people” is more of a suburban phenomenon. If the shops are only catering to the high end, a problem can develop. (I am less sure why this happens to such a great extent in large US cities vs elsewhere, vs more of a balance of shops, but it does seem to.)
      - wahnfrieden 5mo ago
        The poster appears to be Israeli. I’m not an expert and have never been but I understand spatial wealth segregation is quite extreme there and may explain their take. Here’s one study: https://www.ref-inst.org/en/articles-and-studies/spatial-inequality-in-israel-tal-and-leventhal https://www.ref-inst.org/en/articles-and-studies/spatial-ine... So it may just be that where they are from, the concept of “luxury neighborhoods” which do not need to cater to the poor and disadvantaged populations does indeed exist, due to segregation factors
- yohannparis 5mo ago
  Why does everything needs to be economically viable?
  - koolba 5mo ago
    Because that’s what has traditionally allowed western countries to have a wide availability and inventory of goods vs communist economies.
    - deleted 5mo ago
      [deleted]
    - bojan 5mo ago
      But why does the availability have to be wide? Maybe those stories can do few things, but do them well. Sell staple foods and healthy choices.
      - halflife 5mo ago
        Because than people won’t come to your store. People buy where they can purchase the maximum of their shopping cart in a single place. That is why you have loss leader grocers, where they pull people with dramatic discounts on specific items, but the total cart costs the same
        yohannparis 5mo ago
        I understand your point of view. But in cities of all sizes, it's easier to not have to do that. For example in NYC, a medium size city, you can easily go do your shopping in multiple places, and not at the same time.
        halflife 5mo ago
        Yes, and some people do that. Some consumers go to specific stores to purchase specific qualities of brands. But most do not, especially for convenience products. You get it where you can.
- tencentshill 5mo ago
  He won by not being a capitalist. He campaigned on doing something to actually meet the basic needs of the people who elected him. This is the cost of that promise. This will force them to compete on those terms instead of directly on money.
- shimman 5mo ago
  You sound extremely privileged and frankly out of touch (not uncommon with the HN demographic). Do you think working families in NYC don't deserve the same monetary relief that massive corporations get with their own welfare programs? Why should trillion multinational companies take our public money to subsidize their businesses and we can't do the same for workers? Why do you prefer helping non human entities (corporations) over literal humans?
  - deleted 5mo ago
    [deleted]
  - halflife 5mo ago
    Subsidies can go to small businesses owners. Not just large corporations.
- deleted 5mo ago
  [deleted]
- darth_avocado 5mo ago
  > Won’t it just cause neighboring stores to close? Hopefully they kept all those profits around from the time they price gouging consumers in the name of “supply chain issues”, “transitory inflation”, “bird flu” etc. I still remember all the headlines about bird flu and how egg prices were doubling because of it. Turns out the egg production barely dropped and it was all a ruse to make more money.
  - SpicyLemonZest 5mo ago
    You can't conclude it was a ruse without knowing the elasticity of egg demand! This is ultimately the kind of thing that worries me about a municipal grocery store. Will voters allow it to respond in rational ways to market conditions, or will they expect the city to go out and extort some egg suppliers when market prices rise above what they consider reasonable?
    - ceejayoz 5mo ago
      The DOJ thinks it was a ruse. https://www.reuters.com/legal/government/us-egg-producers-face-new-wave-price-fixing-lawsuits-2025-11-18/ https://www.reuters.com/legal/government/us-egg-producers-fa... As did a jury: https://apnews.com/article/egg-producers-price-gouging-lawsuit-conspiracy-8cd455003a3a40bab74d0f046d0f2c9d https://apnews.com/article/egg-producers-price-gouging-lawsu...
      - deleted 5mo ago
        [deleted]
      - SpicyLemonZest 5mo ago
        It could potentially be a ruse by egg producers. Certainly there's reason for suspicion. But darth_avocado's claim was that grocery stores were in on the ruse and must have extracted huge profits from price gouging consumers. I think that's obviously false. You'll note that in the jury case the plaintiffs were themselves megacorporations, and substantially larger ones than the producers they were suing at that. I don't blame consumers for deciding they don't care about the underlying market structure and just want cheap eggs. But you can't run a store on that basis, and if the city feels like it has to there'll be problems.
- lexicality 5mo ago
  > Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers? I'm sure this time trickle-down economics will work and not simply line the pockets of business owners
  - halflife 5mo ago
    When you have a highly competitive market with plenty of actors lower cost does trickle down. Otherwise you’re talking about an extremely complicated cartel which cannot exist.
    - cherry_tree 5mo ago
      Do we have a highly competitive market? If so how do we measure that? If not how do we create one?
  - philipallstar 5mo ago
    It's not trickling down. Lower costs do result in lower prices.
- ceejayoz 5mo ago
  > This sounds extremely non economically viable. Many things government does are not economically viable. That's why they get left to government. > Won’t it just cause neighboring stores to close? The idea is to build these where that has already occurred.
  - WalterBright 5mo ago
    [flagged]
    - ceejayoz 5mo ago
      > Maybe they should look into why the closings occurred. Do you think there's no research on the causes of food deserts?
      - WalterBright 5mo ago
        Store closings are nearly always the result of them not being profitable.
        ceejayoz 5mo ago
        Sure. Lots of things governments need to do are unprofitable, like delivering the mail or repairing the roads. I can go to my local public library, borrow the free books, use the free computers, sit in the free chairs, ask the librarian for free guidance, enjoy the free air conditioning, and even book a free meeting room to meet up with some friends to work on a project. Profitable? Fuck no. Great to have in my city? Fuck yes.
        WalterBright 5mo ago
        Privately run grocery stores have been profitable for 250 years in the US. What has changed recently? Could it be the decriminalization of shoplifting? Or maybe excessive taxes? Or mandates on wages? Vandalism? I forgot to add homeless camping around them, which discourages shoppers.
- WalterBright 5mo ago
  In Seattle, the proposal for a government grocery store included exemption from paying property taxes and rent.
  - halflife 5mo ago
    So they have an unfair advantage over the competition. Or it’s just a way to neutralize the ineffectiveness of the management, since it’s not profitable based, who’s going to be fired?
- bastawhiz 5mo ago
  > and let the discounts competitively pass unto the customers This is the same trickle down economics principle that has proven not to work over, and over, and over again. There's exactly zero reason to believe these businesses would pass on the savings to consumers. Consider! Ingles (a supermarket brand here in NC) is criticized for holding huge amounts of abandoned/vacant/dilapidated properties [0], which stifles competition and lets them hold an effective monopoly and makes neighborhoods objectively worse. It's not about the taxes. Don't underestimate a chain's ability to eat costs by maintaining their market position. [0] https://avlwatchdog.org/opinion-ingles-markets-often-raises-the-ire-of-locals-but-it-shouldnt-be-that-way/ https://avlwatchdog.org/opinion-ingles-markets-often-raises-...
  - halflife 5mo ago
    I didn’t specify on the subsidies themselves. You can create subsidies which are inverse to the stores income. It doesn’t HAVE to go to large chains. There are many way to encourage small businesses to open. Competing with them is not one.
  - wenc 5mo ago
    You're thinking a tax break which is an unconditional subsidy. That relies on the business passing savings through which folks are right to be skeptical about. But that's not all subsidy mechanisms. The best ones are where pass-through is enforced, not assumed. You already know of one that works: WIC. It lowers the effective price for customer, which the store receives as reimbursement. It's not about trickle-down -- that's ideology. It's more about designing the right mechanism.
- thinkingtoilet 5mo ago
  Oh no! Struggling Americans will be able to buy food cheaper! What will we do? Also, if anyone has any reservations about a government run grocery store, go ask your representatives to come out against military commissaries. I bet you will not be able to find one active politician who will try to remove that. You know why? Because government run grocery stores work. End of story. Period. There is no discussion. You are wrong if you disagree. We do this. It exists. It works. And people love it. Try to find one politician that will end that service.
  - cindyllm 5mo ago
    [dead]
  - halflife 5mo ago
    Grocery costs has to come from some formula. If the mamdani stores actually do sell at a lower cost, where did the discount come from?
    - thinkingtoilet 5mo ago
      Again. This exists. There is no theoretical here. Go look up how the military commissaries work. That will answer your question.
      - halflife 5mo ago
        military commissaries are subsidized with taxes. So would these stores have lower prices because of tax subsidies? What prevents rich people from exploiting these subsidies?
        thinkingtoilet 5mo ago
        Yes. They will be subsidized, just like other food-based welfare programs. As for the rich, is this really your concern? A few rich people getting some cheaper groceries is so bad that we have to deny poor people from getting affordable food? Why do so many Americans hate poor people? You know there's literally trillions of waste in agriculture, military, pharmaceutical, oil, etc... subsidies and that's just the tip of the ice berg if you examine the tax code. If you're deeply concerned about rich people gaming the system, why don't you start in those places and then when we figure that out, we can worry about rich people shopping in one of five total grocery stores.
- jmyeet 5mo ago
  To anyone who espouses these claims that the government isn't capable of anything or that it's somehow a moral hazard I just have to ask: how's that working out for you in particular and society in general? Does it feel like things are going well? What we have now is the result of unfettered private control. Private companies collude to raise prices and lower wages. The standard of living in real terms has been in decline for over 50 years. Education, medical, housing and food costs continue to spiral. Where we do have publicly owned alternatives, such as with municipal broadband, those publicly-owned alternatives are always far better. Are we going to make the same argument that EPB in Chattanooga is somehow a moral hazard and has an unfair advantage to Verizon, AT&T, Comcast and Spectrum? Let's just say that it's true that they do. Why is that a problem? Why is it good that billion or trillion dollar companies can charge higher prices than the government can so their owners can buy another mega-yacht at the expense of the people who depend on that service? Because that's what's going on now.
- pollorollo 5mo ago
  Government owned grocery stores already exist [1]. They are run by the U.S. military, have 200+ locations, and charge at least 25% less than other brands [1]. "Surveys consistently rate the commissaries as one of the military's top non-pay benefits." NYC wants to provide similar benefits for residents. [1] https://en.wikipedia.org/wiki/Defense_Commissary_Agency https://en.wikipedia.org/wiki/Defense_Commissary_Agency [2] https://www.youtube.com/watch?v=PQOXdtPBGXI https://www.youtube.com/watch?v=PQOXdtPBGXI
  - gruez 5mo ago
    From your own article: >In 2024, DeCA estimated that it saved patrons $1.58 billion and had an operations cost of $1.7 billion, $1.5 billion of which was funded from appropriations.[8] Isn't this the "selling $1 for 75 cents" business model (aka moviepass) that people made fun of a few years ago?
    - ceejayoz 5mo ago
      Sure. It's also the business model of your local library.
      - gruez 5mo ago
        Well no, because the library is often the sole provider of book lending services and there's no private sector alternative. The same can't be said for grocery stores. To continue your analogy, it would be closer to the government setting up its own streaming service, even though there's netfilx and several other competitors. Even though people hate netflix for its price hikes or whatever, it's unclear how the government can do a better job here than netfilx (or other competitors), aside from strongarming/expropriating rights holders.
        ceejayoz 5mo ago
        > To continue your analogy, it would be closer to the government setting up its own streaming service… https://www.pbs.org/ https://www.pbs.org/
- hitekker 5mo ago
  The nyc subreddit which I'd say is pretty pro-Mamdani shared your concerns. https://old.reddit.com/r/nyc/comments/1sjq9v9/mayor_zohran_mamdani_will_announce_plans_to_open/ https://old.reddit.com/r/nyc/comments/1sjq9v9/mayor_zohran_m...
- ModernMech 5mo ago
  Who knows, let's try it and see. I've heard all my life about how new ideas are potentially not economically viable, so we keep trying old ideas which proven not economically viable. My feeling is that the economy is such a large, chaotic, dynamic system that most people, including experts, have no idea what is theoretically viable or not viable. So making decisions based on "my first order analysis is that this is not economically viable" is misguided. You have to try it first and see how the system actually responds.
MisterTea 5mo ago
I wonder what the margin is on groceries and if the stores can sustain themselves by operating at cost. I also want to know how they plan to handle pricing during shortages, e.g. eggs.
- ceejayoz 5mo ago
  There are existing examples they can probably look to. https://en.wikipedia.org/wiki/Defense_Commissary_Agency https://en.wikipedia.org/wiki/Defense_Commissary_Agency
flats 5mo ago
I was very skeptical of these plans at first—as a New Yorker, I don’t exactly have a lot of trust in our city’s government to run things well. But I’ve come around. Let’s try something new! Let’s show people that local governments in the United States really are capable of making a difference in their daily lives. If it fails, well, we tried & we’ll keep trying.
- miketery 5mo ago
  Just because we can does not mean we should. Here's how this will pan out. - A number of "officials" (friends) will get cushy jobs for running this program. - It will lose millions of tax dollars - a small portion of the population will get cheaper produce for a photo op - Mamdani and friends will call it a success - But net, this will be net negative for the city (ie. tax dollars to crony jobs and subsidizing food for some). Whats the point? The USSR has tried this (subsidized grocery stores centrally planned). Lets not. If on the other hand, the issue was hey its expensive to bring produce XYZ, so why don't we work to reduce that cost by legalizing Kei [1] trucks and exempt from tolls. Now that would be something interesting. 1 - https://en.wikipedia.org/wiki/Kei_truck https://en.wikipedia.org/wiki/Kei_truck
  - ceejayoz 5mo ago
    > The USSR has tried this. Lets not. The USSR tried lots of things we do successfully. This is actually something governments have a proven ability to do, at least in some contexts, without becoming a corrupt boondoggle. https://en.wikipedia.org/wiki/Defense_Commissary_Agency https://en.wikipedia.org/wiki/Defense_Commissary_Agency
    - miketery 5mo ago
      Yeah it was so successful that people would line up around the block for bananas the one time a year. Or when boots came into the store you'd pick up whatever size you could, as you'd trade later. (true stories)
      - 5mo ago
bparsons 5mo ago
The government already runs/oversees a variety of public grocery stores. Including: - Armed forces commissaries. The op ex is subsidized by the taxpayer, but the cost of goods reflects the market wholesale price, plus a 5% fee to pay for capital goods/facilities upkeep. - Grocery stores run by non-profits/charities. Eligible donations are a tax deduction, which represents a form of subsidy by the taxpayer. These stores are really popular in some places in the US. - Food banks. Operate on a mix of private donations and taxpayer grants/tax receipts to some donors. It all amounts to the same thing. The finance model is different in each case, but its all taxpayer supported no matter how you look at it.
thelastgallon 5mo ago
Don’t do these kinds of idiotic things. Do what Singapore does for housing.
- ceejayoz 5mo ago
  Singapore's largest grocery chain is a co-op run by the country's labor unions, which are closely aligned with the government. https://en.wikipedia.org/wiki/NTUC_FairPrice https://en.wikipedia.org/wiki/NTUC_FairPrice
bastawhiz 5mo ago
I'm not opposed to this, but I'd rather have seen incentives and subsidies for local co-ops to succeed in this space. That's probably harder than it sounds, though.
energy123 5mo ago
Dumb populist idea, grocery stores make 2% margins, best case scenario you're saving people 2%, realistic scenario you introduce operational inefficiencies that the chains already optimized out and waste taxpayer resources. If you don't like grocery stores gamifying or selling junk, regulate those aspects. Or put the taxpayer money towards something useful like building public housing.
- legobmw99 5mo ago
  You’re not putting a municipal grocery store on the same block as an existing big box and saying “wow, savings!” Food deserts exist in NYC, and many New Yorkers buy staples at corner stores that charge significantly more than a standard grocery store. Your second paragraph implies that this policy is due to some dislike of existing grocery stores, but that assumes these communities are actually being currently served by grocers at all
  - energy123 5mo ago
    Those corner stores exist in a perfectly competitive market, they have low turnover so they have to charger higher prices to pay staff wages and rent. There are no abnormal profits. Why would you set up a government run store with more operational inefficiencies and less ability to respond to the local knowledge problem, than like give money or food stamps to people in these areas, or use the money in some other way?
    - j_w 5mo ago
      There is no such thing as a perfectly competitive market. I don't understand why people on HN are obsessed with this term. It strictly cannot exist in the real world. A perfectly competitive market requires the following (this is not everything, just some): - Supply perfectly meets demand (yep already wrong here) - Marginal costs equal to average revenue (this means there should be effectively 0 profit for the seller) - Zero transaction costs - Zero externalities (can't exist)
oa335 5mo ago
This is Mamdani’s worst idea. Margins on most essential goods in grocery stores is incredibly low, sometimes it’s a loss leader. Does anyone know of any solid economic rationale for this move?
- woodruffw 5mo ago
  The underlying theory is to put these stores in areas that otherwise lack grocery store access, meaning they won’t compete with existing stores for small margins. Running at a (moderate) loss would also be politically acceptable; the city runs a lot of things at a loss for civic purposes and fills the gaps with taxes. (This is the theory, the practice will be challenged by NYC’s ability to acquire land in neighborhoods that are underserved by groceries and develop a supply chain for these stores. This will be harder, but I personally don’t vote for mayors to only have easy problems to solve.)
  - oa335 5mo ago
    > The underlying theory is to put these stores in areas that otherwise lack grocery store access, I’m generally partial to that motivation - however doesn’t seem to be happening here. This location (La Marqueta) is within a couple hundred feet of a "City Fresh Market" grocery store and ~1500 from several other grocery stores https://www.google.com/maps/search/grocery+store/@40.7983886,-73.9473076,16z https://www.google.com/maps/search/grocery+store/@40.7983886...
    - woodruffw 5mo ago
      Yes, I agree the city has undermined their own (strong) argument with their choice of location. I noted that in another comment as well. (I previously lived about a ~10 minute walk from that public market.)
    - ModernMech 5mo ago
      But if you're running a pilot, wouldn't you want it near some other store to see what the impact on their business actually is? Running a pilot in the middle of nowhere would say nothing about how it impacts other local stores. You'd end up having to run another pilot to answer that question.
rdtsc 5mo ago
> “Some will insist that city-owned businesses do not work, that government cannot keep up with corporations. My answer to them is simple: I look forward to the competition. May the most affordable grocery store win,” Mamdani said. Well it's interesting enough to try. Are they going to keep the stores open at a loss, that's not really competing then, is it? If they sell things that are much cheaper, restaurants could start sourcing their food from there, too. Why get your chicken from some supplier if you can buy it from a cheaper government run store at much less. But then, if these stores are not run at a loss, it means somehow there is this large inefficiency that other stores haven't tapped into. And if I had to guess, grocery stores don't seem like a large margin business, but perhaps that's just my ignorance as it's not something I ever looked into in detail.
- ceejayoz 5mo ago
  > If they sell things that are much cheaper, restaurants could start sourcing their food from there, too. Why get your chicken from some supplier if you can buy it from a cheaper government run store at much less. Restaurants already do this. They buy from wholesalers, because they're cheaper than the grocery store.
  - rdtsc 5mo ago
    > Restaurants already do this. They buy from wholesalers, because they're cheaper than the grocery store. But now grocery stores could be cheaper than wholesalers if there are any subsidies involved or selling at a loss is a thing. Why go to wholesalers when you can camp out with a van by the government subsidized stores when it opens or when delivery comes. Not saying this is insurmountable, the stores can implement a purchase quota: you get X amount of items per transaction and we take your ID or something. But it opens up that kind of a situation. Like I said, I hope it works, it would be interesting to watch.
    - ceejayoz 5mo ago
      > But now grocery stores could be cheaper than wholesalers I really don’t think this will be the case. That’s not the goal here.
bherms 5mo ago
Many people losing their minds over stuff like this... I'm just glad some people are finally trying out new ideas, because the status quo is not working for a large portion of the American population. I just hope they properly track and monitor the outcomes and foster honest/open feedback. The gov't loves to throw money at problems, but never really does much to analyze, pivot, or admit when something doesn't work because that just gives the opposition ammo.
Molitor5901 5mo ago
If you're interested in grocery store economics, I strongly recommend: The Secret Life of Groceries: The Dark Miracle of the American Supermarket by Benjamin Lorr, and Grocery: The Buying and Selling of Food in America by Michael Ruhlman Extremely insightful about how much it cost to run a grocery store, where profits go, who the food suppliers really are, etc. Very eyeopening.
robotnikman 5mo ago
Are they looking to hire any software engineers right now?
euroderf 5mo ago
I visited Soviet Estonia in 1987, on an overnight from Helsinki. A treasured purchase was a simple stamped metal bottle opener. Even the price was stamped: 15 kopecks. This told me that for the very simplest consumer items, they might easily be contracted out and sold at just above production cost. Consumers would be free to buy fancier bottle openers, but sometimes a hunk of stamped metal does the trick. Likewise for many other consumer basics ? Like, a Gotham store brand ?

59 points by DarkContinent 5mo ago

Not a new idea and the intention seems to be good. I wonder how will the implementation go. Where does the stores source merchandises? What is the volume of the five stores in total? How do they plan to offer a better price -- is it a percentage lower than some other stores, or something else? What if they have to run them with a loss? Such and such.

halflife 5mo ago

This sounds extremely non economically viable. The municipality which has monopoly on land taxes and costs will compete with stores that must pay taxes and rent? Won’t it just cause neighboring stores to close? Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers?

tacostakohashi 5mo ago
I think that's essentially the entire point, considering that most of the economically viable grocery stores already exist.
asdff 5mo ago
Major grocers are more inclined to form cartels on price than to engage in organic competitive action. These businesses are too large and incentives too perverse for free market dynamics to apply anymore.
- gruez 5mo ago
  >Major grocers are more inclined to form cartels on price than to engage in organic competitive action. Even if we take at face value that this is happening, their margins are famously low (ie. low single digits[1][2]) that any improvements are likely negligible. In the best case scenario where they're run as competently/efficiently as a normal grocery store, but don't take any profits, you'd be saving like 50 cents on a $10 pack of ground beef. Of course, all of this would go out the window if it's less efficient, either due to government incompetence[3], or lack of scale. [1] https://www.macrotrends.net/stocks/charts/ACI/albertsons/profit-margins https://www.macrotrends.net/stocks/charts/ACI/albertsons/pro... [2] https://www.macrotrends.net/stocks/charts/KR/kroger/profit-margins https://www.macrotrends.net/stocks/charts/KR/kroger/profit-m... [3] https://en.wikipedia.org/wiki/Noe_Valley_public_toilet https://en.wikipedia.org/wiki/Noe_Valley_public_toilet
  - ceejayoz 5mo ago
    > https://en.wikipedia.org/wiki/Noe_Valley_public_toilet https://en.wikipedia.org/wiki/Noe_Valley_public_toilet Mamdani has clearly taken lessons like these to heart. https://www.nytimes.com/2026/04/07/nyregion/how-to-build-a-rest-stop-for-delivery-workers-in-a-hurry.html https://www.nytimes.com/2026/04/07/nyregion/how-to-build-a-r... "The Transportation Department workers arrived at 9:15 p.m., right on time. Mr. Boyce and his crew were ready, having fitted the roof and rear wall panel 30 minutes before. By Monday, the structure was nearly complete. “This is all like synchronized swimming,” Mr. Mansylla said. “To build a structure in New York City in, what, 48 hours? That’s as fast as it gets.”
    - gruez 5mo ago
      Your article doesn't say anything about cost, only that it got built fast. Every time the toilet example gets cited, the punchline is the cost, not how long it took, although that was appalling as well. From the wikipedia article: >The toilet's original proposed cost of $1.7 million inspired media coverage and criticism of the San Francisco government.
      - ceejayoz 5mo ago
        Sure... because it was a prefab and still took two years at that cost.
      - b112 5mo ago
        Plus, the cost of building includes a lot of permits, inspections, studies, and money to sldo so. Taxes too. Was all this waived?
        ceejayoz 5mo ago
        I'm a firm believer that part of progressivism needs to be reining in these sorts of NIMBY obstacles.
        b112 5mo ago
- KK7NIL 5mo ago
  Those are pretty extraordinary claims with very little evidence. And, even if they are true, the obvious solution would be to enforce the already existing antitrust and competition laws, not to have the government directly engage in commerce.
  - darth_avocado 5mo ago
    Why is government directly engaging in commerce such a controversial topic. The government already does it in various forms: VA hospitals, Medicare price negotiations, government subsidies in agriculture, owning 10% of Intel etc.
    - philipallstar 5mo ago
      I wouldn't argue that the US healthcare system is so good that no market distortion can be detected from its current structure.
      - asdff 5mo ago
        >Charges $100 for a tylenol because insurance or medicare will blindly pay for it Yup no distortions here just good old fashion free market!
        philipallstar 5mo ago
        Indeed.
  - asdff 5mo ago
    Too much to write in a HN comment so here is a substack post (1) probably worthy of its own HN post. And how is that the obvious solution? You see who is in the Whitehouse and you think this is a champion of antitrust and lifting up the little man? Quite the opposite. NYC government is a separate entity than federal government with different limits to its powers. They can't do anything about cartel behavior. They can, however, open a municipal grocery store. The government engages in commerce all the time. If we took that argument to its logical conclusion there would be no libraries as they compete with book stores. There would be no armies as they compete with Blackrock mercenaries. No public transit as it competes with private transit. No public events as that competes with ticketmaster. No public schools. No public universities. No scientific research grants. No sheltering or feeding the poor. No treating the sick. No treating veterans. No bridges. No roads. No harbors. No anything. What really would be the role of government after we stripped it of all its potential influences on the world of commerce? I can't even imagine what might even be left... No, it seems a big role in this country for government is facilitating conditions for commerce. Educating the populace such as to upskill the nation's labor pool. Building roads free for businesses to use in transporting goods to market. Treating the sick before they get so ill as to be an undue burden on the medical system that threatens its entire latent capacity. Offering cheaper food seems in line with that. People aren't going to use the spare money to throw into a river; they will use their extra money to circulate back into the economy probably in more productive ways than Kroger buying back its stock or its executives or shareholders squandering it on oysters and boat fuel. 1. https://grocerynerd.substack.com/p/grocery-update-17-how-grocery-cartels https://grocerynerd.substack.com/p/grocery-update-17-how-gro...
- woah 5mo ago
  Oh, that must be why the grocery business is wildly profitable
  - ceejayoz 5mo ago
    Low margins, high volumes. Walmart has low margins. Walmart is also wildly profitable.
  - asdff 5mo ago
    You know what they say about massively consolidated multinational corporations with tens of thousands of employees and millions of square feet in real estate: no one making money there.
- ilaksh 5mo ago
  I wonder if there is a way to improve pricing more systemically by combating some of this. Or if there could be some kind of network and information protocol that could provide a decentralized alternative. Maybe there could be an Internet protocol or NYC Internet protocol that food suppliers could list low price items with. Independent stores could order from here, shipped to their store, or maybe one or two city warehouses where they could pick up. Maybe another system where suppliers could voluntarily detail cost disruptions, allowing government or other organizations insight and sometimes the possibility of helping alleviate those issues etc. I mean the government already spends a lot to subsidize retail food purchases. Maybe another idea is just a very easily accessible new app for credits that is NYC only? It's just that making a single store puts all of the logistical and other issues onto one government department and location, which has been shown in socialist countries to break down. I am all for a few more socialist policies (I am lucky to have survived this long on outsourcing rates without a consistent healthcare plan), but it definitely needs to be a contemporary effort and not some centralized 1950s model.
  - asdff 5mo ago
    This is probably not far off from how things already work in distribution. Most restaurants are ordering from the same food wholesalers in a given region. When I go to more "independent" grocers or local chains they still have much of the same offerings as major grocers in my area, so I'm guessing they also order from the same sets of distributors (or lease shelf space to the same groups). And I'm not talking just the packaged stuff. But when certain varietals come in e.g. Cosmic Crisp apples, its like all the grocery stores in the area are getting the Cosmic Crisp apples over the next few weeks with the same sticker and all. I know for stuff like seafood there is a saturday night 1am fish market near our harbor where significant volume is sold wholesale to restaurants and grocers (but also individuals interested in filling a chest freezer). So I think already there are just few places to order food wholesale in a given region so those prices are probably somewhat even. Then of course you go to vons, kroger, ralphs, save4less, the local korean grocer, and see different prices for the exact same commodified product like Cosmic crisp apple or 6 pack of coca cola, there is your markup that comes from the grocer itself on top of the regional wholesale price. Grocers like to have flexibility in markup to play psychological games like rotating sales, coupons, and offer rewards programs. Seems that sort of finagling isn't tolerated at the next level of abstraction in business to business sales. Cost disruptions might be good to put the blame on who exactly in the chain is gouging prices. At the end of the day, the eggs in the egg shortage were not more costly to produce than beforehand. And the egg farms that were culled of their hens, were probably not that much of an anchor on operations given that they probably were not consuming their usual power, water, farmhands probably all laid off, land bought and paid for probably decades ago by this point, way out in marginal farmland where property taxes are probably quite low. Certainly not enough to quadruple the price of eggs. And how interesting how Trader Joes still sold $2.99 dozen racks during this whole crisis.
- halflife 5mo ago
  That may be, but you can direct subsidies towards inverse relation to the store’s income. You can even add extra taxes for large chains. But as others said, groceries are working on minimal margin. And all of them work with the same wholeselles (except those with vertical integrations), and this is a nation wide problem.
  - asdff 5mo ago
    >That may be, but you can direct subsidies towards inverse relation to the store’s income. You can even add extra taxes for large chains. Not really imo. Private market passes costs to consumers and leverages subsidy offers to achieve rat race outcomes out of competing local governments off each other. It is how you end up with the classic case of a city courting some business but offering enough tax abatement where the city isn't actually getting anything out of the business, and once the abatement expire the business just leaves for somewhere else that will cut them a better deal. City ends up hostage to the business demanding ever more favorable incentives and removal of all taxes (there's been free trade zones established in the middle of ho hum suburbs, stuff brought in there doesn't even count as imported to the US).
    - halflife 5mo ago
      Interesting. I think it really depends on the competitiveness of the market. In a highly competitive market, every cost saved would be passed to the consumer, obviously this is simplistic microeconomics and doesn’t actually works this way. In my city, there’s a supermarket approximately every 150 meters. Food cost is high, but for the entire country. Actually research shows that food cost is higher in low density towns where there is much less competition.
wahnfrieden 5mo ago
In some neighborhoods there are only luxury grocery options. Groceries also form cartels as the other commenter mentioned. The biggest grocers in Canada did it for many years until they were penalized for it (though it’s likely still continuing in other ways - the same players are now under investigation for selling underweight meats) The estimated cost to consumers from bread price-fixing was $4-5 billion
- halflife 5mo ago
  It’s about supply and demand. Luxury grocers provide a shopping “experience”, where low cost grocers do not. In a luxury neighborhood it would make sense the shoppers are looking for experience more so than low cost.
  - wahnfrieden 5mo ago
    The neighborhoods I'm talking about also have many people living in poverty or near it. Looks like you live in Israel which is perhaps less integrated / more segregated than Brooklyn (I don't know though, I haven't been to see first hand)
  - rsynnott 5mo ago
    What’s a ‘luxury neighborhood’? In any large city, most central areas are generally a bit of a mix; “this is only for rich/poor people” is more of a suburban phenomenon. If the shops are only catering to the high end, a problem can develop. (I am less sure why this happens to such a great extent in large US cities vs elsewhere, vs more of a balance of shops, but it does seem to.)
    - wahnfrieden 5mo ago
      The poster appears to be Israeli. I’m not an expert and have never been but I understand spatial wealth segregation is quite extreme there and may explain their take. Here’s one study: https://www.ref-inst.org/en/articles-and-studies/spatial-inequality-in-israel-tal-and-leventhal https://www.ref-inst.org/en/articles-and-studies/spatial-ine... So it may just be that where they are from, the concept of “luxury neighborhoods” which do not need to cater to the poor and disadvantaged populations does indeed exist, due to segregation factors
yohannparis 5mo ago
Why does everything needs to be economically viable?
- koolba 5mo ago
  Because that’s what has traditionally allowed western countries to have a wide availability and inventory of goods vs communist economies.
  - deleted 5mo ago
    [deleted]
  - bojan 5mo ago
    But why does the availability have to be wide? Maybe those stories can do few things, but do them well. Sell staple foods and healthy choices.
    - halflife 5mo ago
      Because than people won’t come to your store. People buy where they can purchase the maximum of their shopping cart in a single place. That is why you have loss leader grocers, where they pull people with dramatic discounts on specific items, but the total cart costs the same
      - yohannparis 5mo ago
        I understand your point of view. But in cities of all sizes, it's easier to not have to do that. For example in NYC, a medium size city, you can easily go do your shopping in multiple places, and not at the same time.
        halflife 5mo ago
        Yes, and some people do that. Some consumers go to specific stores to purchase specific qualities of brands. But most do not, especially for convenience products. You get it where you can.
tencentshill 5mo ago
He won by not being a capitalist. He campaigned on doing something to actually meet the basic needs of the people who elected him. This is the cost of that promise. This will force them to compete on those terms instead of directly on money.
shimman 5mo ago
You sound extremely privileged and frankly out of touch (not uncommon with the HN demographic). Do you think working families in NYC don't deserve the same monetary relief that massive corporations get with their own welfare programs? Why should trillion multinational companies take our public money to subsidize their businesses and we can't do the same for workers? Why do you prefer helping non human entities (corporations) over literal humans?
- deleted 5mo ago
  [deleted]
- halflife 5mo ago
  Subsidies can go to small businesses owners. Not just large corporations.
deleted 5mo ago
[deleted]
darth_avocado 5mo ago
> Won’t it just cause neighboring stores to close? Hopefully they kept all those profits around from the time they price gouging consumers in the name of “supply chain issues”, “transitory inflation”, “bird flu” etc. I still remember all the headlines about bird flu and how egg prices were doubling because of it. Turns out the egg production barely dropped and it was all a ruse to make more money.
- SpicyLemonZest 5mo ago
  You can't conclude it was a ruse without knowing the elasticity of egg demand! This is ultimately the kind of thing that worries me about a municipal grocery store. Will voters allow it to respond in rational ways to market conditions, or will they expect the city to go out and extort some egg suppliers when market prices rise above what they consider reasonable?
  - ceejayoz 5mo ago
    The DOJ thinks it was a ruse. https://www.reuters.com/legal/government/us-egg-producers-face-new-wave-price-fixing-lawsuits-2025-11-18/ https://www.reuters.com/legal/government/us-egg-producers-fa... As did a jury: https://apnews.com/article/egg-producers-price-gouging-lawsuit-conspiracy-8cd455003a3a40bab74d0f046d0f2c9d https://apnews.com/article/egg-producers-price-gouging-lawsu...
    - deleted 5mo ago
      [deleted]
    - SpicyLemonZest 5mo ago
      It could potentially be a ruse by egg producers. Certainly there's reason for suspicion. But darth_avocado's claim was that grocery stores were in on the ruse and must have extracted huge profits from price gouging consumers. I think that's obviously false. You'll note that in the jury case the plaintiffs were themselves megacorporations, and substantially larger ones than the producers they were suing at that. I don't blame consumers for deciding they don't care about the underlying market structure and just want cheap eggs. But you can't run a store on that basis, and if the city feels like it has to there'll be problems.
lexicality 5mo ago
> Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers? I'm sure this time trickle-down economics will work and not simply line the pockets of business owners
- halflife 5mo ago
  When you have a highly competitive market with plenty of actors lower cost does trickle down. Otherwise you’re talking about an extremely complicated cartel which cannot exist.
  - cherry_tree 5mo ago
    Do we have a highly competitive market? If so how do we measure that? If not how do we create one?
- philipallstar 5mo ago
  It's not trickling down. Lower costs do result in lower prices.
ceejayoz 5mo ago
> This sounds extremely non economically viable. Many things government does are not economically viable. That's why they get left to government. > Won’t it just cause neighboring stores to close? The idea is to build these where that has already occurred.
- WalterBright 5mo ago
  [flagged]
  - ceejayoz 5mo ago
    > Maybe they should look into why the closings occurred. Do you think there's no research on the causes of food deserts?
    - WalterBright 5mo ago
      Store closings are nearly always the result of them not being profitable.
      - ceejayoz 5mo ago
        Sure. Lots of things governments need to do are unprofitable, like delivering the mail or repairing the roads. I can go to my local public library, borrow the free books, use the free computers, sit in the free chairs, ask the librarian for free guidance, enjoy the free air conditioning, and even book a free meeting room to meet up with some friends to work on a project. Profitable? Fuck no. Great to have in my city? Fuck yes.
        WalterBright 5mo ago
        Privately run grocery stores have been profitable for 250 years in the US. What has changed recently? Could it be the decriminalization of shoplifting? Or maybe excessive taxes? Or mandates on wages? Vandalism? I forgot to add homeless camping around them, which discourages shoppers.
WalterBright 5mo ago
In Seattle, the proposal for a government grocery store included exemption from paying property taxes and rent.
- halflife 5mo ago
  So they have an unfair advantage over the competition. Or it’s just a way to neutralize the ineffectiveness of the management, since it’s not profitable based, who’s going to be fired?
bastawhiz 5mo ago
> and let the discounts competitively pass unto the customers This is the same trickle down economics principle that has proven not to work over, and over, and over again. There's exactly zero reason to believe these businesses would pass on the savings to consumers. Consider! Ingles (a supermarket brand here in NC) is criticized for holding huge amounts of abandoned/vacant/dilapidated properties [0], which stifles competition and lets them hold an effective monopoly and makes neighborhoods objectively worse. It's not about the taxes. Don't underestimate a chain's ability to eat costs by maintaining their market position. [0] https://avlwatchdog.org/opinion-ingles-markets-often-raises-the-ire-of-locals-but-it-shouldnt-be-that-way/ https://avlwatchdog.org/opinion-ingles-markets-often-raises-...
- halflife 5mo ago
  I didn’t specify on the subsidies themselves. You can create subsidies which are inverse to the stores income. It doesn’t HAVE to go to large chains. There are many way to encourage small businesses to open. Competing with them is not one.
- wenc 5mo ago
  You're thinking a tax break which is an unconditional subsidy. That relies on the business passing savings through which folks are right to be skeptical about. But that's not all subsidy mechanisms. The best ones are where pass-through is enforced, not assumed. You already know of one that works: WIC. It lowers the effective price for customer, which the store receives as reimbursement. It's not about trickle-down -- that's ideology. It's more about designing the right mechanism.
thinkingtoilet 5mo ago
Oh no! Struggling Americans will be able to buy food cheaper! What will we do? Also, if anyone has any reservations about a government run grocery store, go ask your representatives to come out against military commissaries. I bet you will not be able to find one active politician who will try to remove that. You know why? Because government run grocery stores work. End of story. Period. There is no discussion. You are wrong if you disagree. We do this. It exists. It works. And people love it. Try to find one politician that will end that service.
- cindyllm 5mo ago
  [dead]
- halflife 5mo ago
  Grocery costs has to come from some formula. If the mamdani stores actually do sell at a lower cost, where did the discount come from?
  - thinkingtoilet 5mo ago
    Again. This exists. There is no theoretical here. Go look up how the military commissaries work. That will answer your question.
    - halflife 5mo ago
      military commissaries are subsidized with taxes. So would these stores have lower prices because of tax subsidies? What prevents rich people from exploiting these subsidies?
      - thinkingtoilet 5mo ago
        Yes. They will be subsidized, just like other food-based welfare programs. As for the rich, is this really your concern? A few rich people getting some cheaper groceries is so bad that we have to deny poor people from getting affordable food? Why do so many Americans hate poor people? You know there's literally trillions of waste in agriculture, military, pharmaceutical, oil, etc... subsidies and that's just the tip of the ice berg if you examine the tax code. If you're deeply concerned about rich people gaming the system, why don't you start in those places and then when we figure that out, we can worry about rich people shopping in one of five total grocery stores.
jmyeet 5mo ago
To anyone who espouses these claims that the government isn't capable of anything or that it's somehow a moral hazard I just have to ask: how's that working out for you in particular and society in general? Does it feel like things are going well? What we have now is the result of unfettered private control. Private companies collude to raise prices and lower wages. The standard of living in real terms has been in decline for over 50 years. Education, medical, housing and food costs continue to spiral. Where we do have publicly owned alternatives, such as with municipal broadband, those publicly-owned alternatives are always far better. Are we going to make the same argument that EPB in Chattanooga is somehow a moral hazard and has an unfair advantage to Verizon, AT&T, Comcast and Spectrum? Let's just say that it's true that they do. Why is that a problem? Why is it good that billion or trillion dollar companies can charge higher prices than the government can so their owners can buy another mega-yacht at the expense of the people who depend on that service? Because that's what's going on now.
pollorollo 5mo ago
Government owned grocery stores already exist [1]. They are run by the U.S. military, have 200+ locations, and charge at least 25% less than other brands [1]. "Surveys consistently rate the commissaries as one of the military's top non-pay benefits." NYC wants to provide similar benefits for residents. [1] https://en.wikipedia.org/wiki/Defense_Commissary_Agency https://en.wikipedia.org/wiki/Defense_Commissary_Agency [2] https://www.youtube.com/watch?v=PQOXdtPBGXI https://www.youtube.com/watch?v=PQOXdtPBGXI
- gruez 5mo ago
  From your own article: >In 2024, DeCA estimated that it saved patrons $1.58 billion and had an operations cost of $1.7 billion, $1.5 billion of which was funded from appropriations.[8] Isn't this the "selling $1 for 75 cents" business model (aka moviepass) that people made fun of a few years ago?
  - ceejayoz 5mo ago
    Sure. It's also the business model of your local library.
    - gruez 5mo ago
      Well no, because the library is often the sole provider of book lending services and there's no private sector alternative. The same can't be said for grocery stores. To continue your analogy, it would be closer to the government setting up its own streaming service, even though there's netfilx and several other competitors. Even though people hate netflix for its price hikes or whatever, it's unclear how the government can do a better job here than netfilx (or other competitors), aside from strongarming/expropriating rights holders.
      - ceejayoz 5mo ago
        > To continue your analogy, it would be closer to the government setting up its own streaming service… https://www.pbs.org/ https://www.pbs.org/
hitekker 5mo ago
The nyc subreddit which I'd say is pretty pro-Mamdani shared your concerns. https://old.reddit.com/r/nyc/comments/1sjq9v9/mayor_zohran_mamdani_will_announce_plans_to_open/ https://old.reddit.com/r/nyc/comments/1sjq9v9/mayor_zohran_m...
ModernMech 5mo ago
Who knows, let's try it and see. I've heard all my life about how new ideas are potentially not economically viable, so we keep trying old ideas which proven not economically viable. My feeling is that the economy is such a large, chaotic, dynamic system that most people, including experts, have no idea what is theoretically viable or not viable. So making decisions based on "my first order analysis is that this is not economically viable" is misguided. You have to try it first and see how the system actually responds.

MisterTea 5mo ago

I wonder what the margin is on groceries and if the stores can sustain themselves by operating at cost. I also want to know how they plan to handle pricing during shortages, e.g. eggs.

ceejayoz 5mo ago
There are existing examples they can probably look to. https://en.wikipedia.org/wiki/Defense_Commissary_Agency https://en.wikipedia.org/wiki/Defense_Commissary_Agency

flats 5mo ago

I was very skeptical of these plans at first—as a New Yorker, I don’t exactly have a lot of trust in our city’s government to run things well. But I’ve come around. Let’s try something new! Let’s show people that local governments in the United States really are capable of making a difference in their daily lives. If it fails, well, we tried & we’ll keep trying.

miketery 5mo ago
Just because we can does not mean we should. Here's how this will pan out. - A number of "officials" (friends) will get cushy jobs for running this program. - It will lose millions of tax dollars - a small portion of the population will get cheaper produce for a photo op - Mamdani and friends will call it a success - But net, this will be net negative for the city (ie. tax dollars to crony jobs and subsidizing food for some). Whats the point? The USSR has tried this (subsidized grocery stores centrally planned). Lets not. If on the other hand, the issue was hey its expensive to bring produce XYZ, so why don't we work to reduce that cost by legalizing Kei [1] trucks and exempt from tolls. Now that would be something interesting. 1 - https://en.wikipedia.org/wiki/Kei_truck https://en.wikipedia.org/wiki/Kei_truck
- ceejayoz 5mo ago
  > The USSR has tried this. Lets not. The USSR tried lots of things we do successfully. This is actually something governments have a proven ability to do, at least in some contexts, without becoming a corrupt boondoggle. https://en.wikipedia.org/wiki/Defense_Commissary_Agency https://en.wikipedia.org/wiki/Defense_Commissary_Agency
  - miketery 5mo ago
    Yeah it was so successful that people would line up around the block for bananas the one time a year. Or when boots came into the store you'd pick up whatever size you could, as you'd trade later. (true stories)
    - 5mo ago

bparsons 5mo ago

The government already runs/oversees a variety of public grocery stores. Including: - Armed forces commissaries. The op ex is subsidized by the taxpayer, but the cost of goods reflects the market wholesale price, plus a 5% fee to pay for capital goods/facilities upkeep. - Grocery stores run by non-profits/charities. Eligible donations are a tax deduction, which represents a form of subsidy by the taxpayer. These stores are really popular in some places in the US. - Food banks. Operate on a mix of private donations and taxpayer grants/tax receipts to some donors. It all amounts to the same thing. The finance model is different in each case, but its all taxpayer supported no matter how you look at it.

thelastgallon 5mo ago

Don’t do these kinds of idiotic things. Do what Singapore does for housing.

ceejayoz 5mo ago
Singapore's largest grocery chain is a co-op run by the country's labor unions, which are closely aligned with the government. https://en.wikipedia.org/wiki/NTUC_FairPrice https://en.wikipedia.org/wiki/NTUC_FairPrice

bastawhiz 5mo ago

I'm not opposed to this, but I'd rather have seen incentives and subsidies for local co-ops to succeed in this space. That's probably harder than it sounds, though.

energy123 5mo ago

Dumb populist idea, grocery stores make 2% margins, best case scenario you're saving people 2%, realistic scenario you introduce operational inefficiencies that the chains already optimized out and waste taxpayer resources. If you don't like grocery stores gamifying or selling junk, regulate those aspects. Or put the taxpayer money towards something useful like building public housing.

legobmw99 5mo ago
You’re not putting a municipal grocery store on the same block as an existing big box and saying “wow, savings!” Food deserts exist in NYC, and many New Yorkers buy staples at corner stores that charge significantly more than a standard grocery store. Your second paragraph implies that this policy is due to some dislike of existing grocery stores, but that assumes these communities are actually being currently served by grocers at all
- energy123 5mo ago
  Those corner stores exist in a perfectly competitive market, they have low turnover so they have to charger higher prices to pay staff wages and rent. There are no abnormal profits. Why would you set up a government run store with more operational inefficiencies and less ability to respond to the local knowledge problem, than like give money or food stamps to people in these areas, or use the money in some other way?
  - j_w 5mo ago
    There is no such thing as a perfectly competitive market. I don't understand why people on HN are obsessed with this term. It strictly cannot exist in the real world. A perfectly competitive market requires the following (this is not everything, just some): - Supply perfectly meets demand (yep already wrong here) - Marginal costs equal to average revenue (this means there should be effectively 0 profit for the seller) - Zero transaction costs - Zero externalities (can't exist)

oa335 5mo ago

This is Mamdani’s worst idea. Margins on most essential goods in grocery stores is incredibly low, sometimes it’s a loss leader. Does anyone know of any solid economic rationale for this move?

woodruffw 5mo ago
The underlying theory is to put these stores in areas that otherwise lack grocery store access, meaning they won’t compete with existing stores for small margins. Running at a (moderate) loss would also be politically acceptable; the city runs a lot of things at a loss for civic purposes and fills the gaps with taxes. (This is the theory, the practice will be challenged by NYC’s ability to acquire land in neighborhoods that are underserved by groceries and develop a supply chain for these stores. This will be harder, but I personally don’t vote for mayors to only have easy problems to solve.)
- oa335 5mo ago
  > The underlying theory is to put these stores in areas that otherwise lack grocery store access, I’m generally partial to that motivation - however doesn’t seem to be happening here. This location (La Marqueta) is within a couple hundred feet of a "City Fresh Market" grocery store and ~1500 from several other grocery stores https://www.google.com/maps/search/grocery+store/@40.7983886,-73.9473076,16z https://www.google.com/maps/search/grocery+store/@40.7983886...
  - woodruffw 5mo ago
    Yes, I agree the city has undermined their own (strong) argument with their choice of location. I noted that in another comment as well. (I previously lived about a ~10 minute walk from that public market.)
  - ModernMech 5mo ago
    But if you're running a pilot, wouldn't you want it near some other store to see what the impact on their business actually is? Running a pilot in the middle of nowhere would say nothing about how it impacts other local stores. You'd end up having to run another pilot to answer that question.

rdtsc 5mo ago

> “Some will insist that city-owned businesses do not work, that government cannot keep up with corporations. My answer to them is simple: I look forward to the competition. May the most affordable grocery store win,” Mamdani said. Well it's interesting enough to try. Are they going to keep the stores open at a loss, that's not really competing then, is it? If they sell things that are much cheaper, restaurants could start sourcing their food from there, too. Why get your chicken from some supplier if you can buy it from a cheaper government run store at much less. But then, if these stores are not run at a loss, it means somehow there is this large inefficiency that other stores haven't tapped into. And if I had to guess, grocery stores don't seem like a large margin business, but perhaps that's just my ignorance as it's not something I ever looked into in detail.

ceejayoz 5mo ago
> If they sell things that are much cheaper, restaurants could start sourcing their food from there, too. Why get your chicken from some supplier if you can buy it from a cheaper government run store at much less. Restaurants already do this. They buy from wholesalers, because they're cheaper than the grocery store.
- rdtsc 5mo ago
  > Restaurants already do this. They buy from wholesalers, because they're cheaper than the grocery store. But now grocery stores could be cheaper than wholesalers if there are any subsidies involved or selling at a loss is a thing. Why go to wholesalers when you can camp out with a van by the government subsidized stores when it opens or when delivery comes. Not saying this is insurmountable, the stores can implement a purchase quota: you get X amount of items per transaction and we take your ID or something. But it opens up that kind of a situation. Like I said, I hope it works, it would be interesting to watch.
  - ceejayoz 5mo ago
    > But now grocery stores could be cheaper than wholesalers I really don’t think this will be the case. That’s not the goal here.

bherms 5mo ago

Many people losing their minds over stuff like this... I'm just glad some people are finally trying out new ideas, because the status quo is not working for a large portion of the American population. I just hope they properly track and monitor the outcomes and foster honest/open feedback. The gov't loves to throw money at problems, but never really does much to analyze, pivot, or admit when something doesn't work because that just gives the opposition ammo.

Molitor5901 5mo ago

If you're interested in grocery store economics, I strongly recommend: The Secret Life of Groceries: The Dark Miracle of the American Supermarket by Benjamin Lorr, and Grocery: The Buying and Selling of Food in America by Michael Ruhlman Extremely insightful about how much it cost to run a grocery store, where profits go, who the food suppliers really are, etc. Very eyeopening.

robotnikman 5mo ago

Are they looking to hire any software engineers right now?

euroderf 5mo ago

I visited Soviet Estonia in 1987, on an overnight from Helsinki. A treasured purchase was a simple stamped metal bottle opener. Even the price was stamped: 15 kopecks. This told me that for the very simplest consumer items, they might easily be contracted out and sold at just above production cost. Consumers would be free to buy fancier bottle openers, but sometimes a hunk of stamped metal does the trick. Likewise for many other consumer basics ? Like, a Gotham store brand ?