Government-Owned Grocery Stores Aren't the Solution

Mint

29-06-2025

(Bloomberg Opinion) -- Zohran Mamdani brings a lot of guts, charisma and hustle to his campaign for New York City mayor, along with a laudable desire to offer the public a break with a dysfunctional status quo. Unfortunately, the break he's offering largely consists of bad ideas.
On that list, the idea of government-run grocery stores is far from the most pernicious — but it is the most grimly fascinating, in part because nobody seems to be asking for it. The demand to 'freeze the rent' on the slightly less than half of the city's rental stock that is subject to rent stabilization regulations is misguided for lots of boring Economics 101 reasons. But it's also true that, for many of those same reasons, it will serve the short-term interests of rent-stabilized tenants. I think it's a bad idea, I wish he weren't running on it, and it's regrettable that so many New York voters seem excited by it. But I do understand what they're thinking.
The popularity of city-run supermarkets, by contrast, is just kind of mystifying. The idea keeps popping up on the left even though nobody is demanding it and nobody can decide what problem it's supposed to solve.
When the proposal came up in Chicago, it was supposed to be a solution to the problem of 'food deserts.' The idea was that some neighborhoods, especially on Chicago's poor and depopulating South Side, were suffering because residents lacked convenient access to a grocery store.
Once upon a time, I myself lived in a supermarketless urban neighborhood in Washington, and can confirm it was annoying. Eventually, an influx of more affluent newcomers brought in their wake a Trader Joe's. Which to me suggests that food deserts are not really much of a freestanding problem. If you improve the public safety, transportation infrastructure and public education in a given neighborhood, then more people will want to live there — and stores will open to serve them.
Trying to address a cycle of neighborhood decline by opening a supermarket doesn't really make sense. It's hard enough to execute well on core public-sector functions like policing, schools and transit — why take on the assignment of running a grocery store?
Chicago, at any rate, ended up abandoning the idea.
None of this has not stopped advocates from heralding the concept as 'a bold solution for food insecurity.' FoodTank, a self-styled think tank for food, claims that city-owned stores already exist in St. Paul, Kansas City and Atlanta. But the market in Atlanta is a privately owned grocery store leasing space in city-owned property. Another example the group cites, a proposal in Madison, Wisc., is actually a plan for the city to develop a parcel to include 150 units of affordable housing, a parking structure and a grocery store. One could debate the merits of this, but it's not what Mamdani is proposing.
Mamdani is pitching the government-run stores not as a solution to food deserts but as a cure for high grocery prices. He says the new stores will be 'focused on keeping prices low, not making a profit' because 'without having to pay rent or property taxes, they will reduce overhead and pass on savings to shoppers.'
This presupposes that there is a large number of supermarket-shaped buildings that the city either already owns or else could obtain for free. More to the point, if grocery prices are too high because of property taxes, the city could always offer grocery stores a tax break.
To be fair, Mamdani himself seems to be losing faith in this idea. He did not particularly emphasize it during the primary campaign, and when pressed in interviews he tends to describe it as a pilot program he'll happily abandon if it doesn't work out. So I don't think New Yorkers need to live in fear that he will extinguish grocery freedom.
But it says something unflattering about the progressive policy world that it supports the concept of public supermarkets as a cure for food deserts despite study after study after study showing that their presence has no public health benefits. Instead of reacting to this data by abandoning this idea, advocates repurposed government-owned stores as an inflation cure. To be clear, there's no basis for the belief that a paucity of government-run supermarkets is responsible for high grocery prices.
By resorting to this rationale, America's self-proclaimed democratic socialist movement calls into question one of its favorite conceits. America's democratic socialists are fond of saying that they are not opposed to capitalism — they are just in favor of a more generous, Nordic-style welfare state. If so, it's hard to see how government-owned grocery stores fit into this model. After all, that's not how things work in Sweden, Denmark, Finland or any other successful economy. Support of government-run supermarkets is a kind of desperate grasping to try to connect a real public concern — inflation — with what really animates the movement: fetishistic anti-capitalism.
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This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Matthew Yglesias is a columnist for Bloomberg Opinion. A co-founder of and former columnist for Vox, he writes the Slow Boring blog and newsletter. He is author of 'One Billion Americans.'
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