The Outstater

September 27, 2023

Cornucopian Welfare

I CAN’T KNOW ENOUGH about my city’s new government grocery store, one of several proposed for areas officially designated as food “deserts.” If the facts are ever known it will serve as a bipartisan example of government folly, as good a one as any liberal could dream up and one overseen by a Republican city council.

Heck, authorized shoppers at the government grocery won’t even need money. It expects to tap into a virtual cornucopia of welfare: Persons living in the designated areas will be able to walk to this store and “purchase” food with an Electronic Benefits Transfer (EBT) card, an electronic system that allows them to pay through the Supplemental Nutrition Assistance Program (SNAP).

Earlier this month on the strong urging of our council’s three black Democrats and with the applause of the leading GOP members, including a mayoral candidate, a resolution was prepared to put all of that in motion. It would approve use of a couple of million dollars to renovate and expand a 7,000-foot property as an urban grocery store. A critic of the project estimates the city already has up to $2.5 million cash in it with perhaps another million or so in streetscape and neighborhood improvement plus unknown future dollars in loss guarantees to cover the first years of operation.

Please know that the city won’t actually own or manage this fiscal chimera. Somebody else will — the details are yet to be worked out — and we expect to see a long line of plunderers, er, applicants.

This is all being done absent anything resembling a business plan. If there were one, it would answer some obvious questions, one being why grocers left the neighborhood in the first place. They say they couldn’t make a profit because of shoplifting, employee theft and general street crime.

But the city will fix that — right?

Au contraire, the woke council majority, the mayor’s office and the prosecutor don’t have the stomach for applying justice in racially disproportionate numbers — and that is a big problem for a grocery store whose customers are racially disproportionate.

Without a business plan there is no market research, and anyway, local authorities keep the discouraging numbers far back in the file cabinet. We do have data from other communities experimenting with even more generously funded projects.

But let’s back up a minute, there is a business plan — a failed one, borrowed from Chicago, the city of legendary inefficiency and corruption.

The Wall Street Journal reports that in the past two years at least six grocery stores have closed on Chicago’s South and West sides. Earlier, the owner of Whole Foods Company stood shoulder to shoulder with the Chicago mayor to cut the ribbon at a much-celebrated urban grocery. The two promised it would provide access to fresh fruit and vegetables and be “a healthy anchor for the community.” Six years later it quietly closed despite $11 million in subsidy.

And in the same report we learn that Walmart has closed four stores in similar areas of Chicago because it was costing them  tens of millions of dollars a year with losses doubling in the past five years. In 2022, a mere 17 percent of retail thefts in Chicago resulted in an arrest, the newspaper reported. “The problem isn’t corporate racism,” the paper concluded. “It’s crime.”

Nor is it poverty. Does anyone believe that corner grocers if not chain stores would not re-enter an inner-city market if crime had not become such a huge factor? The Congressional Budget Office says that adjusted for transfer payments and tax exemptions, the annual U.S. household income of the lowest quintile is fully $49,000 — large enough to attract private grocers if a neighborhood were crime free.

When New York City reversed its crime statistics in the mid 1990s, commercial investment doubled within a few years. You should want to try that before you turn over the problem to a lawyer-heavy redevelopment commission spending other people’s money.

Finally, there is no “owner” of our urban grocery, so who will audit its multi-million-dollar operation? The Board of Public Works? My journalistic instincts say it will be a “success” until it suddenly isn’t. That will be despite regular and unpublicized infusions of tax dollars in the years ahead to cover unexpected expenses — such as unreported shoplifting and inept governance. — tcl


Leave a Reply