As leaders of America’s half-dozen giant supermarkets raise prices once again (Walmart, 40 percent “on some items”), they’re blaming Trump’s recent quixotic, retaliatory tariffs on foreign imports. Consumer boycotts and demands for public food stores are in the wind by the outraged perhaps because they suspect gouging by farmers and wholesalers on essentials such as eggs, milk, and bread. Some 53 percent find the price hikes a major source of stress.

The USDA’s (U.S. Department of Agriculture) latest average price for a gallon of milk was $4.45, a dozen eggs, $6.47, and a loaf of white bread, $3.05. At high-end chains like Gristedes, milk was $5.89; eggs, $12.09; and bread, $5.29.

Recent attention about public food stores has come from New York City’s November election campaign for mayor. The Democrat’s primary winner Zohran Mamdani is promising five city-owned supermarkets , one for each borough’s food desert in low-income neighborhoods. Some three million people in New York City have no easy access to fresh food. He estimated initial cost at $60 million to be deducted from the city’s privately funded FRESH (Food Retail Expansion to Support Health) program. It uses tax breaks, zoning changes, and “regulatory relief” for storeowners in those desert zones.

But New Yorkers have had public-run enterprises since the 1700s (oysters) followed by the great, mostly jobless immigration waves of the 1880s and their pushcart commerce in Manhattan’s Lower East Side. For a $1 per week city permit and a $10 cart rental, some 6,000 families daily braved rain, snow, or heat wave to ensure few residents starved to death. In 1934, Republican Mayor Fiorello LaGuardia moved carts into city-owned vacant buildings, using WPA funds (Works Progress Administration) and larger permit fees to meet maintenance expenses. As a private-public operation, vendors could keep their earnings.

Today, vendors in the six remaining buildings are managed by the city’s Economic Development Corporation which charges rent and for licenses. Black-market rates for scarce permits in 2023 were $6,000-8,000. Earnings of city/state/federal governments in 2023 alone were $71.2 million though the city since 2011 has subsidized 27 stores with 25-year tax abatements.

That reinvestment perhaps may explain why public stores for food deserts have sprouted all over the U.S. in the last few years.

Now, one of the nation’s biggest and oldest (130 years) public food chains is the Pentagon’s PX system (aka DeCA: Defense Commissary Agency). It sells food at wholesale prices averaging 25 percent less than major supermarkets. Of the four-branch PXes, the Army and Air Force alone serve 30 million customers on 5,500 bases here and abroad, often in “food deserts.” It is highly unlikely they will complain about tariffs even while buying vast volumes of bulk food from foreign importers.

Best of all for PX stores and taxpayers, profits revert to the federal government. And they’ve been considerable, particularly for the A&AF branch: —$492 million in earnings and $8.5 billion in revenue for 2024.

Small wonder that the PX system has been seen as a model for civilian-run public-groceries across this country in the last few years for food deserts, especially in urban low-income neighborhoods and rural areas.

The nation is now down to about 40,000 grocery stores, and a January USDA report says 53.6 million Americans (17.4 % of the population) live in low-income areas with little access to them. Forty-four counties have no food stores at all, not even a convenience operation with its high prices and limited stocks. They’re scarcely where most people stock up on Saturdays for a month’s groceries.

As for cooperatives, 165 exist, but their 1.3 million customers have to pay $100-$200 for a lifetime membership. Gas stations do offer candy bars, soft drinks/beer, and ready-made sandwiches, of course, but they do nothing to solve food deserts’ high rates of chronic diseases, poverty, and shorter life spans.

One explanation for this discrepancy appears to be that grocery giants like Albertsons too often wiped out the small, independent Mama-Papa stores offering home deliveries like to my in-laws in Newport News, VA. Add mergers gobbling up competitive chains closing many a popular neighborhood supermarket. Potential replacements redline neighborhoods by low incomes, crime rates, and minorities.

The obvious antidote to this long-time problem of the “underserved” initially was federal help. The idea was to “help build stores, shorten the trek for fresh food, and, and in the process, make people healthier and bolster the local economy,” Molly Parker explained in the Capital News Illinois. So in 2014, when Congress passed the Farm Bill, it included the Healthy Food Financing Initiative, a private-public program under the USDA’s wing. Its current $183 million resource offers grants and technical help to food retailers and suppliers underpinning grocers’ food products sold at low prices around the country.

States have also helped develop public stores to increase future business taxes and attract new businesses. In 2023, the Illinois legislature passed the Illinois Grocery Initiative providing $20 million for stores in food deserts. Last May, its Democrat governor J.B. Pritzker followed suit by signing off on $20 million toward store construction and renovation of existing ones in four food deserts.

Avoiding private public partnerships, however, means the state and local governments are free of corporate involvement, get a far higher return from store earnings—and receive the same results that Parker lists. Among other chief financial inducements for a public store are tax abatements and free rent on city-owned properties, usually covered by its business development appropriations. Because personnel are public employees, labor costs are already covered.

According to Crain’s Chicago Business newsletter:

A public grocery store might sound like a utopian idea, but it has recently proven successful in other parts of the country [than New York City], primarily in conservative rural communities. These stores function like privately owned stores and carry the same products, but operate more like a public utility.

Major cities like Houston and New Orleans now have public stores. So do states like California, Illinois, Kansas, Minnesota, Ohio, Pennsylvania, and Wisconsin. Rural America—small towns and villages—has always been a classic food desert. People take hours and spend small fortunes annually on gas and tires to drive miles to a major supermarket elsewhere. My friend Brandon is among them, despite the time and gas expenses (“We don’t mind it”) to shop at KFC, a Kroger subsidiary.

Many are in small towns like St. Paul, KS (p0p. 595). Because its only grocery store folded in 1985 and no private store was interested, residents were forced into a 34-mile round trip to a supermarket. A group of them decided a public-owned grocery store was as essential as the city-owned water department. The new mayor believed: “that access to food, like access to water, was a public good and something that should be supported by the city and the community.” An overwhelming vote for a public store was passed. That quickly led to a $400,000 zero-interest loan from the USDA for the initial startup costs. Profits would not only repay the loan, but also significantly boost St. Paul’s revenues.

In major urban areas, the City of Madison WI just leased a full-service public store on city property in a food desert for $4.6 million. It has 24,000 square-foot ground-floor space, four floors above with 150 affordable apartments, and both a parking structure and ground space. It is also on a bus line, a key must for a public store’s success. Both Chicago and Atlanta are making serious plans to follow New York City’s lead.

Most opponents of public stores seem to harp on arguments that taxpayers are subsidizing a business startup, even though earnings are promptly returned to city and town treasuries. Moreover, private startups certainly are subsidized by municipalities in offering annual tax abatements and thousands of taxpayer dollars spent on promotional inducements (“locate here”) to reap future business taxes.

Another argument is that public groceries will wipe out Mama-Papa stores, as if the majors haven’t been doing that since Piggly Wiggly’s ® self-service supermarkets’ debut in 1916.

The owner of Gristedes’ 31 New York City high-priced stores considers public groceries to be “radical socialism,” wildly exaggerating they “would collapse our food supply, kill private industry, and drag us down a path toward the bread lines of the old Soviet Union…. [Mamdani] wants bureaucrats to decide what you eat, when you eat, and where you get it from.” He’s threatening to move his chain to another state if Mandani is elected mayor.

Other monolithic chain stores aren’t bothering with such economic falsehoods. Successful storeowners know that low prices and quality are what bring in the customers. Among them is employee-0wned WinCo Foods (142 stores nationally) which just launched a sensational two-week promotion of bread at 98 cents, three chicken breasts for $1.88, and canned tuna for 28 cents in the Portland OR area.

Survival factors beyond four years for public stores certainly do center around low prices: discounts, coupons, “door-busting” sales of “loss-leaders,” and enforcement of the long-standing 1936 Robinson-Patman law by the FTC (Federal Trade Commission) forbidding suppliers to discriminate on price for the same product to favored customers. Getting customers in the door to change from a familiar grocery could range from leasing space to a delicatessen, bakery, or soda fountain to staging major events, big sales, and offering delivery services.

Operational recommendations include starting a network of public stores pooling resources, says Erion Benjamin Malasi, policy and advocacy director of the Economic Security Project. “[It] would be in a stronger position to sustain long-term and weather downturns than any individual store alone.”

Civileats adds the nitty-gritty suggestions for public-grocery success:

Stock no more than 1,500 carefully selected products instead of 30,000. Buy in massive volumes. Employ union workers as municipal employees. And make it joyful and dignified to work and shop there.

The post The Latest About Public Groceries in Low-Income “Food Deserts” first appeared on Dissident Voice.

This post was originally published on Dissident Voice.