The left-wing candidate for mayor of New York City, Zohran Mamdani, wants city-run grocery stores. That’s a bad idea, notes economist Daniel DiMartino: “We tried your government-run grocery stores idea in Venezuela already, Zohran. It is a disaster. They let thousands of tons of food rot & sold rotten food. They all went broke and closed down eventually.”
The progressive New Republic recently pushed the idea, writing that “the idea of public grocery stores has entered the crowded race for New York City mayor. Zohran Mamdani, a socialist candidate and current state assemblyman, has said that if elected he would create a pilot program to put a city-owned grocery store in every borough….Mamdani isn’t the only lawmaker embracing this approach to cheaper and more accessible groceries. This year, Madison, Wisconsin, is opening a city-owned grocery store…Atlanta is set to open two publicly run grocery stores, while Chicago is opening a city-run market. It’s not an entirely new concept. Erie, Kansas, has owned Stub’s Market since mid-2020.”
City-run grocery stores lose money despite receiving tax exemptions, donations, and indirect subsidies. As City Journal explains, “The Erie Market in tiny, remote Erie, Kansas is the most cited example of this experiment. The store loses tens of thousands of dollars annually, requires volunteers to stock the shelves, and relies on donations of produce from local businesses. It is more like a rural co-op or food pantry than a real grocery store.” It elaborates on Mamdani’s other extremely costly ideas in “Why City-Run Grocery Stores Are A Bad Idea.”
Yet, despite that, Illinois is spending $2.4 million on a city-owned grocery store with a declining population, an action touted by Illinois’ progressive governor, J.B. Pritzker. Such wastes of money help explain why Illinois is the state with the nation’s highest state and local taxes for people with median incomes. One-fifth of Illinois’ budget is gobbled up by pension benefits for public employee unions, many of them left-wing. Illinois’ unfunded pension liabilities are so huge they add up to 18% of Illinois’ economy.
At the progressive web site Bluesky, NSF economist Mark Regets says, “I am not a ‘government is always incompetent’ person. BUT it really does not have the skills or infrastructure to run a large grocery store. The purchasing, pricing, and display of THOUSANDS of items is more complicated than many think.”
As another Bluesky poster observed, “It’s insane to use tax money to build a new [government-owned] grocery store in [an Illinois] town that’s lost 3/4 of its people, when they can just travel a short distance to other grocery stores.”
Government-run grocery stores are a bad idea, given how incompetently the government runs even things that should be easy to make a profit on, like liquor monopolies. A 2024 audit of the Michigan Liquor Control Commission (MLCC) found that the state’s complete inability to properly track its spirits inventory resulted in nearly a million dollars of liquor disappearing without a trace. $961,000 of the state’s liquor inventory—a massive 62,294 bottles—vanished between January and February 2022. The missing liquor was 20 percent of the state’s entire inventory.
