New York City Mayor Zohran Mamdani has just published details of how he plans to fulfill his campaign pledge to open five city-owned grocery stores across the city. On Monday, he released his “Recipe for Affordability” proposal and a call for grocery store operators to manage the coming stores. That confirms that rather than government-managed locations, these city-owned stores will really just be delivering a trumped-up subsidy.
The stores will carry a core basket of produce, meats, and other groceries placed on average 30 percent below market prices. But American supermarkets net just 1 to 4 percent profit margins on sales, so you can’t wring out a 30 percent discount just by forswearing profits. The proposal is therefore quite candid that the difference will be made up by taxpayers. It promises to “offer subsidies that will lower grocery prices” and admits that “sustaining these lower prices will require targeted public investment.”