Whooping Crains and Bodegas

As was expected, Crain’s came out against the Health Care Security Act (HSCA) in a recent editorial. However, unexpected and particularly gratuitous, was its personalization of the bill as a "Catsimatidis -bodega protection act” (the target of the paper's ire being John Catsimatidis, the owner of around 48 Gristedes supermarkets, and a client of Alliance Director Richard Lipsky’s). Crain’s claims that Gristedes is losing business, not because it provides for adequate health and pension benefits to its workers, but because of "the highest prices and worst service in any city."

We can't wait for Crain’s to do this comparative city analysis but until then let's offer a different view on this issue. Gristedes is located all over Manhattan and the chain is paying exorbitant real estate taxes on all of its locations. It is not unusual for one store to pay as much as $500,000 in such taxes. On top of this, and just as all stores in the city experience, Gristedes suffers from a regulatory mind-set that adds additional burdens on to the very consumers that, quite all of a sudden, Crain’s has decided to champion.

Shouldn't these be the kind of issues that a business publication should save its ire for? Instead Crain’s attacks the victim here and in the process sounds more like Mark Green who erroneously told New Yorkers that it was the poor who "paid more for less" when it came to grocery shopping.

Blaming Bodegas

It was Karl Marx who observed that history repeats itself – the first time as tragedy, the second time as farce. Marx was referring to Napoleon’s nephew but the observation applies to the Crain’s editorial as well.

The editorial, while tragically blaming the supermarkets who are the victims of an out-of-control municipal tax and regulatory policy, then goes on to farcically lay blame on the city's bodegas who it says, "have long charged residents of poor communities exceptionally steep prices and worked hard to keep out competitors."

Is Crain’s serious here? How have the bodegas, community institutions in neighborhoods all over the city, conspired to keep out competitors? Come on now, get out of the office folks! There are often three or more bodegas on each block. This just in: Jose Fernandez and the Bodega Association have set up an attack apparatus, funded by the millions of dollars the stores have apparently extorted from low-income consumers, and are taking aim against--who?--why Wal-Mart of course.

This is really quite hilarious. Memo to Crains: Bodegas, all 13,000 of them, will continue to thrive in neighborhoods all over the city even should Wal-Mart break into the NYC market. And as far as high prices are concerned well, these are convenience stores and we've never heard any editorialist inveigh against, 7-11 stores for instance. That being said, however, if you do a price comparison (our favorite is the 20 oz. bottle of Diet Coke) you will find that the corner bodega, precisely because it is faced with a fierce competition, offers reasonable prices on its staple items (unlike some of the chain drug stores, and gas station convenience outlets, that will be at least 50% higher on these items in the same neighborhoods).

As far as health care is concerned does Crain’s, a paper that detests HCSA, really want it to apply to the Mom and Pop bodegas? Are bodegas, which have historically been a bootstrap opportunity for generations of immigrants, that much of a threat to poor New Yorkers? Has HCSA made the paper perhaps become unhinged? We can just see it now, Crain’s the business paper launches a crusade to reform the hiring practices of small stores so these outlets comply with the minimum wage laws that we'll suppose Crain’s has been philosophically (and historically) opposed to.