Wednesday, January 12, 2011

Catsimatidis Defends Neighborhood Business Against Walmart

In a heart felt and incisive Op-ed piece in this morning's NY Daily News, Red Apple CEO, John Catsimatidis lashed out against the Walmart invasion of NYC: "I am strongly against Walmart's entry into New York City, and I won't pretend that I'm completely objective. I own the Gristedes supermarket chain, and if Walmart comes to town, it would mean competition for my business. But it isn't my business that I'm worried about. Over the years, my business has been able to grow way beyond its beginnings in the neighborhoods of New York. So it is not threatened with extinction if Walmart comes to town. But others are."

Catsimatidis, whose business has branched out into oil refineries, gas stations, and convenience stores, will not be threatened by Walmart's entry into the city but is speaking up in defense of all those immigrant entrepreneurs that have come-and are still coming-after him. They are the ones that are in the cross hairs of Walmart-Nelson Eusebio, who gave such an impassioned defense of independent retailing last night on NY1, Mark Tanis from Brownsville, and Louis Hernandez fron East New York-just to name a few of the thousands of local smalll business owners that will struggle mightily to survive should the Walmonster gain a major toe hold in New York.

Catsimatidis outlines the nature of the threat: "As all New Yorkers know, the real estate base of New York is centered in more than 200 diverse neighborhood shopping areas throughout Brooklyn, Queens, Manhattan, the Bronx and Staten Island. These shopping strips - whether Seventh Avenue in Park Slope, 86th St. in Bay Ridge or Lydig Ave. in the Bronx - are our downtowns. They not only anchor the tax base, but they also define the neighborhoods themselves. Many of the shop owners also own homes in the city and are engaged in civic debate."

And it's not only the retailers who will be hurt-but their local suppliers as well. Taken as a whole these are the real economic backbone of the city-and they are the ones who have been neglected by the current administration: "The stores themselves are, taken together, more economically stimulative to the city's economy than a single big-box store like Walmart. These entrepreneurs not only hire locally, but they buy the bulk of their inventory from local distributors. The professionals they hire are by and large locally based. When a local store earns money, it tends to get reinvested in the city. Studies show that local, independent stores circulate about 85% of their revenues in this fashion, while large national chains circulate only about 15% of their revenues locally.

Who are these wholesalers? They are people like Marlen Lugones, a Cuban American woman who is building a successful soda distribution business supplying these local stores with a distinctive low priced brand of pop. They also include Heinz Vieluf, the Dominican American who has built Cibao Meats into a thriving wholesale enterprise-and there are hundreds of others-immigrants all, who came here in pursuit of the American Dream, just as Catsimatidis' parents did.

It's why he has such an allegiance to taking on this fight. As he says: "Nor should it be lost on us that many of these store owners are immigrants pursuing the American Dream, as I was when I started out. Not so of Walmart - so letting the huge retailer set up shop in New York will have an unavoidable anti-immigrant impact. Wherever the retail giant has located, smaller competitors - the ones that have always helped shape the character of our cities - struggle to stay in business. It's a basic law of economics that when one retailer gains, it's going to come at least partly at the expense of others. Why would we want to do this, especially with so many small businesses already struggling mightily?"

It's the same argument that Eusebio made last night in the NY1 debate. Eusebio, speaking for the over 400 Dominican owned supermarkets who have trail blazed in the city's low income neighborhoods, talked about the important contributions made by his fellow country men-going into neighborhoods that the chains had fled in the 70s and 80s. Now, having established that there are great economic opportunities in these neighborhoods, the Walmonster wants to come in and take over for these pioneers.

Catsimatidis also referenced the Walmart poll in his editorial today-and made a telling point: "Walmart insists that New Yorkers want it to come here; it even commissioned an opinion poll to prove it. But polls can be misleading. I remember when Charlie Katz wanted to build a giant mall on the Bay Ridge-Borough Park border. The community went up in arms - and elected my friend, now state Sen. Martin Golden (R-Brooklyn), who was the mall's chief opponent, to the City Council. Those are the kinds of polls that are meaningful to me."

The point is that there is always a theoretical support among New Yorkers for the right of any company to freely be able to do business without restraints-theory that gives way to reality when people are actually confronted with the size and scope of a huge retailer like Walmart. And the opposition often revolves around traffic: "And haven't we been trying to build a more environmentally friendly city? Well, ensuring that walk-to-shop neighborhoods stay healthy is an important piece of sustainability. And it keeps our city safe, because there are more people on the streets at all hours. Walmart, on the other hand, will generate tens of thousands of additional car and truck trips a week. I don't understand how we could, on the one hand, argue for congestion pricing - then turn around and push for the building of malls and box stores on the city's periphery."

Which brings us to CM Eric Ulrich's Walmart defense last night at the NY1 debate. Ulrich, who has a bright future and argues well, told CM Barron that he would welcome Walmart into his community. Well, we have been in Woodhaven and Ozone Park and we have fought some interesting fights there before the council member was even born perhaps. Let's say we are extremely skeptical about any Ozone Park welcome wagon for traffic generating Big Wally.

And we would be remiss if we didn't mention the spirited debate from the fiery Charles Barron last night. In our view, he got off the best line when confronting Tony Herbert, one of Walmart's, "booty capitalists." When Herbert was talking about Walmart's so-called good jobs, Barron looked at him and said, "The only good job they have given out, Tony, is yours."

But we'll  give Catsimatidis the last word on what's at stake in the Walmart battle: "The greatest New York retailers have always been those emerging from the neighborhood. We don't need to import our success stories.We have already lost so many of our independent stores to the chain invasion. The Center for an Urban Future reports that every borough registered a net increase in chain stores over the past year. Let's not let Walmart put the nail in the coffin."