Chicago spent more than $13 million of taxpayer money to put seven grocery stores into neighborhoods that did not have one. All seven closed on Saturday, July 25. The people who shopped there got no warning.

Cleveland owns a grocery store, and it closed in April. Kansas City, Kansas, put about $7 million of public money into a grocery store downtown, and it closed in December.

Two days later, New York Mayor Zohran Mamdani promised something larger. His city will build and own five grocery stores, and it will price the food in them 30% below what every other store in the city charges.

I wrote in June that government grocery stores fail. Mamdani is building five anyway. And the socialists behind him have already said, on camera, that they do not care what happens to the family groceries this drives out of business.

New York has 13,000 bodegas. The mayor's plan never mentions them.

The city published the plan on July 27. It guarantees 30% off normal retail on all fresh produce and meat, plus about 20 categories of pantry staples like milk and rice. The city sets those prices once a month and holds them. Five stores, one per borough, $70 million. The first store opens at the end of 2027 in Hunts Point, a poor section of the Bronx. The rest, East Harlem included, are promised only by the end of the mayor's first term. So the discount is announced today and the first store arrives in seventeen months, and four of the five boroughs get nothing until after that.

There is no income limit. A household in Tribeca, one of the wealthiest neighborhoods in Manhattan, gets the same 30% off as a grandmother in Hunts Point, and taxpayers cover the difference for both.

New York already has about 13,000 bodegas, by Forbes' count. Those are the corner groceries selling milk and canned goods on nearly every block, and they stock the same products the new city stores will. The plan does not mention them anywhere.

Cleveland closed its store in April. Chicago's seven closed in July.

Seven American cities and towns have lost a government-owned or government-financed grocery store since March 2024. I wrote about three of them in June. Baldwin, Florida, owned its store outright, and Erie, Kansas bought its own. Kansas City, Missouri bankrolled a third. Four more have closed since that column ran, and three of those four closed this year.

Kansas City, Kansas, spent about $7 million on a downtown grocery owned by its members rather than a company. It lasted five years. Community Voice reported the closing on December 30, and Commissioner Bill Burns told KSHB it was "a good idea that went bad."

Cairo, Illinois, built a market with $750,000 in grants and donations, needed to sell $70,000 of food a month to survive, and closed in January after ProPublica found it was taking in less than half of that.

Cleveland's New Eastside Market opened in 2019 in a building the city owns. Arthur Fayne, the developer and part owner, warned at the opening that "the worst thing you could have is a grand opening and a grand closing." Ideastream reported the closing in April. The store left about $250,000 in unpaid taxes and utility bills behind it.

Chicago is the case New York should have studied hardest. In 2023 the city put more than $13 million into a deal with a franchisee of the discount chain Save A Lot to run seven stores on the poorer South and West sides. The contract required them to stay open until 2035. All seven closed on July 25, nine years early. Mariah Rush reported that Chicago is now "exploring every opportunity to recoup taxpayer funding, if necessary." Mayor Brandon Johnson blamed the federal government: "I heard that the federal government had a little hand in this particular one."

The government programs that fund stores like these fail at the same rate. Reporters went looking at what that money bought. Six stores Illinois officials once held up as successes drew on a $13.5 million state program aimed at food deserts, the neighborhoods with no full supermarket within reach, and four of the six have closed. Of 24 stores the federal government paid to open in 2020 and 2021, five had closed by mid-2024 and six had never opened. Florida's legislative analysts reviewed their own state's version and wrote that its "impacts are unknown."

New York would be the eighth city on that list.

Radhames Rodriguez endorsed Mamdani. Now he says nobody will come to his store.

Radhames Rodriguez runs the United Bodegas of America, the trade group for the men and women who own those corner stores. He endorsed Mamdani during the campaign, after the candidate promised his members a say in whatever the city built. It split the group. One of its co-founders quit over it. The plan arrived on July 27 with a 30% discount in it and no consultation before it. Rodriguez told the Washington Examiner what that number does to a man who owns one store: "having items that sell for 30% less than our prices means nobody will go to our stores."

He is right, and the math is not close.

A grocery store earns very little on what it sells. A study of independent grocers put their net profit at 1.9% in fiscal 2024, and the Food Industry Association puts food retailers generally at 2.1% last year. A grocer keeps about two cents of every dollar that crosses his register.

That same study puts their gross margin at 27.4%. Gross margin is what is left after the store pays for the food itself. Rent and payroll come out of that 27.4% along with everything else, and the two cents is what survives.

A 30% discount is larger than that entire 27.4%. The city store will sell a case of eggs for less than the bodega across the street paid its own wholesaler for the same case, and no private store can match that price and stay open. Shawn Tully wrote in Fortune on Sunday that a supermarket that tried "would suffer a 28% loss on these important products," and that as those stores close, "the food deserts would expand, not shrink."

The city cannot reach that price by shopping smarter, because five stores are far too few to command the volume discounts a national chain gets. Howard Yaruss, an economist writing in the New York policy journal Vital City, named where the money really comes from. The city stores "will pay no rent and no property taxes," advantages no competitor gets, and the plan "will undermine existing taxpaying businesses."

The bodega owner pays city taxes. The city will spend that money building a store that sells below his cost. Michael Durant of the Food Industry Alliance, which represents grocers across New York State, put it to NY1 last year: "the idea of using a business' tax dollars to compete against them is frankly offensive."

Antonio Pena leads the National Supermarket Association, which represents 450 independent grocery stores in the city. He called the plan "a big slap in the face to us." Francisco Marte of the Bodega and Small Business Group asked the city to spend the money helping existing stores buy their food more cheaply instead. "We could deliver his promise," he told Gothamist.

Immigrants own most of these stores. They voted to sue him.

The owners fighting the plan are Hispanic, Asian, Caribbean, African, Middle Eastern, Jewish and South Asian. On July 28 their Multicultural Business Coalition voted to sue the city if the mayor will not meet them, and it is raising a million dollars to pay for the case. Frank Garcia, who chairs the coalition, said the mayor "doesn't seem to want to sit down with us."

A 2020 report from the city comptroller's office found that immigrants own most of the independent businesses on New York's shopping streets. Mamdani campaigned as their defender. His first major economic program will put a good number of them out of business.

Asked what happens to the stores this bankrupts, the DSA said they should not have existed

Mamdani ran and won as a member of the Democratic Socialists of America, and that group supplies much of his political organization. Ten days before he announced the discount, the co-chair of its New York City chapter went on Fox News, and Martha MacCallum asked Gustavo Gordillo a direct question: what happens to the private grocery stores that a government-run competitor drives out of business?

Gordillo answered that "if one publicly-owned grocery store that brings prices down in the neighborhood is enough to put someone out of business, then maybe they shouldn't have been in that business in the first place."

The mayor says the opposite. On the day he announced the plan, he told ABC7 the bodegas were safe. "We know that a lot of what drives revenue for these bodegas, grocery stores, those are things that make it possible for them to continue to operate," he said. "Those are not things we have any interest in competing for." He was talking about alcohol and lottery tickets. Those are real money for a corner store, and he promised to leave them alone. He said nothing about the produce and the meat, which are the products his 30% discount covers. The mayor named the goods he will not touch and left out every good he intends to undercut.

That leaves three positions on the table. The mayor says the small stores will survive. The co-chair of his own political organization says the ones that do not survive had no business existing. The plan itself does not mention them at all. Only the mayor's position is a promise, and he cannot keep it and keep the discount. None of this is an accounting mistake. A movement willing to say on television that a bankrupted family business should never have existed will not reverse course once the bankruptcies start. New York has decided those closures are an acceptable price for the program, and it is paying that price with other people's businesses. The men making the trade are pleased with themselves for making it.

This is how socialism works wherever it takes power. The program comes first, and any man whose livelihood stands in the program's way is, by their definition, in the way. Socialists have run this play in every country that ever gave them the chance, and it has never once required them to feel bad about the people it ruined.

The man who owns the corner store does not need seventeen months and seventy million dollars to work out what a 30% discount does to a business that keeps two cents on the dollar. He has already done that math. His mayor's party has done it too, and decided he should not have been in the business in the first place.