Heaping plate: Austinite advises Mamdani to grow his city-owned grocery plans

An Austin “grocery nerd” advising New York City Mayor Zohran Mamdani on his campaign promise to open five city-run public food stores worries that the new mayor isn’t thinking big enough to succeed.

Mamdani’s campaign – that included a food-truck video exposing a city in the throes of “halal-flation” – helped convince New Yorkers to elect their first African-born Muslim mayor. Mamdani said upon taking office Jan. 1 that he would “govern expansively and audaciously.” He pledged to lead as “a democratic socialist” to “deliver an agenda of safety, affordability and abundance.”

To implement his promises to open a public grocery in each of NYC’s five boroughs, Mamdani’s team has turned to an informal brain trust that includes New York City native and longtime Austin resident Errol Schweizer.

“It is actually kind of common around the world to have some sort of low-cost municipally run grocers,” Schweizer told Austin Free Press. “High food prices are going to make this sort of public grocery policy inevitable.”

Sacked by Whole Foods

Schweizer “started on the shop floor” at Whole Foods and “worked his way up” to “vice president in charge of $6 billion worth” of company groceries, said University of Texas LBJ School of Public Affairs food researcher Rajeev Patel. But “he’s still the sort of kid from the Bronx who hustles and takes working class politics really seriously.”

Schweizer opened the Whole Foods store on North Lamar Boulevard and was its Southwest and New York regional buyer before heading the company’s national grocery program. He said Whole Foods fired him before its $14 billion Amazon acquisition in 2017.

“I got a big (expletive) mouth,” he told Austin Free Press, and “I had different ideas about the direction of the company.”

Schweizer is a “guy who’s thinking really deeply about the challenges in our food system,” said Austin Food Policy Manager Edwin Marty, who has worked with him on local food issues. Those thoughts – expressed in Schweizer’s columns in Forbes and his Substack “The Checkout” – caught the attention of Mamdani’s inner circle, which has solicited his input on multiple calls.

While Mamdani has a huge bench on his child care, transportation and housing affordability issues, Schweizer told Austin Free Press that his administration faces “a very steep learning curve” on grocery operations – with the notable exception of transition team member Lina Khan. As Biden’s Federal Trade Commission chair, she blocked Kroger from acquiring Albertsons and sued Amazon in a pending anti-trust case.

As Mamdani reportedly tries to recruit the Columbia Law School professor, Khan declined to comment for this story.

People’s grocery challenges

Schweizer said in an interview that Mamdani’s plan to open five city-owned grocery stores is too modest to slash prices. Even if the city pays for rents, wages, taxes, and overhead costs, small players can’t leverage the deep wholesale discounts needed to deliver affordable food, he said.

“Public groceries can succeed, but only with the scale and operational sophistication of proven models,” Schweizer and Patel stated in a Civil Eats article published in August (see their math here). “Half-measures will inevitably fail.”

Mamdani also faces skepticism that government officials in general – and democratic socialists in particular – know how to run grocery stores anywhere but into the ground. Then, too, Mamdani heaped his grocery pledge onto a $7 billion plate of promises that includes giving New Yorkers free buses and universal child care, while freezing subsidized rents.

His public grocery plans have rankled some industry moguls. During the mayoral race, billionaire John Catsimatidis threatened to move his New York grocery chain operations to New Jersey if Mamdani prevailed. But the day Mamdani won, voters across the Hudson River also selected an affordability Democrat, Mikie Sherrill, to govern New Jersey.

Voter pocketbook concerns are no mystery. Nationally, a grocery basket that cost $36 in 2019 costs closer to $60 today, Schweizer said. Prices for 10 leading grocery categories, including eggs, dairy, beef, snacks, and sodas, jumped 60% in that period, as the number of food units sold nationwide contracted 5%, he said.

Food-price inflators have included COVID supply-chain snarls, avian flu, climate change, and Trump-branded deportations and tariffs. But Schweizer said “grocery cartels” are the chief culprits. Consumers get gouged, he said, because U.S. food production, wholesaling, and retailing are concentrated in too few hands. The highest grocer profits seen since World War II, he said, outpace the industry’s revenues and wages.

Although U.S. grocery shelves offer mind-numbing arrays of choices, Schweizer said that fewer than five companies supply more than 70% of many food lines, from soda pop to meat. Food wholesaling and retailing are similarly skewed. While New York City boasts more small, independent retailers, a half dozen grocery chains sell most U.S. cities the lion’s share of their food.

With H-E-B and Walmart (with Sam’s Club) selling 75% of local groceries, Schweizer calls Austin “the least weird grocery market in the United States.”

Existing models

The best-known example of public U.S. food purveying is the federal Supplemental Nutrition Assistance Program (SNAP) that fed 42 million mostly elderly, disabled, or children before Trump’s “One Big Beautiful Bill” cut that budget by a record $186 billion over 10 years. SNAP has bankrolled 9% of U.S. grocery sales, Schweizer said.

The Defense Commissary Agency also sells almost $5 billion of food a year on military bases worldwide, offering a 25% discount compared to commercial groceries. Its former CEO, Bill Moore, told a forum in December that it can do that thanks to huge buying power coupled with U.S. taxpayers spending $1.5 billion a year to pay for its facilities, utilities, transportation, and salaries.

Schweizer told Austin Free Press that “grocery math” poses a major hurdle for Mamdani markets. Even if tax dollars pay such operating costs, New York City can’t deliver affordability unless it wrestles major price reductions from food wholesalers.

Heading a dozen Whole Foods stores in New York 20 years ago, Schweizer said he couldn’t “compete against much bigger chains” on prices. That’s why he believes that Mamdani’s five-store plan “doesn’t make sense.” Ex-Defense commissar Moore agreed. Boiling it down, Moore said: “Volume is king in retail.”

Purchasing power

New York City already subsidizes more than 700 food pantries and soup kitchens, more than 120 seasonal farmers markets, and six indoor public markets, according to Nevin Cohen of the City University of New York’s Food Policy Institute.

Calling themselves the “Supermarket Access Coalition,” Schweizer, Liz Accles, and others are advising – and pressuring – Mamdani to expand the city’s existing $500 million in annual food purchasing power. Accles heads New York’s Community Food Advocates.

The goal, Schweizer said, is to leverage demand throughout the food chain for food that promotes workers, ecology, animal welfare, health, nutrition, and local economies, as Schweizer previously advocated at Whole Foods.

Austin Food Policy Manager Edwin Marty said that Schweizer also successfully lobbied to incorporate such values-based purchasing into Austin Independent School District school meals and in the visionary 2024 “Austin/Travis County Food Plan.” Schweizer said Austin’s’ slow implementation of that food plan is hamstrung by its dependence upon the “regressive, atavistic imbeciles that run the state.”

Now Schweizer is working with a broad coalition to promote those sensibilities in the Big Apple. “We bring the New York City connections,” Accles told Austin Free Press, and he brings “30 years of supermarket expertise.”

Mamdani’s team estimates that five city stores would require a $60 million public investment. That’s enough to fund the equivalent of five “large bodega corner stores” that can’t tame prices, Schweizer warned.

“You have to make sure the math is serious,” he said.

UT’s Patel and Schweizer wrote that Mamdani instead should invest $400 million a year in 20 stores that can wield purchasing muscle. At that scale, the city might be able to drive down food prices enough to tap the market of 1.5 million food insecure New Yorkers, Schweizer said. This big investment amounts to a “rounding error” in the city’s $120 billion annual budget, he and Patel wrote.

The two Austinites painted a picture in “Civil Eats” of what 20 successful Mamdani stores could look like.

They “would buy in massive volumes,” combining “the military commissary’s cost-plus pricing (and free delivery) with Costco’s warehouse efficiency and Aldi’s limited assortment strategy.” They would stock “no more than 1,500 carefully selected products.” Taxpayers would pay wages and other costs, employing “union workers as municipal employees.” And the city must make each store a “joyful and dignified” place “to work and shop.”

Houston businessman Sam Stolbun, who has owned commercial bakeries that supply grocers, including Walmart and Whole Foods, takes a different tact. He said that Mamdani should form a “goodwill” partnership with a grocer that already has a large-volume distribution system in New York City. That way, he said, the five stores could reap the price benefits of their partner, who “is already operating at a high volume.”

With government-owned grocery stores operating on mass scales from Mexico to Istanbul, Schweizer said that they’re inevitable in the U.S., where existing markets fail to properly feed tens of millions of low-income people every day.

“It’s a market failure,” Schweizer said. “The private sector can’t solve for this right now.”

Andrew Wheat is the managing editor of the Austin Free Press.