More notes from an observational economist

or grocery store lessons

To see and watch FoxNews and other right-wing media sources, one would think we were in the midst of a blizzard, hurricane, or Soviet-style economy — a combination of empty shelves and inflated prices will leave us hungry and poorer before the next paycheck.

A fellow casino worker and avowed Trumpist told me as much during a break as he pointed to someone of FoxNews braying about it. Unfortunately, the video clip was from early May 2020 during the COVID lockdown and I recognized it as such and said as much. My coworker then started in above illegal immigration and I reminded that unemployment was at a 50 year low and at that point, he (fortunately) stopped talking altogether.

But FoxNews illustrates an important point — if you want to tell an economic story, static (e.g. blizzard, hurricane) or fluid (e.g. pandemic, recession), grocery stores are a trove of economic realism.

I have been fascinated by grocery stores since I was 10. I used to help my mother get groceries at the Navy commissary in Honolulu and have been hooked on it ever since. There is no greater place to see the best and worst of capitalism and get a realist perspective of your place in the economy.

The most important thing to know about your grocery story is how much and how often, it is restocked.

The four biggest food companies (Nestle, Mondelez, ADM¹, and Tyson) in the world² sell about 80% of what Amercians buy in grocery stores (rest easy, 3 are U.S. based). If you throw in Kraft-Heinz and JBS Foods, that percentage is closer to 90%. And that doesn’t include beverage companies. Their combined market share is over 75% of what is bought at the local grocery store level.³

The monopolistic and exploitive nature of food processing and distribution ought to concern everyone as farmers and workers get the dieter’s slice of the the corporate pie.

With that backdrop, a few observations.

• Entemann’s on the endcaps is a sign of a flourishing economy. A treat for the poor and a splurge for the working class, its accessibility in grocery stores is a decent economic barometer.

• Spaghetti sauce on the endcaps is a sign of economic stress, unless your grocery store is pushing an Italian theme for a particular week.

• Speaking of ethnic foods, Mexican food, like basic Italian food (pasta and sauce), is fairly inexpensive. Seeing whose buying it and how voluminously is a decent gauge of economic health.

• Perpetual “deals” on tuna and bread and pasta used to be a sign of economic stress, but you’re better off seeing how busy the store’s deli counter is. Sliced lunch meat is expensive; and when fewer people are buying (and buying less), the economy is not doing well.

• Bulk meat purchases with freezer bags for people who don’t seem like coupon mavens with any frequency is a economic caution and often is a sign of inflationary fears.

All of which brings me to my last trip to my local Acme. As I pushed my bachelor cart

through the aisles, virtually all the vestiges of supply chain issues seem to have zeroed out. That is an East Coast perception and fairly suburban one — I live on the outskirts of a sizable city but my grocery store is in a strip mall so it has a very suburban feel to it.

If you go to the grocery store enough times a week (the old weekly shopping trip is becoming less the societal norm and multi-week shopping is becoming fairly typical), you’ve probably seen a variety of trucks making deliveries. Grocery store chains in cities, suburbs, and exurbs get their shelves stocked through multiple (and often daily) deliveries.

Not so much in rural America. I lived for three years in Rock County, Minnesota in a very small town (Hills pop. 686). I could tell you with pinpoint accuracy when the food distributor got to the Sunshine Foods in Luverne (pop. 4785). It came only once a week and it was always on Thurday mornings. The same goes for the Dollar General which was about 6 blocks or so from Sunshine foods, except it was Wednesdays. The county had 9,000 or so residents and those two stores sold nearly nearly every grocery item in the entire county. With or without a pandemic, the supply chain is tenouous and incomes (often close to the minimum wage line) are susceptibe to inflationary conditions.

And while grocery prices have stabilized due to falling fuel costs and well functioning supply chains — the right-wing storyline continues.

The storyline that is not reported is the lack of a COLA approach to the minimum wage and the complete absence of pressure to increase wages for those in the bottom 80 percent.

In the early 90s, when inflationary woes and unemployment bubbled up after nearly a decade of public acceptance of a so-so economy, politicians and the media squawked incessantly about the “middle class squeeze”. If the Democrats want to make political inroads, they’d be right to message “tax and wage fairness”, because no one is winning in the economy except the wealthy and it’s been going on for 40 years and counting.

1. Archer Daniels Midland.

2. https://www.forbes.com/sites/chloesorvino/2022/05/12/the-worlds-largest-food-companies-in-2022/?sh=17a14cc074db

3. https://www.theguardian.com/environment/ng-interactive/2021/jul/14/food-monopoly-meals-profits-data-investigation