Sunday, December 16, 2007

Deep down inside, wouldn't they want a Sams Club?

From the Sun Times on the demise of a Hyde Park institution founded in 1932.

Meanwhile, some Hyde Park residents, who complained about the Co-Op's above-average prices and sometimes subpar service, didn't see what was worth saving at all.

[***]

Many Hyde Park residents had taken pride in having a community-owned supermarket that embodied progressive values and stocked a wide range of products reflecting the rare diversity of the neighborhood.

Its members over the years included prominent liberal politicians such as former Ald. Leon Despres, retired federal Judge Abner Mikva and former U.S. Sen. Paul Douglas, who is said to have advised the Co-Op's founders while he was a U. of C. economics professor.

But several financial missteps -- namely the failure of two satellite stores -- crippled its finances. And the idealism of its mission collided with the brutal reality of failed expansions, mushrooming debt, and increasingly frustrated customers for whom lofty values ceased to trump high prices and often shoddy service.
I have fond memories of Hyde Park and Kenwood. My Dad had a Dime Store not far from the Co-op at 63rd and Blackstone in the 50s and early 60s. We'd spend time in Hyde Park and he'd take me around the University and over to Harding's Castle to see the armor and swords.

Paul Douglas was a hero of my Dad's. Probably the only politician he considered a hero. Leon Despres the lone fighting reformer for open-housing which was then the defining liberal issue in Chicago as far I knew. So the Co-op's closing stirs some memories.

Today my kids don't even know what a Dime Store is. Small time capitalism is about as out of date as cooperative progressivism. Hanging on to high prices and sub-par from either not very progressive.

There should never have to be a trade off between lofty ideals and high prices or shoddy service. (Often ideals given up when there is a deal at Walmart. I've met fellow Liberals buying tires there.)

Low prices and good service lead to increased wealth for all, and if the economic disruption creates an injustice then progressive politicians should mitigate it, but ideals should never obstruct the greater good of economic growth. A progressivism that can't reconcile those things probably should go the way of the Co-op.

8 comments:

Anonymous,  7:53 PM  

There should never have to be a trade off between lofty ideals and high prices or shoddy service.

If I'm parsing this correctly, viz., (lofty ideals) vs. (high prices or shoddy service), I'm not sure what meaning it's supposed to convey.

NASA figured out the hard way that one gets to choose only two of (1) better, (2) faster, and (3) cheaper.

In my case, I paid $10 a pound for a Thanksgiving turkey. The "lofty ideal" was humane raising and slaughter, as well as preservation of heritage breeds. The service was terrific. And the price was surely extraordinary.

What part of this equation should "never" have to occur?

Bill Baar 6:32 AM  

What part of this equation should "never" have to occur?

Only that you would impose it on the rest of the City when most would prefer butterballs on sale for much less per pound.

That's when lofty ideals get imposed on he market in a way that impoverishes.

Anonymous,  10:59 AM  

Small time capitalism is alive and well, especially in the service industries. And yesterday's dime store is today's Dollar General.

The Century Club,  1:07 PM  

"Low prices and good service lead to increased wealth for all"

No, low prices built on poverty pay and terrible benefits build wealth for a few. There's a reason that the Walton family is the richest in America while their employees are on food stamps.

"but ideals should never obstruct the greater good of economic growth"

I agree. The ideal of Laissez faire economics often gets in the way of economic growth by funneling wealth to a few people. It would be better if we didn’t let that ideal get in the way of a healthier economy that was built on decent paying jobs.

If you want to take your shots at the Coop for being poorly managed, fine. But the Coop problems aren’t a defense of Wal-Mart’s.

JB Powers 9:35 AM  

TCC ignores the vast number of consumers in his theory that somehow the Walton family has unjustly profited by providing low prices to customers. Consumers greatly benefit from low prices, much more than the owners of WalMart have.

The "Walton Family" and the other shareholders of Wal-Mart have lost $45 Billion in the last 7 years, while continuing to provide low cost goods to consumers and reasonable jobs to employees.

Wealth for a few? Sounds like riches for all, and sacrifice for a few.

JBP

The Century Club,  12:44 PM  

JB,

Two thoughts:

Because big box stores sell such massive amounts of product per employee, raising wages doesn't have a dramatic effect on prices. UC Berkeley just released a study that shows if Wal-Mart raised its minimum wage to $10 and passed the cost ALL on to consumers, the impact would be prices that are less than 1% higher for the average shopper.

Also, the Waltons each made about $500 million last year. This isn't an either/or question. Companies as profitable as Wal-Mart can pay a living wage and it won't drive them (or consumers) bankrupt to do it.

JB Powers 3:45 PM  

TCC,

So if raising wages is not an issue, Wal Mart can do that if they like. I think the executives at Wal Mart are perfectly capable of making that decision without our assistance. Maybe the end customer does not want to pay more for goods, that is how markets work.

The Waltons and other shareholders of WalMart have lost around $45 Billion on WalMart stock in this decade. They may make money elsewhere, but not on WalMart.

If you have a better idea on how to run a market, go start another co-op and see how much fun it is.

JBP

Prof. Goldblatt Ph.D. 10:10 PM  

Wal-Mar is the crack cocaine of retail. Or better the Meth.

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