Zohran Mamdani

[The Great Zaganza]

doesn't need to turn a profit, just not lose more money than extra food stamps would

 

[Darat]

doesn't need to turn a profit, just not lose more money than extra food stamps would

Or be found to have other benefits as well?

 

[Segnosaur]

1. Making it impossible for other businesses to compete with prices (if, as mentioned by rdwight and also footnoted in the article, the profit margins for stores tend to be 1-3% then obviously 30% off those prices on staple goods would act like a huge loss leader - and furthermore one that by design cannot be competed with because even if those stores reduce their prices by more than they could afford the government shops would reduce them even further, presumably funded by taxes).

Why would the gub'mint store reduce their prices even further? The pressure to lower prices will only be felt by proximate businesses (grocery stores in NYC exhibit clear price discrimination), and are unlikely to show up as anything more than rounding error in however the municipal markets end up pricing those goods.

I think it is from the description of how Mamdani-mart plans to set its prices... Look at nearby stores, take some sort of average, and set your prices 30% lower. If your local Target or Kroger realizes they are losing too much business and have to lower their prices to compete as a loss leader, then Mamdani-mart will see those new lower prices, find an average, and set them another 30% lower.

Carried to its logical conclusion, prices would eventually become zero.

 

[mumblethrax]

In my opinion its a distinction without difference.

That's just incorrect.

Most obviously, rent stabilization in New York is quite literally an entirely separate set of policies from rent control. Rent stabilization was introduced specifically to replace rent control with a more market-friendly approach. You can't treat these policies as equivalent, even if you consider them both bad.

And when you do that, you will cause at least some of them to decide "You know, I can earn more profit by turning my land into a parking lot, and I won't have to deal with all sorts of tenant-related headaches."

You're failing to appreciate that regulated markets are...regulated. Landlords can't tear down a rent-stabilized building in favor of a parking lot without permits that they aren't going to get without major outlays. It's a major metropolis--you don't get to do whatever you want with a parcel of land that you own, particularly when it's already been improved.

The problem with that particular metric... it is an average. Not all units had the same increase, and it likely depends on the neighborhood, if there is a mix of rent-controlled and non-rent controlled units, etc. There are also other issues: that 12% may not be adjusted for inflation, that "increase" covers maintenance that have also been increasing, etc.

Of course it's an average. Financially distressed buildings (which constitute about 9% of building) have tax abatements available. 12% easily covers inflation and then some. And the cost of repairs hasn't gone up but nearly that much.

(also, I am not sure where you got your 12% figure from... nationwide or just NY, all rental units or just rent-controlled, but it differs from values that I have seen.)

2025 study from the RGB. Rent-stabilized units in NYC.

Notice that? thousands of units that are sitting empty because the landlords figure they won't earn enough back to make fixing them up worth while. And that's with various increases in operating income over the years. Now there is a rent freeze, and even more buildings will fall into the same category.

As mentioned, zombie apartment have much more to do with HSTPA than it does with any possible rent freeze. The mayor does not have the ability to do anything about that.

I am sure lots of tenants did see a drop in their income.

Which is why the rent freeze is evaluable in terms of immediate relief to cost-of-living pressures.

Yes housing affordability is a problem. Yes, lots of low and middle income people have seen stagnant wages while other expenses go up. But when you go and deliberately make one group (the landlords) largely responsible for "fixing" the issue, you will have side effects.

Mamdani hasn't done that.

That is... debatable that he has a "firm grip" on the problem. There is plenty of evidence that rent controls contribute to housing shortages, and a rent freeze is an extreme version of that.

No, a rent freeze is marginal, and does not significantly contribute to shortages.

That rent control reduces housing availability is an idea that is accepted by many left and right wing economists accept. But Mamdani is doing something that the majority of economists say is wrong. That doesn't sound like he has a "firm grip" on the problem, it sounds more like he is taking the populist approach. "I'll do what sounds good rather than what the experts say"

Again, this is distinct from a rent freeze, and it's not difficult to find left wing economists who approve of Mamdani's rent freeze while disapproving of rent control in general.

You are substituting a general argument against price control in rental market for an argument against specific and immediate relief to tenants, which doesn't work.

Actually I would say he is doing just the opposite. A rent freeze the reverse "incentivizing developers to build more". Instead, he is telling them "I am willing to limit your profits if you build housing." They would be better off to use their resources to do other things if they want to maximize their investment.... stick money in the stock markets, build retail instead of residential, develop a death ray in order to blackmail the world, etc.

Consider that the rent freeze is not the whole of his housing policy.

Now, he may have some other ideas to create more housing. But rental units constructed and run by private individuals and companies will always be a major factor in the housing market.

New rental units constructed and run by private individuals and companies are not subject to NY's rent stabilization laws, unless they accept public subsidies or specific tax abatements.

 

[mumblethrax]

I think it is from the description of how Mamdani-mart plans to set its prices... Look at nearby stores, take some sort of average, and set your prices 30% lower.

Can you tell me where you're getting the idea that they will look at nearby stores? Everything I've seen has explicitly referred to a city-wide average.

I doubt local shops can reduce their own prices that far, but if they did, then the act of doing so would reduce the market price, no?

Not significantly, no. Only stores within spitting distance will feel pressure to lower prices.

 

[theprestige]

doesn't need to turn a profit, just not lose more money than extra food stamps would

You're not making any sense. "Extra food stamps" were never on the table.

 

[Gulliver Foyle]

I think it is from the description of how Mamdani-mart plans to set its prices... Look at nearby stores, take some sort of average, and set your prices 30% lower. If your local Target or Kroger realizes they are losing too much business and have to lower their prices to compete as a loss leader, then Mamdani-mart will see those new lower prices, find an average, and set them another 30% lower.

Carried to its logical conclusion, prices would eventually become zero.

You know that instead of explaing why Mamdani marts don't work, you've just explained why the free market is a mythical beast, don't you?

 

[Donal]

I think it is from the description of how Mamdani-mart plans to set its prices... Look at nearby stores, take some sort of average, and set your prices 30% lower. If your local Target or Kroger realizes they are losing too much business and have to lower their prices to compete as a loss leader, then Mamdani-mart will see those new lower prices, find an average, and set them another 30% lower.

Carried to its logical conclusion, prices would eventually become zero.

That's very much what big chains do to run out the smaller, local stores. Somehow, no one has ever hit 0.

Also, the objective of these government run stores is not to compete or dominate the market. It is to provide for people who are currently underserved by the current status quo.

 

[Brainster]

I think it is from the description of how Mamdani-mart plans to set its prices... Look at nearby stores, take some sort of average, and set your prices 30% lower. If your local Target or Kroger realizes they are losing too much business and have to lower their prices to compete as a loss leader, then Mamdani-mart will see those new lower prices, find an average, and set them another 30% lower.

Carried to its logical conclusion, prices would eventually become zero.

A far more likely outcome is that the lines at Mamdani-Mart become so long that a lot of shoppers decide the cost savings isn't worth the time expended.

 

[kookbreaker]

A far more likely outcome is that the lines at Mamdani-Mart become so long that a lot of shoppers decide the cost savings isn't worth the time expended.

Dude, this line has such "nobody goes there anymore - its too popular" vibes.

 

[Donal]

A far more likely outcome is that the lines at Mamdani-Mart become so long that a lot of shoppers decide the cost savings isn't worth the time expended.

Ya, Americans would never stand around for hours just for the hopes of getting a discount price.

 

[kookbreaker]

Anyone ever been in a Restaurant Depot?

 

[theprestige]

Ya, Americans would never stand around for hours just for the hopes of getting a discount price.

Once a year, on luxury items.

But yeah, I think if there were lines so long that people were going home frustrated and empty-handed, there would already be a hugely profitable business there to serve that market.

That said, I could see intolerable waits even with few customers, because all the deeply discounted pork chops and chicken breasts are locked up, and just like at the DMV, finding a government worker who will promptly unlock the cabinets is an ordeal of its own.

Food deserts happen because businesses don't see enough paying customers to justify the operating costs of setting up shop in that neighborhood. There's only a few reasons for that. Literally not enough people live there*, a surplus of non-paying customers**, and excessive regulatory burdens*** come to mind.

---

*Better solved by a 'meals on wheels' type taxpayer subsidized food delivery service for the few people still living there.

**Better solved by more community policing.

***Better solved by either reducing the regulatory burden, or offering tax incentives to offset the additional operating costs.

 

[kookbreaker]

Some of you folks really need to watch this video. I've been talking about this a few times. It doesn't seem to have sunken in.


Yes, this is different in that it was a private company, but it was done with the aid of public programs as well. That is different than Mamdani's plan but doesn't mean his version will be wrong.

 

[theprestige]

Some of you folks really need to watch this video. I've been talking about this a few times. It doesn't seem to have sunken in.


Yes, this is different in that it was a private company, but it was done with the aid of public programs as well. That is different than Mamdani's plan but doesn't mean his version will be wrong.

Was there anything wrong with offering tax incentives amd/or regulatory easements, to encourage desired behaviors from private companies? Any particular reason Mamdani needed to reinvent the wheel from first principles?

"We're going to do something that works, but different" doesn't instill confidence that they're going to do something that works.

At least the Philly model is based on paying subject matter experts to do the job they already well know how to do.

 

[Donal]

Once a year, on luxury items.

No, on pretty standard consumer goods

But yeah, I think if there were lines so long that people were going home frustrated and empty-handed, there would already be a hugely profitable business there to serve that market.

We're talking groceries here. Essentials. Stuff you literally cannot live without.

That said, I could see intolerable waits even with few customers, because all the deeply discounted pork chops and chicken breasts are locked up, and just like at the DMV, finding a government worker who will promptly unlock the cabinets is an ordeal of its own.

I think your first mistake is going to the DMV for chicken and pork chops.

Food deserts happen because businesses don't see enough paying customers to justify the operating costs of setting up shop in that neighborhood.

Really? Holy crap! I had no idea. You should be careful with that kind of talk. Pointing out the failures of the free market is...SOCIALISM!!!

There's only a few reasons for that. Literally not enough people live there*, a surplus of non-paying customers**, and excessive regulatory burdens*** come to mind.

Also, not enough people buying high margin items to make it worth it. Not enough interest from brands to pay for premium shelf space. ◊◊◊◊◊◊◊◊◊◊◊◊◊◊◊◊ affects all industries.

---

*Better solved by a 'meals on wheels' type taxpayer subsidized food delivery service for the few people still living there.

**Better solved by more community policing.

***Better solved by either reducing the regulatory burden, or offering tax incentives to offset the additional operating costs.

 

[The Atheist]

Yup and there are insurance based models and ones like the NHS...

Yes, I was referring to NHS and the cloned systems of public healthcare in NZ, Aussie, et al.

To me, and pretty much everyone else living in those systems pays their insurance premiums by way of tax than direct payments. Damn Commies!

Carried to its logical conclusion, prices would eventually become zero.

Perfect example of reducto ad absurdum. Well played.

 

[Donal]

Was there anything wrong with offering tax incentives amd/or regulatory easements, to encourage desired behaviors from private companies? Any particular reason Mamdani needed to reinvent the wheel from first principles?

"We're going to do something that works, but different" doesn't instill confidence that they're going to do something that works.

At least the Philly model is based on paying subject matter experts to do the job they already well know how to do.

You know this isn't a new model, right?

 

[Trausti]

You know this isn't a new model, right?

I would think it is a new model. There have been attempts elsewhere to have public grocery stores. But I'm not aware of any promising a 30% market discount on items. That's just not workable. Especially as Mamdani looks to private partners to run them.

The Mayor also issued a request for proposals (RFP) from qualified grocers or firms to serve as operators of one or more N.Y.C. Groceries stores. The selected operator will be responsible for day-to-day store operations, including merchandising, staffing and adherence to strong labor practices.

 

[kookbreaker]

Was there anything wrong with offering tax incentives amd/or regulatory easements, to encourage desired behaviors from private companies? Any particular reason Mamdani needed to reinvent the wheel from first principles?

"We're going to do something that works, but different" doesn't instill confidence that they're going to do something that works.

At least the Philly model is based on paying subject matter experts to do the job they already well know how to do.

Actually a decent question. I honestly do not know if NY State has a program like this but still failed to fill the needs so Mamdani is taking matters into his own hands.

There's also the simple coverage fact: despite the success of the PA program, Philadelphia still has food deserts.