John Mackey, the price war peacenik
Today, we're debuting a brand-new topic here at the Vigorous North. The "Jackass Environmentalism" tag will be attached to posts that discuss the ways in which elitist jerks abuse the mantle of "environmentalism" to protect their narrow, privileged self-interests, frequently at the expense of the environment. From the Kennedy family's protests over Cape Wind ("but that's where we sail!) to carbon indulgences for SUVs, this topic promises to be riper than your organic mango shipped from Thailand.
Which makes a nice segue to our inaugural jackass environmentalist: John Mackey, CEO of Whole Foods Market (henceforth referred to as "WhoFooMa").
Mackey made the news recently when the Federal Trade Commission revealed that the WhoFooMa CEO had been talking up his company's stock on Yahoo Finance message boards under the pseudonym "rahodeb." The not-so-anonymous-as-he-thought postings reveal Mackey's opinions on Wal-Mart ("I probably admire Wal-Mart more than any other company in the world... I love Wal-Mart!"), unions (almost as bad as trial lawyers), and his own haircut ("I like Mackey’s haircut. I think he looks cute!").
Some WhoFooMa stockholders are wondering why their CEO was spending so much on-the-job time on a backwater internet discussion board. But what this is really all about is Mackey's desire to buy out his closest competitor, Wild Oats Market (WiOMart - pronounced as the past tense of "Wyoming" might be if "Wyoming" were an irregular verb).
A recently-released FTC memorandum quotes Mackey's desire to "avoid nasty price wars in Portland (both Oregon and Maine), Boulder, Nashville, and several other cities which will harm our gross margins and profitability" (page 6 of the memo). What a good liberal peacenik, right? Except what Mackey describes as a "nasty" conflict is actually good for consumers, farmers, and the organic foods industry.
As you may have guessed, I can think of plenty of problems associated with the Whole Oaty Wild Foods Jackass Organic GloboMarts. But the massive transfer of wealth from yuppie credit card accounts to organic food producers has unquestionably provided big benefits to the environment and family farms.
However, if Mackey should acquire his competitor, organic farmers will have one less retailer to whom they can sell their products - and in many markets, WhoFooMa could become the only buyer. Which means that farmers will either have to subject themselves to the prices and whims of WhoFooMa or try their luck at the roadside stand. If there's only one buyer, the whole market for organic food will suffer (in economics, this is called a "monoposony").
The same problem comes up from the consumer's perspective. Having two Jackass Organic GloboMarts in the same neighborhood means that Portlanders, both in Oregon and in Maine, will pay less for soy milk, organic fruit, and (unfortunately) Fijan bottled water, thanks to competition. What Mackey refers to as "avoiding a price war" is what the FTC, you, and I would call "a monopoly."
For the sake of full disclosure, I suppose that I should mention that I worked at the local WhoFooMa for two weeks when they opened here in Portland, ME. I applied based on hearsay that they provide good worker benefits, and while this was the case, the whole place is also pervaded with a creepy celebratory attitude toward conspicuous consumption. If Winnie-the-Pooh sweatpants were somehow able to soothe liberal guilt and stroke their wearers' egos, then WhoFooMa would be Disney World without rides.
I haven't been back since I ran out the door on my last night there, but it's fertile ground for many future Jackass Environmentalism posts - so there's much more to come.
Read Wacky Mackey's posts on Yahoo Finance here.
Which makes a nice segue to our inaugural jackass environmentalist: John Mackey, CEO of Whole Foods Market (henceforth referred to as "WhoFooMa").
Mackey made the news recently when the Federal Trade Commission revealed that the WhoFooMa CEO had been talking up his company's stock on Yahoo Finance message boards under the pseudonym "rahodeb." The not-so-anonymous-as-he-thought postings reveal Mackey's opinions on Wal-Mart ("I probably admire Wal-Mart more than any other company in the world... I love Wal-Mart!"), unions (almost as bad as trial lawyers), and his own haircut ("I like Mackey’s haircut. I think he looks cute!").
Some WhoFooMa stockholders are wondering why their CEO was spending so much on-the-job time on a backwater internet discussion board. But what this is really all about is Mackey's desire to buy out his closest competitor, Wild Oats Market (WiOMart - pronounced as the past tense of "Wyoming" might be if "Wyoming" were an irregular verb).
A recently-released FTC memorandum quotes Mackey's desire to "avoid nasty price wars in Portland (both Oregon and Maine), Boulder, Nashville, and several other cities which will harm our gross margins and profitability" (page 6 of the memo). What a good liberal peacenik, right? Except what Mackey describes as a "nasty" conflict is actually good for consumers, farmers, and the organic foods industry.
As you may have guessed, I can think of plenty of problems associated with the Whole Oaty Wild Foods Jackass Organic GloboMarts. But the massive transfer of wealth from yuppie credit card accounts to organic food producers has unquestionably provided big benefits to the environment and family farms.
However, if Mackey should acquire his competitor, organic farmers will have one less retailer to whom they can sell their products - and in many markets, WhoFooMa could become the only buyer. Which means that farmers will either have to subject themselves to the prices and whims of WhoFooMa or try their luck at the roadside stand. If there's only one buyer, the whole market for organic food will suffer (in economics, this is called a "monoposony").
The same problem comes up from the consumer's perspective. Having two Jackass Organic GloboMarts in the same neighborhood means that Portlanders, both in Oregon and in Maine, will pay less for soy milk, organic fruit, and (unfortunately) Fijan bottled water, thanks to competition. What Mackey refers to as "avoiding a price war" is what the FTC, you, and I would call "a monopoly."
For the sake of full disclosure, I suppose that I should mention that I worked at the local WhoFooMa for two weeks when they opened here in Portland, ME. I applied based on hearsay that they provide good worker benefits, and while this was the case, the whole place is also pervaded with a creepy celebratory attitude toward conspicuous consumption. If Winnie-the-Pooh sweatpants were somehow able to soothe liberal guilt and stroke their wearers' egos, then WhoFooMa would be Disney World without rides.
I haven't been back since I ran out the door on my last night there, but it's fertile ground for many future Jackass Environmentalism posts - so there's much more to come.
Read Wacky Mackey's posts on Yahoo Finance here.
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