Fast & Curious: Short Takes on Random Things

Food for thought

Let’s start with a little game of “Okay, stop” with Sylvain Charlebois—professor in food distribution and policy and senior director of the AgriFood Analytics Lab at Dalhousie University and all-round media darling. Here he is on the question of whether Canada’s three leading grocers have been price-gouging under the cover of rising inflation:

Charlebois:

In our grocers’ defence, though…

Okay, stop

“Our” grocers? I don’t think many Canadians—outside those holding significant stock in or occupying the C-Suites of Empire (Sobeys), Loblaws and Metro—think of these firms as “ours.”

Charlebois:

…financial data aren’t necessarily telling us that grocers are abusing their oligopolistic powers even in the current inflationary environment.

Okay, stop

This is like telling me my neighbor is not necessarily abusing the powers of his ACME Home Ballistic Missile System when the obvious point is that my neighbor shouldn’t have such powers—that possession of such powers constitutes an abuse in and of itself. (And yes, my neighbor is Wile E. Coyote.)

Charlebois:

Many will want to believe it, but the evidence is just not there. Canadian grocers have done well, but gross margins have remained anywhere between two per cent to four per cent. Loblaw’s numbers are slightly higher than usual this year, but it’s nothing like in other economic sectors. Take banking, for instance.

Okay, stop

Banks suck too, Sylvain! Pointing out that banks have also profited handsomely during these hard times is not a defense of grocers it’s a clear (and pretty bush league) deflection.

Let’s compare your insouciance about grocers’ gross margins to what Toronto Star reporter Marco Chown Oved says about them in this interview, based on an investigative piece he wrote in January and updated in July.

Oved begins by explaining that during the first three months of the pandemic, when grocery stores were one of the few businesses allowed to remain open, Canada’s Big Three grocers saw food sales increase by $4 billion over the same period a year earlier. Oved says that while it’s true the grocers initially had additional pandemic-related costs in terms of staffing and cleaning, these eventually subsided (see the story of their “hero pay”) while sales remained high:

[O]f course, when you sell more product, you’re gonna make more profit, and there’s nothing, sort of, untoward about that. But it’s when you look at the actual margin, it’s like, of every dollar that you sell how much do you get to keep? And that was what was going up…

What I think some people don’t realize about supermarkets is just what a massive industry it is. The three, big supermarkets, Loblaw, Empire…and Metro…they control more than 60% of [the] grocery industry in Canada. So, 60 cents of every dollar spent on groceries in Canada goes to these three companies. And they sell unbelievable amounts of food. They make more than $100 billion in sales every year. Like, it’s just huge, huge, huge amounts of money. So if you just tweak your profit margin by, like, 1%, it literally equals, like, hundreds of millions of dollars.

I found Oved’s interview thanks to this week’s episode of Canadaland Short Cuts, co-hosted by Arshy Mann whose own show, Commons, is about to release a series called “Monopoly” and if I hadn’t been looking forward to this series before Mann referenced Empire CEO Michael Medline, I would certainly have been after, because Medline has become an object of fascination for me. He’s the most unapologetic of the food barons, although he’s only been a food baron since 2017, when he joined Empire after being dumped as CEO of Canadian Tire.

Even the Financial Post seems a bit surprised by Medline’s sheer gall:

Medline has stood out in recent weeks as a rare food CEO willing to publicly challenge economists and consumer advocates who have asked why the three dominant grocery chains in Canada — Loblaw Cos. Ltd. and Metro Inc. are the other two — managed to fatten profit margins while their shoppers face the worst food inflation in four decades. In a controversial speech to shareholders at the company’s annual meeting last month, Medline called the critiques “reckless and incendiary,” spurred on by lazy “armchair quarterbacks” in government and media.

“From business leaders and from friends, I’ve never had a better reception to anything I’ve ever said,” Medline said of the speech. “I felt that something had to be said, and I said it. It got more attention than maybe I thought, which I’m glad of.”

I think listening only to your fellow “business leaders” and “friends” on the subject of food price inflation is an excellent strategy for a grocery chain CEO, don’t you?

 

Real estate

I turned up so many little nuggets of information over the course of my research into the great unburied power lines mystery of 1984 that I have to share some of them, so today I’m going to group together some of the news I read about buildings and land.

I have already noted that Sydney’s Bicentennial Committee had proposed two possible bicentennial year projects to council, which had chosen Centre 200 over the possibility of buying the Vogue Theatre for use as a “Civic Auditorium.” What I didn’t mention was that in January 1984, the chair of the Bicentennial Committee, George MacNeil, had come out in support of the Vogue project in a radio interview. Noted the Between-the-Lines columnist:

The reaction to the interview was most positive.

I also noted that fundraising for a new regional hospital was well under way although there was, as yet, no official plan in place for such a facility. This made me think, once again, that present day advocates for a new Central Library have missed a trick by not fundraising as a show of support. I’ve said it before and I’ll say it again: money is site agnostic.

But as it happens, there is a much more direct library comparison to be drawn between the present and 1984, because that year, the City of Sydney was planning the expansion of the McConnell Library, which had outgrown its headquarters on Falmouth Street (sound familiar?).

In July, Alderman John Nardocchio, chair of the City Library Committee, was demanding a firm commitment from the federal government for the $1 million project. The Post noted that the committee had $230,000 from the estate of the late Bruce Rossetti for the expansion and was looking for $150,000 from the County, $135,000 from Ottawa and $150,000 (minimum) from the province. (The library, it strikes me, has always depended upon the kindness of citizens—it’s named for former Mayor James McConnell because he donated to its construction.)

Nardocchio said Cape Breton—The Sydneys MP Russell MacLellan had told him the money would be coming in June, but was now saying it would be after the election, scheduled for September 4. The paper also notes that plans for the addition had been completed by Sims and Gavel Architects.

In other building news, the Bank of Nova Scotia was building its new offices on Charlotte Street, although the edifice was a “scaled back” version of the $1 million office tower originally planned, and the Isle Royale Hotel on the corner of Dorchester and Esplanade (renamed the Harbour Royale Hotel) was scheduled for renovations.

The new County building (now the Central Police Station) was under construction on Grand Lake Road:

 

Work on what was either, depending on your fondest wishes, a refurbishment of the old Sydney Forum or the beginning of the new Centre 200, had begun and the newly renamed Transit Cape Breton had unveiled an ambitious plan for a transit hub, intended to serve the city’s bus service but also regional bus operators and charter services and possibly even VIA Rail, which still ran a rail liner between Sydney and Halifax (and would employ yours truly as a ticket agent and baggage handler for a brief but glorious period before ending the service in 1989).

In July 1984, Transit CB was hoping to get funding for a feasibility study for the facility which was “probably” to be located on land adjacent to what would be Centre 200, “between Falmouth and Prince beside the CNR tracks.” The space was then occupied by the old city warehouse, but a new city warehouse was almost complete at that point.

 

Personnel changes

Leonid Brezhnev, leader of the Soviet Union, died in November 1982 and was replaced by Yuri Andropov, who died in February 1984 and was replaced by Konstantin Chernenko, who died in 1985. Chernenko was replaced by Mikhail Gorbachev who served until the dissolution of the country in 1991.

I mention this mostly because I ran across the headline about Andropov’s death while I was reading old Posts, but also in light of recent developments in the UK, where Liz Truss resigned this week as prime minister, setting a land-speed record for entering and exiting the office. Her 44-day term made her the shortest-serving PM in British history, rivaled only by one George Canning, whose 119-day term ended in 1827 when he died of tuberculosis while in office.

The Tory party expects to choose another leader—and prime minister—in a week’s time, which means 2022 will be the year of at least three British PMs. I was trying to draw parallels between the Soviet and UK situations for no particularly good reason other than that both involved rapid changes in leadership. I even wondered if there were some element of history repeating itself—first as tragedy, then as farce—at play, but I think in the case of the UK we have gone well beyond farce.

I even, after listening to recent statements from Nicola Sturgeon, leader of the Scottish National Party, found myself entertaining the possibility that the next British PM might oversee the dissolution of the United Kingdom.

But I’m going to run away now before those of you much better versed in British and/or Soviet history shoot my hypothesis down from a high altitude with pinpoint accuracy.

Enjoy your weekends!