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Amidst Procurement Angst From
Wal-Mart And Delhaize, Kroger Makes Changes More Transparent To Vendors

We’ve written much about Wal-Mart’s procurement gyrations and recently wrote both here and here about the efforts of Delhaize to centralize procurement.

Both were problematic for different reasons. Wal-Mart’s procurement changes have been a source of more angst for the supplier base than was necessary in large part because the company has been at war with itself. Personalities have been in conflict and turf battles have been engaged. Things have been done in secret, and getting something as simple as an organizational chart has required something close to CIA clearance. We have had a number of calls from people who work for Wal-Mart asking us about what is going on with some other part of Wal-Mart — even the employees don’t always know.

The Delhaize effort has been controversial because of the distinctive nature of the Hannaford operation from the Food Lion operation. Jim Corby and team have gotten good reviews for the way they have communicated, but we still get calls from Hannaford vendors who are very worried over the long term likelihood of their keeping Hannaford business, a fear that we suspect is in many cases justified.

In contrast Kroger, especially Reggie Griffin, Corporate VP of Produce & Floral Merchandising & Procurement — and just now assuming the position of Chairman at United Fresh — is getting mostly praise from its vendors, although it is also undergoing a massive reorganization to centralize its procurement operation Why? Simple really. It has avoided Wal-Mart’s problems by being clear and transparent with its own team and its vendors. So everyone gets organization charts, Kroger is  doing vendor-coaching, everyone seems to  know what is happening, etc. — all the things necessary to make the process seamless, or at least as seamless as possible.

Also Kroger benefits because most of its divisions were buying very similar product anyway. So the question is not raised about whether the specifications are now going to change wildly. Kroger also was not a big supporter of many terminal markets, so the issue on the table isn’t whether a whole class of vendors will suffer dramatically as is raised by Delhaize — as Hannaford has long been a big supporter of the Boston terminal markets.

Consolidated procurement in these circumstances makes perfect sense. All too often having people spread around just leads to the development of relationships that may not be in the interest of the company.

Of course, there are risks to centralized procurement as well — mainly the growth of bureaucracy that dissuades people from becoming suppliers.

Seth Godin is a well-regarded marketing expert, and he wrote a blog post titled Get Better at Buying, in which he reminds executives at big corporations of a truth sometimes forgotten:

“…the salesperson isn't the enemy, and buying from them isn't charity. The transaction happens because it benefits both sides…”

But Godin points out that selling to big companies is not necessarily an easy thing to do:

“…Ruth Stevens reports that the typical company with more than 1,000 employees has, on average, 21 different people involved in each sale of over $25,000.

Having made sales (when I was younger and more foolish) to ten of the thirty biggest companies in the country, I can testify that 21 might be an understatement. The typical big company's org chart is a mystery, the process is a mystery and there never seems to be an end to the roster of meetings and people. It's almost as though these companies don't want to buy anything.”

Making vendors jump through these hoops is not inconsequential:

First, this is screamingly inefficient. Second, it drives away the great opportunities, leaving the companies with no one but the sales-focused, uber-patient companies willing to put up with 21 different people and a million meetings.

Wal-Mart switched its procurement strategies in no small part because executives there came to the conclusion that restricting the Wal-Mart supply chain to vendors of such competency as to be able to handle a co-managed replenishment program 52 weeks a year was constraining its supply chain in a way that cost it a lot of money.

But a big buyer that is nominally open to all vendors but de facto requires special competency in selling big companies can actually constrain its supply chain even more.

Seth Godin closes with some advice for big buying organizations:

“If you want to increase productivity and discover new opportunities, you're going to need better vendors. One way to do that is to streamline your buying process and let the folks selling to you know how it works. They're not the enemy. In fact, they're your best source for off-the-shelf improvements and innovation you can start using tomorrow.

Whoever buys the best, wins.

Your purchasing department shouldn't be a backwater... it ought to be an engine of innovation for the rest of the organization.

I'd start by reaching out to companies that might be able to help your company. Give them an org chart. Give them an overview of the best way to sell to you. Issue a newsletter outlining regular news about successful sales and how they were made. Reward your employees when they help a new vendor make a sale that really benefits you. Hassle your employees if they hassle or lie to your vendors.

If a vendor asks, "are you serious about buying from us," the answer should either be, "yes," or perhaps, "no, thank you." But we're all too busy for power games.

There are a lot of good ideas here, but the most important one is to recognize that having the best vendors is a powerful asset for any company.

There was a time that the CEO of Wal-Mart used to go around saying that Wal-Mart needed its vendors more than the vendors needed Wal-Mart. It is not clear what the current CEO would say to that proposition; it is clear that many retailers could gain a competitive edge by internalizing the thought.

 

 




Elephant In United’s Convention Halls: PMA-United Merger Possibilities

As the industry gathers for the United Fresh convention in New Orleans, many will be discussing whether it would be a positive or a negative for the Produce Marketing Association and United Fresh to merge.

It is a long-running industry controversy that strikes to the heart of what the industry would like to have its associations actually do and how the industry would like to pay for those functions.

Last month in Pundit sister publication, PRODUCE BUSINESS, we dealt with the issue once more in a piece we titled, Industry Concerns Should Trump Association Concerns In Merger Talk:

The question of whether the Produce Marketing Association and the United Fresh Produce Association ought to merge has vexed the industry for decades. This year, the industry is confronting this decision once again, behind closed doors.

It is not an obvious or easy decision. The gist of the problem is that PMA has come to own the largest trade show in the industry. It is an exceedingly successful and profitable business and throws off virtually all of the trade’s communal free cash flow. Yet, United, as the trade’s primary representative in the halls of Congress, has the bulk of responsibility for priority industry expenditures.

If we study the matter and ask what functions the trade most needs from its associations, we consistently get two answers: The trade needs representation before the government and other influencers in society, and the trade needs promotional assistance with consumers at large.

When he was Chairman of PMA, Bruce Peterson — who now serves on the Board of United — often would pose this challenge to all industry associations: “If this association didn’t exist, would we invent it today?”

Though it is often alleged that merger has been blocked by the egos of various executives, and one can never entirely dismiss these concerns, it is also true that this influence can never be definitive in the face of a resolute board of directors. The truth is that there are substantive difficulties to merger that have never quite been satisfied. Most notably, the question of the scope of the industry has been unclear.

Both United and PMA have traditionally had a vertical membership including retailers, foodservice operators, wholesalers, distributors, processors, shipper, growers and others. This is terrific for discussions on things such as PLU standardization or traceability, but those types of discussions, though perhaps enriched by relationships built in association work, can often be done through ad hoc committees.

When it comes to representation, the vertical association model has challenges. Most recently, on the Food Safety Bill, it is notable that both PMA and United, in the end, opposed the bill with its exemption for small growers. Yet both FMI — representing supermarkets — and NRA — representing restaurants — endorsed the bill.

The matter was decided hastily during the Lame Duck session, and there weren’t any opportunities for our trade associations to testify before Congress during this time. But Reggie Griffin, vice president of produce and floral procurement and merchandising at The Kroger Co., is in line to become Chairman of United at its convention this May. It is unlikely that if such an issue were to arise during his term at the helm of United it would make sense to have him testifying before Congress strongly opposing such a bill, only to have his testimony followed by, say, Kroger chairman and CEO Dave Dillon, speaking on behalf of FMI, strongly supporting the legislation.

At the same time, the desire for merger makes a lot of sense. On government relations, there is the sense that multiple voices weaken the trade’s influence in D.C. On hopes for consumer outreach, a unified approach is more likely to be a success. There also is a sense that there is a great deal of efficiency that could be gained by merger. Some of this is through the elimination of duplicative overhead — we don’t need two association CEOs, etc.— and some is from the notion that both associations vie to remain relevant, and so, inevitably, duplicate one another. Also in the background of all this is that we have many local and regional associations, some with a great deal of heft.

Our experience has been that most members of the boards of directors of national associations take their responsibilities seriously. But elections to these boards are not contested, and so the members “represent” the trade in only the most random way. There are also countless members of the trade who may not have the time or interest to give sustained involvement by serving on a board, but who have much insight to share on crucial issues such as industry governance. In addition, many ex-members of boards, who served their time and are not currently active on boards, have much insight to share.

The worst possible thing is to one day have a press conference to announce a merger, or that merger talks have collapsed, without giving the trade an opportunity to review the relevant facts and suggest appropriate structures. It is a recipe for discord down the road and the splintering of any newly merged associations. It is better if everyone who cares to do so gets to review the data and speak up before decisions are announced. The Internet and social media make this easy to do, and for the associations looking to maximize the value for the industry, transparency should be foremost in their operations.

The key is for association board members to see their roles in a specific way. Most industry members really care about the industry, not the association. Put another way, they support the association because they think it will make for a better industry, not because they care about the association itself. If one focuses on the industry, one will be thinking about how decisions impact the future profitability of the trade.

In the end, the discussion needs to go past each association’s proprietary concerns and come back to Peterson’s question: “If this association didn’t exist, would we invent it today?” By opening and bending the process, we will focus more on the best interests of the trade at large. That is really our goal, and that is really what most industry executives care about. There is no reason to run a closed 20th century process to achieve 21st century goals.




The Biggest Beneficiary Of A Possible Strike At Ralphs, Vons and Albertsons Might Just Be The Fresh & Easy Chain: With Record Losses And New Management In The UK, This May Be The Last Hope For Tesco In America

Southern California supermarket employees have voted to authorize their union leaders to call a strike against Supervalu’s local Albertsons stores, Kroger’s Ralphs banner and Safeway’s Vons stores. A mediator has been called in. The last such strike, back in October of 2003, lasted for more than four months.

The key beneficiaries of such a strike would be non-union Fresh & Easy and Wal-Mart as well as many ethnic and independent stores.

It is possible, still, that the supermarket chains will hang tight. After all, they have operations elsewhere to subsidize losses in this market, and all three chains are anxious to see their cost structures competitive with non-union competitors.

Labor, though, is in a difficult spot. If it “wins” by getting more, it just makes the big three supermarket chains less competitive, which will surely mean job losses down the road. A strike, certainly one of any duration, simply means lost market share… and lost jobs, some of which will probably never be recovered.

Much as the United Auto Workers could demand progressively more as long as the only effective large-scale competitors were Detroit’s Big Three — but bankruptcy ensued once imports and production in non-union foreign transplants came to be significant — in a world with lots of non-union sources of food, it seems suicidal to not find a way to settle.

One place where fervent pro-strike prayers are almost certainly being said is at Tesco’s headquarters in the United Kingdom, as in the most recent Tesco financial reports, Tesco has announced that Fresh & Easy lost about $307 million during Tesco’s 2010/2011 fiscal year, an increase of almost $55 million over last year.

Astoundingly, Fresh & Easy managed to lose almost $2 million for each store it had open at the end of the year.

Tesco claims the problem was costs incurred in integrating Wild Rocket and 2 Sisters, the British transplants it way overpaid to acquire, which we discussed as part of our extensive coverage. This explanation doesn’t really hold any water since Tesco knew it had made these acquisitions when it was giving guidance to the financial community.

The reality is that Tesco doesn’t think it makes sense to vertically integrate. That is why it doesn’t do so in the  far more important UK operation. It was between a rock and a hard place, as those companies can’t operate profitably at low volumes and sales are just not where they need to be. Although Tesco trumpeted that its Fresh & Easy same-store sales, or like-for-like, in British parlance, rose 9.4%, it forgets to mention that this is significantly below what a US supermarket chain would typically expect during the early year maturation process of a store.

Like St. Augustine pleading that Lord should grant him chastity — but not yet — Tesco promises profitability for Fresh & Easy, but sometime toward the end of the 2012/2013 fiscal year.

Honestly, one wonders if the executives at Tesco really understand what the issues are with Fresh & Easy. They do a staged “interview” with the CEO, now Philip Clarke. He addresses Fresh & Easy by saying that the customers who shop there love it — they just need more customers. Although he makes no case for why customers who haven’t liked it for the last several years will suddenly begin to like the stores. He goes on to speak of it as shopping with no additives and preservatives. You wonder if he realizes that they sell Coke and Pepsi in the place.

It is possible that a strike might save Fresh & Easy, but there was hidden in the report a new sign that Tesco’s patience with the division will not be infinite. Tesco has had a kind of loose target of increasing its ROCE, or Return on Capital Employed, to 14.6% for some time, but now Philip Clarke announced not only a date — fiscal year 2014/2015 — but also announced that Tesco was changing its compensation plan for its top 500 executives to incorporate ROCE return as a metric.

This means that Tim Mason and the U.S. executives have to turn around Fresh & Easy pretty quick — or all 500 top executives at Tesco will have a personal financial interest in shutting it down. This makes the 2012/2013 profit expectation less like a goal and more like a deadline.




Keynes vs. Hayek In Rap: Rounds One and Two

Our piece, Is Locally Grow Produce “Worth It”, argued that the push for promotion of “locally grown” as a public policy did not stand up to basic economic scrutiny, a point we emphasized by quoting extensively from Nobel Prize winner Paul Krugman’s essay titled, Ricardo’s Difficult Idea.

Of course, economic literacy is important for everybody in a democracy, as we all have the opportunity to influence public policy through our votes and by reaching out to our elected representatives. We wanted to share two absolutely terrific rap videos that attempt to delineate the differences between two economists: John Maynard Keynes and F.A. Hayek.

F.A. Hayek and John Maynard Keynes
Round I
“Fear the Boom and Bust”

 

F.A. Hayek and John Maynard Keynes
Round II
“Fight of the Century”

The inside joke of the pieces is that, although these are ideas that have been in contention for a long time, it really is not the case that there has been a big debate between the two going on all this time. Lord Keynes was the celebrity and you catch that in the videos at various places where Keynes is treated as a rock star, and the more scholarly Hayek is an unknown. Even at the end, the media is all around Keynes, not Hayek. Hayek’s ideas, and those of his compatriots in the school known as Austrian Economics, though for a moment in the 1930s in deep contention with those of Lord Keynes, were marginalized. 

Hayek got a break when Reader’s Digest condensed his most readable work, The Road to Serfdom back in 1945. At the time, Reader’s Digest had a circulation over 5 million and the condensed version, which you can download here, made Hayek a celebrity in America. If you have never read it, it comes highly recommended.

By 1971 Richard Nixon, the supposedly rabid conservative, took America off the gold standard and declared “I am now a Keynesian in economics,” which is popularly portrayed as him declaring, “We are all Keynesians now” — a line used in one of the videos.

Already, though, it was becoming clear to professional economists that Keynesian models were incomplete and unable to address the stagflation of the 1970s. By 1974, when Hayek received the Nobel Prize in economics, his ideas were already being paid new attention.

By 2010, conservatives in America began seeking to popularize alternatives to the Keynesian inspired stimulus plans and so started talking about Hayek. By June, Hayek’s The Road to Serfdom, a 66-year-old book, had become the #1 seller on Amazon.

The videos mention many key phrases. F.A. Hayek wrote a book called, The Fatal Conceit: The Errors of Socialism, and the video also mentions his Noble Prize lecture titled, The Pretence of Knowledge.

Keynes was destined to dominate in part by dint of personality but also because of the way democracy often functions.

Keynes was always ready to step in after a bust to try to solve the problems. Hayek was more focused on how to create conditions that avoided artificially inflated bubbles that were bound to burst. But in democracies, the constituency is small for those who want to temper exuberance and large for those who would like to be bailed out when things go wrong.




Kent A. Sepkowitz, M.D., Medical Experts And Patient Autonomy

We have written quite a bit lately about health care and medical issues. We told the story of my father’s battle with cancer with a piece titled Never Tell Me The Odds: One Man, One Disease, One Battle and a follow-up titled Pundit Poppa’s Medical Report: Drawing Strength From Infusions Of Love ... We’ve chronicled our friend Jan Fleming’s travails here, here and here. We gave tips on chemotherapy and critiqued a New York Times piece with an article titled Dr. Sloan Misses The Point: A Fighting Spirit Is Vital In Overcoming Illness and a follow-up titled Pundit’s Mailbag — Fighting Spirit And The Challenge To Live. All this, of course, in the context of the Special Note we wrote five years ago when my father had a stem cell transplant for his Leukemia.

Now The New York Times has run a different piece… this one by Kent A. Sepkowitz, M.D., a vice chairman of medicine at Memorial Sloan-Kettering Cancer Center in New York City. The piece is titled, If Only All We Wanted Was Expert Advice, and his point seems to be that people don’t really want experts; they want people to magically solve their problems or, perhaps, just to agree with them.

After explaining that he has a chronic plumbing issue related to his dishwasher at home and that plumbers dismiss his layman’s theories as to the cause, Dr. Sepkowitz realizes he does the same with his patients:

“…often I dismiss their ideas with the same careless flick of the wrist I have come to expect from the latest in my long line of plumbers and dishwasher subspecialists. Like the plumber, I’ve heard that one before, whatever the complaint; I’ve previously spent time and wasted patient hope chasing the same false lead down a dead-end path. I hope I have learned from my missteps, gained in wisdom, tempered my own eagerness to order test after test. I am the one with more experience at this, right? Isn’t that the point?

Many patients sense my reluctance to consider their theories. One recently asked me to evaluate him because of a sense of deepening fatigue without fever or weight loss; might it be an infection? I explained that I had tried many times through the years to diagnose infection in patients with his specific set of complaints but had never turned  up an answer. In my judgment, the “million dollar work-up” was a waste of his time and money. After I finished, we stared at each other in awkward silence. I had broken his heart a little, and I too was demoralized. It is not enjoyable to trample hope.”

The doctor sees the matter as a problem of our expectations of experts:

“It seems to me that what we have here is a basic problem with our attitude toward experts. The calculation ought to be simple: we all seek people who know more about a situation than we do exactly because they know more than we do. Of course, we always want experts. And when we find them, we ought to trust them, right? Instead, however, we dismiss them when they aren’t whistling our tune.

We suddenly become more expert at the very thing we thought they were expert at. After all, patients come to see me in a major research hospital, the ultimate house of science, a temple to the rational mind built on a foundation of countless sharp-edged logical observations made by experts from Hippocrates right up to the doctors and researchers published in this week’s New England Journal of Medicine. I am the somber keeper of this great tradition, the translator of the randomized double-blinded placebo-controlled studies conducted by thousands of researchers on hundreds of thousands of patients. I have the facts.”

Ah, but there’s the rub. When matters of personal health (or home appliances) are at stake, we want a lot more than expertise from our experts. The rational world suddenly loses its appeal; dull, steady scientific observation seems only dull and steady. We want some pixie dust, a little magic, an eccentric genius who can see through the usual mumbo-jumbo to the core of the problem (paging Dr. House).

It is an interesting theory but more than a little inadequate to explain the phenomenon the doctor describes. Yes, almost surely, there are people who are unrealistic and want experts to deliver more than humans can deliver.

But having worked with many doctors, first as I tried to help my father deal with his leukemia and stem cell transplant and currently as I try to navigate my father’s pancreatic cancer, other possibilities seem more plausible than a desire for pixie dust and magic.

Dr. Sepkowitz ends his essay with the notion that the relationship between a patient and his physician is almost religious in nature: “…we are left with the most basic, bare-bones determination: do we trust this guy or not? And this decision, rather than following along a perfectly manicured line of reasoning and evidence, relies on that least scientific of all human inclinations — the simple leap of faith.”

Well, one does need to trust one’s physician, but as Ronald Reagan urged in the context of nuclear agreements with the Soviet Union, it is prudent to “trust, but verify.”

Even the most trust-worthy of physicians is still a human being. He can forget, make a mistake, and overlook something important. And, in medicine today, dissatisfaction with the experts can often be traced to four things:

1) The Way Doctors Are Paid Doesn’t Encourage Them to Explain Very Much

If one needs a complex legal matter explained, one’s lawyer will be happy to explain it – and bill you for every minute he does so. The lawyer will fly to your office and discourse in your conference room or over dinner at your country club. And after explaining the matter to you, he will come back and explain it again for your partner, investors, etc. If you want him to write up a legal opinion letter on the subject, your attorney will do that as well.

In contrast, it is very difficult to get a doctor to explain much of anything that takes more than a few minutes to explain. If you ask a doctor if it is possible that you might have a lymphoma rather than adenocarcinoma, he is likely to say that the pathology is inconsistent with a lymphoma, but you won’t get an explanation of what precisely is inconsistent, why it is inconsistent, etc.

The image Dr. Sepkowitz seems to have of experts—as people one goes to and places one’s hopes in their hand—reminds one of nothing so much as the way ignorant sports stars or movie stars sometimes turn over their financial affairs to some adviser and then wind up penniless.

I think it is fair to say that more intelligent people typically use experts but recognize that, in the end, they are responsible for their own money… and their own health care.

The expectation that respecting expertise means surrendering to an expert is in a way very insulting to patients. Some may want doctors to just handle everything, but others want doctors to explain why they are recommending various choices of action, to define alternatives, etc.

2) Is The Expert Working For The Patient, the Hospital or Insurance Company?

My father’s chemo protocol was developed by Dr. James Abbruzzese at M.D. Anderson. He is a great expert in the field and he developed a protocol that included a roughly two-hour chemo infusion preceded by two hours of hydration, and followed by two hours of hydration.

He justified this by pointing out that the cisplatin in the chemo mix was highly toxic and that pancreatic cancer patients often have trouble drinking enough water.

We took this protocol to a South Florida hospital and another pancreatic cancer expert and, although he said he was willing to execute the protocol developed by Dr. Abbruzzese and M.D Anderson, when push came to shove, he was unwilling to order the hydration. He never gave a clear reason except to say he had other patients do a similar protocol without all the hydration and they did fine. In the end it became obvious that he was under heavy pressure from the institution where he worked to “turn” chemo beds.

We found another doctor and another local institution that was willing to execute the M.D. Anderson protocol as written –with hydration.

The key issue: We were sitting with our doctor and he had issues other than my father to deal with. How much faith can one have in the best expert if he has many masters to appease? If we are going to put faith in a medical expert, we sure better know that he has no obligation or incentive to work for anyone other than the patient. That is not the situation today.

3) Is the Expert Working for the Patient At All?

Dr. Sepkowitz works at Memorial Sloan-Kettering, one of the world’s premiere cancer institutions. In this type of environment, it is very common for patients to visit, get a chemo or radiation protocol set up and then go home to a distant state or country and have it executed by a local oncologist.

This makes enormous sense. The cost of healthcare is only partially what is paid to medical facilities. There are enormous costs in lost wages, transportation, apartment and hotel rentals, etc. When my father had his stem cell transplant, my family stayed in Houston almost six months.

Not to mention that patients who are ill are then further burdened with having to live in a strange city without family or friends nearby. So the idea of having great experts at major academic cancer centers planning the treatment while being executed locally makes perfect sense.

But those great doctors at Sloan-Kettering or M.D. Anderson or similar institutions get paid absolutely nothing for continual consultation with the local physician and with a patient.

Forget about being experts; we think our doctors and other medical personnel at M.D. Anderson are saints. They work for free, taking phone calls, sending e-mails, doing research, etc.

The problem, though, is that the relationship shifts. In many ways, all patients are like the Blanche Dubois of Tennessee Williams, forced to depend on the kindness of strangers. It shouldn’t be that way.

4) Do Experts have Enough Knowledge to Make Expertise Relevant?

Dr. Sepkowitz makes the point in response to a patient’s request for testing that “In my judgment, the ‘million dollar work-up’ was a waste of his time and money.”

This is an interesting question because Dr. Sepkowitz is a medical expert – but not an authority on the value of other people’s time or money. He also gives no indication of attempting to ascertain the value the patient may place on these things.

One issue may be, as we mentioned in point two above, that the doctor feels an obligation to an insurance company or Medicare or Medicaid or his own hospital to not order tests that almost certainly won’t pan out since any of these organizations might wind up paying. But that may be a conflict with the patient’s wishes.

Here is a real life example: Somewhere along the line, a family member who is a doctor mentioned that my father might want to have a genetic test for the BRCA gene mutation.

In pancreatic cancer, it is widely agreed and not at all controversial that if one is positive for this mutation, one’s tumor will be more responsive to “platinum” chemotherapies such as cisplatin and oxaliplatin.

The test for the BRCA mutation can be done through a simple blood test.

So we have a very low risk test — as opposed to something that requires surgery, etc. — and, if positive, a proven benefit — a more effective chemotherapy.

The problem: Only 0.2% of the population will test positive for this mutation and it costs $3,200 to do the test.

That it is not standard treatment is not surprising. Insurance companies and Medicare will generally only pay for the test if there is a family history of the mutation. Uniform testing would, in fact, confer very little benefit for very large costs. But these are considerations for public policy experts, not for an individual doctor with an individual patient.

The family member who is a doctor and suggested the test was not only a medical expert, but quite familiar with my father’s attitude and situation.

We instantly ordered the test, even though we had to pay for it. Why did we do so? The long and short of it was that my father had $3,200 and we were more than willing to spend it on anything that had any chance of helping my father. It is his money; if he dies of a terminal illness he won’t need it.

Nobody would think ill of my father if he wanted to go spend $3,200 on a vacation because visiting Aruba was on his bucket list, so why shouldn’t he be able to spend it on a test that has only a tiny chance of a payoff?

Yet, recommending or even informing patients of the availability of such a test is not standard operating procedure at even the top cancer centers.

This brings us to the key critique of Dr. Sepkowitz and his assessment of the way people deal with experts. The experts tend to be expert in a narrow field. When patients refuse to take the “leap of faith” that Dr. Sepkowitz seems to want to recommend, in part it is because even the greatest doctor just has no training or expertise in knowing how others value their time and money. Some may be ready to die and don’t want to spend a nickel; others want the “million dollar work-up” that Dr. Sepkowitz wants to deny them.

It is widely recognized that patients have rights. We are sure Dr. Sepkowitz would defend the rights of patients to die as they choose, indicating on advance directives etc., the right to not be resuscitated or to not have extreme measures taken.

Yet, he wants to deny the same patients the right to be treated as they choose, thinking that, instead, they should rely on experts. It is a chilling thought.




Michael T. Osterhom Speaks Out On a Matter of Public Health Concern: Peeps!

Dr. Michael T. Osterholm is no stranger to Pundit readers. He is one of the rare experts in public health who was willing to break ranks and publicly critique the FDA when it was running an incompetent investigation into the salmonella Saintpaul outbreak of June 2008.

He made this courageous statement here in the Pundit. We titled the piece SPECIAL EDITION VII Salmonella/Tomato Outbreak — Frank Talk And Analysis. Dr. Michael Osterholm, Esteemed Authority On Public Health, Speaks Frankly About The FDA, The CDC And The Incompetent Management of the Salmonella Saintpaul Tomato Outbreak Investigation.

Dr. Osterholm is widely recognized as the world’s leading public health expert on influenza and a world class authority on food safety. Following his piece in the Pundit, we presented Dr. Osterholm with an award for courage that we have not seen fit to give to anyone since.

 

Yet, taking oneself too seriously is the occupational hazard for people of great authority and achievement. We came across this video and are pleased to be able to report that Dr. Osterholm remains immunized against pomposity:

 




Pundit's Mailbag — Buying Locally Grown And The Freedom To Choose Otherwise

We have had many discussions in the context of our writing about the local phenomenon, and our piece, Reality Check For Locally Grown Advocates: Economics Don’t Measure Up, brought many thoughtful letters some of which we featured in our piece titled Is Locally Grown Produce “Worth It”. Now we thought we would focus on a powerful letter from the director of a New Jersey non-profit:

I hope that you will consider printing my letter in response to your continued argument against local produce so that a voice other than those who oppose local purchasing can be heard. As the founder of a community farmers market in central New Jersey that is open six months a year and supports 13 farms selling the produce and goods that they raise in New Jersey and Pennsylvania, as well as being the director of the New Jersey Farm to School Network, I take great pride in supporting the economic vitality of the farmers I promote.

Your articles to date have been nothing short of “local” bashing to an industry that is basically overpowered by the economics-of-scale world you support. For those of us who would like to eat an apple or a tomato in season that has not traveled thousands of miles, I suggest that you travel to a farmers market and see that buying local does not necessarily cost more than a grocery store version nor does it “make us poorer” to do so.

Nobody doubts the reality of economics on the food supply and the forces that power food from where it is grown to who ends up eating it in the end. But in your world view, large agribusiness systems are the only way that food should be grown, shipped and consumed. Your article questions the “point” behind the demand for locally grown food: Why? Because it contradicts the established control of larger systems on the food supply chain, upsetting an apple cart that is run by big businesses, not small family farms or distributors of those farms.

Would it not be more charitable for one in your position who represents the produce industry to take note of this demand instead of feeling threatened by it, and to lobby to have your readership move slightly aside to realize there is room for both the big and small in the food chain? We’re not asking for pineapples to be grown in North Dakota (a very catchy title, I might add). What we are supporting is that the United States have food systems where we have access to food within a day’s drive to enhance the experience of sustaining our farmland and the economies that support these communities, and that we give credit to farming as an important part of our nation’s character and security. 

Please look beyond the fear mongering of those who think that the demand for local is nothing short of a communist plague. It is a much deeper issue than any of the articles you have brought to light. Give it credit and I hope you’ll be willing in the future to hear more from those of us who support all produce growers but love to eat food that is grown locally.

Beth Feehan
Director
New Jersey Farm to School Network
425 Greenwood Ave
Trenton, New Jersey

We appreciate Ms. Feehan’s note as it gives us an excellent opportunity to distinguish between two very different issues. Issues that in our extensive coverage of local often get conflated.

One issue is an opinion about a particular item or class of item. Contrary to what Ms. Feehan writes, this Pundit is not at all “against locally grown.” In fact, we enjoy going to farmer’s markets as a form of recreation and like seeing, buying and eating  unusual varieties of fruits and vegetables. We love chatting with farmers, learning about different types of honey and other locally grown foods. 

We also know that gardening can be therapeutic and have known the pleasure of harvesting mangos from our own trees and eating the lusciously sweet fruit at its moment of ripe perfection. We remember going to a summer camp in upstate New York and recall the joy as the freshly harvested sweet corn was brought into the dining room.

We believe strongly that consumers have a right to free choice. That is why we even defended, in this piece, the right of consumers to join a raw foods club and buy products of questionable safety.

If the government proposes to prevent consumers from buying or eating locally grown foods, we stand prepared to man the barricades in defense of consumer freedom.

A second and quite distinct issue is whether public policy ought to attempt to bias customer choice in one way or another. Should particular selections be subsidized? Should purchases of one type or another be compelled?

We like the idea of electric cars, but find the notion of a $7,500 taxpayer subsidy for each Chevy Volt to not be justified. We love the idea of growing domestic fuel rather than buying oil from unstable enemies of the US — but find ethanol subsidies to be market-distorting. All these types of policies, by subsidizing behaviors that would not be economically optimal, do make us poorer.

We were writing about local in the context of the procurement policies of a public university — UC Davis. The question is not whether the University should buy local. If the locally available product that meets the specifications for UC Davis procurement in terms of flavor, safety, etc., happens to be the least expensive, of course, UC Davis should purchase local. The existence of a policy favoring local procurement is, however, saying something else. It is saying that even if New Jersey blueberries are the most flavorful, the safest and the least expensive, U.C. Davis ought to pay more money to get an inferior product that happens to grow locally… and leave the New Jersey farmer without a customer. That we are opposed to doing.

We do note that Ms. Feehan, though she writes us about local, seamlessly shifts to words like “family farm” and “small” and an opposition to “big business.” Whatever the merits of these things, it is worth noting that an admonition to buy local will not necessarily result in procuring from small family farms.

As we have noted before, Wal-Mart defines local as “in state” — so without changing its procurement by one iota, if it opens more California stores, its “locally grown” statistic gets higher.

In the end, Ms. Feehan makes an impassioned plea on behalf of consumers who “love to eat food that is grown locally” — and we do care about these consumers, but they require no special protections.

If UC Davis said it was buying local because if it puts a bowl of “local” mixed greens and a bowl of “Salinas” mixed greens on the salad bar, and it finds that the students all prefer the local greens, well that doesn’t require a special locally grown procurement preference — that is just buying what the customer wants. The point of the elaborate multi-tier UC Davis procurement system with its preference for suppliers less than 50 miles away, as opposed to 50-100 miles away is, in fact, the opposite. It is specifically to override the preferences of consumers and buy something local even when, because of price, quality, flavor, etc., the consumer would have preferred something from a more distant farm.

We support Ms. Feehan’s efforts to educate schoolchildren about produce, and we think school gardens and trips to local farms are fantastic ways to get children engaged. We know of no “big business” in the produce industry that opposes these educational tools, and we are big supporters. We also would like to see our children eat more fresh fruits and vegetables at home and in school so as to make obesity less likely. We applaud Ms. Feehan and the good work of the New Jersey Farm to School Network.

We support local food — when it is of a quality and price that consumers wish to purchase it. We also support consumer freedom to buy what they choose.

Many thanks to Ms. Feehan for weighing in on this important issue.

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