How the Supermarket Helped America Win the Cold War (Update)
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What was the Cold War farms race?
We clearly won the abundance war. But the American victory was, to some degree, a Pyrrhic victory, whose after-effects are still being felt.
Economists who don't do U.S. agricultural policy are horrified by what they see in terms of distorting markets.
Today on Freakonomics Radio, how a sprawling system of agriculture technology, economic policy, and political will came to life in the supermarket.
Tell me, who could possibly afford to buy food in a place such as this? This is just an ordinary food market. Competition and big volume keep prices down. Utterly impossible.
This is Freakonomics Radio, the podcast that explores the hidden side of everything with your host, Stephen Dubner.
The supermarket is so ubiquitous today that it's hard to imagine the world without it. But of course, such a time did exist.
There's some debate about when supermarkets actually started, but usually we pin it at around 1930.
That's Shane Hamilton. He's an American historian who teaches at the University of York in England.
I am the author of Supermarket USA, Food and Power in the Cold War Farms Race.
Was the supermarket a purely American invention?
I argue yes. The easy answer is that the first declared supermarket was built in the United States. I think the broader answer is that what makes a supermarket a supermarket is the industrial agriculture system that enables the affordability of mass-produced foods.
The predecessor of the supermarket was the dry goods store.
So they didn't have fresh produce. They didn't necessarily have milk or meat or a bakery in-house. That's what a supermarket did, is it put all those food items, and often many other things, you could get auto parts... You could get your shoes shined in the early supermarkets. It was a kind of one-stop shopping and service emporium.
Another big difference, supermarkets were self-serve. In a dry goods shop, you'd ask a clerk for something and they'd fetch it. In a supermarket, you could ogle the meat and produce yourself, even handle it, and then put it in your basket. The supermarket chain Piggly Wiggly is credited with having pioneered the self-service retail model. It is still operating today in 18 states. The biggest supermarket chain for much of the 20th century was A&P, the great Atlantic and Pacific tea company.
A&P, as of the 1940s, was the world's largest retailer by any measure, by sales volume, by number of outlets and so forth.
Between 1946 and 1954 in the U.S., the share of food bought in supermarkets rose from 28% to 48%. By 1963, that number had risen to nearly 70%. A&P had so much market power that the Department of Justice went after it for anti-competitive practices. This was an interesting development, considering that the U.S. government played such a significant role in the creation of supermarkets in the first place.
The original goal had been to use the supermarkets to drive down the cost of food for urban consumers.
The U.S. becomes a majority urban nation by, I think, 1920. And there's a lot of anxiety among leaders, political leaders, thought leaders, about whether or not U.S. agriculture is going to be productive enough to feed this growing urban population.
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