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    Published on: June 29, 2012

    by Kevin Coupe

    In this world of instant communication and the highly competitive 24-hour news cycle, the immediate aftermath of yesterday's ruling by the US Supreme Court on the Patient Protection and Affordable Care Act (PPACA) offered a vivid example that while speed is important, it isn't always the most important thing.

    The illustration came when Cable News Network (CNN) went on the air with its report - saying that the Court had ruled that much of the law - including the individual mandate requiring people who can afford it to have health insurance - was unconstitutional.

    That same report on the Court decision was broadcast by Fox News.

    Both reports, of course, were dead wrong, and were based on an incomplete reading of the opinion. The Supreme Court actually ruled the opposite - that President Barack Obama's health care overhaul was constitutional. (Though, to be fair, Chief Justice John Roberts, in writing the decision for the majority, did not say it was a good idea, just that "it is not our job to protect the people from the consequences of their political choices.")

    Both CNN and Fox were driven, no doubt, by a desire to be first and a desire to be fast. Technology made both things possible.

    But this drives home a lesson that we often point to here on MNB - that just because you can do something, that does not mean that you should do something.

    What happened yesterday, on a number of levels, was an Eye-Opener.
    KC's View:

    Published on: June 29, 2012

    The US Supreme Court, in a decision that seemed largely unexpected, issues a 5-4 ruling yesterday that left President Barack Obama's centerpiece legislation, the Patient Protection and Affordable Care Act (PPACA), almost completely intact, including the individual mandate requiring people who can afford it to have health insurance.

    Numerous retail associations quickly weighed in on the decision.

    The Food Marketing Institute (FMI): “Today’s Supreme Court ruling upholds PPACA’s multitude of reporting requirements and mandates for food retailers and wholesalers to offer health coverage to their employees.   As employers of millions of full-time, part-time and seasonal workers, uncertainty still remains for food retailers in every community in this country.

    “As employers, food retailers will need to follow government agencies’ yet-to-be-released criteria for determining which employees are required to be offered health coverage under PPACA and whether that employer-offered coverage, as required under the new law, is deemed ‘affordable’ and passes the ‘minimal value’ requirements in the statute.  Within the coming 18 months, federal agencies must issue new regulations covering all of these issues and more, and each company across the industry will be forced to decide how best to adjust its health coverage and work schedules, to comply with the new law – or whether to simply withdraw from offering coverage and pay any penalties that may be required.

    “In addition, there are two provisions in PPACA that specifically impact the grocery industry:  a restaurant menu labeling requirement that was incorporated into the legislation just prior to its passage followed by a proposed rule from FDA that could expand to supermarkets the regulations intended for restaurants; and a requirement that customers present a doctor’s prescription before being allowed to use an FSA debit card to purchase over-the-counter medicines at their local food stores, while continuing to allow the use of FSA debit cards to purchase eligible items that are not medicines. 

    “We will continue to work with Congress and the Administration to address these concerns as soon as possible.”

    The National Grocers Association (NGA): "Today's decision by the U.S. Supreme Court to uphold the constitutionality of the individual mandate, a key provision of the Affordable Care Act, makes the future more certain for employers who must now continue to prepare for 2014 when the majority of the law's provisions will take effect.
    "With this decision, N.G.A. will redouble its efforts to minimize the impact and burdens on independent retail grocers by continuing to work closely with fellow members of the Employers for Flexibility in Healthcare Coalition to educate the administration on the important need for maximum flexibility in regulatory requirements. 
    "N.G.A. will also continue to work closely with Congress to address key provisions and requirements of the law that are most troublesome to N.G.A., such as the 30 hour threshold for full-time employees, the need for maximum flexibility when determining an employee's status as full or part-time and the chain restaurant menu labeling provision that Congress did not intend for grocery stores.  Additionally, N.G.A. will continue to educate our members on how to implement and comply with the law, which can be a challenge for even the most sophisticated operations.
    "N.G.A. supports healthcare reform that increases competition in the marketplace and reduces costs on employers making it easier to provide benefits to employees and their families.  N.G.A. will continue to work closely with Congress and the administration to push for regulations and support legislation that supports this goal while addressing the unique needs of independent retail grocers and wholesalers and their employees."

    The National Retail Federation (NRF): “As the voice of retailers of all types and sizes, we’re disappointed by today’s ruling. The Court missed an opportunity to redress the many shortcomings of the law.
    “As it stands, the law wrongly focuses more on penalizing employers and the private sector than reducing health costs. For these reasons, NRF has been a consistent skeptic of the Affordable Care Act.
    “NRF worked closely with lawmakers throughout the debate with the hopes that bipartisan reform would help make coverage more accessible and affordable. The law that emerged in 2010 was a controversial and partisan measure riddled with punitive mandates and penalties that were as unreasonable as they were unworkable.
    “Although the Court upheld the law’s constitutionality, many problems remain: it penalizes employers too much; it doesn’t do enough to reduce the cost of health care; and it is unreasonably complicated and difficult to implement and administer.
    “This law will have a dramatic, negative impact on every employer and employee in the United States and further constrain job creation and economic growth.
    “NRF will redouble our efforts to repeal the law while we continue to work, in good faith, with regulators to smooth implementation for retailers and businesses alike.”

    NACS: “The Court’s decision to keep in place employer mandates will place significant burdens on nearly 40% of our industry and put these businesses at a substantial competitive disadvantage ... For NACS, the health-care debate was very focused. Rather than engaging on the broad tenants of whether the government should or should not be involved, we focused directly on the effects that mandate would have on convenience retailers, and today’s ruling is bad news for our members.
    “We are well aware that the country’s health-care system is broken and requires a serious overhaul. We will continue to support common-sense reform to make the system more efficient and eliminate waste and fraud, but today’s decision is a step in the wrong direction.”

    The Retail Industry Leaders Association (RILA): “With the Supreme Court decision now behind us, the focus must turn to the employer-mandate and the effect that impending changes to employer-sponsored coverage will have on the nearly 170 million Americans who receive healthcare through their employer.

    “President Obama repeatedly assured Americans that if they liked their health insurance, they could keep it. However, today, with just 17 months until the law takes effect, and no meaningful implementation guidelines available for employers, those assurances are in doubt.

    “While retailers are committed to continuing to provide health coverage to their employees, overregulation jeopardizes their ability to do so.

    “RILA continues to urge the Administration to protect retailers’ ability to offer quality, affordable coverage that fits the unique needs of their workforce and not to undermine the flexible, voluntary system that provides coverage to millions of employees and their families.”

    The National Council of Chain Restaurants (NCCR): “Today’s decision will impose costly burdens on the chain restaurant industry, thousands of small business franchisees and their employees. Throughout the legislative debate on the ACA and over the last two years, NCCR has voiced the industry’s consistent concerns that the law would do significant harm to job growth and the economy. We’re afraid that continues to be the case as the industry braces itself for 2014.

    “The ACA imposes heavy mandates on employers using punitive penalties for non-compliance. The law will particularly damage the chain restaurant industry, which operates on thin margins and cannot support costly government imposed mandates.  Many chains have indicated they will have no choice but to cut back on workers’ hours or close restaurants in order to avoid the penalties.

    “NCCR opposed the ACA and has advocated instead for reforms that expand access through lower costs.  In 2009, Congress and the president went about health care reform the wrong way.  Instead of making health insurance more affordable, they focused on unrealistic mandates and penalties that do nothing but punish employers and weigh down the economy.

    “NCCR will continue to work to repeal the ACA and replace it with common-sense reforms that lower the cost of health care insurance for all Americans.”
    KC's View:
    The Democrats will hope that Americans see this as settled law, and only will view the upside as we go into the November presidential elections. Republicans, on the other hand, will hope that angry voters who object to the legislation will be motivated by this ruling to get out the vote this autumn.

    I suspect that nothing is settled. Nothing ever is anymore, or so it seems.

    I think there is plenty of room for adjustment within the existing law. My sense is that it has not done nearly enough to bring costs down, but I do believe that its requirement that insurance companies cover people with existing conditions is a good one. I also think that it seems entirely appropriate - especially these days - that insurers are required to allow parents to cover kids up to age 26 under their family plans.

    But no matter what the Supreme Court says, the debate probably will continue. And it is going to be angry.

    Published on: June 29, 2012

    "Trouble in Aisle 5," a new study from Jefferies, the global investment bank, and AlixPartners, suggests that traditional food-at-home vertical retailing "is likely to see its challenges accelerate over the next few years. The study ... finds that a confluence of factors appear poised to rapidly transform the food-at-home industry. The confluence of changing demographics, economic factors and customer preferences has the potential to create a long-term disruption across the food-industry value chain that transforms where and how consumers shop for groceries as well as what products they choose."

    According to the study, "The root cause of the impending transformation lies in changing demographics. Over the next decade the baton will be passed from one mega-generation to another as 'Millennials' (born between 1982 and 2001) come of age and 'Baby Boomers' (born between 1946 and 1964) enter the next phase of their lives and spending patterns. As a result, established food brands and traditional grocery stores will be pressured at both ends by sets of consumers with very different value equations."

    Among the shifts that the study predicts will offer retailers both challenges and opportunities:

    • Convenience is more important to Millennials - "they expect to get what they want, when and where they want it, and they know they have options for both products and retailers."

    • "Millennials are much less loyal to both food brands and traditional grocery stores and much more willing to explore different distribution models (online shopping, smartphone shopping, delivery services, etc.) and spread their shopping across different brands and channels (mass merchants, club stores, drug stores, convenience stores, online, etc.) to fulfill their consumable needs."

    • Millennials are also more price-sensitive than Baby Boomers, but they are "willing to pay more for the specific attributes they value: convenience, freshness, health, variety (of flavors, international/ethnic cuisines, product sizes, etc.,) and natural/organic."

    "The at-home food industry is just beginning to feel the impact of this major demographic shift as Millennials rise in prominence and Baby Boomers adjust to meet the requirements of age and a fixed income," says Scott Mushkin, Managing Director and Senior Equity Research Analyst covering Food & Drug Retailing and Packaged Food at Jefferies. "The bottom line for food-at-home industry stalwarts is that big changes are coming, and companies who don't fully understand those changes risk being marginalized."
    KC's View:
    No argument here. If retailers think that existing store formats will satisfy the next generation of consumers, they're sadly mistaken. Just think about how your kids are different from you in almost everything they do ... and work on the assumption that shopping is also going to have to be a different experience to satisfy them.

    Published on: June 29, 2012

    WSJ Magazine has a terrific and provocative interview with Dan Barber, chef and co-founder of Blue Hill at Stone Barns, the award-winning restaurant in Pocantico Hills, New York, that has become an oasis for local foods and what the Journal calls "decadent, intensely flavorful multicourse dinners - equal parts educational experience and unforgettable meal."

    Some quotes from the interview:

    • "I'd like some to explain the phenomenon of the self-righteous vegetarian to me. I'm not here to say I don't eat vegetables—I do, a lot of them—but, from a soil perspective, they're actually more costly than a cow grazing on grass. Vegetables deplete soil. They're extractive. If soil has a bank account, vegetables make the largest withdrawals. So without animal manure, where are you going to get your soil fertility for all those vegetables in an organic system? You are, by some measures, forcing crops into a kind of imbalance."

    • "Butchering and eating animals may not be called kindness, but eating soy burgers that rely on pesticides and fertilizers precipitates destruction too. You don't have to eat meat, but you should have the good judgment to relinquish the high horse."

    • "Generally, the food with the most flavor comes from farmers who are local or regional, or integral to a community. You can't treat farming like a car-manufacturing plant and expect that it will produce anything great to eat. That's why chefs have become advocates for everything from water rights to farm-workers rights to farmers markets."

    • "Chefs are powerful because we are curators of what's truly delicious; we're driven by pleasure. The sustainable food movement is about hedonism, A to Z: Be greedy. Be greedy for great food when you know that it was grown in the right way. That's why a local, grass-fed burger shouldn't be a guilty indulgence. It should be a part of your diet."

    • "What I don't like about sustainable foodies—and I'm considered one of them—is that we carry an air of preachiness about food. (No one wants to be told what to eat, whether it's by your mother or by a group of holier-than-thou chefs.) But true sustainability is about more than just deciding to cook with local ingredients or not allowing your child to have corn syrup. It's about cuisine that's evolved out of what the land is telling you it wants to grow."

    • "Five years ago I would have said that locavorism was at its height and that a new fad was coming to replace it. Now I'm actually convinced we're just beginning to see its potential. This isn't a trend, like tall food or truffle oil. Chefs are creating whole cuisines around eating local. Farmers are reshaping our landscape around it. Government and health officials are writing policies around it. Communities and cultures are being built around it. They're all connected. And that power is not to be underestimated."

    You can read the entire piece here.
    KC's View:
    First of all, I should mention here that I've been to Blue Hill at Stone Barns for one of the most memorable and delicious meals of my life. It also, I should note, was perhaps the most expensive meal I've ever eaten. (The horse there may not be high, but it sure is pricey.)

    I will tell you this. When it comes to food, I'd much rather be driven by pleasure than expediency. It won't always mean having a Dan Barber-style meal, but life is too short to eat crappy food.

    Published on: June 29, 2012

    Reuters reports that Walmart's Canadian business "is offering discounts on more than 10,000 products starting Friday, aiming to build sale momentum and market share ahead of its aggressive expansion and next year's arrival of Target Corp."

    According to the story, the discounts will be on apparel, electronics, health and wellness products, hardware and home merchandise, as well as on about 3,000 grocery-store items from dry goods to fresh produce. Walmart said the program will run through July.
    KC's View:

    Published on: June 29, 2012

    Forget the cost of healthcare. Let's talk about what really matters...

    A new study from BIGinsight says that despite concerns about rising food prices, "the average price of an Independence Day picnic is down a few dollars to $59.14 (from $61.16 in 2011). The total nationwide spend on cookouts is estimated to be $2.4 billion based on a shopping list of cookout staples."

    The survey also says that "67.6% of Americans plan to celebrate July 4th with a cookout, rising from 64.4% in 2011."
    KC's View:

    Published on: June 29, 2012

    • Nordstrom announced yesterday that it will open its first store in New York City, at 225 West 57th Street between Broadway and Seventh Avenue, just south of Central Park and the highly successful Time Warner Center in Columbus Circle.

    The new store is expected to open in 2017 or 2018.

    Reuters reports that Anheuser-Busch InBev, the world's biggest brewer, will acquire the half of Grupo Modelo, Mexico's biggest brewer, that it does not already own for $20.1 billion (US).
    KC's View:

    Published on: June 29, 2012

    ...will return.
    KC's View:

    Published on: June 29, 2012

    After mentioning earlier this week that Mrs. Content Guy and I had attended the Jimmy Buffett concert at Mohegan Sun in Connecticut on Tuesday night, I got a number of emails from MNB readers that basically broke down into two categories.

    One set was from folks who have already attended Buffett concerts this year, or plan to ... and it is great to know how many Parrotheads there are in the MNB community.

    The other emails were from folks wondering how this year's "Lounging in the Lagoon" concert tour measured up to previous tours ... and I'm happy to tell you that this is one of the best we've been to over the years. (I've probably gone once a year to see Buffett more more than a dozen years...) Jimmy was energized, indefatigable and in good voice ... and he even did an acoustic set with most of the Coral Reefer Band sitting around as if on a front porch, doing some old favorites but giving them a new flavor. He also told some new stories and kept the crowd engaged, singing and dancing in the aisles.

    All I can say is that going to a Jimmy Buffett concert is a great way to begin or end the summer. For many of us, it is a fabulous tradition ... and as long as he keeps singing, I'm going to keep going.

    Last night, with a certain amount of morbid curiosity, my son and I sat down to watch "Anger Management," the new and highly touted Charlie Sheen TV situation comedy that is his attempt to revive his career after being fired by CBS and the producers of "Two and a Half Men." When the two episodes were over, we agreed that we could not remember watching an hour of so-called comedy that was less funny. The show is poorly written, badly acted, and ill-conceived. That was an hour of our lives that we'll never get back ... and we will devote not one more minute to watching it.

    Seeking A Friend for the End of the World is a curious piece of movie-making. It has an interesting concept - if we all knew that an asteroid was about to hit the planet and kill us all, what would we do? How would we behave? It is sort of the flip side of how Jerry Bruckheimer would treat the subject, and I have to admit I was looking forward to it.

    For the first hour and fifteen minutes, I was disappointed. For that time, the film is a strange mash-up of low comedy and high mindedness, and it doesn't really work, despite the best efforts of Steve Carell and the always spectacular Keira Knightley - there is just too much focus on how some people indulge their worst instincts.

    But then, something happens. The plot turns a bit, and somehow the film gets lit up inside. It becomes a little gentler, a little more philosophical, and Martin Sheen does an extended cameo that absolutely makes the movie work in an unexpected way. I can't recommend the movie, but I also find it hard to totally kill it ... I walked out of Seeking A Friend for the End of the World actually feeling good about it, which I never would have expected just 30 minutes earlier.

    Make your own call. Or, better yet, wait until it comes out on video or cable.

    I have a fantastic white wine for you, which will be perfect for these hot summer days - the 2011 Chateau Lamothe White Bordeaux from France, which is just wonderfully bright and delicious and full of flavor. Enjoy.

    That's it for this week. Have a great weekend, and I'll see you Monday.

    Fins Up!
    KC's View:

    Published on: June 29, 2012

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    KC's View: