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Got a couple of interesting emails yesterday about the report that Whole Foods will pay a $500,000 fine to settle accusations that it mislabeled and overcharged for products in New York City, though the company continues to be defiant both about the original charges and the settlement.

I commented:

I guess that Whole Foods has to stay on its high horse about this, but somehow it leaves a bad taste in my mouth. They're bigger problem is that a lot of people equate mis-pricing with extravagant over-pricing ... and I'm not sure that whining about how the New York City Consumer Affairs Department interprets a legal agreement.

MNB reader Tom Kroupa wrote:

I agree with your comments about Whole Foods response to the weights and measures fine they paid in New York City.

Because their CEO John Mackey is a libertarian, his default line is always anti-government. You may recall that he called President Obama a nazi because of his distaste for Obamacare. This may be the reason for his begrudgingly paying the fine for overcharging customers. 

If he would have admitted their mistake openly, rather than try to give the perception that the government somehow was targeting Whole Foods, it would have been a better approach for customer relations. An honest "mea culpa" is the fastest way to regain customer loyalty.


I'm not even sure it has to be an honest mea culpa. It just has to appear sincere.

(I think it was George Burns who once said, "Sincerity - if you can fake that, you've got it made.”)

But MNB reader Bruce Wesbury disagreed:

I’m growing extremely tired of all this Government intervention. Whole Foods is and always will be the most overpriced grocery store on the planet. If you are a shopper there and don’t know this you are more than likely a member of the 1% club. The ill-informed will now cheer that the big corporation had to pay 500 million to the State of New York. All this so Cuomo and his team can continue to find stores that charge more than they think is fair for a Twinkie. The circle will continue as all Whole Foods will do is raise prices to everyone else to cover the fine. In the end, only the consumer suffers.

Just a couple of things here.

First, Whole Foods has to pay a half-million dollars ... not a half-billion dollars. (If the fine had been for $500 million, I'd be up in arms about government intervention, too. And I suspect John Mackey would be preparing for a re-enactment of the siege at the Alamo.)

Second, I'm pretty sure Whole Foods doesn't sell Twinkies.

But let's put these aside. And let's mostly talk about the broader issue, not Whole Foods.

While I understand and appreciate concerns about government overreach, I do think that when a company mislabels products and appears to be deceiving the consumer, it is perfectly appropriate for the government to step in and make sure it doesn't happen.

You seem to suggest that it doesn't really matter, because Whole Foods' customers and rich and can afford the higher prices anyway. But that's not the point. Companies have to be honest and above-board about how they treat their customers, and there needs to be some sort of governmental mechanism for assuring that this is the way business is done.

There is a difference between charging high prices and over-charging through mislabeling. In the first case, consumers make their own choices. But if the second case occurs, consumers aren't making their own choices because they're being deceived ... and so somebody has to step in.

If you are reflexively anti-government, you don't think it should be the government that does so. (Or maybe you just are reflexively anti-Cuomo. hard to tell.) Either way, that's a perfectly legitimate position to argue. But then you have to tell me how such situations get rectified. (The "free market" argument doesn't work for me, because "free market" and "theft" are not, in my mind, synonymous.)

The thing is, I think even most people with legitimate concerns about the size of government are okay when some agency steps in and prevents them from being ripped off. it is when government appears to be doing the ripping off that they get irritated. Sometimes justifiably so.
KC's View: