Friday, September 24, 2010

The Washington D.C. food truck wars, with another brief rant about illegal tamales

Here's some classic protectionism for those who are fans of the genre:

From the Washington City Paper:

If anyone can understand the tension between brick-and-mortar restaurants and the mobile army of food trucks that has stormed D.C. in the past year, it’s Stephan Boillon. After he lost his job at Dino in Cleveland Park in 2008, the veteran chef sought to launch an upscale sandwich shop on Connecticut Avenue NW. His plan was to offer only cold sandwiches, which would enable him to build a restaurant with no burners, no oven, and no deep fryers.

But even Boillon’s stripped-down concept was going to cost $750,000 before the doors opened—a figure that didn’t include rent, utilities, insurance, advertising, taxes, labor, association fees, or any of the other overhead it takes to operate a business in a neighborhood that expects a lot from its entrepreneurs.

So with credit tight and investment money scarce, Boillon found a cheaper way into the gourmet sandwich business: a food truck.

For $50,000, one-fifteenth of the price to build his brick-and-mortar concept, Boillon started El Floridano, his rolling unit dedicated to home-made roast-pork Cubans and other bread-driven bites. Boillon had traded a restaurant’s higher profit margin for a truck’s lower start-up costs.


If only supply-and-demand economics were so easy. The sudden appearance of gourmet food trucks that delighted so many lunch-hour consumers simultaneously horrified the established restaurant community—a deep-pocketed, politically wired bunch.

Now, like in Brooklyn and Los Angeles and every other city where mobile vendors represent new competition, the District’s inline businesses are turning to the legislative process to ease their pain. Thus when it comes to the street-food options, you may not have the ultimate say. Lawyers, lobbyists, social-media activists, councilmembers, and business owners are all working the levers of power to determine what rolls your way for lunch.

And here’s the unique D.C. twist to this traditional battle between the rolling and stationary food providers: The old-school street carts, and the powerful depot owners who represent them, don’t care much for these four-wheeled foodies, either.

In the battle for Washington’s food dollars, the mobile vendors have public opinion—and 47,000 Twitter followers—on their side. But their competitors have what might be a more powerful weapon: money.

Well-financed entities like the Golden Triangle Business Improvement District, the Restaurant Association Metropolitan Washington, the Dupont Circle Merchants and Professionals Association, and the Apartment and Office Building Association of Metropolitan Washington have all submitted proposals asking the D.C. Council to put new restrictions on trucks. Some of the proposals are downright draconian.

Go here to read the proposals, all of which are designed to keep consumers from getting what they want. 

Fort Worth has businesses doing the same thing but at a lower level.  In Cowtown, it's usually the food truck guys who are trying to stifle the competitors. 

Several years ago at Jukt Micronics, I had a Roach Coach operator complain to me about the Mexican dude selling tamales from a bicycle to my employees (which they were joyfully purchasing instead of buying the nuclear winter-proof gunk from her Roach Coach).  She wanted me to throw the bicyclist out of the parking lot because he didn't have a Food Handler's Permit, and no one knew what he was putting in those tamales. 

This confrontation took place before my political awakening, but I already had enough sense to ridicule the notion that a government-issued permit was enough to purify the contents of the bicycle tamale bin or the preservative-laden cholesterol bombs in her van. 

I don't remember how that worked itself out.  But speaking of illegal tamales....

Go here for a much later rant about illegal tamales being sold outside another Jukt Micronics location.  Something about businesses and regulators trying to stifle the tamale market gets me fired up.

Here's a video about the D.C. Roach Coach food truck operators. 

I do love me some homemade tamales.  A fresh coat of Whitening to The Agitator for the link.


CenTexTim said...

Oh for Christ's sake. Let people buy what they want from who they want. If there's a problem let the buy-ees take it up with the sell-ees.

Of course, this would put a whole passel of congresscritters and lawyers out of business. We can't have that now, can we...?

The Whited Sepulchre said...

No sir, we cannot have it.
On the other hand, I might need to get some counseling help. There's something about immigrants illegally selling tamales that makes me get emotional.
I might not walk across the street to stop a bank robbery, but don't mess with people selling tamales from a bicycle.

Nick Rowe said...

I don't always want to seem to be the lone voice of dissent here because I agree with 90% of what I read.

But the reason the FDA and food safety standards came into effect was the horrendous practices before there was regulation.

Patent medicines were not merely robbing people's money, they were causing physical harm. At that time, people were freely using lead paint and ingesting both lead and mercury. It wasn't merely ignorant consumers but ignorant scientists and doctors.

You would be appalled at what is allowed to pass as food or drink in other countries.

I, for one, am grateful we are more aware of the things which cause bodily harm and I do not think the free market would adequately seek out dangerous substances. In theory, lawyers and consumer watchdogs would do this but lawyers always go after the easy money and watchdogs are rare.

Perhaps watchdogs have been crowded out by government. But I don't always buy the info coming from the Center for Science in the Public Interest. The same sort of "scientists" are foisting AGW on us. They are more "statist" than the FDA and are, in fact, pushing the FDA to do more.

I once met a guy with a hot dog cart who earned $500 a day. Pretty impressive! I almost bought a cart myself. I used to buy burritos from a guy who brought a small cooler of them to campus every day.

I'll bet most home kitchens couldn't pass a health inspection, but they don't each feed 500 people a day either.

The Whited Sepulchre said...

Whose Certificate Of Safety would you rather have on something you consume - The FDA's or Wal-Mart's?

Nick Rowe said...

The FDA.

I take numerous prescription drugs and I appreciate that the FDA monitored the safety and efficacy of those drugs. I doubt the Walmart pharmacy would ever do such tests in the absence of the FDA. And if there was a problem, Walmart would likely pass the blame to the manufacturer.

With respect to food, the FDA too. I also doubt Walmart's willingness and ability to monitor the safety standards in the production of the millions of products they retail.

Walmart has sold dangerous products before and they will do so in the future. I don't expect them to bear responsibility and I don't believe they bear blame - they are a retailer.

I am not saying everything is hunky dory with the FDA. Their stamp of approval gives a false sense of security. They impede the development of lifesaving drugs with needless bureaucracy. Its MedWatch program provides early warning for harmful drug reactions and interactions; no private entity could or would do that.

Underwriters Laboratories and Consumer Reports are better examples than Walmart. Walmart's main concern is profitability per unit of shelf space. But even an independent advocate like Edmunds eventually sold out to the industry it monitored.

In short, a private watchdog can (and does) become just as complacent, bureaucratic, and captured as government agencies.

Look at the credit rating agencies. That turned out really well, not that regulators did any better. You can't eliminate the principal-agent, moral hazard, and adverse selection problem by privatizing it. Some firms just consider lawsuits part of their cost analysis.

But I'm always keen on private alternatives and agency reforms whenever possible.

The FDA isn't the worst federal agency, although its scope and budget make it an easy target for criticsm. Maybe they need a better PR campaign with more transparency. There is so much they do, their failures are more visible than their millions of successes.

Anonymous said...

It is a very pathetic way of representation. I always feel shy about food truck wars. Live in peace, no war.
used digger derricks

Dr Ralph said...

Nick - it's occasionally scary (but a little comforting) just how much you and I agree on.

While there is plenty to dislike (and make fun of) about some regulations, it's important to remember most of them are there to address real issues. Your points are well taken.

Are you still planning to head out our way soon?

Michel said...

food truck war is a very unwelcoming thing in the world. Personally I hate it.Food truck war must be stopped.
used digger derricks

Nick Rowe said...

Yes, Ralph, I'll be arriving in Big D next Monday afternoon.

Hope to see you then. There's nothing on my schedule Monday night if you and WS are available.

On Tuesday evening I know we have a planned reception to attend.

I have no confirmed plans for Wednesday or Thursday evening, but since this is our annual pow wow of analysts across the nation, I'm sure my colleagues will want to par-tay together.