Food Stamp Recipients Not Welcome at Costco: An Example of Classism: Legalized Jim Crow Segregation of the Poor

He's the typical middle class white male who never previously had to think about the conseqences of social class privilege. His month long experiment of taking "The Food Stamp Challenge" was an eye-opener.

The Queens citycouncilman, found that if he had to rely on food stamps like 31 million poor Americans must, he couldn't get enough to eat and what he could afford was unhealthy. Gioia learned something else, too.

He discovered that if he had to use food stamps, he couldn't help stretch his food dollars at Costco, a wharehouse store that gives its members significant savings on quality food. Food stamp recipients are unwelcome at Costco.

It was a rude awakening to one of many aspects of what it means to be poor in America.

"Costco...has a reputation for being a socially conscious company," said Gioia. When Gioia learned that Costco refused to accept food stamps despite being surrounded by poverty in the Big Apple, he wrote a letter petitioning Costco executives to rethink their policies.

Costco CFO Richard Galanti, who handles media relations, refused to comment on the issue.

Councilman Gioia's office reported that Costco executives stated that there are three reasons why the company does not accept food stamps:

1. Costco executives didn't think Costco would qualify as a food stamp accepting merchant.

3. Due to Costco's annual $50 fee/bulk purchase model, food stamp recipients probably wouldn't shop there anyway.

Valid Concerns Or Excuses For Classism?

If over-priced corner stores can qualify as food stamp merchants, a publicly traded corporation like Costco which sees $71 billion in annual sales would certainly qualify. The US Dept. of Agriculture merchant eligibility guidelines are simple and straightforward. There are two ways for merchants to qualify:

1. At least 50% of the total sales are derived from the sale of eligible staple foods (i.e. not junk food)

2.The merchant offers at least three different varieties of food in each of the four food groups.

Stores that average $100 a month or more in food stamp transactions can receive devices from their state at no cost to them that accepts the food stamp debit cards. Merchants must sign an agreement governing the use of the equipment and provide banking information for prompt payment.

Queens' Costco Within Walking Distance of Many Poor

Joel Berg of the New York City Coalition Against Hunger said that Costco's one-time $50 membership fee pales in comparision to what food stamp recipients must spend for transportation to go to another supermarket.

Berg cited a recent US Dept. of Agriculture survey that showed that food stamp recipients spent an average of $6 to travel for their food shopping. Assuming a weekly food shopping trip, that translates to $288 a year. Being able to walk to Costco and shop there would enable many poor people in Queens to save on transportation costs and stretch food dollars.

Prejudice Against Poor People To Blame For Costco Policy

Until the recent economic upheavals, everyone held the poor in contempt. For many of the nuveau poor, it's an epiphany. They're realizing how hard it is to get or keep a good job when age discrimination and a bad economy is leaving too many Americans behind. Yet, draconian attitudes towards the poor persist.

Everyone talks about well-dressed bejewelled women buying groceries with food stamps. But how many of these women were previously middle class and lost everything due to mid-life job loss, illness and divorce, except for their engagement and wedding rings and their wardrobe?

Apr 30, 2009 12:09 PM

Guest :

"Until the recent economic upheavals, everyone held the poor in contempt."

Wow. That statement is absolutely false!

I thought the articles on this site were intended to employ facts to inform. This "article" is heavy with opinion and extremely slanted. Reads like a review of Costco. Very little helpful information.

Apr 30, 2009 12:27 PM

Jacqueline S. Homan :

So prove me wrong. I've LIVED the "Food Stamp Challenge" as a disabled woman. I've gotten the glares and stares. I've been presumed to be "trash" because of how I paid for my food. And I was treated, more than once, to cutting unsolicited criticism and judgments about my food purchases — just because of paying with food stamps. Have you?I've heard the remarks made about "those people" because having been poor for most of my life, I notice these things.

Apr 30, 2009 1:44 PM

Sam Kessler :

Interesting article. Though I think the whole food stamp program in NYC is screwed up too. Since so many people are now unemployed in Manhattan and receiving unemployment benefits, a majority of them won't even qualify for food stamps because they're unemployment benefits are more than $1,100 and you'd have to make under that amount in order to qualify! If an unemployed person received the maximum weekly benefit payment of only $430 which is around $1700 per month. In other states that would be a lot although we're talking about NYC where rent usually begins around 1700/month. There is no justice in such a screwed up system it seems.

Apr 30, 2009 3:02 PM

Guest :

Jacqueline:

Actually, I have been on food stamps. My parents drove an hour out of the town we lived in to use them because of they didn't want to subject my siblings and I to any more rude and insensitive people than we already had to deal with.

Your statements "Until the recent economic upheavals, everyone held the poor in contempt" and "Everyone talks about well-dressed bejewelled women buying groceries with food stamps" are absolutely false.

This article is not journalistic. It is biased and belongs on your Blog or some other Web site. I'm not out to prove you wrong. Just recommending you post your opinion elsewhere.

Oct 3, 2009 10:08 PM

Guest :

I was much intrigued by this story. There was always something that bothered me about Costco. I should mention upfront that I received my Costco membership as a gift. The last time I was there, I stood at the exit and counted people as they exited and noted their race. In about 200 that I counted, just one was African American. There were 2 other African-Americans that I inadvertently counted but later removed when I noticed their Costco employee badges.

What I find bothersome about Costco, even before I read this story, was that I found it "classist", if there is such a word. I noted the parking lot filled with late model high end cars such as Lexuses, Mercedes, Infinitis, BMWs, etc. These are the people who need the type of discounts that Costcos has the least. Though I have a Costco card, I try to avoid Costco -- as I feel it gives price breaks to people who need it the least. Why can't these people shop at smaller locally owned stores that may be more expensive but that would benefit the local community more ? I believe that shopping at Costco's actually makes products more expensive to the working poor. They can't afford the Costco memberships so they shop at higher priced stores who stock these products in smaller size packages. The manufacturer, because it has had its margins cut so thin by Costco's, charges higher margins to those stores that the working poor frequent.

There is a fundamental difference between Wal-Mart and stores of that ilk and Costco's. At a Wal-Mart, one sees people from a variety of races and social-economic classes. Not so at Costco. At Costco's, you see mainly whites as well as over-represented professional Asians (including East Indians).

Next time of you Costco members is at Costco's, do a count. See how many blacks and hispanics there are. You won't find many. They are out shopping at local stores who have bought the same items at prices -- because Costco's has pushed the manufacturer "to the wall" in getting the items to it over-privileged customers.