President Barack Obama picked a Safeway distribution center in Maryland today as the scene for his new policy debut -- an executive action directing the Environmental Protection Agency to tighten regulations on carbon emissions from trucks. The speech marks the president's third climate initiative of the week, and his second well-publicized visit to a supermarket-affiliated stop this month.
Obama is obviously no stranger to grocery store glad-handing. In July 2009, he held a town hall meeting on the Affordable Care Act at a Kroger in Bristol, Virginia. Michelle Obama made a trip to Target in October 2011, and Obama picked up some Christmas cookies, fruit, and exchanged copy-friendly banter with toddlers in shopping carts in an Iowa Hy-Vee market in December 2007.
But, Obama's embrace of supermarkets in 2014 is a little more unorthodox -- he has picked his settings less because they allow him to appeal to and interact with voters, and more because of an affinity for the corporate policies enacted by the chain of his choice.
When Obama wants to explain why the public should care about his policies, anecdotes are his favorite ammunition. Midwesterners, factory workers and veterans have been his constant companions the past six years during these visits.
Recently, however, anecdotes about CEOs and smart corporate practices have started to enter Obama's speeches. Obama praised Apple, Microsoft and hundreds of other companies for changing hiring policies to help the long-term unemployed. The president said Costco's wages and benefits are a model for other countries trying to increase efficiency and profits while retaining the best workers. And today, Obama talked about how Safeway Inc. has invested in more efficient trucks -- just like the country should.
This isn't the first time Obama and Safeway have shared a news cycle before, though. Like we did with the president's Costco trip in January, below find the greatest hits of the Obama and Safeway relationship, featuring a wax president and a photoshopped Romney beard.
Safeway and Obamacare
In May 2009, when the White House was just beginning its efforts to build health-care legislation that could somehow make it through Congress, Obama met with several private-sector businesses to discuss large-scale insurance systems that have proven successful. After the roundtable, the president made public remarks, and gave a shout-out to Safeway.
You have companies like Safeway that have been able to hold their costs flat for their employees at a time when other companies are seeing double-digit inflation in their health care. ... When you hear what Safeway or Johnson & Johnson or any of these other companies have done, what you've seen is sustained experimentation over many years and a shift in incentive structures so that employees see concrete benefits as a consequence of them stopping smoking or losing weight or getting exercise, working with providers -- the provider incentives are aligned with the employee incentives as well, and changing the culture of a company.
That wasn't the first time Safeway, and its CEO Steve Burd, had been mentioned as a model for national health-care reform. When Democratic Sen. Ron Wyden of Oregon sponsored a health-care bill in 2006, Burd was at the press conference. Burd also visited Wyden's office on Capitol Hill to discuss the bill in 2007. Burd told the Oregonian that Wyden, "reacts well to new information. It's not like he has figured it all out, although he knows an enormous amount about the subject." Sen. Barack Obama, who had just announced his presidential campaign, called Wyden's bill a "bold new health plan." In July 2007, Bloomberg Businessweek published a profile of Burd, which explained the moment that made the CEO such a potent leader for politicians looking to reform health-care. In 2004, the company's health-care costs had hit 119 percent of its annual profits, and they would go bankrupt unless they changed their system.
Burd first tried wellness and preventive-care programs. But it wasn't enough. His frustration grew so strong that he underwent a fundamental conversion: The lifelong believer in keeping government out of corporate affairs became convinced that, to rescue the U.S. health-care system, government had to get involved. Ultimately, all Americans needed coverage, and CEOs had to lead the charge. "I've become a bit of an evangelist on this," says Burd, sitting in his fifth-floor corner office overlooking the bustling Amador Valley, outside of Oakland, Calif.
A business leader who thought the government needed to get more involved in corporate affairs? Democrats at the White House and on the Hill thought they had found their lucky charm.
Obama mentioned Burd repeatedly throughout the health-care reform fight and Republican legislators thought Burd's ideas were brilliant, too. Arizona Sen. John McCain gushed about Safeway in a August 2009 town hall. Senate Minority Leader Mitch McConnell talked up Safeway on the Senate floor in June 2009, the same month that Burd wrote an op-ed in the Wall Street Journal about his company's wellness program.
The final bill signed by President Obama in March 2010 included the "Safeway Amendment," which, according to the San Francisco Chronicle, "allows companies with self-insurance programs like Safeway's to incentivize employees 'to lower their overall health care costs.'"
However, many health-care experts and observers questioned how effective Safeway's wellness program was -- it hadn't been in effect at the company long enough to make many conclusions when the bill was signed. And last fall, Safeway was one of the grocery store chains in Washington fighting with unions over health-care costs regarding the Affordable Care Act and part-time workers.
Burd stepped down as CEO in May 2013, and although many industry leaders praised his tenure, the unions, many customers, and many employees did not join in. Ron Lind, president of UFCW Local 5, told the San Jose Mercury News, "For the most part, our members do not have warm feelings for Mr. Burd," Lind said. "But in fairness, it's hard to find happy employees in unionized grocery stores these days."
Safeway and the environment
Today wasn't the first time that Obama and Safeway have intersected when it comes to environmental policy. In May 2006, Sen. Obama sent a letter urging executives -- including Safeway's -- to start selling E85 fuel, or 85 percent ethanol, at their stores.
The nation is at a crossroads in energy policy. Our choice is to continue to cling to fossil fuels as the cornerstone of our supply, or to take advantage of existing technology and the emerging consumer preference for non-petroleum-based fuels. It is clear that alternative fuels are our energy future. That market is up for grabs, and the resistance of conventional-branded gasoline retailers to offering E-85 at their service stations creates an opportunity for companies like yours.
In his remarks today on limiting carbon emissions from trucks, President Obama said,
So when you see these companies’ new electric or natural gas-powered delivery or garbage trucks, it’s due to this partnership. And the reason we’re here is because Safeway was an early leader on this issue. By improving the aerodynamics of its trucks, investing in larger trailers, more efficient tires, Safeway has improved its own fuel efficiency. And the results are so solid that Safeway now encourages all the companies it hires to ship its products to do the same. ... If we keep on going, we’re going to leave a better future for our children. And I’m proud of Safeway and all its workers for helping to show us the way. If it can be done here, it can be done all across the country.
In October 2013, the EPA and the Department of Justice announced that Safeway needed to pay a $600,000 settlement because of Clean Air Act violations. The company responded by promising to reduce the company's greenhouse gas emissions by spending $4.1 million in upgrades. Safeway's statement regarding the settlement said, "The allegations in the complaint are dated from 2004 to 2007 and do not reflect a number of improvements Safeway has implemented since that time."
Safeway gets "it's complicated" with the White House
On May 17, 2012, Safeway's senior vice president and senior counsel, Robert Gordon, told a very bad joke at the company's annual shareholders meeting:
You know, this is the season when companies and other institutions are interested in enhancing their reputation and their image for the general public, and one of the institutions that's doing this is the Secret Service, particularly after the calamity in Colombia. And among the instructions given to the Secret Service agents was to try to agree with the president more and support his decisions. And that led to this exchange that took place last week, when the president flew into the White House lawn and an agent greeted him at the helicopter.
The president was carrying two pigs under his arms and the Secret Service agents said, "Nice pigs, sir."
And the president said, "These are not ordinary pigs, these are genuine Arkansas razorback hogs. I got one for former Speaker Nancy Pelosi and one for Secretary of State Hillary Clinton."
And the Secret Service agent said, "Excellent trade, sir."
Gordon apologized, but the damage was done.
And although Safeway has been exceptionally useful to Obama as a bridge for getting bipartisan support for some of his policies, the company's allegiances are more split when it comes to backing political candidates. As the Bloomberg Businessweek profile of Burd noted, the former Safeway CEO raised enough funds for President George W. Bush's re-election effort to earn "Ranger" status. In 2012, the most mentioned member of Safeway's staff -- at least in D.C. -- gave $25,000 to the Romney Victory PAC, and another $10,000 to the National Republican Congressional Committee. Overall, the company has a more diverse political portfolio -- in 2012, 46 percent of Safeway PAC's contributions went to Democrats, and 54 percent went to Republicans. Finally, when the Onion's fictional "Filthy Mitt Romney" (a friend of "Diamond" Joe Biden) gave an impromptu campaign speech after the 2012 presidential elections, the setting was, of course, Safeway.
The Safeway mythology in Washington, D.C.
Obama's many mentions of Safeway are perhaps understandable outside of politics, given that the grocery store is inarguably the most influential on the D.C. social circuit. Case in point -- before Obama's inauguration in 2009, wax replicas of the soon-to-be president watched over Safeway checkout lines across Washington, D.C.
When the neighborhood's grocery store reopened in May 2010 after an intense makeover, the guest list looked like it belonged to a White House Correspondent's Dinner afterparty coordinator instead of a grocery store chain manager. White House chef Sam Kass prepared food for the event, where there was a Belvedere vodka fountain and many people in ball gowns. Al Gore's social secretary helped plan the grocery store's unveiling, and senators and representatives mingled at the event.
Dick Cheney and King Abdullah are noted former customers of the Georgetown store. At least one political consultant says he owes his marriage to Social Safeway. The company's spokesperson said at the time, “It’s rare that a grocery store creates this kind of excitement."
If you're going to tout a company's practices as ones the country should adopt, it doesn't hurt to choose a company that the people lobbying and passing bills absolutely adore for having a great sushi bar.
Though Safeway holds political value for Obama, his history with the chain may have simpler origins, going back further than 2006. In his remarks today, he said,
I have a little soft spot for Safeway in my heart because some of you know I went to high school in Hawaii and I was living with my grandparents, and our main grocery store was Safeway. It was right down the way. And so my grandmother would send me out to go shopping at Safeway, and everybody there always treated me very well. So I very much appreciate the good work you guys do.