If you're a criminal organization, it's just a really bad idea to establish a prominent business right in the middle of town with the name of your organization in the name of the business.
Wait, new fan theory: the police are corrupt and actually letting Team Rocket do whatever they want, and Red is a lone vigilante trying to bring justice to a lawless Kanto.
They already used that idea for Pokémon Colosseum, though.

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