{"id":10297,"date":"2023-11-13T10:28:51","date_gmt":"2023-11-13T17:28:51","guid":{"rendered":"https:\/\/sandiegonewsdesk.com\/?p=10297"},"modified":"2023-11-13T10:29:04","modified_gmt":"2023-11-13T17:29:04","slug":"fast-food-prices-hiked-after-california-ups-minimum-wage","status":"publish","type":"post","link":"https:\/\/sandiegonewsdesk.com\/?p=10297","title":{"rendered":"Fast-food prices hiked after California ups minimum wage"},"content":{"rendered":"

Original Article Link: Fast-Food Prices Hiked after California Ups Minimum Wage | National Review<\/a><\/p>\n

By Will Swaim<\/p>\n

There\u2019s got to be a great joke that illustrates the aphorism about insanity being the habit of doing stupid stuff over and over with the expectation that you\u2019ll get different results. It\u2019s clearer now that the joke may be California.<\/p>\n

Following Governor Gavin Newsom\u2019s decision \u2014 after some complicated political wrangling between Newsom and a furious fast-food lobby \u2014 to impose a $20 hourly minimum wage on the fast-food industry, Chipotle and McDonald\u2019s announced on Q3 earnings calls last week\u00a0that they\u2019ll be raising menu prices in the state.<\/p>\n

How big a hit will customers take \u2014\u00a0if they\u2019re willing to take it at all?<\/p>\n

“We\u2019ve been studying that . . . it\u2019s going to be a pretty significant increase to our labor,”\u00a0Chipotle CFO Jack Hartung said on the company\u2019s call. “We haven\u2019t made a decision on exactly what level of pricing we\u2019re going to take, but to take care of the dollar cost of that and\/or the margin part of that, we haven\u2019t decided yet where we will land. It\u2019s going to be a mid- to high single-digit price increase, but we are definitely going to pass this on. We just haven\u2019t made a final decision as to what level yet.”<\/p>\n

“There is going to be a wage impact for our California franchisees. I don\u2019t think, at this point, we can say exactly how much of that is going to work its way in through pricing,”\u00a0McDonald\u2019s CEO Chris Kempczinski said on his company\u2019s earnings call. “Certainly, there\u2019s going to be some element of that, that does need to be worked through with higher pricing. There\u2019s also going to be things that I know the franchisees and our teams there are going to be looking at around productivity.”<\/p>\n

It didn\u2019t take an economist to predict this outcome. I called it in a\u00a0National Review<\/em>\u00a0article about Assembly Bill 257, what was called the Fast Act. “In an industry that operates on razor-thin margins,”\u00a0I wrote, the Fast Act “will have two immediate predictable outcomes”:<\/p>\n

On the worker side, higher wages, richer benefits, and more cumbersome labor laws will lead to job cuts as franchise operators seek to curb their skyrocketing labor costs. In some places, restaurant owners will rapidly automate; ATM-like ordering kiosks will replace actual people \u2014 primarily immigrants and other minority people who, by way of the fast-food business model, are just beginning their ascent on the American economic ladder. Other business owners may simply sell off to larger enterprises whose high volumes will allow them to cope with slimmer margins. That will make it harder for workers to rise into positions of management and ownership.<\/em><\/p>\n

On the customer side, as some franchisees simply close permanently, we\u2019ll see the expansion of what progressives have called “food deserts”\u00a0in poor communities already underserved by grocery chains. Customer service in the remaining stores will decline and prices will rise.<\/p>\n

So, in a kind of grim partnership, poor customers and rising workers, immigrants and the native-born, will suffer together.<\/p>\n

In that January article, I called this “the iron law of California progressivism: Claim that new laws will help the poor. When the actual effect turns out to be catastrophic for the poor, blame capitalism\/markets\/billionaires\/racism, and expand government control of the business. Rinse, repeat, and promote as a national \u2014 even\u00a0global<\/a>\u00a0\u2014 model for equity. And if Californians have anything to say about it, AB 257 will be coming to you, no matter where you live in the United States.”<\/p>\n

Indeed, Biden\u2019s forever-acting Secretary of Labor Julie Su has already expressed her unbridled enthusiasm for California\u2019s policy. That\u2019s no surprise, either: Su was California\u2019s secretary of labor, and is closely tied to the union leadership behind a number of execrable labor policies. Among the most notorious is AB 5, the law that banned independent contracting in key industries, including Uber drivers and trucking companies. When AB 257 emerged from the same fetid philosophical swamp, there was Su, now part of the Biden administration,\u00a0telling the bill\u2019s supporters<\/a>, “The Department of Labor stands with you. The Biden-Harris Administration stands with you.”<\/p>\n

Now, as the obvious consequences of this bill are becoming evident (and trust me, this is only the beginning), it\u2019s worth asking if the administration still stands with what Newsom and California Democrats have unleashed on the state.<\/p>\n

This article by CPC president Will Swaim originally appeared on\u00a0nationalreview.com.<\/a><\/em><\/p>\n

Original Article Link: Fast-Food Prices Hiked after California Ups Minimum Wage | National Review<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Original Article Link: Fast-Food Prices Hiked after California Ups Minimum Wage | National Review By Will Swaim There\u2019s got to be a great joke that illustrates the aphorism about insanity being the habit of doing stupid stuff over and over with the expectation that you\u2019ll get different results. It\u2019s clearer now that the joke may…<\/p>\n","protected":false},"author":3,"featured_media":9073,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-10297","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-politics"],"yoast_head":"\nFast-food prices hiked after California ups minimum wage - San Diego News Desk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/sandiegonewsdesk.com\/?p=10297\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fast-food prices hiked after California ups minimum wage - San Diego News Desk\" \/>\n<meta property=\"og:description\" content=\"Original Article Link: Fast-Food Prices Hiked after California Ups Minimum Wage | National Review By Will Swaim There\u2019s got to be a great joke that illustrates the aphorism about insanity being the habit of doing stupid stuff over and over with the expectation that you\u2019ll get different results. 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