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Restaurant Shutdowns: The cost of Bidenomics

July 9, 2024

It’s a nice August summer night. You just came back from a day at the beach. It’s time for dinner, and you are too tired to cook at home. So eating out it is. You go to your favorite place, you already know what you’ll get, and you can’t wait. When you are ready to park, your excitement turns to disappointment; the place is closed—for good.  

This story is turning into a national reality. Chains like Cracker Barrel, Denny’s, TGI Fridays,  Hardee’s, and Tijuana Flats are closing dozens of locations; some have even filed for bankruptcy.  

The reason? The bad economic policies passed by President Joe Biden and his Democratic allies in Congress and the states. 

High inflation and minimum wage laws wreak havoc on the finances of dozens of restaurants and bring your favorite chains to heel.  

Bidenomics caused inflation… 

Soaring prices are forcing countless restaurants across America to raise prices or close doors, and Bidenomics is responsible for this.  

How so? Quite simple: when the government prints more money than the market can absorb, prices go up, and your money is worth less— and in the last four years, Biden & Co. printed much more money than the market could handle.  

Since 2021, Biden and his friends in Congress, better known as the Bidenomics Five, approved bills that injected a colossal amount (at least $5.5 trillion extra, to be precise) of money into the market. The result, inevitably, was high inflation. 

…And inflation destroyed restaurants 

Food prices, especially, surged these last three years:  

  • Whole chicken costs 26% more than in 2021.  
  • A pound of ground beef now costs almost 30% more
  • Fruits and vegetables went up 14%. 
  • Eggs went up by a whopping 84%. 

When food prices skyrocket, restaurants have no choice but to raise their prices to stay in business. This is precisely what happened: food away from home increased by more than 22% in less than four years.  

Some chains couldn’t survive inflation and closed many locations.  

Don’t take our word for it. Take the word of the CFO of Denny’s, who explained their company was closing down dozens of locations (more than 60 in the last two years) due to “inflationary pressures” as each store now has to make $1.2 million a year to break even—$200,000 more than the $1 million they needed a few years ago.  

Inflation might be the toughest challenge restaurants face, but it is not the only one. 

Minimum wage hike: a blow to restaurants  

Minimum wage laws (passed by Biden’s friends in state governments) also make it harder for restaurants to stay afloat. 

There’s no better example of this than California.  

In September 2023, Governor Gavin Newsom passed a law raising the minimum wage to $20 and created a government body with the authority to raise wages yearly.  

This law does more harm than good.  

Since passed, California food chains increased prices in a desperate try to survive both inflationary pressures and higher labor costs.  

Other chains did not withstand the pressure and closed dozens of locations, costing the state around 9,500 jobs. Giant food chains like Pizza Hut laid off thousands of delivery drivers, while others are speeding up their automation projects to reduce costs— by hiring fewer people.  

Newsom, a good friend of Biden and his policies, passed a law that was supposed to help workers while not hurting consumers.  

But the opposite happened: his law hurts businesses, leaves thousands without work, and passes the cost to the consumers.  

Next time you drive through a closed restaurant, remember that Biden and his friends (both in Congress and state governments) probably did that.