Like a lot of folks, my wife and I enjoy a good restaurant meal. In fact, one of my bucket-list items is to become a Tokyo Ramen King, which requires one to eat a ramen bowl in each of Tokyo’s 23 city wards (it’s a completely unofficial title, but I still plan to do it). Every Saturday, we enjoy lunch in a lodge to the north, which is on pretty safe ground, businesswise, due to a healthy summer tourist trade and its location right on the Parks Highway.
But in many parts of the United States, restaurants, especially small, locally owned ones, are suffering under inflation and Bidenomics:
Visits to sit-down restaurants were down nearly five percent in 2023 from the year prior, according to location analytics firm Placer.ai.
Even big metropolitan areas in the US known for their great dining spots are struggling to maintain an environment where it’s profitable to run a restaurant.
Eater NY reported that over 40 bars and restaurants closed in New York City from December 2023 to January 2024, with some of the owners saying business simply never picked up after the COVID lockdowns in 2020.
New York has problems, but they are worse in other areas – like the Midwest, where many an eatery can’t rely on tourist traffic:
In middle America, where there are fewer people and household incomes are lower, almost all restaurants are feeling the pressure of empty seats.
Iowa’s capital city of Des Moines, for example, has seen many restaurants close because of lower foot traffic. Establishments are of course aware of this but so are the remaining restaurant regulars.
Abby Sheffer, a law student at Drake University, told local station KCCI that she and her friends have noticed ‘there’s a lot less people.’
‘We went to the barbecue place down the road, and we were the only ones in there. And it was like that for two and a half hours,’ Sheffer added.
Restaurants and bars across the country, as we see, are facing a witch’s brew of inflation, debt, and decreasing traffic.
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Restaurants are already a tricky enough business to run as it is. Small restaurants have an astonishing failure rate and operate on small margins. My father-in-law has run cafeterias, mostly on military bases, for almost 60 years – yes, really, he’s almost 80 and still works full-time – and has described to me many times how his locations have always run on a pennies-on-the-dollar margin. His cafeterias always paid his bills, but he relied on volume to make it work. For him, it’s worked, but not many restaurants and bars have the benefit of having a semi-captive audience in a military base or other federal building.
The Biden administration’s horrendous spending (and, to be fair, the dumps of printed money during the Trump administration, sold as “pandemic stimulus) has been wildly inflationary. Add to that stupidity like California’s jacking up minimum wage for fast-food workers, and you have a business model that is simply no longer tenable. The federal government shut down the entire economy in 2020, floated loans to businesses that they are having trouble now repaying and got people accustomed to doing more cooking and eating at home. This is having an impact – today on restaurants, but tomorrow?
Every time government gets involved in economic matters, it ends up making things worse. Joe Biden and Gavin Newsom clearly don’t have the marbles to figure this out – indeed, you could make a good argument that Joe Biden hasn’t had any marbles to speak of for a while now. Maybe at some point, we’ll get some public servants who are capable of absorbing this information. But I won’t hold my breath for it.
