California Governor in PANIC as McDonald’s LEAVES the State | Elizabeth Davis

The California Miracle: How to Destroy an Industry in One Easy Step

There is a specific kind of arrogance required to look at a functioning ecosystem and decide that you, a politician sitting in a plush leather chair hundreds of miles away, know how to run it better than the people who have been doing it for decades. We are witnessing the catastrophic results of this arrogance in real-time across California, where the state’s war on basic economics has claimed yet another victim. This time, it isn’t a faceless corporation or a speculative tech startup. It is a McDonald’s at Stonestown Galleria in San Francisco, a community staple that served Happy Meals and hot coffee for thirty years. The owner, Scott Rodrik, didn’t close his doors because the food was bad or because the customers stopped coming. He closed them because the state of California made it mathematically impossible for him to survive.

Rodrik’s farewell note was polite, citing “unprecedented changes to the economic landscape” and “ill-timed legislative mandates.” But let’s translate that from polite business-speak into the raw, ugly truth: California’s government has strangled the golden goose. This closure is not an anomaly; it is the inevitable, predicted, and entirely preventable result of Assembly Bill 1228, the legislation that jacked up the minimum wage for fast-food workers to twenty dollars an hour overnight. This twenty-five percent labor cost increase wasn’t a raise; it was an eviction notice for thousands of small business owners and the employees they can no longer afford to pay.

The hypocrisy of the legislative class is breathtaking. They sold this wage hike as a victory for the working man, a triumph of labor over capital that would lift fry cooks and cashiers out of poverty. Instead, they have engineered a massacre. Since the law took effect, and even in the months leading up to it, the California fast-food industry has shed somewhere between ten thousand and twenty-three thousand jobs. These aren’t just statistics; these are livelihoods vaporized by the stroke of a pen.

Pizza Hut provided one of the most brutal examples of this new reality before the law even officially started. Looking at the incoming balance sheets, major franchise operators made the cold, hard calculation that they could no longer afford delivery drivers. In a move that illustrates the utter ruthlessness of this economic environment, they fired twelve hundred drivers. These were people with families and bills, some of whom had served the company for nearly a decade. Their reward for their loyalty? A pink slip and a severance package that amounted to roughly four hundred dollars. That is the price of progress in the Golden State: forty-four dollars per year of service, and a kick out the door so that the politicians in Sacramento can pat themselves on the back for being “progressive.”

The carnage is widespread. Rubio’s Coastal Grill, the beloved home of the fish taco, shuttered forty-eight locations in a single day. Think about the scale of that failure. It isn’t just a business contracting; it is a business collapsing under the weight of a hostile government. Rubio’s ended up filing for bankruptcy for the second time in four years, eventually selling for a fraction of what it was once worth. The executives were clear about the cause, citing the significant increases to the minimum wage as a primary driver of their demise. When a company that survived the Great Recession cannot survive the California legislature, you have to ask who the real enemy of the economy is.

Defenders of the law will point to the wage increase as a moral imperative, ignoring the economic reality that a wage of zero dollars an hour is the ultimate poverty trap. This was highlighted heartbreakingly by the closure of Foster’s Freeze in Lemoore. The owner, Lauren Wright, didn’t want to close. He tried to make the numbers work until the very last second. But when the mandate hit, he had to shut down on Easter Sunday, leaving his staff unemployed. The Assistant General Manager, Monica Navaro, delivered the most damning verdict of all when she revealed that her employees would have preferred to stay at their previous wage rather than lose their jobs entirely. They understood what the politicians refused to acknowledge: a job paying sixteen dollars an hour puts food on the table; a theoretical job paying twenty dollars an hour that doesn’t exist feeds no one.

For the workers who managed to keep their jobs, the “victory” is equally hollow. The Competitive Enterprise Institute found that nearly ninety percent of California fast-food workers have seen their hours reduced. Employers are not charities; they have fixed budgets. If the state mandates that labor costs go up, the amount of labor purchased goes down. Workers like Edgar Ramos at Wingstop are finding themselves fighting for shifts, working harder with fewer colleagues to support them, and ultimately taking home less money than they did before the “raise.” The state has effectively criminalized the entry-level job, turning what used to be a stepping stone into a high-pressure, low-hour gig that barely sustains the people it was supposed to help.

And then there is the consumer, the forgotten victim in this socialist experiment. The cost of this legislative hubris is being passed directly to you at the drive-thru window. Prices in California fast-food restaurants have skyrocketed by over fourteen percent, nearly double the national average. McDonald’s, once the bastion of affordable dining for the working class, has become a luxury good. When a McChicken sandwich triples in price and a standard meal costs nearly twelve dollars, the low-income consumer is priced out of the market. McDonald’s executives have admitted that they are losing the battle for the low-income customer, the very demographic that relies on fast food for an affordable meal. The irony is palpable: the state claimed to be helping the poor, but instead, they made it too expensive for the poor to eat.

We are watching a slow-motion car crash where the drivers refuse to take their foot off the gas. Franchise owners like Carrie Harper Howey are resorted to counting ketchup packets and analyzing sauce squirts just to keep the lights on. This is the level of absurdity we have reached. Innovation and growth have been replaced by survival and scarcity. The business model isn’t evolving; it is devolving.

The truly terrifying part is that the data is undeniable, yet the denial persists. Three separate studies—including one funded by the very union that pushed for this disastrous law—have confirmed the job losses. When even the people who paid for the study to prove you right have to admit you destroyed over ten thousand jobs, the debate should be over. But in California, ideology matters more than reality. They will continue to spin this as a transition period, ignoring the shuttered storefronts and the empty bank accounts of the workers they claimed to champion.

This is a warning to the rest of the country. The death of the Stonestown McDonald’s is not just a local story; it is a forecast. When you allow the government to dictate the terms of business without regard for the laws of supply and demand, you don’t get a worker’s paradise. You get unemployment, high prices, and boarded-up windows. The California dream is being dismantled one legislation at a time, and the only thing growing in the Golden State is the line at the unemployment office.