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FAST Act will likely trigger yet another tsunami of businesses leaving California for other states with less bureaucracy and a less demanding labor market

This result shouldn’t surprise anyone. Inflation has driven up operational costs for businesses across the US and shrunk profit margins for major food chains in the past few years. 

This has led to higher menu prices (like the “$18 Big Mac”) and slowing sales for every major fast food company.  Another anchor dragging on the restaurant business in many regions was at least two years of covid stimulus coupled with rent moratoriums, creating aggressive labor shortages and raising wages in upwards of $16 per hour for brand new no-skill employees.

Small chains and mom-and-pop businesses simply can’t compete.  Larger chains raised prices but have also been forced to reduce employees and labor costs through automation, but the layoffs are just getting started. 

Enter California’s “FAST Recovery Act” passed into law in 2022 and going into effect in April of this year – The legislation requires a particular set of food chains dealing in certain kinds of products outlined in the law to raise their minimum wages (already at $16 an hour on average) to $20 an hour.  The income increase is limited to chains that have 60 or more locations in the state of California (meaning, the combined number of locations regardless of who owns them must be higher than 60)  Keep in mind that while many of these chains are associated with international corporations, they are owned and run by franchisees; they are still family run businesses.

“Restaurants are struggling to stay above water, and Democrats just threw them an anvil,” California Assembly Republican leader James Gallagher told FOX Business. “We warned Democrats this new mandate would cost jobs. They ignored us, and here we are with the highest unemployment rate in the country poised to get even worse.”

The “digital options” that many fast food franchises are referring to are automated ordering systems as well as robot workers which are slowly but surely becoming more cost effective than human laborers.  At least one fast food location in California is testing a fully robotic restaurant with no human workers.

Layoffs will accelerate along with the normalization of the technology, and the high wages that are crushing profit margins are making the decision easy for business owners.  Some chains have reported that they will be forced to cut working crews in half; meaning, those working will be paid $4 an hour more, but they’ll have to work twice as hard per shift.  The most probable end result in the next 5 years will be the majority of chain restaurants operating with a tiny crew of humans working alongside increasing automation.   

The political left is already accusing the fast food industry in California of “retaliation” for the wage increase which was negotiated in part with restaurant workers unions involved.  This is what they asked for, and now it’s happening; for every action there is an equal and opposite reaction. 

The problem that is typical among leftists is a lack of understanding when it comes to the basics of business operations.  Profit margins can be thin and money can still be made due to sheer scale, but revenues at that level are often calculated in cents or fractions of a cent per sale.

This kind of business model is beyond the comprehension of the average socialist.  They simply see workers whose wages are not keeping pace with the high cost of living in California and assume business owners are greedy.  Instead of confronting the state government that caused higher prices through extreme regulation and taxation, they want to give that very government even more power to punish businesses that are already under pressure.

Well, get ready for more job losses and get ready for the takeover of fast food robots because these are the only options franchise restaurants have left.  They might be able to force business owners to pay $20 an hour for no-skill labor, but they can’t force those business owners to keep hiring.  

Furthermore, it’s likely that the FAST Act will trigger yet another tsunami of businesses leaving California for other states with less bureaucracy and a less demanding labor market.  Meaning, more jobs for red states and more unemployment for California.    

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Col. Douglas Macgregor Warns Attack on Iran Would Cause WWIII and Mass Migration

Thousands of Americans now celebrating the team’s loss online.

During Monday night’s women’s college basketball Elite Eight tournament game between Louisiana State University and the University of Iowa, the LSU team was noticeably absent from the court during the singing of the National Anthem.

The team’s coach later claimed the whole thing was a misunderstanding and that she never has her team stand on court during the anthem.

Internet users flocked to social media to celebrate the LSU team’s loss after dissing the U.S. National Anthem.

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Ukraine keeps striking Russian oil assets despite the Biden admin’s unequivocal demands for a hard stop, suggesting that diplomatic fallout is now imminent.

As discussed in our morning wrap, US equity futures are dipping lower as bond yields in the US continue to move higher as crude continues to surge and is up another 2% on growing fears of middle-eastern escalation after a senior Iranian commander was killed by an Israeli airstrike in Syria yesterday, with Iran immediately vowing revenge, and as Ukraine once again struck oil infrastructure targets deep inside Russia, overnight hitting Russia’s 3rd largest refinery, ~800 miles from the front lines.

As OilPrice details, Ukrainian drones hit the primary refining unit of Russia’s third-largest refinery southeast of Moscow more than 800 miles from the front line, Reuters reported on Tuesday. Ukraine keeps striking Russian oil assets despite the Biden admin’s unequivocal demands for a hard stop, suggesting that diplomatic fallout is now imminent.

The Taneco refinery of Russian company Tatneft in Tatarstan, an industrialized region southeast of Moscow, was attacked by Ukrainian drones in the latest such attack from Ukraine on Russian refining infrastructure.

The refinery has a capacity to process 340,000 barrels per day (bpd) of crude. Its primary refining unit, with a capacity to process about 155,000 bpd, was hit in Tuesday’s attack, according to pictures seen by Reuters. The unit caught fire, which was swiftly extinguished, Russian media report.

They also quote Ramil Mullin, the mayor of the city of Nizhnekamsk, where the refinery is located, as saying that there have been no injured people in the attack.

“There are no injuries or serious damage,” Mullin wrote on Telegram. “The technological process of the enterprise has not been disrupted,” the mayor added.

A source with the Ukrainian intelligence in Kyiv told Reuters that Ukraine hit a major Russian oil facility in Tatarstan to reduce Russian oil revenues.

Ukraine has stepped up attacks on oil refineries in Russia in recent weeks, which have reduced Russian refining capacity, and which, reportedly, have the White House concerned about rising international prices.

The United States has repeatedly urged Ukraine to halt its drone attacks on Russian oil refineries due to Washington’s assessment that the strikes could lead to Russian retaliation and push up global oil prices, the Financial Times reported last month, citing sources familiar with the exchange.

According to Reuters estimates, the amount of Russian oil refining capacity that has been taken offline due to Ukrainian drone strikes is 14% of Russia’s total refining capacity.

Calculations show that 900,000 bpd of refining capacity have been taken offline by drone strikes, Reuters reported last week.

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Col. Douglas Macgregor Warns Attack on Iran Would Cause WWIII and Mass Migration

January 6 judges discuss the Trump support of the defendants, implying Trump support will soon be the sole accusation against indicted Americans.

Anthony Rubin and Carlos Arellano guest hosted the Monday Alex Jones Show where they interviewed investigative journalist Corinne Cliford about the judicial attack against American’s First Amendment rights to a redress of grievance.

Don’t miss:

EXCLUSIVE: Col. Douglas Macgregor Warns Attack On Iran Would Cause WWIII And Mass Migration

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“We have a special supervisory commission together with an independent company which is monitoring the internet, the media, and public declarations,” IOC president said

International Olympic Committee (IOC) President Thomas Bach has admitted to a pair of pranksters that Ukrainians have been asked to spy on Russian athletes online so that they could be banned from the upcoming Paris Games.   

In a video-call posted on Tuesday, in which one of the Russian duo known as Vovan and Lexus impersonated an African official, Bach claimed that by sanctioning Russian athletes, the IOC is “punishing those who are responsible for the annexation.”  

The IOC chief was apparently referring to the former Ukrainian regions of Donetsk, Lugansk, Kherson and Zaporozhye, which overwhelmingly voted to join Russia in a public referendum in 2022. They followed the Crimean Peninsula, which did the same in 2014 after a Western-backed coup in Kiev.

“No Russian anthem can be played and no Russian flag can be raised [at the Paris 2024 Olympics],” the IOC president stated.

Answering a question on whether Russian athletes who support the Ukraine conflict deserved the right to take part in the Olympics, Bach revealed that the IOC has a special commission which monitors public statements by athletes in support of the government in Moscow.   

“We have a special supervisory commission together with an independent company which is monitoring the internet, the media, and public declarations,” he stated.   

“We also offered the Ukrainian side – and not only offered, but also asked to provide us with their knowledge about the behavior of such athletes or officials,” Bach further revealed.  

He stressed that any athletes found to have expressed support for the Russian government will be banned from the Olympics.   

Russian athletes are allowed to participate in the Games as neutrals in individual sports, but are barred from team events.  

After the start of the Ukraine conflict in February 2022, the IOC recommended that athletes from Russia and its close ally Belarus should not be allowed to compete in international events. In December last year, the body ruled that a limited number of people from the two countries could participate in the Olympics as AINs (individual neutral athletes).  

In March, the international body announced that the maximum number of Russians who could qualify for the Paris Games was 55, while Belarus is limited to 28 athletes. However, according to IOC director James Macleod, the two nations are unlikely to meet the quotas, and around 36 Russian and 22 Belarusian athletes are expected to make it to the Games.  

Several top-ranking European officials, including Latvian Foreign Minister Krisjanis Karins and Italian Prime Minister Giorgia Meloni, have fallen for prank calls by Russian duo Vovan and Lexus in recent months, during which the politicians revealed their thoughts on sensitive topics such as the Ukraine conflict.

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Col. Douglas Macgregor Warns Attack on Iran Would Cause WWIII and Mass Migration

Brent futures approached $90 per barrel on Tuesday

The price of the oil benchmark Brent peaked at $89 per barrel on Tuesday, nearing levels last seen in June 2022, according to Intercontinental Exchange (ICE) data. Industry experts have attributed the surge to an Israeli airstrike on the Iranian consulate in Damascus and Tehran’s threat of retaliation. 

Brent futures had risen by nearly 2% since Monday to trade at $89.060 per barrel as of 10:25 GMT, before retreating slightly, according to the ICE figures. The US benchmark West Texas Intermediate exceeded $85.

On Monday, Iran – a major oil producer – threatened a “harsh” response against Israel. The attack on the Iranian diplomatic compound in Damascus killed seven Iranian military advisers including three senior commanders.

Israel has repeatedly targeted Iranian installations in Syria, due to Tehran’s alleged support of the Palestinian group Hamas in Gaza. Although Israel has not commented on the latest strike, the New York Times cited four unnamed Israeli officials as acknowledging that Israel was behind it.

Oil prices have rallied in recent months on fears that the Israel-Palestine conflict could spread to the broader Middle East. The region is a crucial supplier of energy and a key oil shipping route.  In mid-March the price of Brent climbed to $85 per barrel as Yemen’s Houthi militants stepped up their rocket fire on merchant ships in the Red Sea, calling it retaliation for the actions of Israel and its supporters.

According to a projection by Bloomberg Economics, oil prices could reach $150 per barrel if Iran joins the conflict.  

ICE data suggests that Brent last traded above the current level in June 2022 ($98.460 per barrel on June 28, 2022), during the early stages of the Western sanctions campaign against Russia, a major oil exporter, over the Ukraine conflict.

The advance in crude prices has also been underpinned by OPEC+ production cuts, strong economic data from China, and economists’ expectations of a global deficit this year.

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Col. Douglas Macgregor Warns Attack on Iran Would Cause WWIII and Mass Migration