California keeps looking for ways to raise prices, drive away more businesses and destroy growth through bad policy and bad politics

Whether you’re a lawmaker, a business owner or leader, or an everyday voter, one thing is clear: California has become a dramatic case study of putting bad politics over good policy. Last fall, the legislature passed a bill – AB257, or the FAST Act – almost entirely at the behest of organized labor’s firm grip on many of the state’s lawmakers. It makes it all but impossible to run small business restaurants, but the impacts are far beyond that. Under the FAST Act, an unelected council of political insiders, not local business owners and their teams, would make big decisions about crucial elements of running a business, fracturing the econo- my in the process. As the head of McDonald’s U.S. business and a native Californian, I’ve had reason to pay particularly close attention to the bill and how it passed. But the fallout from the legislation – and lessons to be learned here – matter to all of us, particularly as the Golden State tries to emerge as a model for the rest of the country.

Proponents argued that this bill was about helping everyone — especially hardworking people employed by restaurants. But the facts simply don’t support it.

No evidence exists to conclude that the FAST Act will better serve workers’ needs. That’s not just my opinion but also the conclusion from the state’s own experts. California’s Department of Finance said, “it is not clear that this bill will accomplish its goal.1” The Department of Industrial Relations (DIR) debunked a core argument of the FAST Act that claimed wage theft was disproportionately high in quick service restaurants. In fact, DIR said wage theft is up to five times lower at quick service restaurants than in other industries.2

Three of the foremost and most credible media outlets in the country – The Wall Street Journal, Washington Post and Bloomberg – unanimously said the bill was predicated on false promises, with one simply stating that it’s a “recipe for higher restaurant prices and lower business and job growth.”

Economists estimated AB257 would drive up the price of eating at a quick service restaurant in California by 20% at a time when people can least af-