Article

Democrats take the House

There's a slew of restaurant-related issues that will be impacted by the 2006 election.

November 5, 2006

Editor's note: This article was originally titled "Election: Restaurant issues take center stage" and highlighted the campaigns of Republican Congressional candidates Ann Northup (Ky.), Mike Whalen (Iowa) and Melissa Hart (Pa.). All three candidates lost in Tuesday's election.

Five years from now, the American restaurant landscape could look completely different. Menus might have calorie counts on them. Trans-fats might be banned from all ingredients. And your fry cook might be earning more cash than a private in the U.S. Army.

Whether this future becomes reality may very well hinge on this year's elections.

On Nov. 7, Democrats swept Republicans from power in the House of Representatives and moved to within one seat of victory in the Senate in a sharp rebuke of President George W. Bush that led immediately to Defense Secretary Donald Rumsfeld's resignation. According to CNN, Bush said he had "a series of thoughtful conversations" with Rumsfeld about the defense secretary's resignation.

"I'm obviously disappointed with the outcome of the election and as the head of the Republican Party I share a large part of the responsibility," Bush said.

Six states approve wage hikes

This year, there were ballot initiatives to raise the minimum wage in six states: Arizona, Colorado, Missouri, Montana, Nevada and Ohio. All six minimum-wage proposals passed.

"The people who want to raise minimum wage must have never written a check to cover labor," said Ed Tinsley, chairman of the National Restaurant Association.

The NRA said voters that thought that they were approving a one-time increase in their state minimum wage will be surprised when they learn that each of these measures contained complicated indexing provisions that set automatic yearly wage hikes on autopilot.

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Top-tier restaurant chains like Chipotle Mexican Grill and Buffalo Wild Wings are not really concerned about the minimum wage hike. "We pay well over minimum wage anyway," said Steve Ells, Chipotle founder and chief executive. Buffalo Wild Wings CEO Sally Smith said in an investor's call that the chain is prepared to increase menu prices.

But Tom Foulkes, vice president of state relations for the NRA, said setting the wage-hike in stone — by writing it into the state constitution — could be detrimental in the long run. He said minimum wage should be debated on the floor, not voted on.

"Cramming a complicated economic issue like raising the minimum onto an already cluttered ballot is no way to enact sound economic policy," Foulkes said.

Congress

A majority Democrat House does not bode well for restaurant operators, said John Gay, NRA's vice president of the government affairs division. But. ...

"The National Restaurant Association will aggressively promote and advocate our pro-employee/pro-employer public policy agenda, which is a major component of the Association's Cornerstone Initiative," said Steven C. Anderson, NRA's president and chief executive. "That agenda supports, proactively,

Steven C. Anderson, NRA president.

legislative initiatives that ensure that the restaurant industry continues as the cornerstone of our nation's economy, the cornerstone of the local community, and the cornerstone of career and employment opportunities."

Anderson said the restaurant industry's overall impact on the nation's economy is in excess of $1.3 trillion a year, or 10 percent of the country's Gross Domestic Product.

"Whether a lawmaker has a 'D' or a 'R' after his or her name, we are confident that consensus can and must be reached to continue and expand the American Dream that is embodied in the restaurant industry," he said.

What's next?

Now that Democrats have control, there will be more challenges on minimum wage, on legal reform, on obesity. "There will be more hearings about menu labeling," Gay said.

Gay can see a scenario where the government might take on "Big Food" as it did with "Big Tobacco."

"That's really just speculation," Gay said. "But we have worked with Democrats for years and no matter how it turns out, we'll work through the challenges."

Earlier this year, the Republican-led House passed an immigration reform proposal focused mostly on border security. The Senate backed a different proposal, also backed by President Bush, which would allow many of the estimated 7 million undocumented workers to stay, and permit businesses to recruit workers for seasonal jobs. With Democrats in control of the House, the chances for a congressional compromise appear more likely, the National Immigration Forum's Angela Kelly told the Chicago Tribune. Gay told the Tribune, "Immigration offers a strong potential for a Democratic-led Congress and this president to agree," he said. However, the Democrats are not unified on the issue. Organized labor is divided on immigration reform. The AFL-CIO, for example, vows to do its best to kill the Senate bill as it opposes the guest worker program.