“Denver’s high minimum wage, especially its low tip credit, has unintentionally undermined the financial viability of full-service, labor-intensive restaurants. As costs outpace revenue and margins evaporate, once-thriving independent establishments are closing in droves, eroding the city’s cultural fabric and economic diversity.
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Restaurant operators and advocacy groups agree that Covid sparked the decline, but rising costs since have continued to cripple the industry. Property taxes, utilities, insurance, food and drink prices, rent, and one of the highest minimum wages in the country — higher than in Los Angeles or New York — are straining already razor-thin margins.
The city’s low tip credit, which results in a high minimum wage for tipped workers, is a particular pain point.
Denver City Council unanimously passed a minimum wage increase in November 2019 — just four months before the pandemic hit — and it was fully implemented citywide by 2022. Today, the base minimum wage is $18.81 an hour and the tipped wage is $15.79 — increases of about 70 percent and 95 percent, respectively.
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Per 2019 legislation, wage increases are uncapped and rise annually with the Consumer Price Index. In 2026, the base wage will be $19.29. For operators like Ms. Tronco and Mr. Seidel, who said that labor now consumes more than half his revenue, the math no longer works.
“When you force an operator to give raises every January 1 to the group of people who’s already making the most money, it chokes our ability to give a salaried person or an hourly cook a raise,”
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To keep her business alive, Ms. Tronco has cut the hosts and bussers she hired when opening and reduced weeknight server shifts. She raises her menu prices every six months to keep up with costs. Her numbers have taken a hit: Sales are down an average of 10 percent this year.
“It just feels like whack-a-mole,” Ms. Tronco said. “Inflation has affected everyone … Now we’ve got a tariff situation and all my wine importers are telling me that everything is going to go up $3, $4 a bottle.”
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Mr. Padró said the small tip credit is the industry’s biggest burden. He supports a higher base wage, even up to $25, because most of his employees already earn above that. He said that his servers and bartenders average $38 and $44, respectively. Expanding the tip credit would alleviate some of the burden faced by operators.
“I have 17-year-old kids pouring coffee for their teachers, making more than them,” he said.”
“Michelle Freenor, a tour guide in Savannah, Georgia, gets good reviews from customers.
But her business almost didn’t get off the ground because local politicians said, “No one can be a tour guide without first getting a government license!””
Wealthy people and great entrepreneurs aren’t going to not start that great business because they will pay more taxes if they make it big. Either way, if successful, they would have done something great and will be rich.
The most profitable and flexible workforce for Americans is illegal immigrants.
When we put tariffs on China, we are saying every country on Earth can get low inputs from China except America, making American business less competitive.
“Imports are essential to the kits that Levi and his one employee assemble in a warehouse near Charlottesville, Virginia. For example, a kit that teaches kids how to build a small theremin requires a circuit board, resistors, capacitors, bits of wire, and plastic molding to hold batteries and other pieces in place.
“I don’t have millions and millions of dollars to spin up my own circuit board assembly line, and plastic mold injection, and everything,” Levi says.
Though he is running a small, niche operation, Microkits is in many ways a microcosm of American manufacturing. Levi provides the ideas and designs, and he oversees the final assembly of his products in America, but those products combine parts sourced from around the globe.”
Trump inherited money and business from his dad, and made a lot of money through his celebrity, but as far as his actual businesses, he mostly spent a lot of money and then used courts to not pay debts he owed. He was a bad and dishonest businessman, and his image as a successful businessman is mostly false.
“Skype’s consumer service was shut down by its parent company Microsoft…Though President Donald Trump’s overzealous antitrust enforcers think popular platforms with large user bases imbue firms with incontestable market power, the rise and fall of Skype contradicts this theory. Federal trustbusters should keep this case in mind before deeming Big Tech companies monopolies, breaking them up, and decreasing American innovation, growth, and dynamism.
Skype launched in 2003 and had 150 million monthly users by the time of its acquisition in 2011. Microsoft bought the internet calling service for $12 billion in inflation-adjusted dollars in May 2011, which the Federal Trade Commission (FTC) approved in June of that year. Salvatore Cantale, a professor of finance at INSEAD, a global business school, explained in 2013 that Microsoft paid “roughly ten times Skype’s revenues in 2010 [and] around twice its recent valuation.””
“Considering the network effects—which Reason’s Elizabeth Nolan Brown explains as the advantages that accrue to tech platforms that already have a strong user base—experienced by telecommunications services, many would predict that this dramatic increase in demand would increase Skype’s market share as new users flocked to the most-used videoconferencing platform. But the opposite happened: In 2021, Skype’s market share fell to a measly 6 percent while Zoom’s skyrocketed to nearly 50 percent. Skype’s market share recovered only seven percentage points by 2024 and was discontinued by Microsoft, which transitioned accounts to Microsoft Teams, an application that facilitates workplace communication and collaboration.”
“Google is not a charity; it’s a business. If it cannot generate revenue to make a profit through the combination of its advertising products, user data, and contracts with device manufacturers, it may have to raise prices on products that are presently enjoyed for free by consumers.”
“Expropriating billions of dollars from American businesses is injurious and capricious. Citizens of the E.U. benefit from the American technology sector; siphoning capital from U.S. tech firms leaves them with less to commit to research and development, stymieing further innovation. The E.U. should stop penalizing American firms that outcompete their European counterparts.”
Trump’s China tariffs are destroying this small business.
When starting the business she looked into manufacturing in the U.S., but no U.S. factory would accept such a small order. Today, the price, requirements, and availability of source materials make manufacturing in the U.S. prohibitive.
After Trump’s election, she prepared for 20 percent tariffs, but Trump’s 100 plus percent tariffs are destructive.
“As ugly as the stock market losses have been, the big hit from Trump’s tariffs probably haven’t even arrived yet. As always, the stock market is not the economy—it’s an aggregated indicator of what investors think the economy will look like in the future. Right now, they think it will be bad. Really bad.”
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“In addition to crashing Americans’ retirement accounts and wiping out huge amounts from American companies (Apple and Nike were among the biggest losers in Friday’s rout), Trump’s move will soon raise taxes, wreck supply chains, and make basic goods more expensive or difficult to obtain.
In other words, even if you aren’t affected by the stock market sell-off, you’ll feel the effects of the tariffs before long.
Take each of those things in order. First, the tax increase. Tariffs are a form of taxation. According to the Yale Budget Lab’s analysis, Trump’s tariffs will reduce the average household’s income by nearly $3,800 this year. That’s because lots of things will get more expensive. Tariffs could triple the cost of a new iPhone, for example.
Second, the supply chain chaos. Ryan Peterson is the CEO of Flexport, a tech platform that helps companies with global logistics. He reported last week that 28 percent of the companies in Flexport’s system are “pausing all ocean freight bookings from Asia until there’s more clarity on where tariffs will end up.”
That means that even if some American companies are willing to pay the tariffs to keep supply chains flowing, they may not be able to find importers and shipping services right now.
Finally, the tariffs (and the associated supply chain disruptions) will have an immediate impact on prices and the availability of goods.
“A trade war triggered by Trump’s chaotic tariffs is the same type of aggregate shock as the Covid crisis, but worse,” warns Ben Golub, a professor of economics at Northwestern. As the tariffs degrade the ability of modern international supply chains to function, he wrote on X, the results will be “supply shortages and price spikes.”
To give just one example, consider the morning cup of coffee you might still be nursing. Americans consumed 1.6 billion pounds of coffee last year, but the United States produces only about 11 million pounds annually (all of it in Hawaii).
America also exports a lot of coffee—more than $900 billion of it last year. That’s possible even though we don’t grow very much here, because America-based coffee companies can buy beans from other countries, roast them, and then export them abroad. What are those middle-of-the-supply-chain companies supposed to do? Coffee-drinkers are screwed and coffee exporting companies that employ American workers are doubly boned.
Now repeat that same process for every industry connected to global supply chains. It’s grim.”