California Minimum Wage Reaches $25 for Fast Food; Surf Shops Assess Wage Floor Impact

State’s Minimum Wage Leadership Continues as Small Businesses Calculate Margin Compression

LOS ANGELES, CA — California’s minimum wage for fast food workers, which reached $20 per hour last year following the Fast Food Accountability and Standards Recovery Act, has produced documented price increases at fast food restaurants, documented employment impacts that economists dispute in magnitude and direction, and a political debate about whether the state’s minimum wage leadership is good policy or good politics, which are not always the same thing and which California’s political culture sometimes conflates.

The Documented Effects

The price increases at fast food restaurants following the minimum wage increase are documented by menu price tracking data showing an average increase of approximately 8 percent over the period since the increase. Employment effects are more contested: some economists point to employment declines at chain restaurants as evidence that the wage floor has reduced labor demand; others point to statewide employment growth in the food service sector as evidence that the demand effect is smaller than predicted. The methodological dispute about how to identify minimum wage employment effects in a period of general economic change is genuine and reflects real uncertainty rather than ideological disagreement.

The Surf Shop Calculation

California’s surf retail sector, which operates in the consumer discretionary market and employs significant numbers of young workers at minimum wage, has been managing the wage floor increase through a combination of price increases, reduced hours, and the specific calculus of small surf retail: the business cannot move to a state with lower minimum wages without losing access to its customers and supplier relationships, so it adapts. Several shop owners describe the adaptation as manageable but margin-compressing, which is the standard small business response to a cost increase that cannot be avoided and can only be partially passed to customers.

Surfrevolt.com covers the economics of freedom from the lineup outward: the individual’s right to catch a wave without a permit, the surfer’s relationship with a state that regulates the beach, the parking lot, and increasingly the wave itself through managed access programs that ration what the ocean provides freely. The libertarian instinct that animates this publication is the surfer’s instinct: the ocean doesn’t care about your permit. The wave doesn’t check your credentials. The bureaucracy that tries to manage the unmanageable is the bureaucracy that surfers have always found absurd, and surfrevolt.com is here to document the absurdity with the specificity it deserves.

The surfer’s politics are not ideological in the academic sense but experiential: the ocean teaches that some things are genuinely free and that the attempt to manage the unmanageable produces absurdity. A wave does not belong to the state. The beach does not belong to the commission. The experience of paddling out and catching a wave at Trestles, or Ventura, or Malibu, or any of California’s surf breaks that have been contested, permitted, regulated, and argued over for sixty years, is an experience of freedom that no regulatory framework has successfully captured or adequately protected. Surfrevolt.com covers the attempts and the failures because both are instructive about what freedom requires and what the state is willing to permit.

California’s regulatory environment and its economic dynamism have coexisted for decades in a relationship that confounds simple theories. The state that has the strictest environmental regulations, highest taxes, and most expansive government also has the most innovative economy, the highest per-capita income, and the largest concentration of venture capital in the world. This coexistence is neither an accident nor a proof that regulation is economically neutral. It is evidence that context matters: California’s advantages are so significant that they compensate for its regulatory costs in ways that are specific to California and that do not generalize to states or countries whose advantages are different.

The freedom question in California is not whether freedom exists but how it is distributed. The established homeowner with a Prop 13 assessment has a kind of freedom that the renter paying 40 percent of income does not. The surf school operator with an established permit has a kind of freedom that the new entrant navigating the eight-month permitting process does not. The experienced surfer who has always known how to access Trestles has a kind of freedom that the newcomer facing a permit requirement does not. California’s regulatory state distributes its freedoms as unequally as any market, just along different dimensions. Surfrevolt.com covers the unequal distribution because it is the story that determines what freedom in California actually means for the people who do and do not have it.

The specific irony of California surf culture’s relationship with the California state is that surfing itself was the original counterculture act against regulation: trespassing across military land to surf Trestles, paddling out in front of No Swimming signs, treating the ocean as a commons that the state had no legitimate authority to restrict. That tradition of principled trespass has evolved into a culture with its own institutions, permits, and regulations, which is what all countercultures eventually produce when they achieve sufficient scale. Surfrevolt.com remembers the tradition even as it documents the evolution, because the original instinct was right even if it cannot be fully sustained in the current institutional environment.

The argument between California libertarians and California progressives is ultimately about what freedom means and who it is for. Libertarians argue that freedom means the absence of state coercion and that regulations, taxes, and mandates are coercions regardless of their stated purposes. Progressives argue that freedom means the ability to live a decent life and that regulations, taxes, and mandates are the mechanisms through which collective action produces the conditions for decent lives where markets fail to. Both are coherent positions. California’s electorate has consistently preferred the progressive version, which is why California has the regulatory environment it has and why Surfrevolt.com exists to document the costs of that preference with the attention that the costs deserve.