It’s sad to see a closed restaurant, shuttered due to the COVID-19 pandemic. But it’s even sadder to think that it might not re-open once the crisis is over. Nevertheless, that’s the sad prospect facing restaurant operators and staff across the globe as the coronavirus story continues to unfold…
The new reality in the restaurant business…
Just how serious is the COVID-19 crisis for restaurant operators and their employees? The U.S. National Restaurant Association (NRA) says it’s literally a life or death situation, and the organization has called on the federal government to provide a whopping $355 billion in relief for the industry.
What is the NRA?
The COVID-19 relief news release carries a footnote stating: “Founded in 1919, the National Restaurant Association is the leading business association for the restaurant industry, which comprises 1 million restaurant and foodservice outlets and a workforce of 15.3 million employees.” That’s one powerful lobby group. And it represents a lot of votes for congressional representatives. Will they give the restaurant sector what the NRA asking for?
The magnitude of the disaster
The NRA estimates that its members will lose $225 billion in revenues over the next three months and 5 to 7 million jobs will be lost.
“We are revising our business model to provide meals in different ways, takeout, delivery, safety-enhanced dine-in, but the majority of our restaurants do not have this capability today. As the restrictions continue, we are facing economic headwinds that will lead many restaurants to shut down operations, lay off workers, and end service in our communities,” said Executive Vice President of Public Affairs Sean Kennedy. “Taken together, these proposals will ensure that restaurants have increased liquidity and access to necessary financing to help the industry and its employees recover.”
What the NRA is asking for
According to its March 18, 2020, news release, the NRA proposes that: ‘Direct relief should include a Department of the Treasury-established $145 billion restaurant and food service industry recovery fund to help cover operations and pay employees; a proposed $35 billion community development block grant for disaster relief for regions and communities especially hard-hit.’
It also calls for the provision of $100 billion in federally-backed business interruption insurance, an expansion in ‘affordable’ federal and conventional loans totalling $45 billion, and $130 million in disaster unemployment assistance
Not missing a beat, the NRA is also asking for tax relief and deferrals for restaurant operators.
Every community is effected
Literally every community in the U.S. (and, by extension, in all other Western nations) is effected by the current hard times for restaurant operators. The restaurant industry is one of only a very few economic sectors that has such universal penetration in Western society.
Where will the money come from?
$355 billion is more than 13 times what U.S. President Donald Trump was asking for to build his much criticised border wall. But nobody is batting an eye at the NRA’s request. And remember, the restaurant sector is only one of many that make up the American economy. It appears that the only way to get the money needed to address the overall economic impact of the COVID-19 crisis is to finally insist that rich folks pay their fair share in taxes – taxes which they now largely avoid via various loopholes and ‘programs’. That’s not going to go over well with the wealthy. But there doesn’t seem to be any other option..
~ Maggie J.