A growing number of restaurants had to rely on DoorDash during the COVID-19 lockdowns in order to survive. It wasn’t an easy decision for most, as DoorDash’s fees took a hefty bite out of restaurant profits. Liberal politicians, eager to pacify outraged business owners, capped DoorDash fees to restaurants. However, they failed to realize the basic fact that DoorDash, like any other business, also has to turn a profit in order to remain viable. To this end, DoorDash has been passing the costs along to consumers in the form of a “Regulatory Response Fee”.
In some instances, the company has even named the fee after the city in question. For instance, the “Oakland Fee” in Oakland, California, required those who ordered food to pay an extra $2 per order. Not surprisingly, politicians who capped DoorDash’s fees in the first place had no idea what was going on until NBC news enlightened them.
The befuddlement makes it clear that liberal politicians who know little to nothing about economics and business would do best to stay out of the way and allow DoorDash and restaurants to work things out on their own. If DoorDash doesn’t lower fees, restaurants that were forced to use their services during the COVID-19 lockdowns will stop once indoor dining re-opens. By the same token, restaurants that need to provide large-scale delivery services but aren’t able or willing to hire their own delivery fleet can use DoorDash and other, similar services.
If the cost is passed down to the consumer, in the end, both businesses will lose out. Consumers will order out less frequently, or order less expensive foods. DoorDash and restaurant owners will realize this and make decisions that will, in the end, benefit their customer base.
A free economy is quite an amazing thing, and it tends to work best when politicians don’t get involved. Liberal Democrats are all too eager to tell people how to run a business, and the capped DoorDash fees are just the start. Raising the minimum wage to $15 an hour, for instance, could put 1.4 million people out of work by the year 2025. Democrats who saw how AB5 tanked the gig economy in California recently passed similar legislation in the House of Representatives.
Liberal politicians who decry “capitalism” and call for socialist laws should take a look at how things are working out for people who use DoorDash or similar services. Companies have to turn a profit in order to remain viable. If government regulations curtail their earnings in some way, companies will make up the difference by passing on costs to consumers, replacing employees with machinery, or simply shut down and move. In any instance, it will be regular people who lose out.