A handful of consolidated fast-casual chains raised burrito prices on purpose, and Carol Roth’s column at Fox News doesn’t name them. Writing over at Fox in “Government made your burrito more expensive, and socialism will make it worse,” she runs down federal spending, the deficit, the Federal Reserve, the minimum wage, state permitting — every lever except the one doing the actual work — and lands on the catechism of the comfortable: less government, not more. The piece is right that inflation happened and that the federal debt is large. It’s wrong about which lever did the damage.
Concede the true half, because it’s true. The Federal Reserve’s balance-sheet expansion during COVID did add to inflation. So did pandemic deficit spending. Money-supply growth, when it outruns real output, reduces the purchasing power of every dollar in circulation. A modest minimum-wage hike does push some costs into prices at some firms. Permitting and compliance do burden small businesses. None of that is fake. The first half of the piece is a real economics-paper version of those points, buried under three pages of resentment.
Now the omission. Roth names the Fed, the welfare state, the minimum wage, the compliance burden. She doesn’t name the firm. She doesn’t name Chipotle, or the consolidation that has left three or four firms controlling most of the fast-casual market in any given metro. She doesn’t mention that when an industry consolidates, the survivors gain pricing power — the power to raise prices above input-cost growth, year after year, and pocket the difference. That isn’t inflation in the macroeconomic sense. It’s rent extraction dressed up as inflation, and in concentrated sectors like food services it has been a meaningful slice of the price tag in recent years.
How meaningful? Multiple working analyses — the IMF, the Federal Reserve Bank of Kansas City, the Economic Policy Institute, and independent economists — found that corporate profit margins contributed well over 40% of the rise in the U.S. price level between the end of 2019 and mid-2022, against a more typical 11% to 12% in prior inflation episodes. Concentrated industries like food services, where pricing power is structural, were exactly where this markup story showed up in the data. Roth calls the price tag a tax from government. A non-trivial slice of it is a tax from the only firms big enough to set their own prices — the same firms her column would protect from the “burden” of a wage floor. If Roth thinks the consolidated firm’s pricing power isn’t the bigger story, she’s welcome to make the case. She didn’t.
The Fed frame has a separate problem Roth didn’t bother with. The 2021–2023 inflation surge was global, hit food and energy harder than many other goods, and was driven substantially by pandemic supply-chain disruption and the war in Ukraine’s effect on grain and fertilizer. The Fed’s balance sheet did grow — that’s real. But if the monetary story were the whole story, you’d expect to see prices rise proportionally across the board. We didn’t. We saw food and energy rise sharply while many goods and services barely moved. The labor-cost story fails the same test. The minimum-wage work that actually exists — David Card and Alan Krueger’s foundational 1990s study and the more recent evidence from Seattle, San Francisco, New York, Los Angeles, and Chicago — finds modest pass-through, on the order of a few percent for every ten percent wage increase. The actual burrito inflation was several times that. The labor-cost story doesn’t pencil. The pricing-power story does.
Then the minimum-wage paragraph, where the trick gets cheap. Roth argues that a wage floor “works its way up” the ladder and ends up hurting the worker. There’s a real economics-paper version of that argument. There’s also the version where the cheap burrito is subsidized — by SNAP, by Medicaid, by the earned-income tax credit — for the underpaid workers who assemble it. The low-wage worker doesn’t keep what you saved. You do, and the public fisc eats the rest. A modest wage floor internalizes a cost the public is already paying. It moves a few billion dollars from taxpayers to the people who actually did the work. Some of it finds its way into prices; some doesn’t, because in a concentrated labor market one big employer often sets the wage for the whole area — the textbook case where the worker has nowhere else to sell their hour.
So Roth’s framing inverts. She wants cheap burritos, so she argues for the cheapest possible labor at the chains. But a worker earning $7.25 an hour at Chipotle still can’t afford the $14 burrito they’re making. The “affordability” she keeps invoking is the affordability of the customer, not the affordability of the worker — and the chains have arranged things so the customer and the worker are often the same person, paying each other through a corporate markup. That’s not a market outcome. That’s an extraction. I’m not anti-market. I am anti-extraction. There is a Grand Canyon between those two positions, and the burrito’s price sits squarely in it.
Then the kicker. “Less government, not more, is the only solution,” writes a woman whose column is hosted on a government-regulated broadcast platform, monetized against government-protected intellectual property, distributed over government-built internet infrastructure, and protected from fraud by government enforcement. Fine. But also: her “solution” is a stance, not a mechanism. It doesn’t say what happens to the workers. It doesn’t say what happens when the consolidated firm has no competitor and no labor market left to discipline its prices. It just hands the firm more of the same.
Here is what builds instead, and it isn’t socialism in any sense that justifies Roth’s sneer. It is the boring, working machinery that already exists in this country, which her column has not noticed.
If you want to discipline the consolidated food firms, give workers countervailing power — a sectoral wage floor for fast food and home care, set by a board that actually exists, with employers at the table. Recent modeling by the Center for American Progress estimates sectoral bargaining could roughly triple union coverage in the United States. The fast-food industry is concentrated enough to absorb a wage floor without losing employment; the firms have plenty of markup to give up. If you want to discipline corporate markups across the economy, build public options for the things the consolidated sectors are now monopolizing — public banking, a public grocery option, public childcare that competes on price with the rent-extracting incumbents. If you want to discipline the food firms specifically, let the workers own them.
A worker-owned burrito cooperative would internalize the margin Roth is currently handing to Chipotle’s shareholders. The co-op keeps the markup as member income, not as profit to a remote C-suite. The pay ratio inside such a co-op is set by the members, typically between three-to-one and six-to-one. The country has roughly 820 worker cooperatives today, up from 323 a decade ago, employing on the order of ten thousand worker-owners. Mondragon, the Basque federation, has run variants of this at more than €11 billion in annual revenue since 1956 — through multiple recessions, several European currency crises, and the 2013 bankruptcy of its flagship appliance co-op, Fagor Electrodomésticos. Mondragon’s general council declined to keep pouring money in — would have endangered the whole federation — so the council worked to relocate roughly 1,700 of Fagor’s ~1,800 Spanish worker-members to other co-ops, with early retirement offered to others. Non-member workers weren’t covered, and the regional job losses in the Basque country ran into the thousands. That is not magic. That is what happens to people when the magic runs out in a worker-owned firm, instead of what happens to them in a private-equity-owned one.
The 145 million Americans who belong to a credit union already belong to a cooperative. The Bank of North Dakota has been publicly owned and consistently profitable since 1919 — in the reddest state in the union — and nobody has ever called Bismarck the Kremlin. We expanded the Child Tax Credit in 2021; the Census Supplemental Poverty Measure recorded the largest single-year drop in child poverty on record, roughly 46% in a year, and bounced back when we let the expansion lapse. The American childcare “market” cannot be cheap for parents, decently paid for workers, and profitable for owners all at once; every other rich country picked the parents and the workers and paid the difference. We picked the spreadsheet and act surprised.
Roth’s piece ends with the catechism: less government, not more, is the only solution. It isn’t. It’s a stance her column takes and never pays for. The actual choice is between the chains keeping the markup or the workers keeping it — and the institutions that decide which are already up for grabs. The next move belongs to whoever stops blaming the teenager behind the counter and starts naming the consolidated firm.