“Reopening the Economy” Isn’t the Way to Save Restaurants. What Is?

Part of the Series

Despair and Disparity: The Uneven Burdens of COVID-19

In the early days of shelter-in-place, I cooperated with some friends in Sacramento’s city government on a concept designed to channel money to local restaurants so that they could keep dollars flowing to at least some employees.

The idea was pretty straightforward: When we go out to restaurants, to bars, or to cafés, we are willing to pay a premium for our food and our drink because we value the social camaraderie we find in such places. Essentially, in addition to paying for the raw ingredients of the things we ingest, we are also paying rent for our restaurant tables and our bar stools.

Temporarily unable to sit at those tables or on those stools, many with the means to do so have retreated to virtual get-togethers with our friends and our colleagues, perhaps opening bottles of wine and beer before we log on, and then clicking our virtual glasses together in toasts and talking in front of computer screens. But we’re all hoping for, longing for, a day in the future when we can return to those tables and stools — and hoping, desperately, that our beloved local eateries, and their hard-working staff, manage to weather the financial storm until then.

The plan we came up with in Sacramento was simple: after each get-together, instead of calling the waiter over and asking for our check, we’d log onto a GoFundMe site for local restaurants and bars set up by the city and some local influencers, and we’d cash out on that site. When I have a drink with friends now, I click on that site and donate the equivalent of a couple drinks’ worth.

The site raised $29,000 in its first few weeks — not a huge amount by any stretch, but enough to allow for more than 20 micro-grants to be distributed to restaurants. According to the owners, as they waited day after day for federal loans and stimulus checks to arrive, these locally generated grants were enough to tide them over for at least a couple weeks. A similar fund in Charlottesville, Virginia, raised over $60,000 in the weeks that it was operative.

All over the country, private groups, local governments and philanthropic organizations are turning to increasingly creative measures to try to keep money flowing to restaurants, bars and cafes during a mandated shelter-in-place period that threatens to destroy millions of livelihoods and drive much of the restaurant industry to destruction.

There are now Diner Bonds that allow diners to buy discounted gift certificates for restaurants, to be redeemed once shelter-in-place ends. Essentially, if you buy a bond, you are loaning your local restaurants money to help tide them over. In redeeming those certificates down the road at an amount more than the face value, the restaurants are, in essence, paying interest back to the Diner Bond purchaser.

The National Restaurant Association has set up a Restaurant Employee Relief Fund, coordinated by celebrity chef Guy Fieri. It aims to raise $100 million, and as of early April was reporting that it had already raised $10 million. The James Beard Foundation established a Food and Beverage Relief Fund for independent restaurants, but the number of applicants for relief was so overwhelming that it has now suspended accepting new requests for help. And the Restaurant Workers’ Community Fund, which usually works on labor issues in the industry, has created an emergency fund for channeling $500 donations to individual restaurant employees.

In New Orleans, one of the country’s culinary hubs, the Louisiana Restaurant Association is providing a limited number of unemployed restaurant workers grants of up to $1,000 to help tide them over. But it only has enough resources to distribute 1,000 grants — far too few to meet the need in a city with as many bars and restaurants and clubs as has the Big Easy.

Similarly, in Nevada, the state’s restaurant association has also set up a relief fund.

But, while it’s better than nothing, the scale of the economic wreckage — in Las Vegas, one-third of the city’s jobs are tied up in restaurants, bars, casinos and hotels — means that private aid initiatives will only ever be a drop in the bucket.

In a more rational society, these ad hoc efforts wouldn’t be needed. Instead, Congress and the Trump administration would have immediately recognized the vital necessity of subsidizing wages in shuttered industries during a mandated public health lockdown — as did most countries in Europe — and 20 million-plus Americans wouldn’t have needed to file for unemployment over the past month. But to date that hasn’t happened.

While Congress has passed legislation to increase unemployment checks and to authorize the Treasury to send out stimulus payments, millions of those who qualify haven’t yet received any payments; and, when they do, they will be utterly inadequate to cover all of the recipients’ lost income over a multi-month stoppage.

Moreover, in a shameful capitulation to Trump’s nativist instincts, noncitizen immigrants who have legal documents but no Social Security numbers, as well as undocumented workers (including recipients of the Deferred Action for Childhood Arrivals program), many of whom work in the hospitality industry, were specifically declared by Congress to be ineligible to receive the stimulus checks sent out by the Treasury. So, too, were families in which one spouse was a U.S. citizen but the other did not have a Social Security number. In 2014, the National Restaurant Association estimated that 2.3 million immigrants worked in restaurants in the U.S. Many of these folks (and their spouses) are not going to receive Trump-signed stimulus checks.

Last week California’s Gov. Gavin Newsom announced that the Golden State would use Federal Emergency Management Agency money, add in some state and local dollars, and start paying restaurants to cook food for vulnerable elderly Californians who will likely have to shelter in place for months to come; and those three meals a day will then be distributed, free of charge, to the elderly. It’s as close to a New Deal-style employment program as anything unveiled so far during this crisis.

But, Newsom’s effort notwithstanding, even in California most restaurants and their staff have been left in an ugly limbo. To be sure, demand for take-out and delivery services has sky-rocketed — Talkwalker Analytics, which monitors online trends, recently documented an 11,000 percent increase in social media mentions of Instacart in March and April, and huge upticks in mentions of Uber Eats, Postmates, DoorDash, ChowNow and other restaurant delivery services. But that doesn’t begin to cover all the lost earnings from full tables and crowded bars seven nights a week.

And so, with a faltering federal response, and with most states too burdened by other fiscal needs to take on a full-scale restaurant-and-bar rescue effort, it is falling to local residents and philanthropic organizations to fill the void as best they can. A staggering 8 million restaurant workers have lost their jobs in the last couple of months, and the industry as a whole stands to lose nearly quarter of a trillion dollars. Most of those workers, even when they had jobs, earned low wages and lived pretty much paycheck-to-paycheck. Many, because of their immigration status, will not receive any federal assistance. They are our neighbors, our friends, our relatives. As a society, we owe it to them to support them in any way we can over the coming months.