Dem Senators Criticize McDonald’s Price Increases, Thrusting Fast-Food Giant Further into Political Spotlight

A group of Democratic senators is scrutinizing McDonald’s price increases, thrusting the fast-food giant further into the political spotlight.

Senators Elizabeth Warren (D., Mass.), Bob Casey (D., Pa.), and Ron Wyden (D., Ore.) wrote a letter last week to McDonald’s CEO Chris Kempczinski asking for more information about the company’s pricing strategies and why its price increases have outpaced inflation.

“While McDonald’s is not the only fast food restaurant that has increased prices significantly in recent years, its dominant market position as the largest fast food chain in the United States has an outsize impact on American consumers. While working families are trying to make ends meet, McDonald’s and its corporate counterparts have continued to grow their profits,” the letter reads.

“Corporate profits must not come at the expense of people’s ability to put food on the table. As we seek to investigate and understand the increased consumer costs in the economy, we hope McDonald’s will help us to understand why its prices have risen so high.”

In May, McDonald’s president Joe Erlinger disputed social-media posts suggesting the company was raising prices over and above the rate of inflation. He said the franchisees who set prices were responding to inflationary pressure on input costs and touted McDonald’s limited-time offers.

“In doing so, they work hard to minimize the impact of price increases on our fans. This includes the everyday prices on our restaurant menu boards to special limited-time offers,” Erlinger said in a statement.

“That’s why prices for many of our menu items have risen less than the rate of inflation – and remain well within the range of other quick service restaurants. It’s also why more than 90% of U.S. franchisees are offering meal bundles for $4 or less.”

Warren and her colleagues questioned the veracity of Erlinger’s statement, citing operating expenses and profit margins listed in the company’s publicly available financial statements. The letter also references an earnings call in July where McDonald’s executives acknowledged that low-income consumers were taking their business elsewhere due to its prices.

The lawmakers are asking McDonald’s for information about how individual items are priced and how the company advises franchisees tasked with setting prices at specific locations. They are also questioning McDonald’s recent stock buybacks and the executive compensation structure for its top employees.

Warren is a longtime critic of big business and a proponent of the “greedflation” theory that large corporations are to blame for high inflation under the Biden administration, rather than other factors such as government spending and supply bottlenecks.

Likewise, Casey, a vulnerable incumbent running a close race against GOP challenger Dave McCormick, routinely blames excessive corporate profits for inflation and has made it a campaign issue. Many economists have dismissed the “greedflation” narrative, especially as inflation has subsided in particularly vulnerable sectors.

Although it was written last week, the letter only became public Tuesday following former president Donald Trump’s much-discussed campaign stop at a Pennsylvania McDonald’s.

Trump briefly worked the fry cooker and served food at a McDonald’s in Bucks County, Pennsylvania Sunday, setting up a striking contrast against Vice President Kamala Harris’s claim that she worked at McDonald’s to help pay for college.

Videos and pictures from Trump’s McDonald’s stop circulated widely on social media and proponents of the move argued that it made him appear relatable and brought out his humor. The former president’s liberal critics have angrily suggested it was a meaningless stunt and homed in on Trump’s skepticism of Harris’s past work at the fast-food chain.

During her presidential campaign, Harris has repeatedly brought up her past experience working at McDonald’s to connect with service workers and highlight her middle-class background. Harris did not mention the job in either of her memoirs and neither do two Harris biographies.

“As we’ve seen, our brand has been a fixture of conversation this election cycle. While we’ve not sought this, it’s a testament to how much McDonald’s resonates with so many Americans,” McDonald’s said in a statement.

“McDonald’s does not endorse candidates for elected office and that remains true in this race for the next President. We are not red or blue — we are golden.”