A Tale of Two Food Cities

A story of Makers and Takers, and the rules each live by.

When the people find they can vote themselves money, that will herald the end of the republic.
—Benjamin Franklin

Don’t hate the player. Hate the game.
—Ice-T

Editor’s note: This article first appeared in 2011.

In America, there are two basic types of wealthy people: those who get rich by making our lives better and those who get rich by using the political process to transfer wealth from others. You’ll find Makers anywhere people are free enough to get a good business off the ground. You’ll find Takers anywhere authorities can pick winners and losers in the economy―whether through regulations, subsidies, or special favors.

The trouble is the rules don’t always favor the Makers.

Nobel Prize winner Douglass North, in his 1993 prize lecture, said:

The organizations that come into existence will reflect the opportunities provided by the institutional matrix. That is, if the institutional framework rewards piracy then piratical organizations will come into existence; and if the institutional framework rewards productive activities then organizations—firms—will come into existence to engage in productive activities.

Great civilizations emerge where Makers can flourish. Once-great civilizations declined once the Takers started to outnumber the Makers. 

Greece. Rome. Britain. America will soon follow. The firewall between business and the state had been dismantled in these prosperous centers. All lost ground because they succumbed to the influence of Takers—also known as special interests. While many believe government power should be wielded for the greater good, most of what is done in the public’s name is really just “politics without romance.” 

But don’t take my word for it. 

White Tablecloths

From Washington, D.C., you can travel south on I-95 through lightly rolling central Virginia. Cross the state line. There, you’ll pick up what’s left of tobacco road. Take that to Raleigh. 

The capital of North Carolina has always been a strange mix of ole-boy networks and populism, much like the rest of the state. Despite its proximity to the high-tech Research Triangle Park, Raleigh is more like a mini-Washington, D.C., only the backbiters and bureaucrats talk a little slower. 

In 2007, downtown on Fayetteville Street, you could find The Mint—a white-tablecloth restaurant that could have been plucked from Chicago’s Gold Coast or New York’s Upper East Side. Despite Raleigh’s questionable urbanity, The Mint is one of maybe a handful of “world-class” restaurants in the area. And if it weren’t for a kind of cosmopolitan penis envy on the part of Raleigh’s big wigs, The Mint would probably never have come into existence.

In 2007, the city of Raleigh officials gave The Mint $1 million in subsidies in addition to at least a year’s free rent in a city-owned building. Town poobahs had decided Raleigh must have country-club eating closer to the legislature and administrative buildings. How, after all, could important people be expected to broker big deals over plates of barbecue and ‘slaw?

Raleigh has always had a chamber-of-commerce mentality. It extends back through nearly 100 years of Dixiecrat tradition. In other words, starting and running a business in North Carolina has always been about pleasing the political class. This is not to pick on Democrats; an animal we might call a “chamber-of-commerce Republican” inhabits the state, too, only it lives mostly in Charlotte. The Democrats have almost always held the reins in the city of Raleigh, not to mention legislative power in the state. In truth, when it comes to picking winners and losers, these two creatures, R and D, were virtually indistinguishable in North Carolina before the great upheaval 2010. Neither is pro-entrepreneurship. Both are pro-business. And there is a difference.

Take the business of eating out. As high-end restaurants like The Mint get subsidies, push-carts and food trucks are effectively banned.

Job Creation

Suppose you’re having a hard time making ends meet. Instead of lining up to get a welfare check at the Department of Social Services, you decide to start a micro-business selling food. What would you encounter if you tried to start a food truck in Raleigh? At the state level, writes the intrepid reporter Sara Burrows:

A Department of Environment and Natural Resources rule adopted in 1980 dictates, ‘Only hot dogs shall be prepared, handled, or served from a pushcart.’ Other than hot dogs, only prepackaged food from approved restaurants may be sold. State law allows a greater variety of food to be prepared and sold from food trucks, but trucks are more expensive and more heavily regulated than food carts.

If state regulations weren’t enough, city ordinances make things virtually impossible for micro-restauranteurs:

While some cities allow [food trucks] to park in metered spaces or designate a lot for them downtown, food trucks in Raleigh can operate only on commercially zoned land, with a permit, for up to 20 days. A limited number—two per block—of non-motorized pushcarts are permitted to set up on city sidewalks, but they cannot locate near a restaurant selling similar food, and they must be of a certain dimension, weight, and material.

Burrows once asked then Raleigh City Councilwoman Mary-Ann Baldwin why the city restricts the number and location of mobile food units. Baldwin rather brazenly admitted the regulations are necessary to protect established restaurants and keep the streets free of unsightly trucks. 

“You want to balance what’s good for the entrepreneur with what’s good for your restaurant owners,” the Carolina Journal quotes Baldwin as saying. “You don’t want to hurt [restaurant owners] and put them out of business. They’ve made a huge investment.” (I would have expected the usual shtick about health and safety, so Baldwin gets credit for honesty.)

So, do food trucks put big restaurants out of business? It’s possible, but isn’t that the nature of free enterprise? Competition? Creative destruction? Customers win? Something better replaces what goes out of business.

That’s a decision customers ought to make, not city planners. 

Managing partner Rick Jones of the Raleigh Restaurant Group (which owned The Mint) is what we might indelicately call a Taker. In other words, if it were not for the taxpayer’s dollars that kept Jones’ Potemkin restaurant on the taxpayer’s dole, Raleigh’s citizens might have let something interesting take root. Who knows what delicate saplings might have sprung up and blossomed had city planners not subsidized The Mint and forbidden food trucks?

Not all the blame goes to Rick Jones for gaming the system. He didn’t make the rules; if he hadn’t cashed in, someone else probably would have. Don’t hate the player. Hate the game. But it’s time we started thinking about changing the rules so that we reward Makers, not Takers. Both Makers and Takers get rich, but only one group deserves it. And to think that Rick Jones got wealthy at the expense of some taxpayers who could never afford to eat at The Mint! Well, let’s just say there’s something wrong with that.

Petty Fascism

Councilwoman Mary-Ann Baldwin is what I refer to as a petty fascist. While I normally hesitate to use the ‘F-word,’ it applies in Raleigh’s case. 

“Where socialism sought totalitarian control of a society’s economic processes through direct state operation of the means of production,” writes anti-authoritarian author Sheldon Richman, “fascism sought that control indirectly, through domination of nominally private owners. Where socialism nationalized property explicitly, fascism did so implicitly by requiring owners to use their property in the ‘national interest’—that is, as the autocratic authority conceived it.”

Replace “national” with “city” interests, and the F-word is apt. I’d bet Raleigh’s petty autocrats benefit from quid pro quo arrangements with corporate restaurateurs like Rick Jones. It’s just one of innumerable examples of crony capitalism in America―Takers living at the expense of Makers.

Town planners get into their heads that they are elected to determine the city’s character. These wise elites should figure out everything from restaurants to light posts to paint colors―down to the minutest detail. All will be decided according to their superior notions of a good city. And that is, frankly, why cities like Raleigh can lack grit and culture. Sure, the area is nice enough. But apart from boxy government buildings, downtown has become increasingly sterile and fabricated—all according to plan.

Culture and commerce cannot be planned from the top down. It emerges from the people, communities, and markets. In the seminal Life and Death of Great American Cities, Jane Jacobs once wrote that cities “have the capability of providing something for everybody, only because, and only when, they are created by everybody.” Why? Because,

There is a quality even meaner than outright ugliness or disorder, and this meaner quality is the dishonest mask of pretended order, achieved by ignoring or suppressing the real order that is struggling to exist and to be served.

That is culture, life, and prosperity from the bottom up.

Cities like Raleigh and neighboring Cary are fine if your idea of great food is Carrabba’s or The Mint. But people who like to taste the interesting experiments of humbler entrepreneurs will find little to offer in places subsidizing corporate cronies and keeping the little guys from ever getting into the game. Such places have about as much culture as ultra-pasteurized milk. What’s worse: Opportunities for people of little means get steamrolled when politicians collude with big business. Yet, this happens all the time. The ghosts of stillborn businesses hover around the town halls of America, and yet no one can see or hear them.

They are the casualties of a regulatory state that has grown too big and too costly. 

One Customer at a Time

Fourteen-hundred miles away, things were a little different―at least when it came to eating out.

“Damn, that’s a good taco.” That’s what Mike Rypka kept hearing over and over again. He knew if he kept hearing it, he was doing something right. 

My first experience with one of Rypka’s tacos changed my entire taco concept. And I’m no novice. I have tasted tacos far and wide, from the taquerias nestled in Chicago's North-side neighborhoods to the street food of the Yucatan. All were tacos that had, in some sense, set the bar for such fare. Until I tried Torchy’s.

I ordered a "Dirty Sanchez."

Scatological reference notwithstanding, imagine someone with lots of tattoos handing you your food from the window of an Airstream. It comes in a plastic basket with little cups of hot sauce on the side: scrambled eggs sharing a double-wrapped, soft-corn-tortilla bed with tempura poblano peppers, cheese, escabeche (pickled) carrot spears, avocados, and spicy ranch dressing. Carrots? Yes. The pickled carrot spears animate the taco with hints of crispy and tangy. The avocado is central and sensual. The sauce unites everything in creamy coolness. Those firm, steaming eggs make you forget that the Dirty Sanchez has no meat.

It takes chutzpah for a guy from Virginia to come to Austin, Texas, and start a taco truck. “You can’t throw a stick without hitting a Mexican restaurant in this town,” Rypka said, recalling his start. “Were we crazy?”

I don’t want to understate Rypka’s experience. He had studied at Johnson and Wales in Miami. He cooked for 3,000 heads a day at the World Bank, served President Clinton dinner, and ran kitchens as an executive chef at high-end restaurants in Chicago, L.A., and Houston. He had done all this after starting when he was only 15 at―of all places―a Popeye’s Chicken in Springfield, Virginia. Rypka says that’s where he fell in love with food. “Weird,” I thought, but I didn’t argue. The man was a culinary genius. 

A resume like Rypka’s might make most of us cocky, and yet that’s not what I sensed in him as we chatted over coffee. This was a guy with a passion for his craft and a belief that ordinary people can have delicious food at a decent price. “If I could do good quality, high-end food for the masses, that’s what I wanted.” By “masses,” Rypka meant a few Sixth Street partiers looking for hangover cures or a couple of working stiffs on their lunch breaks.

Little did he know what masses would come to mean.

Humble Beginnings

Rypka said he never set out to do anything but get into a situation where he could cook his own food, make his own rules, and not have to report to anyone except his customers. “I didn’t have rich relatives or anything,” Rypka said, “so we had to start small.” Turns out Rypka had a buddy with a rehabbed food truck―more or less a caterer’s R.V. “He couldn’t sell the thing to save his life. Back then, nobody wanted a food truck. These days, you can hardly find one anywhere.” 

I asked Rypka what he did to get started. He grinned a little as he reflected.

“I maxed out my credit cards. I took a loan out against my house,” he said. “And I didn’t get a paycheck for almost a year because I was putting everything back into the business.” 

Rypka convinced a downtown property owner to lease space in his lot―this, before hipsters made food trucks cool and The Food Network made them mainstream. Surprisingly, the Austin officials didn’t harass him, though the city can be draconian in other respects. In 2005, most people thought of a trailer as a place where rednecks live and/or recreate, or maybe how Mexican immigrants sell food in the barrio (certainly not a trained chef).

And this, by the way, is another aspect of Rypka’s brilliance as an entrepreneur: branding. He knew he had to signal something special. He did not settle for painting something sloppy on the side of his truck. Instead, he set to work “with a girl at Kinko’s” to design a logo that would capture Austin’s vibe and allow him to stand out in a city that hosts quite a few strong local brands.

Working at night, Rypka settled on the essence of what would become the Torchy’s logo: a cartoon devil baby with a pitchfork. The fiery font is distinctive: “Torchy’s” above and “Tacos” below, with the imp-child in between. A left-to-right scroll through the center reads “Damn Good.” So the whole impression is of Torchy’s ‘damn good’ Tacos as a gestalt, which calls to mind a playful tattoo. Perfect for Austin.

The live music capital is a city full of cosmopolitans, Johnny Cash fans, professionals, cultural creatives, the occasional cowboy, hipsters, and a lot of people with tattoos. It’s a city of beautiful contradictions. The contrasts work together like pickled carrots, fluffy eggs, avocado, poblano, and ranch. In Austin, Rypka had struck a chord.

Bear in mind Mike Rypka was serving good food at the genesis of the Austin food truck craze, of which he―along with food-truck phenoms Hey Cupcake and Flip Happy Crepes―formed the nucleus of the city’s mobile food culture, a culture that has swept much of the United States in recent years.

I wrote this in 2011, still in my honeymoon phase with Austin, after having moved there from Cary, NC. Of course, there have been any number of changes in 13-plus years. Indeed, Raleigh’s quality of life measures have likely improved and, as a denizen of Austin for said 13-plus years—I left in June 2023—I can tell you that Austin’s quality of life had diminished considerably as of that date. And that includes the food.

Damn Good Work

I couldn’t tell you how many people Torchy’s Tacos employs today. These folks can now pay their bills and have opportunities to advance within a good company.

And I dare say Rypka is probably in the “one percent” now. From a used taco truck, to ten stores and growing: How did they do it? “One customer at time,” Rypka said. He put together a great team, and he gives them tons of credit. But he started from almost nothing. No business plan. No begging for capital. A loan here and there,  but otherwise, they leaned on neither corporate investors nor colluded with politicians. 

Simply put: Austin didn’t ban food trucks. Rypka thrived in a business environment that allowed him to start small and experiment.

Despite the recession of 2008-2012, Rypka and his team were in the process of opening a tenth store as of this writing in 2011. Today, Torchy’s has an estimated 120 stores.

There are other types of food in Austin, too. From hole-in-the-wall ethnic to Tex-Mex chains like Chuy’s, and from Texas brisket to experimental sushi like that served at award-winning Uchi. Did any of these great places need their investments protected from Austin’s food trucks? Has Austin’s vibe been anything but enriched by the food truck culture? Let’s just say Austinites would have a revolt if it tried to ban them.

Vibrant cities like Austin have wonderful food ecosystems because of micro-entrepreneurs. Food trucks congregate along South Congress Avenue in areas that remind one of strange attractors. People flock to the area because they know the food trucks are there. Sometimes they patronize them, other times they want to sit indoors. It doesn’t seem to affect the surrounding restaurants that thrive in the area, such as Perla’s (seafood), Snack Bar (hipster American), and Zen (Japanese fusion).

So this leads us to a question: What would Austin, Texas, look like if the city had not allowed the original Torchy’s taco truck? And what would Rypka be doing today? Working for a corporate outfit like Sodexo? What about his 300 innumerable employees? 

The moral of these two stories is that the opportunities that arise from entrepreneurship can easily be legislated or regulated away in the name of all sorts of things. But we should really ask ourselves: Are the aesthetic preferences of town elites worth risking that some good things won’t come into existence? Should tablecloth restaurants be allowed to siphon off of hardworking people while people like Steve Pruner of Durham, North Carolina, who’re getting arrested for selling hot dogs from a cart without a license? And even if hot dog vendors and food trucks had the ability to put every big corporate restaurant in town out of business―which is doubtful―wouldn’t that be a reflection of the people’s will?

People vote better with their dollars.

Politics Without Romance

Nobel Prize winner James Buchanan put the central problem of American politics with scholarly concision:

If the government is empowered to grant monopoly rights or tariff protection to one group, at the expense of the general public or of designated losers, it follows that potential beneficiaries will compete for the prize. And since only one group can be rewarded, the resources invested by other groups—which could have been used to produce valued goods and services—are wasted. Given this basic insight, much of modern politics can be understood as rent-seeking activity. Pork-barrel politics is only the most obvious example. Much of the growth of the bureaucratic or regulatory sector of government can best be explained in terms of the competition between political agents for constituency support through the use of promises of discriminatory transfers of wealth.”

What Buchanan described in 122 words is a great power nexus. Politicians give advantages to special interests in exchange for power. Completing the nexus, do-gooders provide moralistic cover for most of it (health and safety, public good, saving the planet, and so on). Citizen-consumers, like you and I, lose. Power and wealth are concentrated on the political class and the corporate class. The costs of that power and wealth are dispersed over everybody else through higher taxes, higher prices, and limited choices.

As I write this, America is still in a recession. We have been for a while. True recovery will not come via dropping largesse from on high like manna from taxpayers. Nor will it come from crony capitalism that you’ll find in Washington, D.C., Raleigh, (or yes, Austin). It will come from genuine entrepreneurship led by people who start as small as Mike Rypka and may end up as big as the late Steve Jobs. These are people who satisfy our unmet needs. They serve us, and they make our lives better. In that sense, they make us richer, which is the essence of growth.

Making better rules for entrepreneurship―micro and macro―is the way America can be great again.

Editor’s Note: For what it’s worth, that last line was written pre-MAGA.

Editor’s Note 2: Torchy’s Tacos, unironically, opened a Raleigh, NC location in 2001.