Job-Killing Uncertainty in the Overregulated Obama Economy
CKE Restaurants CEO Andy Puzder on the Crushing Costs of President Obama’s Health Insurance Regulations
WASHINGTON, DC – The House Committee on Oversight and Government Reform today released Job-Killing Uncertainty in the Obama Economy, a new video in which CKE Restaurants CEO Andy Puzder – an AmericanJobCreators.com participant – underscores a major reason why job creators aren’t hiring in the Obama Economy: uncertainty caused by new government regulations. To comply with just one of the hundreds of new regulations in the President’s health insurance law, CKE will be forced to spend approximately $1.5 million to replace all restaurant menus, according to Mr. Puzder. That’s 17% of what it invested in new restaurants in 2010, and it’s all capital the Obama Administration will divert from job creation.
“Health care is probably the most significant unknown at the moment. People are unsure about how much it will impact their business, but they will know it will be significant and it will be negative,” said Mr. Puzder in the video. “It’s very hard to model the cost because the bill is so complex. The range [CKE’s economic forecasters] gave us on our health care costs increasing was between $7.3 and $35.1 million dollars. We spent about $9 million last year building new restaurants. That would be totally wiped out.”
CKE owns or franchises 3,182 restaurants – under the Carl’s Jr. and Hardee’s brand names – and supports more than 70,000 American jobs. Each new restaurant generates roughly 25 new jobs and pumps more than $1 million into the surrounding community. But according to testimony delivered at a July 28, 2011 Oversight hearing, regulatory uncertainty from the Obama Administration is jeopardizing Mr. Puzder’s ability to build, expand and hire across the country.
“We use our revenue to pay our bills and expenses, to pay down our debt, and we reinvest what is left in our business,” Mr. Puzder testified to the Oversight Health Care Subcommittee. “New unit construction will cease if we have to allocate the monies for that construction to the [President’s health insurance law], and building new restaurants is how we create jobs.”
Rep. Trey Gowdy (R-SC): “What should the federal government do or stop doing to enable you to create more jobs?”
Mr. Puzder: “The government now is doing a lot to create a high degree of uncertainty in the business community. We are uncertain about what tax rates are going to be; we are very uncertain about health care costs, and the only thing we are certain about is that they are going to go way up. We are uncertain what is going to happen with energy, with the EPA. We are uncertain about unionization with the NLRB….if the government would just work to create some certainties, I think you would see an explosion of job creation.”
Job-Killing Results of Obama’s Regulatory Rampage
Mr. Puzder: Rep. Elijah Cummings (D-MD) “mentioned how his firm had been profitable and they gave those profits into paying for insurance. I think part of what we are all saying here is we can take those profits and put them into insurance, but if we do that we can’t invest them to grow our businesses and create jobs. There is no corporate pot of gold to go to to pay for this stuff. We have to take it from someplace, and it is going to come from growth and job creation.”
Perverse Incentives of President Obama’s New Health Insurance Regulations
Rep. Scott DesJarlais (R-TN): “Will the health care law lead you to automate more services or replace full-time workers with part-time staff?”
Mr. Puzder: “Absolutely…We will automate positions such as the cashier. Right now they have those ordering kiosks like the ATM. We haven’t used those because we like the personal touch and they are a little expensive, but once you implement this health care bill, I think those kiosks are going to become much more desirable. So I will be reducing labor force and also automating positions.”
RT @GOPoversight: Carl’s Jr. CEO @AndyPuzder explains how biz uncertainty hurting him VIDEO: http://bit.ly/rialHi AmericanJobCreators.com
RT @GOPoversight: What’s the job-crushing cost of @WhiteHouse policies? Carl’s Jr. CEO @AndyPuzder responds (VID) http://bit.ly/rialHi
RT @GOPoversight: @WhiteHouse encouraging growth or burdening business? Carl’s Jr. CEO @AndyPuzder responds (VID): http://bit.ly/rialHi
RT @GOPoversight: AmericanJobCreators.com giving voice to US Biz. Listen to Carl’s Jr CEO @AndyPuzder his story http://bit.ly/rialHi #4jobs
AmericanJobCreators.com is a House Republican initiative to expose the true costs of government regulation. AmericanJobCreators.com is part of an ongoing conversation between Congress and the people we serve about the regulatory reform needed to support private-sector job growth.