Business Owners Speak on Struggles with ObamaCare, Regulations
As the president doubles down on regulation — from labor, to carbon, to health care “reform” — business owners are crying foul. Regulation and the costs associated with it are all but incalculable, and are killing the very job creation on which President Barack Obama says he is focused “like a laser.”
See CKE Restaurants: according to a release from the House Committee on Oversight and Government Reform’s “American Job Creators” initiative, CKE owns or franchises 3,182 restaurants under the Carl’s Jr. and Hardee’s brand names nationwide, employing more than 70,000. Each new restaurant generates roughly 25 new jobs and pumps more than $1 million into the surrounding community.
According to the release, to comply with just one of the hundreds of new regulations in the health insurance law CKE will be forced to spend approximately $1.5 million to replace all restaurant menus. That equals 17 percent of what the company invested in new restaurants in 2010.
Those are not the committee’s numbers: those numbers were provided by CKE’s CEO Andy Puzder. In a video sent out with the release, Pudzer said unknowns — in particular, health care — are stifling job growth:
You generally try to come up with a five-year business plan. You have to know what your expenses are going to be and generally know what your revenue will be. People right now are very worried about taxes because the president keeps talking about raising taxes so it’s very difficult to model that in the forecast. The uncertainty in the businesses community arises from a number of factors: taxes, energy and primarily health care.
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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. 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. We spent about $9 million last year building new restaurants. That would be totally wiped out.
Puzder said he was given a best guess of $18 million on increased health care costs, double what they spent creating new restaurants and new jobs last year.
Puzder recently testified in front of the Oversight Health Care Subcommittee that those increased costs would force them to stop building new restaurants and possibly let people go:
We use our revenue to pay our bills and expenses, to pay down our debt, and we reinvest what is left in our business. 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.
Puzder said they’d also have to look at automation within their stores:
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.
Fear. It’s even more fear of what’s coming than the current regulations.
And it isn’t just businesses, it’s working individuals as well. Fear of new taxes, fear of inflation, fear of losing your job, fear of losing your house, fear of not being able to feed your family, fear of what they will do next, fear because they aren’t slowing down one iota, no matter what happens. And fear because they lie through their teeth about it.
And it isn’t just working individuals either. People on SS are even more afraid. No COLA increases in the last two years while the price of food and gas skyrockets. $500B stripped from medicare. Doctors quitting medicare. Fear of the death panel. No interest on retirement savings. Saving invested in the market being devastated. The only safe haven is cash, and every dollar taken out of cash brings you closer to total dependency on SS.
Fear is oozing out of the entire culture, no matter who it is, because of the marxists and the man who laughingly spends more time on vacation than anybody in history. He doesn’t seem to be worried about it either. You have to wonder about that. oops! there’s no such thing as shovel ready jobs. oops! we made a little 2 trillion dollar faux pas in the deficit. oops! we made a mistake in our estimations for the StickItToYou. oops! the other guy left us in a worse ditch than I thought. oops! that ban on drilling hasn’t helped much with jobs. oops! maybe the muslim brotherhood isn’t so benign afterall. oops! inflation is a little higher than we predicted. oops! those food stamps are stimulating as many jobs as I said. oops!!! silly me
It was serious in 2008. It’s deadly critical now. This economy and this culture is about to go under. We might not even make it to Nov 2012.
Don’t forget to mention the fear of watching the money you’ve tried to save being eaten away by the “non-existent” inflation that affects everyone except the ruling elite in Washington, DC. And if you try to invest your meager savings in something the economic policies of the mental pygmies in DC cause the market to drop.
And it is the worst and most insiduous kind of inflation; invisible to the CPI. Because the CPI is so heavily weighted to housing costs, the deflation of housing value is hiding all other inflation in the Index. Consequently, those on fixed incomes whose income adjustments are based on CPI get no increases, wage earners get no adjustments or wage increases both because there is “no inflation” and because there is so much unemployment that there is downward pressure on wages. And finally, so much of the wealth of working Americans is in their houses, they wealth has evaporated. Not only has the value of the house deflated, you can’t realistically sell in most of the Country at any reasonable price and certainly not for what is commonly owed on houses. These are grim times.
You’d think all of this would be obvious to the people who are supposedly so dedicated to helping create jobs for the country. Of course, if only 8% of your administration has ever held a job in the private sector, the attitude becomes understandable.
So I will be reducing labor force and also automating positions.
The very same words I heard from business acquaintances in both the mid west and Phoenix area over a year ago. The mid western guy told me last week that after he started thinking and rethinking his costs he has started automating where ever he could.
Good bye jobs hello Obozonomics. Hooray Hussein.
Reducing taxes, reducing spending, and reducing taxes are just a small part of the problem the economy is having. Regulation is the rest, and the larger part of it.
Here in SE Alaska, locals cannot afford to eat salmon or halibut swimming in the local waters. Getting a boat out to fish costs too much, renting a boat costs too much, the “catch/sell” program set up to allow fishermen to sell directly to the public is a farce, the fish processors cannot afford to sell locally, all of this because of regulations.
Mr. Puzder hit it spot on – uncertainty is why we’re not seeing any hiring. Many businesses are making money, but they’re loath to take on new employees when they don’t know what the long-term costs of those new employees will be. They’re hesitant to undertake new investments in facilities or processes in which energy represents a large cost – Mr. Obama can never live down having said he wanted to make the cost of energy “skyrocket”. People remember that and they think twice about putting in that new production facility or line. And God forbid you should earn too much because the Dems make it eminently clear that they want to take it from you. Then there is the EPA with its carbon regulations which stand to make everything you do subject to micro-management and, of course, more expense.
You really don’t have to be a Harvard PhD economist to understand this stuff – If the DC crowd would actually listen to the people who are responsible for creating jobs, they’d understand that they need to stand aside and let business manage it’s own recovery.
You really don’t have to be a Harvard PhD economist to understand this stuff – If the DC crowd would actually listen to the people who are responsible for creating jobs, they’d understand that they need to stand aside and let business manage it’s own recovery.
Do you seriously expect the bigshots in DC to listen to business leaders? The bigshots would sooner burn their Che Guevera T-shirts than talk to a real capitalist!
The bigshots know far more about economics and business than anyone else. After all, they learned it all from their left-leaning professors. Never mind that most of them have never worked in the real world even one day of their lives!
I thought our leaders all had degrees from those ivy league schools. it just goes to show you, money can buy intelligence.
Dodd-Frank is coming. Once the regulators get done writing the tens of thousands of pages of new regs, they will unleash it on us like a horseman of the apocalypse.
Obama, the EPA, and now Cuomo are also screwing with energy costs and supply. Manufacturers and other businesses that are heavy power users must be worried they will be regulated and priced out of business.
And all to what end? Qui bono? Macchiavelli, perhaps, has the answer:
And then what? Writing almost four centuries later, George Orwell, in his 1984 gave us the answer:
This, I believe is the endgame of Antonio Gramsci’s and Saul Alinsky’s heirs and disciples. It’s a cold-eyed calculation on the part of will-to-power driven monsters that they would rather rule in hell than to leave the rest of us alone to live our lives for better or for worse. They’d rather run the whow from atop a pile of rubble and corpses than to leave us to our own devices. Prosperity – our prosperity – is anathema to them. Because it represents something beyond their control – as does any other decision we might make on our own behalf.
This will not end well, folks. For those of you who believe otherwise, you’re whistling past the graveyard of history.
yes
find a benevolent dictator. even a single one.
But these are not words you can say out loud in “polite” company. People still refuse to see what they see, refuse to read His words and his “Dreams,” or Ayers’ dreams, if you will. We tip toe around it and call them “little c communists” or “faculty lounge communits” but it isn’t true; they are BIG C COMMUNISTS. Obama, or whatever his name is, is a Red Diaper baby, many of his associates are, most of his staff are ex-SDSers or similar radicals or the academic proteges of ’60s radicals. We had a coup d’etat in this Country in Nov. ’08 and we dare not call it by its name.
Ward: Amen. Thanks.
We are contemplating building a larger factory. Everything we are doing in the planning stages is for more automation to reduce the number of employees we use per job. We stand to triple our business, but plan to do it on about 1/2 of the total employees we currently employee. In my travels across the country looking at automation I notice that every company that sells automation is backed up with future orders. They simply cannot keep up. My discussions also reveal that every one of our major competitors is doing what we are doing, replacing people with machines.
More regulations, mandated benefits, increased unemployment tax rates … All create disincentives to hire people.
It’s nothing personal .. It’s only business.
If you’re interested in sharing your story, email the editors here and they will pass your mail on to me.
Pat
#8 Businessman – Yes, you are describing part of the situation (replacing rapidly increasing labor costs with equipment). But if I understood you right, you are doing it to stay ahead of your competition. If your company was smart, it would do the same if the economy was booming.
Mr. Richardson’s article is correct in that so much of what Washington is doing (and has done) is raising the costs of almost *everything*. Higher costs means higher prices means lower overall consumption.
The following is related, something I just posted at VDH’s site:
Consumer spending is approximately 70% of our economy (plus more indirectly). If there was a demand for an extra million widgets per year, widget makers would fill that demand. Even if it required hiring or purchasing new equipment.
But consumers are just as battered and wary of Washington, DC as business executives and owners are.
A look at reasons for consumer’s, the general public’s, situation and pessimism might be a good companion piece to this article.
For what it’s worth, I spent 30 years in management consulting, mostly “turnaround” projects.
So how much money will your automated machines be spending on your merchandise? I totally understand lowering production costs. What I don’t understand is what unemployed people use for money to buy these efficiently produced goods.
It won’t help.
They will come after you anyway.
The only safe haven will be the mega-businesses that are in their pockets, until their control is complete, after which they will be on the chopping block as well.
Small businesses cannot thrive in a fascist country. There are too many of them for the fascists to control, so they put them out of business deliberately.
This is when the VAT tax comes into play.
8. Businessman
When you automate you should consider generating your own power as that looks like another area that may be regulated out of existence.
“You’d think all of this would be obvious to the people who are supposedly so dedicated to helping create jobs for the country.” — RebeccaH
The key word is supposedly. Leftists are not interested in expanding the economy, their agenda is to control the economy. And from their perspective the more people on the dole, the easier it to control the serfs.
Yep, Obama’s focused like a laser on jobs. The problem is, every time he handles his job-finding laser gun, he ups the ante. The power level used to be set on “stun,” now it’s on “vaporize.”
Yeah, but these are not the jobs President Obama wants to create anyway. Who wants to flip burgers, especially for a guy named Puzder? What we need to do is raise their taxes so that we get more money at the Federal level, and use that money to give our existing regulators a well-earned raise, then spend it again to hire a new phalanx of regulators. This will (hopefully) bankrupt Puzder (he’s poisoning our children with this fast-food drek anyway) and at the same time increase the amount of money coming into the Democrats’ coffers, via campaign contributions from all those extra bureaucrats…
Of course, once our economy consists solely of regulators and bureaucrats, no one’s told me how we’re ever going to *generate* anything…but I’m sure President Obama has a plan.
This indeed is the key problem affecting the economy, and hence the liberty, of our Republic: over-regulation. And it’s not only that: almost all, if not all, of these Fed regulations that are strangling business, are unConstitutional. EPA/OSHA/Depts of Labor and Education/ATF/SocSec/Medicare/etcetcetc: grossly unConstitutional.
Someone above asked, can’t they see that the over-regulating is hurting the economy? I also ask, can’t everyone see that these agencies are not mentioned in the Constitution, and therefore are not authorized? The answer is yes and no: yes they can see it, but no they don’t acknowledge it, because they’re in denial. They don’t WANT to see it.
As we drive the Republic into the wall at warp speed, only a radical return to the real meaning of the Constitution has a chance of saving us. If enough voters don’t realize this soon enough, then, as someone said above, this does not end well.
don’t uphold the constitution and other laws ..this is what you get.
the obama administration is driven by envy greed and hate.
welcome to africa
or Venezuela.
Yes, Obama is very busy destroying the very job creators he demands provide the jobs he so desperately needs for his “Summers(s) of recovery”. How can one love jobs while hating the job creators? One of my businesses is a restaurant which employs roughly fifty people. We have scrupulously avoided going over fifty employees during our peak business period and this has resulted in our terminating several long term, part-time staff members (whom we liked very much) because we needed to get maximum productivity from more full-time staff. They were shocked to discover that they were being let go as a result of the yet unknown ramifications of “Obamacare”.
Thanks, Mohammad Obozo
One thing that gets forgotten is that the Progressive greenies WANT to reduce economic output and reduce consumption. They are trying to save the planet from “climate change”…Can’t have the climate changing ya know…
This is what “Winning The Future” is all about and why the acronym is WTF!
The following is a letter from a manufacturer in Illinois:
An Open Letter to the President
June 24, 2011
Dear Mr. President,
I read today that you are looking for ways to bring down unemployment. I currently employ 85 people in the USA, 8
in Mexico, 1 in China and 1 in Barbados, so I know a little bit about employing people. I would like to help you, but I
canʼt. Hereʼs why:
(1) In Illinois, at our main factory, we need to hire 11 people, but we canʼt find them. They either make too much on
unemployment, or have been conditioned by years of unemployment insurance or welfare checks to not want to
work. If they actually come to work, they canʼt make it five days in a row, or they claim oil bothers their hands, but
then the gloves we offer them for protection bother them as well. Some of them donʼt like their supervisorʼs music.
(2) I personally would hire people to help me with projects around the house, or in the yard, but if I were to employ
them for too long, I would need to withhold payroll taxes on them, get them workcomp insurance, etc.
(3) Our company would hire short term people to help with outside summer maintenance projects, but Iʼm fearful of
the workcomp lotto ticket holders and the pending $6,000 to $10,000 surcharge and the other unknowns of the
pending health care legislation (by the way, I do provide insurance for my employees).
(4) I would like to hire more elderly people (and do an excellent job already – our oldest factory worker is 81), but weʼre always nervous when we read about strange applications of ADA law – sometimes itʼs just not worth the
risk, even though weʼre willing to take the wage risk of reaching out to help people.
(5) If things slow down, we have to pay unemployment insurance claims on these short term workers. I like the
system in general, and think the concept is fair, but when someone quits, I donʼt know why they still get unemployment. Or else, if we have a layoff and we donʼt lay off according to a quota (which means white straight
men under the age of 40 all have to go first), we have to fight discrimination claims.
(6) Many of the people I could hire out in rural Illinois are being paid to live without jobs in East St Louis and downtown Chicago. I know itʼs called welfare, but itʼs robbed workers of incentive, mobility, self-worth, and a work
ethic. Itʼs not like the old days where people moved to where there were jobs.
(7) Some of them stay for only 90 days. Thereʼs something about rent eviction notices – I donʼt really understand it -
but they have to switch houses (and thus communities) every 90 days so they donʼt have to pay their rent.
This causes their kids to switch schools every 90 days as well, so they end up having to stay home from work
because of the family problems this causes.
(8) I support safe workplaces, a clean environment, retirement plans, health insurance, and a system for
compensating injured employees, but there seems to be so many lawyers and government bureaucrats behind
each issue, even the small issues, to the extent that itʼs cheaper to lose (and settle), than to fight and win, that Ihave to go very slow in hiring. Iʼ
m very loyal to people once weʼve hired them, but we have to sort thru 10 to find
1. During the recession, we paid our employees to plant trees with a shovel instead of laying them off. I thought it
would have been a neat idea for the government to do with all the
shovel ready
talk – hire people to plant trees,
help the environment – but I didnʼt hear about that happening anywhere but here (2 people can manually plant 400 trees a day, by the way).
(9) We have some jobs, short term, that we would hire people for, but we donʼt always know when weʼre talking to
them if they were born in this country. Apparently, where you were born effects which jobs you can have – like
yours, Mr. President. I thought my taxes went to protect and seal our border, but it leaks, so Iʼve been
forced into a posse to enforce the government laws in order to verify that someone who works for me is legal to work in the
USA. I guess I wouldnʼt mind doing that short term, but the police, who work for the government, canʼt do that in
some states if someone is breaking the law. Perhaps they should just stop and check people who have jobs.
I’m not sure what else to say, Mr. President. Iʼd like to help, but sometimes itʼs just easier to raise my prices,
contribute to the growing inflation rate, and look for things that I can just import and resell. I love this country, though,
and Iʼll do what I can.