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.
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.