Job Market Taking a Beating

CKE Restaurants CEO Andy Puzder on economy, his 5-point plan to create jobs

NEIL CAVUTO, HOST OF “YOUR WORLD”: All right, jobs taking a beating, the president taking another meeting -- President Obama announcing that he will be joining his jobs council Monday do tackle the crisis.

To the CEO who says, well, just stop these meetings, these conferences, these talks. Just start doing something now.

Andy Puzder, CEO of CKE Restaurants, it’s the name behind Hardee’s and Carl’s Jr., all that good stuff.

Andy, good to have you.

ANDREW PUZDER, PRESIDENT & CEO, CKE RESTAURANTS: Good to be here, Neil. Thank you.

CAVUTO: You were impatient last time we talked about just what you expect out of Washington. I think, to paraphrase, how about first getting out of the way?

But, having said that, the president’s looking at a big meeting next week, maybe another commission to get to ways to get more private sector hiring. What -- what and how would you advise him?

PUZDER: Well, you know, really, creating jobs isn’t all that complicated. They make it sound very complicated.

But businesses will invest their money -- and American businesses are sitting on about $2 trillion -- they will invest their money when they can come up with a five-year business plan where they can show a profit. You want to get your money back in about five years, so that’s about 20 percent a year.

To do that, you have to be able to project certain expenses. One expense would be taxes. And if you only know what your taxes are going to be for two years, then you really don’t have any feel for what they’re going to be in three, four, and five years.

And you have got the president of the United States, the CEO of the country, saying, look, I want to raise your taxes in two, three years. So, the first thing you should do is make the Bush tax cuts permanent, so you’ve got some certainty with respect to taxes.

The second thing is Obamacare. Nobody understands it. Nobody gets it. We’ve had people come in and try and give us estimates of how much our health care costs would increase over the next two or three years if Obamacare comes into effect and nobody can really give us a realistic number. So you don’t know your health care costs.

Somebody actually should have read the bill before it was passed. Maybe then we would know. The next thing would be labor costs. You can’t really predict your labor costs if you’ve got the federal government out there, through the NLRB -- they couldn’t get card check through Congress, but now they are attempting to get it passed through the NLRB.

They’re being very unfriendly to business, very friendly to unions, as you -- as Boeing could attest with their attempt to move to South Carolina. You need to have a more favorable atmosphere for labor, because if you can’t project your labor costs, you can’t project any kind of a profit going out for a time sufficient to make an investment.

Then you’ve got the EPA doing ridiculous things with oil policy, with fuel policies. They’re trying to get cap and trade, which they couldn’t get through Congress; they’re now trying to get it enacted through the EPA as a regulation. So, you don’t know what your fuel costs are going to be.

And that doesn’t impact -- that not only impacts things like heating and air conditioning, but, in our business, we have a truck pull up to the back of the restaurant that drops the food off. Well, that’s a diesel truck. Happens at grocery stores as well.

You don’t know what your delivery costs are going to be, so you don’t know what your food costs are going to be. So you don’t know your taxes, you don’t know your health care costs, you don’t know what your labor costs are going to be, and you don’t know what your energy costs are going to be.

You’ve really got no certainty upon which you could base an investment. And the last thing would be regulatory reform, to at least send a message to the American business community, no longer vilifying them, but saying, look, we’re going to try and make this easier on you, so we want you to invest.

CAVUTO: Well, wasn’t that the reason why you moved your operations from California to Texas, because you found the climate there more hospitable to business?

PUZDER: Yes. We’re going to build 300 restaurants in Texas this decade. We’re not going to build any in California...

CAVUTO: Why?

PUZDER: ... unless things change.

Well, because in Texas, you can get permitted to build a restaurant in six weeks. In California, it takes about eight months. Once you open that restaurant, they let you run it. In California, they tell you your managers can’t work more than 50 percent of their time in non-managerial tasks. They have an eight-hour day.

CAVUTO: Well, then you have probably heard the news – you’ve heard the news that, you know, Rick Perry might be entertaining a presidential run, the governor of Texas. I know he was among those wooing you to his fine state.

Talk tonight -- I know we’re hitting you with all this stuff fairly late, Andy -- that Newt Gingrich’s staff has been decimated. They all quite en masse.

PUZDER: I heard that...

CAVUTO: Talk is that a lot of them...

PUZDER: ... which makes -- which makes it easier for Perry.

CAVUTO: Right. Right.

What do you think of that? Would -- do you think Perry would make an intriguing presidential candidate?

PUZDER: I tell you, I think -- I’m a Mitt Romney fan. I think Mitt has got the experience. He’s got the business background.

But Rick Perry entering this race would make it very difficult. He’s also an extremely qualified candidate. I would say the Republicans have a great line of candidates. All of them have more business experience than the current administration. And that’s what we need.

Rick Perry would be great. He’s done great things for Texas. And Mitt would be great as well. I think Mitt’s got the real background to make a difference in this country. So, it’s exciting.

I am sorry that Newt’s out, but given his comments on the Sunday morning shows and his affinity for Tiffany’s, I can see why.

CAVUTO: Well, he is not out. He’s not out. To be -- he is insisting he is not out. His campaign staff may be out, but he’s not out. He’s still going to fight on.

I do want to get your very quick take on the president. You kind of intimated it at the outset here. Do you think he’s just in over his head?

PUZDER: On the economy, I think he’s in over his head.

And I think he is listening -- rather than listening to people who actually understand business and have been in business, he’s listening to people that run large companies, which are basically bureaucracies, and economics professors who’ve really not done much other than teach.

(LAUGHTER)

PUZDER: So he has really -- he – there’s nothing wrong with listening to those people. They’re good people. They have good ideas.

But he really needs to get a little deeper and talk to people...

CAVUTO: OK.

PUZDER: ... that -- that are making investments and that actually run businesses.

CAVUTO: Andy, thank you. Always...

PUZDER: And he should read our book, too, the "Job Creation" book.

(LAUGHTER)

CAVUTO: And try your burgers.

PUZDER: Yes. That’s right.

CAVUTO: Andy Puzder, thank you very, very much. Good hearing you again.

PUZDER: Thank you, Neil. Glad to do it.

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