Dangerous liaisons

By Denis Storey


As much as I’d like to write about generals, liaisons and, well, liaisons, and as much as everyone else is talking about cliffs—time to pick up Acme shares?—I feel like pizza.

Papa John’s CEO John Schnatter — an ardent Romney supporter who attacked Obamacare most of the campaign (apparently with text messages) — revisited the issue after the election by saying that not only would he have to raise the price of pie, but that employee hours would be facing the pizza cutter, as well.

In addition to the “10 to 14 cents” per pizza price increases he’d talked about earlier, Schnatter told an audience in Florida last week that franchisees would have to start cutting employee hours based on the PPACA’s requirement that companies employing more than 50 workers would have to cover anyone putting in more than 30 hours a week.

“That’s probably what’s going to happen,” he told the Naples, Fla., crowd. “It’s common sense. That’s what I call lose-lose.”

By his estimation, the law — now more real than ever — would cost his business anywhere from $5 million to $8 million a year.

“The good news is 100 percent of the population is going to have health insurance. We’re all going to pay for it,” he conceded at that same talk.

And that’s what never gets discussed. Despite all the liberal outrage online, his predictions ring true. Besides, "the revolution will not be on Reddit" just doesn’t have the same ring to it.

(Quick gripe: Aside from BenefitsPro, Fox News and The Drudge Report, are Republicans anywhere else on the Web? How come every online “protest” campaign is started by disgruntled liberals? Where are the online activists from the right?)

As I was researching this little anecdote, I stumbled across an interesting Forbes piece where they actually did the math. Which is good, because I’m really bad at it.

To quote: “Last year, Papa John’s International captured $1.218 billion in revenue. Total operating expenses were $1.131 billion. So if Schnatter’s math is accurate (Obamacare will cost his company $5-8 million more annually), then new regulation translates into a .4 percent to .7 percent (yes, fractions of a percent) expense increase. It’s difficult to set that ratio against the proposed pie increase, given size and topping differentials, but many of their large specialty pizzas run for $16. Remarkably, a 10-14 cent increase on a $16 pizza falls in a comparable range: .6 percent to .9 percent. But the cost transference becomes less equitable if you’re looking at medium pizzas, which run closer to $12, meaning a .8 percent to 1.15 percent price increase.”

Either way, we’re looking at pennies on the pie, so to speak. And that’s worth some kind of cyber civil unrest?

Which actually speaks to the larger point: “We’re all going to pay for it.”

In typical American fashion, we want everything, but we want to pay as little as possible. And that’s great for Black Friday, but a treacherous way to run a country.

Which brings me back to the cliff—but sadly not Pentagon Place: We all want to tackle the deficit. But none of us wants to give up our entitlements, tax cuts or our national security. So where does that leave us?

Originally published on BenefitsPro.com