In case I was tempted to eat at Carl’s Jr., one speech from the company’s CEO killed that prospect. The CEO spoke at lunch on Friday at an all-day symposium at Chapman University’s law school, a school with a reputation as a conservative bastion. The subject was supposed to be a dispassionate inquiry into how law and policy in California might be affecting the business climate. But it instead became largely a complaint-fest about liberals, taxes, and teachers.
The morning panels were dominated by speakers bashing California’s terrible business climate and high taxes. The picture painted was of a California captured by public sector unions that has squeezed out entrepreneurial spirit and forced businesses to leave. The evidence was mostly anecdotes, although a few speakers presented surveys on California’s business climate and charts ranking its tax rates. With all the doom-and-gloom, it got to the point where I was afraid to go outside in case my beloved state had suddenly turned into a third-world country, instead of the eighth-largest economy in the world.
The low point for me came with the lunchtime address from Carl’s Jr. CEO Andrew Puzdur (video here), who gave a largely a-factual, a-historical takedown of an imagined socialist California. Puzdur assumed the chairmanship of the Southern California-based fast food chain in 2000 from Anaheim-based Carl Karchner, the founder who starred in many of its TV commercials. Puzdur revived the company into a global chain.
Puzdur described numerous legitimate-sounding complaints about doing business in California. He cited the long wait times to get a building permit, the work rules that keep store managers from filling in on various store duties in times of need, and the required rest breaks without flexibility that keep stores from being able to serve large customer groups that come in unexpectedly. Meanwhile, state overtime rules prevent the schedule flexibility that would come with a 40-hour workweek rather than mandatory 8 hour days. While I’m sure there are good reasons for these laws, it all sounded like typical complaints from a CEO.
But then Puzdur went off the rails. First, he simplistically painted world history as a progression from feudal servitude to the freedom provided by capitalism (glossing over the global slave system that capitalism boosted), now under threat from “socialism.” He blamed teachers for the poor state of California’s educational system, ignoring that the state ranks last in per pupil spending. He dismissed the recent economic success and low unemployment in the San Francisco Bay Area as occurring in just one “enclave” of the state (home to 7 million people). And he cited California’s onerous regulations as the reason he won’t open many more restaurants in the state, when consumer surveys repeatedly indicate that Carl’s Jr. food is nowhere near as good as In-N-Out (or Five Guys, for that matter).
One revealing moment came when the mayor of Anaheim, a Karchner family friend and observant Catholic, objected to Carl’s Jr. racy TV commercials. Puzdur expressed no remorse, saying the commercials saved the company and featured “beautiful women” who enjoy doing the spots. Puzdur and his all-male management team see no reason to object to them.
Yet for all my bewilderment at the California-bashing, in some ways I found it heartening. These conservatives were very focused on the loss of middle-class jobs in the state. And it’s true that while California’s technology sector is booming, rising income inequality threatens the quality of life here. Of course, the trends they point to are happening across the U.S., not just in California, as manufacturing jobs have been fleeing for decades, in part due to free-market oriented trade policies and globalization. But I’m glad conservatives are bringing attention to these middle class issues. I just wish they would stop the blame game, and I don’t agree that gutting worker protection and slashing taxes is the best way to solve the problem.