My head is hurting again. I know I’m a little late to start talking about this now, but I did hear about Papa John’s CEO John Schnatter commenting that Obamacare would raise the price of pizzas (about 14 cents on a large pizza) and I had one thought I wanted to share about that. That thought is: DUH!
Seriously? This was his golden nugget of wisdom that he offered to shareholders? Really? Wow, who would have thought that a business that did not formerly have a particular expense and suddenly did might have to raise prices? It isn’t like that is economics 101 or anything like that.
Without even wanting to get into the Obamacare debate, I’m just astounded that he felt the need to threaten this. It seemed completely obvious from the beginning that requiring businesses to provide healthcare that never had might raise prices some. We were already bearing the expense somewhere (whether in hospital write-offs, medicaid, or some such thing), but I’m betting we all knew that if we shifted the cost to the businesses that the businesses might raise prices.
After all, businesses make money. A few might eat the costs for a while to look good, but sooner or later that expense shifts to consumers. Price- expenses = profit (extremely simplified). If one of those variables changes…other variables are affected. Given the fact that businesses are generally in business to maximize profits I expect that if expenses go up then businesses might increase price to make profit stay the same (at least).
This just makes my head hurt. I don’t even want to get into the pros and cons of Obamacare here, but this shout out from Captain Obvious is giving me an aneurysm. Hell, I don’t even like Papa Johns. It’s kind of gross.