Home Depot co-founder Bernie Marcus: Barack Obama has never worked a day in his life
HH: I’m starting this hour with an American legend. Bernie Marcus is the co-founder of Home Depot. He’s a philanthropist, he’s an extraordinary force for good in the country, and he has launched a brand new initiative today, which he describes in a column at www.realclearpolitics.com, which I have linked at www.hughhewitt.com. That effort is the Job Creators’ Alliance. And to talk about that, I am welcoming Bernie Marcus. Bernie, welcome to the show. It’s great to have you on.
BM: Well, thanks a lot, Hugh. I’m happy to be on so I can kind of explain what Job Creators Alliance is to you.
HH: Well, let’s do that, because I spend a lot of time talking to entrepreneurs, because it’s great radio. And you’re going to try and bring everyone together. To what end, and how are you going to do it?
BM: Well, first of all, how did it start? You know, I mean when you think about Home Depot, it was a great entrepreneurial experience. We started with four stores in 1978. And today, I don’t know, there are 2,200 some odd stores doing approximately $60 billion dollars, about 320,000 people working for it. But I remember the early days, and I remember opening the stores and struggling to make payroll. You know, for four years, we didn’t know whether or not we were going to survive or not. And the truth of the matter is that we survived because we were hard-working. We were entrepreneurs. We figured out a new way to sell products. We got the right theory, and like all entrepreneurs, we just stayed there and fought our way through it.
HH: And I want to remind people, these are not the best of economic times in which you opened up Home Depot.
BM: No, no. We had a problem. In ’79, ’82 was a recession, you remember that.
BM: But we managed to get through it okay. But Hugh, the big problem that came about, a couple of years ago, it kind of dawned on me that if we tried to open the Home Depot today in the same, right now, if the circumstances were the same, if there weren’t the superstores, remember, we invented the superstore. And if these stores weren’t there, and the same thing existed, we could never succeed today, and had the Home Depot create the kind of jobs that we do.
HH: And why is that? What has changed?
BM: How terrible and how frightening that is.
HH: Yeah, what has changed.
BM: Well, first of all, the capital market. You know, every time Washington passes a bill, they kill off the market.
BM: Now for instance, when we started, we went public in 1981. We had four stores. We needed capital to grow. We went to Wall Street, we sold stock in the company. We sold stock in the company. With the proceeds, we were able to open more stores. And we did that year after year after year. But there was, it was one law that wasn’t law. It was called Sarbanes-Oxley.
BM: Sarbanes-Oxley is the worst piece of garbage, the worst law that’s ever been passed in the United States, as far as business, as far as I’m concerned.
HH: Would you explain to the audience, Bernie Marcus, why that is?
BM: Well, they put, first of all, it was done because of Enron and all these tragic things that happened with these people that made these very bad mistakes, and in many cases, lied to the public. And Congress was forced…let me tell you what a Republican Congressman told to me, a Republican Senator. He said we passed this bill. It is the worst bill I ever voted for in my entire life.
BM: Now what did it do? Let me tell you what it did. If Sarbanes-Oxley was in effect in 1981 when we went public, the cost to the company would have been something like $3-4 billion dollars. That’s the cost today.
BM: That’s what it costs.
BM: So what company can go public? You can’t do it. I mean, there’s no way a small businessman…and the capital market is what made the Home Depot.
HH: So we’ve got to get rid of Sarbanes-Oxley. What else do we…I mean, EPA and all of these…
BM: Well, but then you have to look at, then you have to look at all the myriad laws that came along after that. Every regulation, every city, every state, every…and the federal government, all piled on, regulations, one on top of the other, that are promoted by the bureaucracies, and they all think that they’re doing good things. But the truth of the matter is they’re stymieing the businesses. And if you think, Hugh, that this is only a Democratic thing, I will tell you it’s a Republican thing also. Remember, Sarbanes-Oxley was signed by a Republican president.
HH: Oh, and a bunch of Republicans put their hands up for a bunch of bad laws over the last 30 years, and they didn’t effectively block the new banking law, Frank-Dodd, either. Now let me ask, Bernie Marcus, let’s focus in on the Job Creators Alliance, because I think this is a stroke of genius, we’ve got to get people together.
BM: So here is what it’s all about. Look, it started, really, with me driving through a shopping center with my wife. She pointed out how many stores were empty.
BM: And she looked at the stores that were empty, but I realize that every store had represented jobs for anywhere from 13 to 100 people. So all of these empty stores meant that there were people out of work, and why was it happening. It was happening because you have an administration, and you have politicians in Washington, that listen to the big guys. And right now, Obama is listening to Jeff Immelt talk about creating jobs in America. Well, Jeff Immelt is not creating jobs in America. He’s creating them around the world, and he doesn’t pay taxes on top of that.
BM: So who is representing the small businessman? Who’s out there that’s talking about the 80-90% of the jobs that will be created over the next three years? It’s got to be the small business guys. It’s got to be people who have created jobs, started from the ground up, who know what they’re talking about, because in every state, in every state, the state legislatures are passing laws, and the federal government is passing laws, and they’re looking to people like Jeff Immelt. And he’s not helping the small businessman.
HH: Bernie Marcus, this is the heart and soul of the problem. You know how hard you had to work when Home Depot was started. You had no time for politics. You were probably working 20 hour days. So what do you say to the small businessmen out there right now who are saying Bernie Marcus, wow, I love that guy, but I’ve got to go do another shift, I’ve got to fill in for a sick employee, I don’t have time to do this. Do they…
BM: Well, he does. He does. And so what we’re trying to form is to have in each state, have people who have created jobs, or presently or past, people who are actually out there making and creating the jobs for people so that they become the spokesmen in the state. And the Job Creators is going to be a group of people in every single state so that when the law comes up, they can represent the small businessman, because they are the small businessmen. And I’m talking about guys that represent jobs of 50 up to 1,000 people.
BM: They’re really, basically in the same boat that we were in 1978, ’81, ’82, ’83, ’84. And they’ll be able to talk about the restrictions. They’ll be able to talk about why you can’t pass a law, because every law has a reaction. Every law that sounds good affects somebody, and it affects another business. Think about the permitting you have to go through to open a business today.
HH: Oh, yeah.
BM: Think about how many people you have to go through, how many laws, and then you have one other thing. You have litigation, which we did not have in 1978. The trial lawyers weren’t organized the way they are today. And the trial lawyers are a killer of business.
HH: Yup, as is the Consumer Products Safety Commission, but the trial lawyers run up costs there. So Bernie Marcus, if someone goes to the Job Creators Alliance, or sends you the e-mail, firstname.lastname@example.org, what are you going to ask them to do?
BM: Well, we’re going to ask them to join with us to become part of this group. If you’re a small businessman, you don’t have the time. But support us in your state. We’re going to have meetings with people, we’re going to try to organize the small businesspeople. We’re going to try to get them to understand that they can’t sit back, they cannot let the world just bounce on them, and take it without fighting back. You remember that old movie program, I’m not going to take it anymore.
BM: This is an opportunity not to take it anymore. You’re going to have same-minded people who are interested in influencing the lawmakers, influencing the government, letting people understand that they’re going to create, if you’re going to stop me from creating the job, then I’m not going to help the economy.
HH: Let me ask you, Bernie Marcus, people will be very interested in this, do you think we can turn this around? Can this economy go back to the era of growth that Home Depot experienced in the 80s and 90s? Is that possible again?
BM: Listen, the American people are very resilient, unlike other people in the world. We just have to get out of their way. We just have to allow them to grow. And if we don’t do that, and we can’t keep putting in impediments. Look, I know so many small business people today. Nobody wants to expand. They’re not willing to expand today. There’s such uncertainty out there. You have a group of people in Washington today, where they’re the bad guys. I mean, if a man has a successful small business, and he’s making $200,000 dollars a year, he’s the enemy of the world.
HH: Yeah. Do you think the President understands this at all, Bernie Marcus?
BM: I…look, look. I’m sure this guy is, I’m sure his head is in the right place. He just doesn’t understand it. He never worked for a day in his life. How would he know it?
BM: He never had to make a payroll, and he has surrounded himself…there’s a statistic that’s very important. They had a statistic on how many businesspeople worked in every administration. The typical one, the smallest one was something like 35% were in the business world. This administration, it’s 8%. He’s surrounded by college professors, he’s surrounded by economic professionals, but nobody has ever created a job in this administration.
End of interview.