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Home Depot founder Bernie Marcus sticking up for small business through the Job Creators Alliance

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HH: Joined now by my guest from last week, Bernie Marcus. After the founder and former chairman of the board of Home Depot was on last week, I was inundated with calls and emails about him, so I’m glad to have him back. Bernie Marcus, welcome back to the Hugh Hewitt Show.

BM: Great to be back with you, Hugh.

HH: How is the launch of the going?

BM: I think it’s going very well, and you know, the whole purpose of it is to have the people that create the jobs out there speaking and really sharing with the American people what happens in Washington, and what happens in the state houses, how that affects business, and how it affects job creators. Look, we have a terrible problem in the United States. There’s 9% unemployment. There are 14 million people out of work. In fact, there are more. It’s closer to 20 million people, of people who have given up. And we need to listen to the people who really hire people, and create the jobs. The politicians don’t do it. The president of the United States in his life never hired anybody, and doesn’t know the first thing about it. And he’s surrounded by college presidents and academics who really don’t know anything about it, either.

HH: Now Bernie Marcus, after you were on last week, I got a number of questions that all run into this category. How did he do it, because we didn’t really have time to do biography with you. And so I want to just spend a couple of moments on that. How did you build Home Depot, because it wasn’t, when you launched it, it was a pretty dismal economic situation as well.

BM: Yeah, we were, it was 1979, and you know, ’79, ’80, ’81 was not a really good time in the United States. But the truth is, it was right for us, because people were paying exorbitant prices for the type of merchandise that we had. And the theory was that if we could bring product to the marketplace, product that they couldn’t buy anywhere else at the kind of prices that we were going to sell it for, and if we had it all under one roof so that…years ago, and I’m talking about back in 1979, ’78, ’80, ’81, that area, if you need the paint, you had to go to a paint store. You had to go to a lumber store. You had to go to a plumbing store. You had to go to, every one of these things had a store. And it was very, very difficult for somebody to do a job in their house. And we said if we could put it all under one roof, if we could have every product that these people would possibly need, put it out at the best prices, have the most quality, and have people on the floor to teach people how to do it themselves, that it’s a winning formula.

HH: How did you find those people on the floor, because now the orange apron is a famous calling sign now, and people know they go into Home Depot, they’re going to be well taken care of. How did you find and build that culture?

BM: Well, we found people that really wanted to have a job 12 months a year. You know, most of those, you know, a carpenter, plumbers, painters, etc., it’s hit and miss. You know, it’s feast or famine. This was an opportunity to have a job 12 months a year, have your health coverage, have the benefits, have the ability to buy stock in the company, have stock awarded to you. They became partners of ours, everybody that worked there. I happened to have lunch today with a woman that worked for us for seven years. I haven’t seen her. She’s now running a business of her own, and she just thanked me for teaching her how to run a business. And so it’s been a great opportunity for us and for them. And as I said the last time I talked to you, Hugh, it’s the millions of people that have worked for the Home Depot, and we’re talking about, over the years, there’s over 300,000 people working there now. And these people love working where they’re working, they love their jobs. They’re professionals. We have plumbers and carpenters, and all kinds of people that know exactly what they’re talking about. And when you go to a Home Depot store, you know you’re going to find somebody that’s going to point you in the right direction, and sell you a product that you need, not the product that we want them to sell.

HH: And how did the unions fit into this? Was Home Depot every unionized?

BM: No, and that’s the success of Home Depot. And you know, I’ve got to tell you, something happened this week that we have to talk about, and that’s this new rule that came out of the NLRB.

HH: Yes, horrible.

BM: Allowing unions to organized a business, and actually, this bill may be one of the worst things that’s happened to America, because you know, all those states that have right to work states, where typically, typically, the unemployment is down dramatically. People are investing money in these places. Look at what happened to Boeing. Boeing went into South Carolina, and they’re paying their employees almost as much as they pay in Seattle. But they don’t want the work rules. They don’t want to have to deal with the union bosses. And they don’t want to work with the regulations that are thrown at them by the unions. So this bill, the rule that just passed the NLRB, is going to allow the unions to organize almost everybody. You won’t even know it’s coming, because they cut the time length between the time that you’re notified that they’re going through an election, and the election, from 40 days down to 20 days.

HH: And even less, in some instances. It’s like a snap election, and the business doesn’t have a chance to inform their employees about the stakes.

BM: No, they’re dead in the water, because they could be working behind the scenes for six, seven, eight, nine months doing this, and you don’t have a chance. I know that when we had a chance to discuss this, and we had many organizers at the Home Depot. Our people didn’t want a union. The reason they didn’t want a union is because they knew that if they started it in the company, and they were pushing carriages in the parking lot, they had a chance to get up the ladder if they were good, if they were hard-working, if they wanted to put the time and energy into it, they wanted to learn, they could end up being the vice president of the company in a short period of time. When you’re unionized, that doesn’t happen. It’s called tenure, and it’s called you’ve got to be there…the one that’s there the longest, they could be the worst, gets the job.

HH: Now American business did dodge a bullet this week when the Supreme Court turned down the class action suit against Wal-Mart. But lawyers must also be a bane of your existence, Bernie Marcus.

BM: Oh, they hate me.

HH: (laughing)

BM: They hate me, and the feeling is mutual.

HH: (laughing)

BM: I think they’ve done more to kill this company, kill America. Litigation is a major issue in the United States today. Every single company has to deal with it. I don’t care if you run a small restaurant. You’re in deep trouble because if somebody happens to fall in your store, or fall on the sidewalk outside your store, you’re dead meat.

HH: Yeah, I don’t think that the Bar understands the risks that go into starting a small business, and how precarious it is, and how long it takes to…how long did it take you from the time you opened Home Depot to the moment you knew we’ve made it, we’ve got our market, we’ve got our niche, and nothing can hurt us?

BM: I think it was about ten years.

HH: So there’s a ten year start up. Is that pretty common for most businesses?

BM: Yeah, yeah, because remember, we continued to take risks. And Hugh, that’s a major issue, taking the risk. Is it worth it? Because you’re always putting your life on a line, you’re putting everything you own on the line. But if you don’t take the risk, nothing really happens. So entrepreneurs, and a free enterprise system, rewards the risk takers, because you become successful, and then you have this terrible word. God, I can’t get it out of my mouth. You become rich.

HH: Yup.

BM: Oh, my God, and I know, that’s a terrible thing to tell America. Nobody wants to be rich.

HH: Well, they’re turning the rich people into bad guys.

BM: Oh, rich people are the worst people in America. No question about it, unless you’re Nancy Pelosi.

HH: In which case, nobody knows that you’re the rich person in America.

BM: That’s right…or Kerry.

HH: I’ll be right back with Bernie Marcus. He is the founder and former chairman of the board of Home Depot. He has begun a very important organization which I want you to go check out right now, It is vitally important. If you are a small businessperson, or you have a family member who is a small businessperson, or you have any desire whatsoever to ever start a small business, that you get on over to right now, and sign up to help restore the ability for entrepreneurs to succeed in America. Bernie Marcus does not fail when he starts something. is going to soon dominate the Washington, D.C. corridors when it comes to discussions about business. Be a part of building it up.

– – – –

HH: Bernie Marcus, the NBA draft is in Newark tonight. You’re from Newark, aren’t you?

BM: Oh, yeah. Oh, yeah.

HH: So what has happened to that city? Who destroyed Newark?

BM: Well, look, you know, it came about because of the riots that happened, really many, many years ago, back in the 70s, as you know. And I lived in that city. It was a great city. It was a wonderful city, multi-racial, whites and blacks lived together. And after the riots, I mean, what happened is that all the whites moved out of the city, they lost their base of business, and it destroyed their business. They destroyed grocery stores, drug stores, all the places that the good, hard-working people worked at. And they took away their ability to earn a living. And it was a downward spiral. Now I understand now, and I’ve been back there, that there’s been a lot of money poured into it. They have a mayor who’s a good mayor, who’s trying to bring that city back. It’s a very, very important spot. There are lots of people at work there. There are people that deserve a good life. They deserve to have the kind of education for their children, and I hope they’re going to be successful.

HH: Yeah, Bernie, you’ve got so many people working with you on the Job Creators Alliance. You’ve got John Allison, who’s the former chairman and CEO of BB & T, you’ve got Brad Anderson from Best buy, John Mackey from Whole Foods, Susan Story from Southern Company. Do all these people, when you get together, do you ever look at the inner core of American cities and say that doesn’t have to be that way if they’ll just let us do our jobs, we can renew those areas?

BM: Look, I think that the private enterprise system, we have seen it over the years. This is not a new thing. Whenever you have private enterprise involved in something, it’s successful. When you have government involved in it, it’s not successful. It they would just let the private enterprise go, and leave us free, and don’t encumber us with the rules and the regulations that you have to adhere to, I think that America would be in a better place, and I think that the poor people that live in the urban areas, who suffer the most, would be the best off. If you look at education by itself, you understand that these kids are not being educated, but that when they go to charter schools, and there was a charter school in Washington, D.C., I just read an article today, 98% of these kids from the worst homes, from the worst families, 98% graduated, and they have a 100% acceptance rate for college.

HH: Yeah, it’s amazing. Charter schools work. I’m on the board of one over in Arizona, Great Hearts Arizona.

BM: Yeah, yeah.

HH: And they work.

BM: But that’s free enterprise.

HH: Yeah. Before we run out of time, you’re a great philanthropist, but I want to talk about Israel a little bit, because you’re a strong supporter of Israel. What do you make of this president’s policy towards Israel?

BM: It’s very hard to understand. You know, he threw Mubarak under the bus. I think the Saudis are frightened to death, because he’s going to throw them under the bus. I think that he is a, he doesn’t have the courage of his convictions. I think that we watch Iran slowly but surely taking over in the Middle East, the deadly, it’s deadly, just deadly. We see a president that’s very weak on Iran, or they’re going to get the Bomb. And when they get the Bomb, they’re going to dominate the Middle East, and it’s not going to be a good place. Israel is not going to go down. I will tell you. They’re going to fight to the last breath of life. This president is not making it easy for the state of Israel.

HH: Okay, let’s conclude by talking about, we’ve run through the bad stuff, and we haven’t even touched on Sarbanes-Oxley, or Dodd-Frank, or any of the disaster of the flight of capital, the freezing…we haven’t talked about any of this, but we’ve touched on a lot of the problems. Can this all be turned around, Bernie Marcus?

BM: Yeah, I think that in this election, if we elect the proper Congress, and we elect a president that’s got courage, and is willing to stand up, I think that we can turn it around. I am very concerned about the economy. I’m frightened to death about it. And I have such emotion about these 14 million people out of work. I mean, these are hard-working people that worked at jobs at all levels, that can’t find work today. This is a tragedy for America.

HH: How quickly can that situation be turned around?

BM: Nothing is quick. Remember, we owe a tremendous amount. Our debt is insurmountable. It’s insurmountable. And unless this Congress does something about it right now, unless this president does something about it right now, I don’t know what the future is going to hold.

HH: You know, the debt ceiling talks collapsed today. I talked to Jon Kyl…

BM: Well, you know what? Rightfully so. They walked out of the meeting. You have, they want to increase taxes? The last election, they heard from the public that the public doesn’t want to go for new taxes. They want to see cut back…listen, when you have people, right now, the food stamps, you have so much fraud in Medicare, Medicaid, the food stamp program, I mean, why don’t they attack the things that we’re just throwing money out the window on?

HH: From your lips to their ears. Bernie Marcus, good luck with We will check back with you in a couple of weeks if we can find the time to get you back. Any time, you’re welcome here, Bernie, to spread this gospel.

End of interview.


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