Looks like there is no such thing as a free lunch, especially if it’s pizza. In a conference call to investors last week—leaked to the press—Papa John’s Pizza CEO, Louisville resident John Schnatter, suggested that implementation of the Affordable Care Act (“Obamacare”) will drive up company's healthcare costs, to the extent that the company will be forced to raise consumer prices an estimated "11 to 14 cents per pizza, or 15 to 20 cents per order."
Papa John's is the nation's third-largest pizza takeout and delivery chain, and when Obamacare comes into full effect in 2014, will be required to extend health insurance to more of its 16,500 employees, at the nearly 4,000 Papa John’s restaurants in all 50 states and 33 countries.
“We’re not supportive of Obamacare, like most businesses in our industry. But our business model and unit economics are about as ideal as you can get for a food company to absorb Obamacare,” said Schnatter. “If Obamacare is in fact not repealed, we will find tactics to shallow out any Obamacare costs and core strategies to pass that cost onto consumers in order to protect our shareholders best interests,”
Critics were fast to respond that Louisville native Schnatter is a Republican, and a strong Romney supporter. In April of this year, he threw a lavish private fundraiser for the GOP presidential candidate at his palatial home in Anchorage.
Writing at Newsday, Matthew Yglesias sums up the liberal response to Schnatter’s threat to raise prices: “Stipulating for a moment that this is true, doesn't it seem like a rather small price to pay? Papa John's website is currently offering to deliver me a large pepperoni pizza for $14.08 and Schnatter is warning me that the problem with Obamacare is ... a one-time price increase of less than 1 percent! That seems eminently reasonable.”
But leave it to Steven Colbert to deliver the coup de grace:
If this brouhaha has legs, then it may last until the Dalai Lama visits Louisville next year. His Holiness plans to visit and bless a Tibetan Buddhist temple and teaching center and make other public appearances on May 19-21. Maybe he will have time to visit one of our Papa John’s restaurants and order a pizza. Doubtless, he will say, “Make me one with everything.”
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