December 9, 2016 / 4:56 AM / 7 months ago

UPDATE 1-U.S. labor secretary nominee's book lays out his job creation theory

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By Lisa Baertlein

Dec 8 (Reuters) - Fast-food executive Andrew Puzder, nominated to head the U.S. Department of Labor by President-elect Donald Trump, lays out a free-market formula for low regulation and taxes in his book, "Job Creation: How It Really Works and Why Government Doesn't Understand It."

The nomination of Puzder, chief executive of Carl's Jr. hamburger chain owner CKE Restaurants, drew criticism from labor advocates worried about his opposition to a higher minimum wage and government regulation of the workplace. The nomination requires U.S. Senate confirmation.

Following are some of the main points of the 2010 book, written with David Newton.

* Puzder believes the U.S. economy has been suffocating under the weight of regulation, taxes and government policies that created so much uncertainty that businesses shelved plans for investment and adding to payrolls.

"Private enterprise, unencumbered by excessive government intervention, will create jobs. Period!"

"Government's primary role should be to get out of the way and let individuals be enterprising, creative, innovative and hardworking. Government should remove barriers, constraints, and other hindrances that discourage individuals from pursuing innovative experience."

* Puzder argued for four specific proposals to increase job creation: Reduce taxes and simplify compliance; eliminate regulations that impede growth; cut and limit government spending; increase domestic oil production.

* Puzder believes that stable regulation and taxes are key to private-sector investment, which he calls the "Certainty Factor."

"This provides risk reduction and positive incentives to execute private sector hiring plans in support of expansion, modernization, and other growth-related strategies."

* Jobs and skills must change over time with innovation, he writes.

"A new job is not a guaranteed position for life. Its longevity is tied indivisibly to the future performance of the enterprise."

* Puzder has said he opposes a minimum wage, although he does not touch on that in the book. In it, while acknowledging there have been bad actors on the business side, Puzder said that a "mutually beneficial relationship between employer and employee" is more prevalent in U.S. history and the current economy.

"The reality is that the free enterprise system by its very nature encourages employers to value their employees and encourages employees to work to their maximum potential so that both enhance the value of their mutual endeavors."

* Puzder said unions had strangled industries with excessive and anti-competitive pay hikes.

"Empowering unions can increase labor costs to the point of putting employers in or near bankruptcy. This is in the best interests of neither employees, employers nor our potential for economic growth."

* Puzder said the results of New Deal programs introduced by President Franklin Roosevelt to stave off joblessness during the Depression in the 1930s were "very discouraging" and wrote that the Obama administration made similar mistakes.

"Large government, central planning, concessions to labor unions and stimulus programs that FDR believed would produce jobs instead hiked the unemployment rate."

Increasing taxes on firms and individuals, then apportioning those tax dollars to government spending on programs that "hire" people for a limited-term project is not true job creation, he wrote.

Reporting by Lisa Baertlein in Los Angeles; Additional reporting by Lisa Richwine, Deborah Todd and Jim Christie; Editing by Peter Henderson and Peter Cooney

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