With an extensive background in politics, public affairs, education, and business, Todd Kruse offers unique perspectives on the connections between policy and paychecks. Todd shares with Linda his thoughts on the topics of workforce development, employee training, government affairs, regulatory and tax issues, and more. Based on his experiences, what does he ask of elected officials? To first, do no harm. Why would he ask them this? Listen today!
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Linda J. Hansen: Thank you for joining with me today. Today my guest is Todd Kruse. Todd is the general manager at Godbersen Metal Works in Spencer IA. He has an interesting path that led him there. I’ll let him explain that. But in his background he has worked in politics, he has worked on senate campaigns in Iowa, he has lobbied in several states in the Midwest, he’s provided public affairs consulting to corporations and non-profit organizations, and he has worked in the USA, Canada, and the EU.
I am so glad you can join me today for this episode Todd, welcome.
Todd Kruse: Thanks, I appreciate the invitation.
Linda: It’s just an honor to have you here. As we have talked before the broadcast I think our listeners will really enjoy learning from you and hearing kind of a fascinating story of your background. Could you first tell us a little bit, just about your professional background? I know you graduated from college in Iowa. Iowa State University for those of you who are really concerned about that.
Todd: VS. Iowa Hawkeyes.
Linda: I know it’s a big deal in Iowa. So, you graduated from Iowa State and then you have had just a very interesting journey over time. Could you share with our listeners about your background?
Todd: I appreciate that. I will try to do a full loop here. I went to Iowa State University, the Cyclones, to study engineering. After two years I developed an illness called “A Love of Politics”. So, I got involved in campus politics and said “I don’t want to do engineering design for 30 years” so I changed my major. Got a couple of degrees. Eventually graduated from Iowa State. Worked on a senate campaign. Then I became a telecom lobbyist, then I became a public affairs consultant and a college instructor. I did employee training. And then, full circle, a family I grew up with they are now at a fourth generation of their family manufacturing. They were going to buy this factory here in Spencer, IA and just because of longevity I guess, family history, I grew up with them. They liked my skill set and the rapport we have with each other and they said we’d like you to be General Manager of the factory. So, yes that is quite a departure from public policy but the connection is kind of like my roots in engineering or a campaign. It’s a startup company so we have to analyze what assets do we have, what resources. Have a game plan. Leverage those resources and produce results. In a campaign it’s election victory in November. Here is Monday thru Thursday cut some metal, bend it, weld it, and get an invoice from the client which hopefully leads to prosperity if you’ve done everything correctly. So, for me I just covered that over 35 years of experience so it’s going to be a short podcast today.
Linda: Well I think we can dive into some of that in detail, it sounds great. It’s a unique…Every story is unique but you have had some unique experiences that really don’t fit the mold when you think about where you’ve been even in politics as well as were you are now. OK, you said that got the illness of loving politics and I know it’s one that several of my guests have shared that same affliction and I share it as well. What was it that drew you to politics?
Todd: Originally my dad was on a local city council planning and zoning commission. I remember him taking me to meetings. But when I went to Iowa State, I went from a small town of just over 2,000 people to maybe 26,000 students on campus, maybe 300 student groups. I am like wow, there is a lot going on in the world and I have got a lot to learn. I met some political activists on campus and wow, what a flashback when you ask me that question. In 1985 we formed a group on campus called Real Students and we got the name because we had a problem with people who stayed there for like 8-10 years and didn’t graduate and go get jobs. Back then it was cool to wear buttons, so we printed buttons that said “Real Student” and our opposition printed buttons that said “Unreal Student” and that was my start in campus politics. Then that went into student government, some political party activity. So, when I graduated, one week later I had a job, I was starting one week after graduation working on a US senate race. So, I moved to DC to learn the campaign and the candidate, and then back to Iowa to work full time on the campaign. So that was my start, in my second year I said enough engineering. I am just going to learn a lot about politics, economics and history, and it’s been very fun.
Linda: Yes, there is never a loss for new things to learn or new causes to support when we are involved in politics, I will say that for sure. It’s actually, for our listeners, before we were recording we were talking about people we both know and one of my podcast Steve Grubbs is someone you went to college with, correct?
Todd: Well, Steve actually went to University of Iowa, I was at Iowa State, but we were there at the same time. He and I met through political campaigns in Iowa. So, I have known Steve since the 80’s and I really applaud his virtual reality work. He’s smart. He used his political campaign skills to build a small business. That has been growing and now with the virtual reality in a coronavirus world he is offering a great option for education so that’s whey when I can I introduce him to people working on education reform. Because there are a lot of different ways to teach people and it does not have to be the monolithic K-12 system.
Todd: Which is a whole other topic. Well I will give one observation. Look at the largest school districts in this country and were those huge school districts created because it was a great way to teach people, or was it a great way to aggregate and centralize political power?
Linda: I do applaud the many fine public school teachers and public school employees that we have in our country. A lot of them, they are not the problem. They are there trying to be a solution to the problem, so I applaud the teachers but I do believe with you that the system needs reform and I believe school choice should be available for all families regardless of income, zip code or anything else. I am so thankful that I was able to homeschool my kids and I am thankful for all the different options that are available for families now. I think of, like you mentioned Steve Grubbs, who knew we would have corona virus and everybody would need to be working and learning from home at a much more advanced level. I think he’s really at the cutting edge of that. It was just interesting how lives connect and mutual friends who we did not even know we had. For those of you who are listening and did not listen to the episode with Steve Grubbs, please go back and listen to it. You’ll be glad you did. I know school choice, Tommy Thompson really pioneered school choice here is Wisconsin, it was a big issue, it still is. I feel that if people really stop to think about how they could more effectively spend educations dollars they would find that there are a lot of resources and so many choices in how we can educate children and adults. If there’s one good thing I hope comes out of the corona virus epidemic or pandemic is that hopefully people will be more aware of how much time can be wasted in a traditional school setting, but also more aware of all the tremendous resources that are out there for homeschooling families or adult learners. I think that a lot of times we get kind of blinders on our eyes and we just see what we know and we don’t look beyond until we are forced to.
This has caused a lot of families to look beyond. Just a little plug for those listening, one of my other podcast episodes was with Dr. Michael Farris, who founded Home School Legal Defense Association. So, you can also go to Home School Legal Defense Association and find all kinds of resources for Home Schooling or different school choice options and learn about what’s available in your state. At this time that is a really important issue for a lot of families and that is one way where we can see how policy matters to an individual. Right now, they are debating whether or not people should go back to school in the fall or not. My heart is breaking for all the young people who maybe don’t have all the resources at their home. Maybe they don’t have the parental units who are as committed to their education as others. So, there in I feel that there is good options to provide education to children, but we need to be wiser and much more bold about how we allow educational options to come in for our families all across this country.
Todd: Could I chime in with a math example?
Linda: You sure can.
Todd: A few years ago, I went to a PTA meeting or PTSA, whatever everyone’s parent/teacher group is, and they were talking about yet another shortage of something. And a parent said let’s have a bake sale and they said no more. No more bake sales. No more selling wrapping paper. None of that, and I handed out my one page memo. It was based on an article in the newspaper about some education issue. Here is the basic math. Let’s assume that there is 30 students in a class, like a fifth grade class. The national average at the time was just under $11,000 per student. So, let’s say it is $10,000. Thirty times $10,000 is $300,000. Then you subtract what you pay a teacher. So, let’s say with salary and benefits, on the low end it’s $60,000. Because we all know that teachers are under paid. We are told that every day. I tell people, you choose a number. $300,000 minus $60,000 is $240,000. My memo said no more bake sales until we are told where this $240,000 goes. The room was silent after I handed this out. They all kind of looked at each other. Choose a school district and challenge them to tell you where that money is going. Why can’t they afford to buy post it notes and scotch tape?
Linda: Yes, it’s really true and I always tell people that the government does not have anything until we give it to the government first and by the time we get something back it is much less that we gave. I know when I was homeschooling my six kids, there was a budget each year for educational resources, lessons, textbooks. Everything. It’s just a matter of priorities, and I remember sometimes people don’t want to spend that for their kids of maybe for their employees in a workplace, but I remember early on reading something that said if you have to choose what to invest in when raising children, always invest in wisdom. You know, whether you buy this new toy, not that you can’t buy a new toy, kids will ask for all sorts of things, but the best thing we can give to our kids is wisdom and the ability for them to be strong self sufficient adults as they grow up. You talked about educating in the workplace and you have had a great amount of experience there. Can you share with our listeners some of your experiences and best practices for educating employees in the workplace?
Todd: Yes. A couple of different examples. I was hired out of politics for a traditional phone company. Part of my job was employee training. I got lucky because I was in charge of government affairs for the company. So, the training was “How does our government system work?” “Why are we a regulated monopoly?” So, I would travel our states to our district offices and do kind of a Government 101. Because if someone has been working 20 or 30 years, maybe they slept through that class in high school. So that was the focus. The other thing I did beyond kind of a classroom setting was this. The Speaker of the House, of course kind of an influential person. We had about 1000 jobs in our district, and I went to the Speaker and said I’d would like to do a Town Hall meeting with you and a tour. Of course, I am leveraging this economic weight that we had, 1000 jobs, so the format was this. It was three stages. I had the Speaker meet with our management. So, it was probably a group of four of us. We toured the facility and we talked about our investment by pointing to a machine and saying “That’s a half a million dollars, don’t tax it.” A very blunt message. That was stage two.
Then stage three we did a Town Hall meeting. It was with employees and what I did, by design, because I did not want them to be tools of the company, mere robots. I said this Town Hall meeting is for you. So be respectful, be courteous, but ask what you want. Whether it is about school, social issues, whatever the case. It would be great if you asked him about telecomm, because that is what we do. That was the only coaching that I gave them, because I wanted them to feel empowered and engaged, and passionate. So, the next time I talked to the Speaker of the house at the Legislature I could leverage that relationship and that experience we had. So, in three stages it served purposes. The other example I did in employee training. It was at an ecommerce distribution center. That for me was a flashback to industrial engineering which is all about efficiency and through put. It wasn’t government 101, it was like, here is how we do the job, and this is why we have to do it at a certain time because everything is synchronized. People want to sit at home and binge watch and order so we get there order to them when they want. And that is my selfish comment. Hearing you talking about homeschooling. Look at this country. We lay on our couches and we binge watch. And I am starting to use the phrase because I am involved in some service clubs, why not some binge volunteering? Or some binge schooling? “Hey Timmy, come over here and I am going to binge teach you for six hours straight.” That’s probably too much but I am just saying it is some misguided priorities.
Linda: You bring up a good point. Thank you for sharing the examples about how you educated employees. If any listeners are looking for other ideas, I do have a free E-book on the website. If you go to Prosperity101.org you can get a free E-book with some simple tips to educate your employees, and I believe a Town Hall Meeting is one of them. Typically elected officials appreciate the opportunity to meet with constituents. They are happy to that and like you said, it helps your employees feel more empowered and like they actually have a say. Helping them realize that they can make a difference with their opinions and respectful questions. Things like that are all very important. It is much more profitable I would say, both in dollars and cents, but more importantly in terms of impact to do something like that than it is to go out and destroy businesses or loot or burn topple things.
Todd: Or regulate them until they close their doors.
Linda: Right. We have both sides. It’s really true. You talked about how the telecomm industry was highly regulated. Now in the industry your are in with manufacturing what are some of the things that impact your business currently? If you could talk to, well I am sure you do talk to representatives at local, state, and federal levels, I am sure you do. What do you tell them about what’s most import to help your company be more successful?
Todd: Well, it’s no secret and it’s a shared challenge or opportunity for manufacturers in general, but it really comes down to work force development. Whether you know, like at our plant we have laser cutters, and we have welders, and we do paint activity. All of those are pretty specialized jobs, especially welders. Our K-12 system, thankfully we have a vocational educational system. The German model is very interesting where they have tracking. So, you might go on a certain track in your college prep. Another track is vocational. We don’t that as much in the United States but apprenticeships are definitely worth discussing. As I said, it comes down to recruitment. You want to find and retain good employees. While government training programs can be useful, the reality it is on the job training. So instead of taxing away another $100, as general manager I would love to have that $100 to use for job specific training. You talked about it earlier. We get less back from what we give to government. That is the reality with training. I am not here to disparage programs. There is probably some valuable ones there. But again, if $100 of our taxes go to some government entity and then we apply for a government grant and we get $100 back, it cost more than $100 to get that grant. There is friction in the system because some bureaucracy had to be paid to make that grant available. Then we spend that found money to train someone. There is not a lot of economic efficiency in that.
Linda: I would agree. And there is not a lot of economic efficiency too for some of the students entering higher education. I know especially now with corona virus when we have had to look at what are these institutes of higher learning doing and how were they spending the money if they can educate at a level the same by going online, what are these astronomical tuition costs for? People are finding that young people have ridiculous amounts of college debt, student loan debt. Typically, if they are of the mindset and personality and gifting bent I should say to love to do stuff with their hands, be more technical, build things, they might like to go into the trades. Do an apprenticeship, these are ways that they can come out with a fantastic education and in a few short years they have no debt. They have worked it off through their apprenticeship basically. They have excellent job training and typically they become and entrepreneur in the future because they have learned how to run a business from the ground up instead of coming from a classroom.
Todd: That’s the reality, you can always go to college. In our factory the shift is done at 4:30. You could go take a night class. And really round out your education in something you think you need. So, there is value in everything. The key is that people should have options. Leave money in their pockets so they can pursue what they want.
Linda: We talked about the payroll tax deduction, the proposed payroll tax deduction, or the freeze on payroll tax. How would that help your company? Right now, you company and your employees if we did a payroll tax freeze between now and the end of the year?
Todd: Well, I would say in your educational materials, the people you work with, the best thing we can do as a united business community is educate employees. The true cost of on boarding someone. Their salary may be $40,000 but that is not the reality of the cost to on board someone. Social Security is a perfect example. That is 7.5% for each side. So that line item on someone’s paystub, that is only one half of the picture. They don’t see the other half paid by the employer. Maybe they will see that money someday. Demographically, someone more dynamic than me, and maybe you know her already, Star Parker, she wrote a book called Uncle Sam’s Plantation. Somewhere in that book there is a section on who gets robbed the most from Social Security? Sadly, it’s black men because it is based on life expectancy and sadly in this country life expectancy of black males is below other demographic groups. So, they do not see that benefit of Social Security benefits based on what is paid in. That’s census demographics, that is not Todd Kruse making something up.
Linda: You mentioned about the cost for employers to employ their employees. I often say that employees really have no idea what it takes for an entrepreneur to build a company, to provide a paycheck, to provide benefits, to keep increasing those things regardless of what is going on in the outside world. When government comes in and mandates a higher minimum wage, or you mentioned egregious regulations. There is a place for appropriate taxation, appropriate regulation, appropriate legislation. But when it becomes egregious and almost constricting the flow of business and the ability of the business to grow, then that limits jobs that we can provide to employees. One of my lessons in my online course is “What happened to the rest of my paycheck?” They don’t always know, especially now when they just get automatic deposit. How many of your employees actually go back and look in their online deposit information to know what exactly was taken out of their paycheck?
Todd: It’s a minority. It’s a small group.
Linda: I am sure. But so many people will go to the voting booth and then vote themselves right out of a job because they vote for people who are supporting issues and policies that will put their employer out of business. Or at least force their employer to cut back their workforce. So, it’s really important, I salute you for working to educate your employees and having that flow of communication. So, they understand that you care about them, you care about their future, and you want to educate them about these issues.
Todd: Linda, you raise a great point. Voting. And how many people will go vote for a minimum wage increase and a living wage increase. Well there is two ways you can get a living wage. Mandate it by the government. Oh $17.00 an hour is not enough, now make it $30.00, now make it $35. Or reducing taxes, reducing regulation. I set up our 401K. The way we set up the 401K, there is a provision for profit sharing, so we do a company match, like a lot of employers do. But we also have a provision for profit sharing that goes directly into each 401K account. So fine or tax us so that we don’t make a profit, then that provision is worthless.
Linda: Right, you would rather take that money and give it back to your employees, which in turn raises the tide so all the ships can sail. People don’t realize then that a healthy business provides the taxes to the government and they also provide the payroll to the employee so then the employee can pay taxes to the government. So, the best way to help our economy is to help every individual prosper is to make sure that businesses can prosper. So often people claim that if you do that “you don’t care about people” and it is exactly the opposite. We care about everyone and we want them all to have opportunity. You are passionate about that.
Todd: I am really passionate because I ended up doing some college teaching and I guess this made me in favor of sabbaticals. Because a professor sent on sabbatical and I had to do a mock lecture so I made one up, and I got the job. It was one class. It was a part time thing. My dad wanted to be a professor in my life, so that is why I tried, and I’ll be darned, they hired me. I ended up being at 12 colleges and two state prisons which is another chapter of my life, but one class I want to bring up specifically; I had one student who was a huge advocate of every government program possible. He wanted to grow government. I said that is a great idea. Why don’t all of us work for the government so that we don’t have any kind of private sector. All of us will be government employees. He is nodding and saying yeah, yeah. Drinking the Kool-Aid. Then I say, “How will we pay for that?” Then it is just silence because he had no idea what macro economics is. It is truly amazing. For me is the Segway to the ultimate joke into the Soviet Union. We pretend to work and they pretend to pay us. Because essentially in the Soviet Union, everyone was a government. I was there in 1986. You remember the Chicago Speak Easy? That is what private restaurants were like in 1986 in the Soviet Union. You needed to know someone, then knock on the door and get into the restaurant. Because there was no sign that said “Sam’s Diner or McDonalds”. You had to know someone to get in like it was a secret society. Who knew a hamburger was a controlled substance?
Linda: Right, people take so much for granted here in the US and I think at this time with the coronavirus when we have seen grocery stores empty. We have seen some of our basic needs not be available in a sense. I think it is a wakeup call that this could be our life if we decide to adopt a different political system.
Todd: Central Planning and rationing.
Linda: Just everything, we have had this amazing system that has allowed freedom for millions and we need to support it and educate people about it. Todd, I know our time is coming to a close, but if you could give three reasons, just a few reasons why it is critically important for employers to talk to their employees about the political issues, economic issues that truly affect their jobs, what would those reasons be?
Todd: It always pains me when I see a TV story or in the paper that all of the sudden 20,000 people are laid off. Why is that? Everyone is confused, right? You should have the flexibility; I mean if you are going to close a factory; it is still federal law that you have to give notice. So, employees should be educated to think beyond their jobs. It goes to a corporate understanding. 3M has been great at this. They designate a portion of your job, the time you worked there, and you get a budget for you to research your own things and pursue your own things. The idea is entrepreneurs, like yourself, but in a corporate setting when am on payroll, those are intrapreneurs. So, they think like an entrepreneur but they are inside a company. That is important because if we don’t have that kind of mindset, we run the risk of entitlement. Entitlement destroys companies, it destroys school districts.
Todd: So, if you step back, what is politics and educating employees? It’s about voting and the decisions we make have consequences. And that impacts economics. So, you may vote for something that you think is going to be great. But the economics, the law of unintended consequences. I don’t know if I got three different examples there but I was trying to work them all together. So, accountability is great for this, and people come and go. Companies flame out. The lesson that is always expressed in Silicon Valley is fail quickly. Because somebody else is going to have the next big thing. The killer app. It’s like you and I talked about earlier, not on this podcast, but I would consistently say this to college students when I would talk about K-12 reform and ending social promotion. I would pose the question, “What is better for a human? To fail when they are in third grade? Or when they are thirty years old?” Third grade is a lot better. You have time to recover. I don’t want anyone to fail, and this has to be part of the business community. Something went wrong along the way. You did not get all the skills you needed, and we have a training program for that. Well how are we going to pay for that? Let’s send less tax money to the government programs. Whether it is me as general manager or somebody else at another company, in general we know what our employees need to do the job. The other part of the equation is we have an interview and we are professional adults. We say “Hey Fred, Hey Mary, where do you think you are lacking?” or “where does your interest lay and how does that intersect with our needs as a company?” That is where you spend your time and money. That happens quicker and more efficiently than a committee hearing in Washington DC after the sub-committee and then that is sent to the conference committee, and then it is revised in the regulatory process. I have been through all of that. It works a lot better from the way I described from the onset.
Linda: Well, Herman Cain always said that the best way to solve a problem or find the solution to a problem is go to the person closest to the problem. So, you are talking about solving those problems and having those conversations right there in the workplace, where the elected officials in DC or our state governments are solving while they are underneath the dome. Right, they are not in your workplace. Hats off to those elected officials who are there with all of the motivation that truly is to help truly to bring Main Street to the government. It’s is tough because it is a lot of bureaucracy at times. So, when we can reduce that bureaucracy and help businesses thrive we help those employees and all of their families.
Todd: I would love for public officials to take the “Hippocratic Oath”. First, Do No Harm.
Linda: I have always said that I wish every elected official could walk through the halls of the capital and read everything that is inscribed in stone on the walls, because it is just so inspirational. And I hope that it will always be there for people to read. I know we mentioned before, Steve Grubbs, our mutual friend Steve Grubbs, and he has the virtual reality classroom. I said we should take all of these elected officials at all levels and take them back, a walk back in time to the signing of the constitution so they remember who they are representing and why they are actually elected. That would be, I think, really a great thing for America. I know our time is to a close but I always like to let people know how they can contact our guests, so if people want to reach out to you, what is the best way for them to reach out to you?
Todd: Well, in our mobile world, I would go with my cell phone which is text capable. 612-423-5621.
Linda: Ok, well that is great. So, they will always be able to reach you, so text him at that number. You work at Godberson Metal Works, in Spenser, IA. So, we invite everyone who might need metal work done to look up that website and see if that might be a company you might like to do business with. With that, do you have any other closing comments?
Todd: Yes, in general I would say, if the audience is primarily people working somewhere, your job goes beyond what you do at your desk or your workstation. You are part of the largest free enterprise system in the world, and you need to be engaged and educated. Not only to help your company but to help yourself. There is plenty of resources out there, like this podcast, or something really basic like tutor teaching in a junior achievement class in elementary school. It will brighten your day to see these students. I will close with a quick story: I taught a group of third graders and it was a junior achievement class on community economics. I was at a target store and one of the students recognized me and her mother was looking at me kind of warily so I introduced myself and said I just taught a class for your daughters class. She said, “Oh yeah, we know your name. She brings all this stuff home for us to work on together.” So again, whether is Prosperity 101™, Junior Achievement or something you find on your own. There are great ways to engage the entire family.
Linda: Thank you for reminding us that recourses go beyond the individual and education touches everyone. So, thank you for that.
Todd: Happy to do it.
Linda: Thank you again for being here. We are glad you could be part of the podcast so with that we will sign off.
Todd: Thanks Linda.
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