DescentBB

It would seem the union bosses miscalculated a bit . I wonder how the rank and file will feel when they no longer have a job, especially in this economy:

"Hostess Brands Inc, the maker of Twinkies and Wonder Bread, said it will ask a bankruptcy judge for permission to liquidate after failing to obtain wage and benefit cuts from thousands of its bakery workers.

The company said a strike by members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union that started last week was too much to overcome"

Why anyone would strike during times like this is beyond me.

They do it hoping the company will cave. I hope they close and they all lose there jobs. Will teach them a lesson about being greedy. I don't believe unions are needed anymore since we have laws to protect the employees.

CDN_Merlin wrote:They do it hoping the company will cave. I hope they close and they all lose there jobs. Will teach them a lesson about being greedy. I don't believe unions are needed anymore since we have laws to protect the employees.

and, without unions, how long do you think those laws stay on the books? As for the demise of Twinkies, I have no clue what prompted those workers to strike, but to use it as some sort of blanket indictment of unions borders on silly or stupid or both. I note, in my morning business rundown, that Chrysler is expanding their workforce, and last I looked that was a Union shop. Nice of you, Merlin, to slap the 'greedy' tag on folks so readily. Have any specifics as to why these bakery workers were 'greedy'? Did they make nearly as much as management? Have some sort of outrageous pension scheme? Or,might it have been that they wanted reasonable hours, working conditions and pay for their job? I don't have the answers, myself, but when the case comes up here in Delaware bankruptcy court, the filings might clarify things for me.

....from an article in the Wilmington, DE News Journal:
"Hostess had warned employees that it would file a motion in U.S. Bankruptcy Court to unwind its business and sell assets if plant operations didn't return to normal levels by Thursday evening. The privately held company filed for Chapter 11 protection in January, its second trip through bankruptcy court in less than a decade."

lessee....two trips to bankruptcy court in less than 10 years, last chap 11 filed over 9 months before the strike, competiton with 6 other brands killing them. Hmmmm, it seems like the bakery workers weren't the issue, but that management and marketing were lousy. That's ok, just blame the workers, cut their pay to the bone and somebody will make good money, right? I'll bet that CEO that blundered into this debacle probably gets pretty good pay and benefits, wouldn't you?

Yes, because everyone knows only corporations can be greedy.

Probably was a decision led by the union, not the employees anyway.

A question…

Why did the unions feel the need to go after Ford Motor Co,? Ford was like the most progressive company in history*, but the unions still felt the need to unionize them…why?

Power? Greed?

*Up to that time.

Pay? Benefits? Worker Safety? Sure, Ford was progressive for the times, but really, do we wish to have workers in early 20th century conditions with early 20th century benefits. What always amuses me is the number of folks claiming that workers are SOOOOOO protected in the present day. Why then, in the 50's and 60's, did entry level workers receive approximately 1/20 of the pay of CEOs on average, while today, in this age of employer enlightenment, that ration is around 1/160?

Maybe hostess workers didn't want to give up another 8% of their pay and up to 32% of their benefits.

I can't figure out why anyone right now would strike or petition to secede from the union unless they are outright being led to destroy this country, right at the time everyone needs to pull together and make sacrifices. I can't help but think there is some sinister agitation going on right now. The problem lies in the fact that most American's alive now have been stripped of their sense of National Sovereignty and Individualism. They have never really seen how bad it can get and have no sense of sacrifice. I'm betting within the next 5-20 years, they will get their taste of it.

callmeslick wrote:lessee....two trips to bankruptcy court in less than 10 years, last chap 11 filed over 9 months before the strike, competiton with 6 other brands killing them. Hmmmm, it seems like the bakery workers weren't the issue, but that management and marketing were lousy. That's ok, just blame the workers, cut their pay to the bone and somebody will make good money, right? I'll bet that CEO that blundered into this debacle probably gets pretty good pay and benefits, wouldn't you?

Specific to Hostess: I tend to agree. Neither nuclear-resistant nor lard-based food products are particularly in demand these days, and twinkies have a reputation for being both. Hostess needed to have developed & marketed for the new era of food demand: natural, healthy foods if they wanted to stay in business.

General commentary on unions: It saddens me that the system is the way that it is. It seems that it's rare that either side is looking out for anything other than lining their own pockets... to the point of making the companies and customers involved into casualties. I don't know all of the answers of how to fix the issue... but I think maybe it starts with structures that allow each employee to make more money by doing their job better, and conversely limit the earning potential of the people that do a poor job. I like the idea of "broadbanding" where pay level can vary fairly widely in each given job description.

woodchip wrote:It would seem the union bosses miscalculated a bit . I wonder how the rank and file will feel when they no longer have a job, especially in this economy:

"Hostess Brands Inc, the maker of Twinkies and Wonder Bread, said it will ask a bankruptcy judge for permission to liquidate after failing to obtain wage and benefit cuts from thousands of its bakery workers.

The company said a strike by members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union that started last week was too much to overcome"

Why anyone would strike during times like this is beyond me.

Well, lets see. How many times has Hostess been bought through leveraged buyouts, to companies that didn't even make baked goods? Guess what happens when companies are bought and sold for all the wrong reasons? Death.

Loans are taken out on said company to make a huge profit while the rest is milked for all it's worth. Debt is then loaded up on that company to make even MORE profit, so that it inevitably becomes a worthless hulk. The workers are then forced to accept lower and lower wages and benefits through no fault of their own. The workers then decide to strike because they know the ship is sinking and they're screwed anyway. Bingo, dead company, unemployed workers and boatloads of debt that someone has to pay, and guess what? That debt won't be paid by those who created the mess in the first place. They're walking off with wads of cash free and clear to stuff in the Caymans, while the debt usually ends up being paid out of taxpayer coffers during the debt settlements, one way or another. This is a prime example of why equity investors are only out for themselves!

BCTGM President Frank Hurt wrote:Unfortunately however, for the past eight years management of the company has been in the hands of Wall Street investors, "restructuring experts", third-tier managers from other non-baking food companies and currently a "liquidation specialist". Six CEO’s in eight years, none of whom with any bread and cake baking industry experience, was the prescription for failure.

http://www.dailykos.com/story/2012/11/1 ... -1925-2012

http://www.dailykos.com/story/2012/11/1 ... liquidates

callmeslick wrote:....from an article in the Wilmington, DE News Journal:
"Hostess had warned employees that it would file a motion in U.S. Bankruptcy Court to unwind its business and sell assets if plant operations didn't return to normal levels by Thursday evening. The privately held company filed for Chapter 11 protection in January, its second trip through bankruptcy court in less than a decade."

lessee....two trips to bankruptcy court in less than 10 years, last chap 11 filed over 9 months before the strike, competiton with 6 other brands killing them. Hmmmm, it seems like the bakery workers weren't the issue, but that management and marketing were lousy. That's ok, just blame the workers, cut their pay to the bone and somebody will make good money, right? I'll bet that CEO that blundered into this debacle probably gets pretty good pay and benefits, wouldn't you?

Speak about pantloads Slick. Here's what the teamster's, who did settle, have to say:

"The Irving, Texas-based company had already reached an agreement on pay and benefit cuts with its largest union, the International Brotherhood of Teamsters. On Thursday, Teamsters officials blasted the smaller union for not seeking a “solution” in the process or to engage in negotiations."

Do I hear anything about corp mismanagement? No. So like good Democrats, Slick and the small union decide to blame corporate bosses. As it turns out there will now be another 18,000 more people unemployed due to their own stupidity. Wonder how these job losses will reflect on the next job's report.

[quote="tunnelcat"

Well, lets see. How many times has Hostess been bought through leveraged buyouts, to companies that didn't even make baked goods? Guess what happens when companies are bought and sold for all the wrong reasons? Death.

Loans are taken out on said company to make a huge profit while the rest is milked for all it's worth. Debt is then loaded up on that company to make even MORE profit, so that it inevitably becomes a worthless hulk. The workers are then forced to accept lower and lower wages and benefits through no fault of their own. The workers then decide to strike because they know the ship is sinking and they're screwed anyway. Bingo, dead company, unemployed workers and boatloads of debt that someone has to pay, and guess what? That debt won't be paid by those who created the mess in the first place. They're walking off with wads of cash free and clear to stuff in the Caymans, while the debt usually ends up being paid out of taxpayer coffers during the debt settlements, one way or another. This is a prime example of why equity investors are only out for themselves!

BCTGM President Frank Hurt wrote:Unfortunately however, for the past eight years management of the company has been in the hands of Wall Street investors, "restructuring experts", third-tier managers from other non-baking food companies and currently a "liquidation specialist". Six CEO’s in eight years, none of whom with any bread and cake baking industry experience, was the prescription for failure.

[/quote]

So lets see, Solyndra borrows 500 mil from the tax payers, The owners milk the company and give big donations to Obama, then declares bankruptcy. How many millions do you think the ceo and upper rank mgt. skimmed before they shut the door.
Now, in Twinkies case, even tho the new CEO's may not of known about baking doesn't mean they don't know anythng about marketing or running a business. Also, if you don't know this already, middle mgt. usually handles the nuts and bolts of any large company and I doubt they were replaced when new owners showed up. So the employee's got snookered, in reality, by their over reaching union bosses and now are just another unemployed statistic.

for those paying attention to this tripe: Woodchip countered my observation with the comment that HE hadn't heard about any corporate mismanagement. Upon getting a rundown on the multiple CEOs, leverage specialists and liquidation experts running a 'baking' company, he comes up with Solyndra? Really? Come on, dude, do you think we are all so stupid as to not see your blatant dodge?

I think the fact of the matter is Unions are good things until the Union leaders decide to sellout. What i can't for the life of me figure out is how 18000 people were so friggin stupid and gullible. How could no one see that this would bankrupt a company already on the brink of financial ruin? That makes no sense to me at all. I mean I very rarely call people names but in this case, friggin idiots, all 18000 of them. Yet, I know how it was done. They sit there and whip themselves into a frenzy talking crap and arrogance, then they all lose their jobs. In 2 more weeks they will be thinking all the things they should have thought 2 weeks ago. I'm flabbergasted by this and losing all confidence.

Flip, two possibilities strike me.....first, maybe the cuts they were being asked to make were too severe for them to live with, and other employment alternatives were preferable. Second, if you read any of the business articles on this matter,it is obvious that Hostess will sell off the bakeries and brands for money to satisfy the bankruptcy judge. Thus, after a brief period of unemployment, it is highly likely, according to several sources, that those plants and workers will be back into production. Although it does no one any nutritional good, Twinkies and Wonder Bread will still be staples of the American diet, I suspect they will simply be brands made under another banner than Hostess.

callmeslick wrote:for those paying attention to this tripe: Woodchip countered my observation with the comment that HE hadn't heard about any corporate mismanagement. Upon getting a rundown on the multiple CEOs, leverage specialists and liquidation experts running a 'baking' company, he comes up with Solyndra? Really? Come on, dude, do you think we are all so stupid as to not see your blatant dodge?

where did you mention "liquidation specialist" or "leverage specialists"? Or are just trying to muddy the bath waters thinking you somehow will look tan and buff?

woodchip wrote:

callmeslick wrote:for those paying attention to this tripe: Woodchip countered my observation with the comment that HE hadn't heard about any corporate mismanagement. Upon getting a rundown on the multiple CEOs, leverage specialists and liquidation experts running a 'baking' company, he comes up with Solyndra? Really? Come on, dude, do you think we are all so stupid as to not see your blatant dodge?

where did you mention "liquidation specialist" or "leverage specialists"? Or are just trying to muddy the bath waters thinking you somehow will look tan and buff?

I didn't, specifically, but TC sure did, and provided references, to which you started babbling about Solyndra as if it had ANY relevence.

Around here Slick we would call that mitigation. The whole thing sets a dangerous precedent with far to many implications than I care to mention right now. Everything you said is true, except for the fact that employment is not an easy thing to find right now and overnight 18000 more were added to the numbers. Now, people are much less likely to complain at all, and since the unions will take most the criticism, they will probably slowly be undermined too. Nothing good will come of this.

Right and tc was talking in generalities...not specifics, so I threw in Solyndra to balance out what she babbled about. And of course since Solyndra was a Obama pet project it obviously had no relevance. My bad.

And Flip, you made a very lucid observation.

flip wrote:Around here Slick we would call that mitigation. The whole thing sets a dangerous precedent with far to many implications than I care to mention right now. Everything you said is true, except for the fact that employment is not an easy thing to find right now and overnight 18000 more were added to the numbers. Now, people are much less likely to complain at all, and since the unions will take most the criticism, they will probably slowly be undermined too. Nothing good will come of this.

and when the workers 'don't complain', who ends up running roughshod over them? Somewhere along the way, attitudes have to change, people have to start standing up for fairness to regular workers, or that onward march(which I have described at length) toward a nation of peasants and lords continues at an ever-increasing pace. This goes beyond simple economics.....you can run a company in which fair profits are made by all. However,
when the money people succeed at selling the notion to workers that 'this is the best you can hope for', the workers are doomed, IMO.

woodchip wrote:Right and tc was talking in generalities...not specifics, so I threw in Solyndra to balance out what she babbled about. And of course since Solyndra was a Obama pet project it obviously had no relevance. My bad.

maybe you saw TCs comments as generalities, and perhaps that is how they were meant. But, the facts emerging are that Hostess has been run for years by people with no clue about the baking business. Further, they are clearly itching to dissolve and take a short term profit by selling off brands and bakeries to other corporations. The fact that those corporations are willing to scarf up iconic brands is testament to the fact that Hostess could have, if it wished, been run profitably as a standalone business, it's simply that to do so would not have meant the level of return the current investors and management wanted to extract.

And you know this for fact? You talk to the CEO and this is what you were told? Or are parroting the leftist talking points that corporations are run by evil people who are out to screw the workers. Workers are free to band together, pool their resources and buy a business. Then they can run as they see fit.

What I've gathered from various sources:

• Hostess has been in bad shape for a while and was ready to file bankruptcy earlier this year (even though the CEO gave himself a 300% pay raise, go figure).
  
  Hostess wanted to sell, but couldn't because no one would buy it with the union attached.
  
  In an effort to keep the company afloat, they propose an 8% pay cut for employees, which the union handily rejects.
  
  Hostess then prepares to file for bankruptcy, something that was probably inevitable, but they can use the "union" excuse rather than admit mismanagement (Note: properly run companies don't have problems with the unions).
  
  With the company liquidated and no union to get in the way, Hostess can split the company and sell of individual brands. A great way to make some extra money on a dying product.

I don't see how this is a cause for any of you nimrods on the left or right to make an argument out of this. The company was doomed because they had no vision of the future (who wants fatty cakes in the 21sr century?). The labor dispute is business as usual. You guys just like fighting about nothing. Blame the union all you want, but it was doing it's job.

I can't remember the last time I ate a crappy product by Hostess and I won't miss them. I feel bad about the workers, but that train was going to reach the end of the line one day. Hostess should have got on the ball several years ago and rode the market forces by launching new products. They could have taken a lesson from Dunkin' Donuts who, seeing a more health conscious public, de-emphasized donuts, emphasized coffee, and added a diverse breakfast menu. After total re-branding they are more successful than ever.

vision wrote:What I've gathered from various sources:


Hostess wanted to sell, but couldn't because no one would buy it with the union attached..

Not surprising but then who would want to buy a company with union obligations signed by prior owners?

vision wrote:In an effort to keep the company afloat, they propose an 8% pay cut for employees, which the union handily rejects..

Ummm, read my earlier reply. The teamsters (in case you don't know, are a rather large union) signed a agreement and in fact blasted the smaller union for not signing. Pay cuts in tough economic times are agreed to by any number of unions with the idea that when times get better they (unions) can then negotiate for higher wages. Sadly in this case the workers decided they would call the companies bluff and then found out there was no bluff.

vision wrote:Hostess then prepares to file for bankruptcy, something that was probably inevitable, but they can use the "union" excuse rather than admit mismanagement (Note: properly run companies don't have problems with the unions)..

Like Slick, do you know for a fact that if the smaller union would of settled that the company would of filed for chapter 11? "Probably" does not make for good reasoning. As to your "Properly Run" statement would you say GM is a properly run business? I suggest you research how GM's facing ever higher pension payments was leading them to chapter 11 until they were bailed out by Obama.

vision wrote:With the company liquidated and no union to get in the way, Hostess can split the company and sell of individual brands. A great way to make some extra money on a dying product.

I don't see how this is a cause for any of you nimrods on the left or right to make an argument out of this. The company was doomed because they had no vision of the future (who wants fatty cakes in the 21sr century?). The labor dispute is business as usual. You guys just like fighting about nothing. Blame the union all you want, but it was doing it's job.

I can't remember the last time I ate a crappy product by Hostess and I won't miss them. I feel bad about the workers, but that train was going to reach the end of the line one day. Hostess should have got on the ball several years ago and rode the market forces by launching new products. They could have taken a lesson from Dunkin' Donuts who, seeing a more health conscious public, de-emphasized donuts, emphasized coffee, and added a diverse breakfast menu. After total re-branding they are more successful than ever.

Vision you must not do your own grocery shopping. There are aisles with nothing but crappy foods and I suggest you look at what shoppers are putting in their carts. If you seriously think foods like Twinkies were a dying product, you just plain ain't very observant. As to the union doing it's job, then I guess you mean putting 18k workers on the unemployment lines is what unions exist for. A good union, like the teamster, looked at where the company was and decided to work with them instead of saying "screw you" to both Hostess and it's own rank and file.

woodchip wrote:And you know this for fact? You talk to the CEO and this is what you were told? Or are parroting the leftist talking points that corporations are run by evil people who are out to screw the workers. Workers are free to band together, pool their resources and buy a business. Then they can run as they see fit.

I live in Delaware. The daily newspaper has a massive business section, and devotes quite a bit of time to bankruptcy filings, as most are filed here.
Once, again, this time in the form of vision's post, you are presented with solid evidence from business, not political reportage, and choose again to
just disagree, based on what business credentials?
Oh, and for the record, Hostess Brands filed back in January for Bankruptcy(chapter 11). Cutting a deal with the unions(eg-screwing the workers) was an attempt to forstall the process, likely only until sell-off conditions were better. Note that woody doesn't address why the CEO would grant himself a 300% raise before the filing, and then doesn't address the demand for rank-and-file workers to earn less. Woody, this seem fair to you?

yeah all they had to do was thin out their product line, keep the iconic brands, reject that obscene 300% pay raise for the CEO, and everyone would have won in the end.

but no, they had to screw themselves over like this.

i'll miss the cupcakes though.

Workers are free to band together, pool their resources and buy a business

how the ★■◆● do you do this when you live paycheque by paycheque.

not for long....I figure Twinkies and Ring Dings will be back onto the market within a matter of months, Purchased(at great profit for the ★■◆●-weasels that run Hostess Brands) by another snack food company and put back before their adoring public. Wonder Bread on the other hand......

And probably manufactured in the same place, only by a staff of brand new immigrant workers at or near minimum wage.

woodchip wrote:...do you know for a fact that if the smaller union would of settled that the company would of filed for chapter 11? "Probably" does not make for good reasoning. As to your "Properly Run" statement would you say GM is a properly run business?

I do not know who would have done what and neither do you. We are both speculating. And I said nothing about GM. They aren't the only company that deals with unions you know. The larger point is that this is a pretty stupid topic for a left vs. right argument. It's just business man, get over it. Companies fail when they lose their edge.

vision wrote:

woodchip wrote:...do you know for a fact that if the smaller union would of settled that the company would of filed for chapter 11? "Probably" does not make for good reasoning. As to your "Properly Run" statement would you say GM is a properly run business?

I do not know who would have done what and neither do you. We are both speculating. And I said nothing about GM. They aren't the only company that deals with unions you know. The larger point is that this is a pretty stupid topic for a left vs. right argument. It's just business man, get over it. Companies fail when they lose their edge.

Unless they are to big to fail then the government will prop them up. Hostess just wasn't one to big to fail.

Heretic wrote:Unless they are to big to fail then the government will prop them up. Hostess just wasn't one to big to fail.

Surprising, considering all the calories.

Krom wrote:And probably manufactured in the same place, only by a staff of brand new immigrant workers at or near minimum wage.

looks like it may be Bimbo of Mexico. Huge company, pays American scale wages at it's US facilities, well regarded employer, and has a source of sugar that gets Hostess out of tariff issues. Report came out earlier today.

callmeslick wrote:maybe you saw TCs comments as generalities, and perhaps that is how they were meant. But, the facts emerging are that Hostess has been run for years by people with no clue about the baking business. Further, they are clearly itching to dissolve and take a short term profit by selling off brands and bakeries to other corporations. The fact that those corporations are willing to scarf up iconic brands is testament to the fact that Hostess could have, if it wished, been run profitably as a standalone business, it's simply that to do so would not have meant the level of return the current investors and management wanted to extract.

http://www.cnbc.com/id/49853653

Hostess came out of bankruptcy in 2009 after being purchased by an "equity firm" called Ripplewood Holdings, with the funding from 2 hedge funds, Silverpoint and Monarch. The unions at the time gave huge concessions to save the company.

Hostess will now be liquidated by those 2 hedge funds because of the debt. Such a nice way to say working people are losing their livelihoods because no one who owned the company knew how to run that company. None of those controlling "entities" know anything about baked goods. All they do is buy distressed companies for a living, but I seriously doubt they know how to bake Twinkies, better manage stocking or figure out ways to increase sales. I know that just from the way the shelves in the store were stocked locally. The price kept rising and the product kept shrinking in size and quality. They also made no attempts to get a more prime space in the stores and the product line stayed the same here in Oregon for years, hidden in the rear of the store in out of the way nooks. I rarely saw some of their other snacks, like Chocodiles, that I would have gladly purchased. We know there is still a market, because people are now out hoarding Twinkies. They don't want to see them go away.

Attempts at increasing sales failed with their lackluster attempts, so no sh*t things tanked. Pay issues between the union and the CEO soured too. I'm guessing that the CEO's pay was far more golden than the slumping sales warranted. Not the way to run a profitable company. Grease the skids of an under performing CEO and dock the pay of the workers to compensate. Same old story that creates resentment.

The union rejected a deal made by their own leadership. After listening to one worker on the news comment that with the loss of health benefits and pensions, they were down to essentially minimum wage. They figured they had nothing to lose, because the company wasn't going to give them a living wage. This is what's going on all over our country and it's destroying the middle class. I'm willing to bet that the Hostess brand will be purchased for a tidy sum, and that the new owner will take some or all of their product production outside the U.S. to use cheap labor. I wouldn't touch their product with a ten foot pole, if it ever gets reintroduced under those circumstances.

Well it’s about time for liberals to start some businesses so we can all make a living wage, with full bennies.

I won’t hold my breath tho.

you might be surprised how many new companies and entrepreneureal ventures are started by liberals. Then, there is that Gates fellow....

You’re right, I would be surprised.

Lol, are you calling "Mr. Monopoly" a liberal.

very much so. I dare say that Bill Gates is quite a bit left of me on a lot of issues.

Well, with friends like that…

Also the key to my statement was “livable wage and full bennies” most of the new businesses created these days don’t seem to provide those, regardless of who is starting them.

really, Spidey? Ever looked into tech and biological emerging companies. They pay very well indeed. Sure, start-ups are going to go on a shoestring,
IOU sort of basis. But, I have no clue where you come up with that last statement.