More than 18,000 people are without jobs around the country as Hostess moves to liquidate its assets and close forevermore.
The company had a good run of nearly 83 years, starting up at the onset of the Great Depression.
Times were different then. People wanted jobs — even begged for jobs — and would take just about anything offered to them. Simply put: Workers were hungry.
Then came the Great Recession, as some have called it, of this millennium. Hostess — the giant retailer of baked goods with a roster of names such as Twinkies, Ding Dongs and Sno Balls — found itself on the losing end of basic economics.
Sure, there was demand. Sure, there were relatively cheap supplies.
But, nope, there was no longer a cheap workforce.
Somewhere between the Great Depression and Great Recession, the factory climate changed. Unions took over.
While unions ardently fought for decades to provide decent living wages and benefits for employees, they simply got too big for their own good. Many evolved into something that was not the spirit in which they were created.
Factories in the Rust Belt and elsewhere laid off workers and suffered through bitter strikes. Some ultimately shut down production lines as union demands grew beyond companies’ pocketbooks.
Power of the unions, as it turned out, was an illusion.
There’s little incentive for many factories to put up with unions if they can get big dollar incentives to relocate to another place — whether it’s Mexico, China or another state — and find a surplus of unskilled or skilled laborers who will work for a decent, albeit lesser, wage.
It’s basic math. And as times got tough in the recent recession, the executives at the top started really digging deep for savings.
Unions, in turn, started really digging in their heels. Some, to be fair, made incredible concessions to keep their workers working. But many decided to demand more — lower health care deductibles and premiums, higher wages, better benefits.
And, in the case of Hostess, these workers and their communities were stuck with a real zinger when the union failed to come through for them: no jobs.
Our Views reflects the majority opinion of the members of the Grand Haven Tribune editorial board: Kevin Hook, Cheryl Welch, Matt DeYoung and Fred VandenBrand. What do you think? E-mail us a letter to the editor to news@grandhaventribune.com or log-in to our website and leave a comment below.
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Comments
Congratulations Our View staff!! This is probably the most bogus piece you have written - clearly, you are taking the corporate stand, with no apparent knowledge of the facts, which would show the fallacies in most of the article. Yes - the poor private equity firm that bought Hostess, got deep concessions from the unions a few years back during the FIRST bankruptcy, paid themselves royally (CEO makes $125,000/MONTH) yes - that's $1,500,000 during the liquidation. And did I mention Hostess is seeking approval from the US Bankruptcy Court to give its top executives bonuses totaling $1.8 MILLION as part of the wind-down?? Oh, and another thing, Hostess is no longer able to pay ANY retiree benefits, so all those years of thinking you had a pension - you're screwed!! Another thing - there are tons of buyers for poor Hostess that had to liquidate all because of those nasty union laborers that wouldn't agree to to a second wave of concessions. That private equity firm that worked soooo hard to keep Hostess going - WINK, WINK - stands to make a mint off the sale of Hostess. Plan turned out just like clockwork - and then fools like you can put out a bunch of trash commiserating with them while many lives of the workers are decimated.
Lanivan, I appreciate that in this comment you merely blame the generic private equity firm instead of identifying it as Republican or Bain Capital like - I guess because it was a Democrat private equity firm.
But since we are handing out blame for the demise of Hostess (and I REALLY miss being able to buy Beefsteak Rye), let's take some aim at the poor unions. First, the the union bosses of the Bakery, Confectionary, Tobacco Workers & Grain Millers who killed Hostess are just old white men, but they didn't lose their jobs and seem to be taking care of themselves very well.
FRANK HURT PRESIDENT $262,654.00
DAVID DURKEE SECRETARY-TREASURER $244,396.00
JOSEPH THIBODEAU EXEC VICE PRESIDENT $218,989.00
STEVE BERTELLI VICE PRESIDENT $198,062.00
MICHAEL KONESKO VICE PRESIDENT $184,297.00
ARTHUR MONTMINY VICE PRESIDENT $175,505.00
ANTHONY JOHNSON VICE PRESIDENT $167,433.00
ROBERT OAKLEY VICE PRESIDENT $167,265.00
RANDY ROARK VICE PRESIDENT $166,849.00
SEAN KELLY VICE PRESIDENT $161,789.00
Second, the mighty Teamsters were apparently a large part of the reason the Bakers wouldn't give further concessions because the baking part of the Hostess operation was quite efficient, unlike the delivery system where ridiculous union work rules are consciously engineered to increase inefficiency and create superfluous jobs are making Hostess uncompetitive with other industry players. If cakes and bread arrive together and are headed to the same place, they must nevertheless be split onto separate trucks; drivers are forbidden to load products onto their trucks.When the Hostess man delivers product to the store, he isn’t allowed to move items from storage to the shelves; instead, a different employee, called a “pull-up” worker, has to do that job. Oh, and if both cakes and bread are involved? You guessed it: there’s a cake pull-up and a bread pull-up. One guy couldn’t possibly do the same task. If Hostess wants to enter a new market, work rules still apply. (Forbes)
Oh, and the Teamster bosses are still employed, and they ain't pikers :
Name Title Gross Salary Benifits & Other Compensation Total Compensation
JAMES HOFFA GEN PRESIDENT $372,489.00
C KEEGEL GEN SEC-TREASURER $337,601.00
ROBERT BOUVIER INTERNATIONAL VP $226,507.00
FORREST JOHNSON INTL VP/INTL REP $223,296.00
CHARLES DEANER ASSISTANT TO GENERAL PRES $219,378.00
GARY WITLEN DEPARTMENT DIRECTOr $214,779.00
RICHARD BELL EXEC ASST TO THE GST $213,326.00
JAMES MCCALL SPEC COUNSEL $206,494.00
JOHN WILLIAMS TRADE DIVISION DIRECTOR $189,873.00
GORDON SWEETON INTL VP/INTL REP $184,874.00
JEFFREY FARMER DEPARTMENT DIRECTOR $184,051.00
JAMES CURBEAM INTERNATIONAL ORGANIZER $180,230.00
RICHARD HALL INTL VP/INTL REP $179,254.00
FRED GEGARE INTL VP/INTL REP $179,117.00
MANUEL (MANN VALENZUELA ORGANIZING COORDINATOR $178,447.00
SANDRA WEAVER INTERNATIONAL ORGANIZER $176,935.00
DAVID BOURNE TRADE DIVISION DIRECTOR $174,016.00
NEIL DITCHEK AST-INTER UN AFF GEN CNSL $172,060.00
BRET CALDWELL DEPARTMENT DIRECTOR $169,800.00
http://www.unionfacts.com/union/...
Bottom line - there's plenty of blame to go around but how employees can vote to drive a company out of business knowing full well that they will lose ALL their own wages and benefits represents a mindset that is beyond my understanding.
Hello, Vlad - I knew you couldn't resist going off on a tangent with your very, very long lists. Congratulations!! You obviously have lots of time to devote to minutia - I'm envious! Frankly, I don't give a rip if the private equity firm is democrat (there you go again with "corporations are people" and can even be labeled as being of one party or another - amazing!). I really don't care how much $$ is made within those very, very long lists. My point is that the "Our View" "journalists" were exceptionally fact-challenged on this. I'm not even particularly pro-union, but in this case, when connecting the dots, I don't see how Hostess is liquidating because workers didn't agree to a second wave of concessions (maybe the workers should have called their bluff and agreed, and then sat back and watch Hostess liquidate anyway. Might have been a better PR move). Maybe when they saw that no pensions will be paid, and the private equity fund owners are asking for a $1.8 MILLION compensation package just for old times sake), the workers decided to take a stand, whether they go down or not. You know, just for the principle of the thing (that might be a mindset you do not understand??).
Oui vey, do you all hear that? It's the sound of the fire department coming because Ms./Messer Lanivan just got SMOKED.
Since you seem to have more time than I do (it's Holiday time!!), would you consider researching various other bakeries like Pepperidge Farm, etc, and see what the difference is between them and Hostess - why did Hostess fail when others haven't? What's the major factor - unions, wages & benefits, indifferent management - that differentiates Hostess from the others. I would appreciate it (but please don't get your facts from Breithbart, Rush, or O'Reilly)!! My guess is that unions play a big part in all the big national bakeries, so why a Hostess liquidation?
VLAD - this reply was supposed to show up under your comment about labor unions, NOT Renegade X. This new format has some bugs to work out.....
Yes, I know it's the time between Thanksgiving, Christmas, and Hanukkah, but it's not too time consuming if you have bookmarked a site than gives statistics on unions and their wages/benefits (which I provided).
In furtherance of the Hostess situation: On Thursday, Teamster bosses also made a last-ditch effort to “recommend” a different course of action to the BCTGM, even calling for a secret-ballot vote by BCTGM members (secret-ballots are normally something that are, for the most part, taboo to today’s union bosses):
Today, the Teamsters Union announced its recommendation to the Bakery, Confectionary, Tobacco and Grain Millers International Union (BCTGM) that a vote of its Hostess members by secret ballot should be held to determine if the workers want to continue their strike of the company and force it into liquidation.
With respect to other bakeries, I suggest:
For more than a year, BCTGM has had its members who work for American Crystal Sugar in multiple states locked out of their jobs.
Several years ago, the BCTGM led its members out on another ill-advised strike with disastrous consequences. Like at Hostess, when famed biscotti-maker Stella D’Oro workers struck their employer, the union convinced them they had nothing to worry about. Like Hostess’ 18,000 employees, Stella D’Oro workers also lost their jobs when the company’s Bronx facility closed permanently.
You seem to lack empathy for the US workforce/unions. Maybe a review of Henry Ford is in order. A workforce of low wages/benefits is a drag on economic growth. Arbitration done properly with both sides willing to compromise should be the focus, not blaming the laborer.
I just want to clarify something. My name is also Ryan Miller, but I am not the Ryan Miller that posted these comments.
Sincerely,
The Real Ryan Miller
Amen sister........Thanks Brenda for your union back bone support. What a lot of people don't realize is how important unions are, and those that don't care either couldn't get into a place with a union or they are on the company band wagon. Do you think Sam Walton wanted his buisness to be run this way today? No wonder why so many walmart workers want to get unionized. Big companies have to realize that success is not only made behind a desk and for that the wealth has to be shared.
Non union companies understand full well they need to take care of their people. Unions are not what they were when they started. They are getting rich off your back pretending they take care off you! Look around in any union shop and you will see they are protecting those lamers that sit around and do nothing but milk the clock. They do this because they look at this trolls as easy money for their dues. Good companies weed out the non productive slugs because it is the right thing to do and fair to those that are working hard, which further increases productivity and companies gain respect from hard workers and they produce more. Unions protect these slugs and everybody cares less about their own performance because they grow tired of making up for the slugs that are doing nothing. Wake up dude, your being used to make the union fat cats richer!
Wing - it's a fact of life that there are movers and slackers, ethical and unethical, principled and unprincipled in every group whether work, union, Wall Street, communities, churches, schools. Do we have enough digits to point fingers at every slug or troll??
Hi Lan -I call it the way I see it. There should be freedom to remove those that fail to perform. The Unions are protecting those that will not work, for the benefit of union dues, thats wrong and people know it. If unions stayed focused on the workers without trying to enrich themselves, I would be less critical. So yes, I will point, and sneer at all those that are not contributing because they make life harder on those of us that are carrying the weight. I will stay out of politics for now as you can see and know how my stance lines up with my political beliefs!
Fair enough. I will go even further and say that liquidation is available to remove those that fail to perform - i.e., Hostess. Hostess ownership manipulated events so they could blame the workers (maybe Hostess owners are just very bad managers?) - not because the workers didn't work hard enough, but because they wouldn't concede to wave after wave of concessions. Maybe Hostess needed to fail because management was not interested in success but soaking it for all it was worth and then casting it aside with the rally cry, "we blame the workers". I'm not standing up for the unions so much as standing up for the workers. I don't know enough about the inner workings of labor unions to give an educated comment on that. And I don't care to make broad generalizations.
"I'm not standing up for the unions so much as standing up for the workers."
Caused coffee snarf onto keyboard. Who do you think votes to be unionized business owners and hedge funds? Who do you think voted to support the union demands of Hostess? That argument is simply specious, and I think you probably know it.
Ok - you have a point. I made the previous comment in haste. Allow me to re-phrase: The Hostess and Stella d'Oro management/union situations are both examples of private equity firm takeovers of long-time unionized bakeries. Both new owners hoped to leverage their experience and wealth by imposing substantial constraints on wages/benefits to boost profitability, then sell high. They both mismanaged the arbitration process (in several different ways) which ensured union/workforce pushback. Both situations had a workforce who felt they were entitled to the wages/benefits package they were receiving. Both management and union workforce responded with arrogance and greed (although in the case of Stella d'Oro, workers were asked to cut wages from $46,000 to $37,000 - $9,000 - huge sacrifice). In my opinion, the "fault" can not and should not be automatically and entirely placed on the workforce/unions, even though ultimately they didn't do themselves any favors. Thus, my statement that my empathy tends to gravitate to the workers, rather than private equity firms, still stands. As for unions, I'm sure there are some that are corrupt, top-heavy and self-serving, just like PEF's. Hope this comment doesn't choke you up!
No choking up or snarfing, although I do question where you obtained the "facts" that
" Both new owners hoped to leverage their experience and wealth by imposing substantial constraints on wages/benefits to boost profitability, then sell high. They both mismanaged the arbitration process (in several different ways) which ensured union/workforce pushback."
This link more accurately explains what happened at Stella d'Oro, including the following facts http://www.bronx.com/mobile/news...
"Since Brynwood Partners bought Stella D’oro, the Company has undertaken a number of critical strategic actions designed to ensure its long-term health, including introducing new products, securing new retail outlets and investing approximately $11 million to purchase modern equipment and finance the Company’s continued operating losses and capital expenditure needs. Despite what is being stated in the media, Brynwood Partners has not taken any money out of the Company in fees, interest payments, dividends, distributions, or any other form. Stella D’oro also never received a $175,000 Manufacturing Assistance Program (MAP) Grant from New York State, as was incorrectly alleged.
Despite its strategic actions, which resulted in Stella D’oro’s first sales increase in 15 years, the Company has continued to lose money – including more than $3 million in operating losses since 2006 through the time of the strike - primarily due to its uncompetitive labor cost structure. Contrary to misleading statements that the Company is profitable, just not as profitable as its investors would like, the fact is that the Company was and still is losing considerable amounts of money each year."
Full disclosure - this is depressingly familiar, as my father, who had worked for the New York Herald Tribune since leaving active duty in WWII, lost his job after a union strike shut down the paper, after the union, just like the Bakers, had been given access to the employer's books that showed the paper could not continue with the union's demands, and the union didn't care. This happens and not infrequently. Workers, both union and management lose. Union bosses - not so much.
Corporate Greed!!!!!!
A federal bankruptcy judge has approved bonuses for executives of Hostess, the maker of Twinkies, who stay on as the company is broken up and sold off.
On Thursday, as part of a plan to liquidate the company and lay off 18,000 workers, a federal judge in White Plains, N.Y., approved paying 19 Hostess executives bonuses totaling $1.8 million. Hostess has said it has interest from at least 110 firms who want to buy pieces of the operation.
The decision comes as the company, known for its iconic snack cakes like Ho Hos and Ding Dongs, says it doesn't have enough cash on hand to pay retirement benefits to some former employees.
The bonuses do not include pay for CEO Gregory Rayburn, who was brought on as a restructuring expert earlier this year, according to The Associated Press. Rayburn is being paid $125,000 a month.
Former employees are outraged over the bonuses handed out to high ups.
"Anybody's got a reason to be upset who lost their job if there handing out large amounts of money," Paul Carroll told ABC News.
In a statement overnight, Hostess said the bonuses are designed to keep top brass from leaving before winding down what's left of the company "quickly and cost-effectively."
"I was qualified to draw my pension, with no notice I lost about 70 or 75 percent of it I didn't work 34 years to lose it," Carroll said.
Hostess was given interim approval for its wind-down last week, which gave the company the legal protection to immediately fire 15,000 union workers. Hostess said last week it will retain about 3,200 employees "to assist with the initial phase of the wind-down," which is expected to last about a year.
The company began facing troubles a few years ago as pension costs rose and health-conscious consumers stopped buying products.
A contentious battle began with Hostess asking its workers to take a smaller paycheck to keep the company open for business.
The bakers union went on strike Nov. 9, when the company imposed a contract that would cut workers' wages by 8 percent. The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM) said the contract would also cut benefits by 27 to 32 percent.
Hostess, which is privately owned by investment firms, has struggled in recent years with two bankruptcy filings. The company said it "has done everything in its power to pursue a reorganization of its business as a going concern, including spending the better part of 18 months negotiating with its key constituents to obtain a consensual agreement."
With Hostess out of business that means the closure of 33 bakeries, 565 distribution centers, approximately 5,500 delivery routes and 570 bakery outlet stores throughout the United States, the company said.
The Tribune’s opinion could not have been anymore wrong and misinformed. They tried to blame the workers for wanting a fair wage as being the problem in a company that’s management has done everything wrong. In an era when America’s taste has changed to more natural and less sweet foods Hostess made nothing America want s to buy.
The short sighted always say let blame the union for any company problems. One writer wanted us to look at the union boss’s salaries which look pretty good until you look a little closer. Let compare them to the average salary of a fortune 500 CEO. The make on average $12M a year. This is about forty times what the union bosses make. Now that’s just the CEO’s and not the CFO’s, CIO’s, COO’s, CMO’s, and all the many VP’s who each make over millions dollars a year on . These CEO’s make on 380 times more that their average employee. The union heads represent more people and get paid chicken feed compared to the greed of Americas CEO’s. But, let never blame the greed of the people who run these companies.
The tribune also failed to mention a number of key facts about unions. People who live in right to work states make less money and have less benefit’s and have less education and lower education scores than states that allow strong unions. Non union states are also taker states. They require more government money than union states. California, Illinois, New Jersey, and New York which are union states pay for states like Alabama, Mississippi, Alaska, and Montana. In fact 17 out of the top 20 takers states are right to work.
One last item, every year American workers get more productive. In fact we are the most productive workers in the western world. Production is measure by the cost of the worker against the product produced. How does business increase the production? They reduce the cost. How do they reduce the cost? They give less pay, less benefits and less time off to their workers. While you have gotten less and less over the years the corporate management has gotten richer and richer. I ask why the Tribune would be supporting the problem. Who is looking after the American workers? We can say clearly not the Tribune.
Unions power has been broken since the start of Reagonomics. Its only broken because people have become BAITER'S Backstabbers, Abusers, Imposters, Takers, Exploiters, and Reckless.
Lan, sometimes in a war of words(ie)debate, it is beneficial to know when you are unarmed. Hey, I just thought of something...perhaps it was you standing near the road that @cantthinkofaname was refering to in his/her most recent post on the "Hunting is a time-honored tradition article."
dyankee - War? Unarmed? Are we fighting here? Strange comment you made....sorry - the person you refer to is not me. I don't have any strong feelings about hunting in general, so didn't make any comments, but I did read what @cantthinkofaname wrote. Don't see the connection. It would be nice if you actually added to the debate rather than make an attempt to belittle others.
You can't make a $3 product successfully when the overhead is $30 (I do exaggerate). Many buyers have lined up to buy the name/recipe because they have lower overheads or bigger production efficiencies.
The comments of Newspaperlawyer and Cowdog show far more research and thought than the original "Our View" piece. Thanks for showing the big picture, not the narrow viewpoint of the GHT "journalists".
thats why companys are folding and come back with a new name and no union to deal with, i call overhead and a pain, to get the facts straight, china owns us, so get over it !!!!
http://teachersunionexposed.com/...
Teachers and other union members,
Check out the different areas of this site. There are options and you can give yourself a raise by not paying dues. In Michigan it is called being a "fee payer." Workers are now protected by labor laws and unions may no longer be needed for teachers. They certainly do not have the power to negotiate that they once had.
Lanivan- (ie) DEBATE I was not talking about fighting, although...nevermind. Why is it that liberals invert with kewords such as "War", "Guns", "Bullying", "Profit", "Capitalism", "Non-Union", "Bible" its like there is some kind of talking point memo, website, or indoctrinat... hmmm'. The reason I'm not adding anything to this debat is because Vladtheimp nailed it.(no pun intended) That was my point and contribution to this discussion, although I was figuratively speaking. However, we can agree on things, like when we both cringe to see Vlad posting on our topics. You respond with liberal drivel and I simply hit my back arrow button, pack up, and go on to the next article.
dyankee, Master of the Stereotype. First of all, I'm hardly liberal. I'm one of the millions of displaced moderate Repubs that you far-right folks have successfully run out of the party, now making your side a train wreck of a minority group. Believe me, I'm a great believer in capitalism and profit (I make my living on it), the Bible and the Golden Rule (I base my faith on it). But war, greed, arrogance, indifference to our fellow man, and an embrace of stupidity....not so much. Also, I have never and can't imagine ever cringing over any post Vlad makes. At least not in the way you mean! Time and again, you rely on (hide behind?) Vlad and others. We want to hear what you think, too dyankee, even if we don't agree. I might think your comment is drivel, but I am at least interested in hearing the other side.
Since my name has been taken in vain, I guess I can point out in your response to dyankee that: (1) you are the only moderate Republican I am aware of who reads the Daily Kos religiously; (2) by war I guess you mean attacking those who attacked us on 9-11 and defending ourselves and our allies against Moslem extremists; (3) by greed I guess you mean keeping more of our own property than our overseers think is appropriate for the purposes of re-distribution; (4) by arrogance I guess you don't mean the ever arrogant Obama, Pelosi, Schumer, Reid, Wasserman-Schultz, Holder and Sebelius; (5) by indifference to our fellow man I guess you mean subjugation to the state and serfdom instead of liberty; and (6) by embrace of stupidity I guess you mean continued reckless federal spending ignoring the reality of economics. Sorry, my philosophy doesn't swing that way.
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