Hostess workers strike may kill company

[Clayton Moore]

Bahh, that's the dumbest thing I've ever heard. Unions are as soul sucking and part of the problem as any corporate management team. It's not 1890 anymore ya know.

I get why people join unions, but I don't get why unions protect bad workers and allow their members to lose their jobs because the company will go under without a new deal in place. It's not like Hostess is just being hardassed about a deal, it appears they may be out of business if something isn't worked out. Striking a company out of business seems like a really dumb way to handle a problem.

YAY WE WON, WAIT.... WE HAVE NO JOB ANYMORE......

That's so pathetic.

Without unions we'd be one big Christmas Carol.

 

[Clayton Moore]

With corporate coffers overflowing and shareholder returns the bottom line corporate concern I'd say Unions get the unconditional nod for the next twenty years just to stay even.

 

[StankApe]

evidence for this generality?

 

[jj]

Ok, I went to read this. This is the same deal as Borders, inept management, lack of control of expansion, etc, giving the cash to the people at the top, and now that it's all come down around them, they want to loot the company by liquidating it and taking the rest of the money as fees for service.

They're looting the debtors, they're looting the shareholders, and they're putting 10,000 people or so out of work in order to enrich upper management. Management has also avoided trying to find a buyer, or anything else, is determined to liquidate, and is spoiling to close the whole business as fast as possible.

That seems clear.

We're talking about people who make 11.50 an hour, you realize. Those are the people on strike. The insults levelled at this union are purely an attack on human beings who are trying to survive, and nothing else.

Those of you who don't understand, look up "liquidationism" and its effect on the last great depression. You'll see just what's happening here.

 

[JihadJane]

Class war.

 

[StankApe]

Ok, I went to read this. This is the same deal as Borders, inept management, lack of control of expansion, etc, giving the cash to the people at the top, and now that it's all come down around them, they want to loot the company by liquidating it and taking the rest of the money as fees for service.

They're looting the debtors, they're looting the shareholders, and they're putting 10,000 people or so out of work in order to enrich upper management. Management has also avoided trying to find a buyer, or anything else, is determined to liquidate, and is spoiling to close the whole business as fast as possible.

That seems clear.

We're talking about people who make 11.50 an hour, you realize. Those are the people on strike. The insults levelled at this union are purely an attack on human beings who are trying to survive, and nothing else.

Those of you who don't understand, look up "liquidationism" and its effect on the last great depression. You'll see just what's happening here.

did you read the teamsters memo? It appears prior mgmt was doing what you claim, but the new ownership and mgmt group isn't planning any such thing (or why would the Teamsters be endorsing the deal and blaming the baker's union?)

 

[Foolmewunz]

did you read the teamsters memo? It appears prior mgmt was doing what you claim, but the new ownership and mgmt group isn't planning any such thing (or why would the Teamsters be endorsing the deal and blaming the baker's union?)

The Teamsters are backing the deal because if Hostess Brands shuts down half their bakeries, there will be that much more product being delivered by Teamster drivers over longer distances. It doesn't impact their membership in quite the way that it impacts the bakers, who are local and live local.

The current management knows nothing about running a bakery/baked goods business. Since the current capital company took over they have made no effort to bring in management in the form of neither the CEO nor COO with any experience in building a brand and developing new product. HB is suffering for the past two decades because WonderBread and Twinkies just don't have that 21st century buzz.

They are still peddling their old products to keep the brand name alive and planning to auction the brands when they liquidate the company. They care not for the company. They've re-invested nothing in product development - instead writing themselves bonuses with any savings they've squeezed out of the unions. They close down a plant/bakery to save a million and then they go and pay the same or more for their suite of corporate offices in Dallas. Why? They closed down their Texas operations years ago. Ah, but one of their revolving CEOs was a Dallas guy who didn't want to move to Kansas City - where they have nice half-empty offices due to all the back office jobs they've farmed out to the Philippines.

Someone described this thread as having knee-jerk reactions. I'd say it's more Pavlovian. The bell rings ("Hey, anti-union screed over in Economics!") and some posters start salivating. This story has been going on for a decade. Anyone who blames these rather lowly-paid workers for the problems of the company is ill-informed.

 

[balrog666]

The Teamsters are backing the deal because if Hostess Brands shuts down half their bakeries, there will be that much more product being delivered by Teamster drivers over longer distances. It doesn't impact their membership in quite the way that it impacts the bakers, who are local and live local.

The current management knows nothing about running a bakery/baked goods business. Since the current capital company took over they have made no effort to bring in management in the form of neither the CEO nor COO with any experience in building a brand and developing new product. HB is suffering for the past two decades because WonderBread and Twinkies just don't have that 21st century buzz.

They are still peddling their old products to keep the brand name alive and planning to auction the brands when they liquidate the company. They care not for the company. They've re-invested nothing in product development - instead writing themselves bonuses with any savings they've squeezed out of the unions. They close down a plant/bakery to save a million and then they go and pay the same or more for their suite of corporate offices in Dallas. Why? They closed down their Texas operations years ago. Ah, but one of their revolving CEOs was a Dallas guy who didn't want to move to Kansas City - where they have nice half-empty offices due to all the back office jobs they've farmed out to the Philippines.

Someone described this thread as having knee-jerk reactions. I'd say it's more Pavlovian. The bell rings ("Hey, anti-union screed over in Economics!") and some posters start salivating. This story has been going on for a decade. Anyone who blames these rather lowly-paid workers for the problems of the company is ill-informed.

Bwaaaaaaaaaaaaahahahaha! Building a brand?? Is there anyone on the Earth who doesn't know about Twinkies? Or doesn't want a nice cheap Twinkie?


Maybe you can get der Bammy to get the bankruptcy court to stiff all their creditors, give them a gubmint bailout, and force them to hand over the company to the baker's union - call it The People's Bakery and promise all those welfare moms and po' chillun free Twinkies for life!

 

[Foolmewunz]

Bwaaaaaaaaaaaaahahahaha! Building a brand?? Is there anyone on the Earth who doesn't know about Twinkies? Or doesn't want a nice cheap Twinkie?


Maybe you can get der Bammy to get the bankruptcy court to stiff all their creditors, give them a gubmint bailout, and force them to hand over the company to the baker's union - call it The People's Bakery and promise all those welfare moms and po' chillun free Twinkies for life!

Hey, neat! You managed to get black dialect in there.

(Nothing else of any importance, though. You have no evidence but as I mentioned above, you heard the bell and just had to drop back in. Good. We missed you and the evidence you were going to provide for the claims in your previous post.)

 

[Clayton Moore]

Ok, I went to read this. This is the same deal as Borders, inept management, lack of control of expansion, etc, giving the cash to the people at the top, and now that it's all come down around them, they want to loot the company by liquidating it and taking the rest of the money as fees for service.

They're looting the debtors, they're looting the shareholders, and they're putting 10,000 people or so out of work in order to enrich upper management. Management has also avoided trying to find a buyer, or anything else, is determined to liquidate, and is spoiling to close the whole business as fast as possible.

That seems clear.

We're talking about people who make 11.50 an hour, you realize. Those are the people on strike. The insults levelled at this union are purely an attack on human beings who are trying to survive, and nothing else.

Those of you who don't understand, look up "liquidationism" and its effect on the last great depression. You'll see just what's happening here.

Great post.


Those who believe corporations are not the bad guys are also bad guys.

 

[Clayton Moore]

evidence for this generality?

I read.

 

[The Don]

Great post.


Those who believe corporations are not the bad guys are also bad guys.

Corporations are sometimes the good guys, sometimes the bad guys and more often the somewhere in between guys.

The same goes for the unions.

In this case it seems that we have a union which is flexible and sensitive to the needs of the company and a management which is rapacious and inept.

In other cases (the UK Fire Service springs to mind) we have unions fighting to prevent any kind of change or innovation and seeking to preserve "Spanish Practices" dating back decades. It's not as simple as Unions Good, Corporations Bad (or vice versa).

 

[my_wan]

uh...what?

chris_in_kcmo went well overboard in his description, but in a somewhat less extreme fashion this does more or less characterize many historical unions.

 

[WildCat]

Well it's now official - Hostess is gone.

Hostess Brands Inc., the bankrupt maker of Twinkies and Wonder Bread, said it had sought court permission to go out of business after failing to get wage and benefit cuts from thousands of its striking bakery workers.

Hostess said a strike by members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union that began last week had crippled its ability to produce and deliver products at several facilities.

The Irving, Texas-based company said the liquidation of the company would mean that most of its 18,500 employees would lose their jobs.

 

[WildCat]

Ok, I went to read this. This is the same deal as Borders, inept management, lack of control of expansion, etc, giving the cash to the people at the top, and now that it's all come down around them, they want to loot the company by liquidating it and taking the rest of the money as fees for service.

So the people at the top are better off with Hostess going out of business somehow?

They're looting the debtors, they're looting the shareholders, and they're putting 10,000 people or so out of work in order to enrich upper management. Management has also avoided trying to find a buyer, or anything else, is determined to liquidate, and is spoiling to close the whole business as fast as possible.

Again, explain how those in upper management are better off now that Hostess is no more.

That seems clear.

We're talking about people who make 11.50 an hour, you realize. Those are the people on strike. The insults levelled at this union are purely an attack on human beings who are trying to survive, and nothing else.

Those of you who don't understand, look up "liquidationism" and its effect on the last great depression. You'll see just what's happening here.

So how'd that strike work out?

 

[Resume]

Bwaaaaaaaaaaaaahahahaha! Building a brand?? Is there anyone on the Earth who doesn't know about Twinkies? Or doesn't want a nice cheap Twinkie?


Maybe you can get der Bammy to get the bankruptcy court to stiff all their creditors, give them a gubmint bailout, and force them to hand over the company to the baker's union - call it The People's Bakery and promise all those welfare moms and po' chillun free Twinkies for life!

This is an example of a well-thought out argument; I'm glad someone finally added a bit of logic to this discussion.

 

[LTC8K6]

I'll be shocked if Obama does not intervene in favor of the union.

 

[Foolmewunz]

So the people at the top are better off with Hostess going out of business somehow?

Yes, definitely. Follow the financials if they actually get away with this. They sell off all the physical assets, will continue to plead poverty through bookkeeping tricks so they won't have to contribute the millions and millions they've held back illegally from the pension funds for the past year and a half, and then will auction off the private brands to KGF or Frito-Lay or Pepsico. They will all get huge bonuses for doing so and the workers get ska-rewed. It's been the plan for the last seven years.

Again, explain how those in upper management are better off now that Hostess is no more.

First, how'd we like to find out how many in upper management are you talking about? The top guy, top five guys, or anyone with the word "manager" next to their name. I can tell you that most of the top guys are mercenaries, hatchet men and restructuring specialists. They were brought in from other industries and businesses and are not in the least concerned that the vulture capital industry can't find them a nice unsuspecting company to hack up again next year or the year after. But there will still be a Hostess Brands, I think. They will just sit there and auction off the Twinkies brand and WonderBread brand, and sit there and count their money. It's the ideal work for hedge fund guys. Do nothing. Sit there and collect money on a brand you didn't build.

And those who don't stay on and clip coupons in the inner sanctum? They're not going to be rushing off to find work. They'll get six figure bonuses out of this.

So how'd that strike work out?

Depends. First of all the baker's and whatchamacallits union just decided that they'd rather HB sell of the facilities and try to find work with the new owners. HB has made no investments in the business in the last decade and have solely indicated that they want to break up the company. When the courts gave them the okay to restructure, they included in that plan that they would close as many as six facilities and sell off up to three. But HB refused to give the unions any consideration on telling them which plants they intended to close - IMHO because HB did not know. They would determine the closings based on what they could get for selling a business (the "three" they mentioned) versus what they could get for selling off the rubble of the ones they closed.

The courts have been on HB's side in the last few rounds but the judge commented a few times that HB better clean up its labor mess and get that all off the table. I'm not so sure how he'll view them using a five day strike as rationale for permanent bankruptcy. Since they've been playing this game for a decade now, I have a feeling it's not over. The judge also may not take too kindly to them reneging on their commitment to the pension funds and then going out and running up $14,000,000 in legal fees to fight off the unions. (The 14,000,000, coincidentally, would represent the 10% decrease they wanted the $10.50/hour bakers to take.)

Management, I think, is delighted with this ultimate development. One doesn't even have time to do the bookkeeping in a mere five days. They were pushing and squeezing all the unions, hoping one of them would give them an excuse to shut down. And how much better* that it's the baker's and not the drivers? The Teamsters could impact other companies they buy out in the future, but unless they're going out there and buying a slough of bakeries (not likely anyone's going to take them seriously as a purchaser after this misadventure), the baker's and whatchamacallits have no way to effect them.

*And safer. They're still the Teamsters, after all. Trucks have been known to crush BMWs in parking lots by accident, sort of.

 

[BenBurch]

It wasn't going to survive long no matter. Previous management had raided the kitty.

 

[WildCat]

Yes, definitely. Follow the financials if they actually get away with this. They sell off all the physical assets, will continue to plead poverty through bookkeeping tricks so they won't have to contribute the millions and millions they've held back illegally from the pension funds for the past year and a half, and then will auction off the private brands to KGF or Frito-Lay or Pepsico. They will all get huge bonuses for doing so and the workers get ska-rewed. It's been the plan for the last seven years.

Lots of claims there, not one shred of evidence for them.

First, how'd we like to find out how many in upper management are you talking about? The top guy, top five guys, or anyone with the word "manager" next to their name.

Why are you asking me? It's your claim. You define it.

I can tell you that most of the top guys are mercenaries, hatchet men and restructuring specialists. They were brought in from other industries and businesses and are not in the least concerned that the vulture capital industry can't find them a nice unsuspecting company to hack up again next year or the year after. But there will still be a Hostess Brands, I think. They will just sit there and auction off the Twinkies brand and WonderBread brand, and sit there and count their money. It's the ideal work for hedge fund guys. Do nothing. Sit there and collect money on a brand you didn't build.

And that is somehow more profitable than returning the company to health?

And those who don't stay on and clip coupons in the inner sanctum? They're not going to be rushing off to find work. They'll get six figure bonuses out of this.

(citation needed)

Depends. First of all the baker's and whatchamacallits union just decided that they'd rather HB sell of the facilities and try to find work with the new owners. HB has made no investments in the business in the last decade and have solely indicated that they want to break up the company. When the courts gave them the okay to restructure, they included in that plan that they would close as many as six facilities and sell off up to three. But HB refused to give the unions any consideration on telling them which plants they intended to close - IMHO because HB did not know. They would determine the closings based on what they could get for selling a business (the "three" they mentioned) versus what they could get for selling off the rubble of the ones they closed.

Cool story bro, any evidence for it?

The courts have been on HB's side in the last few rounds but the judge commented a few times that HB better clean up its labor mess and get that all off the table. I'm not so sure how he'll view them using a five day strike as rationale for permanent bankruptcy. Since they've been playing this game for a decade now, I have a feeling it's not over. The judge also may not take too kindly to them reneging on their commitment to the pension funds and then going out and running up $14,000,000 in legal fees to fight off the unions. (The 14,000,000, coincidentally, would represent the 10% decrease they wanted the $10.50/hour bakers to take.)

So even the courts are in on the conspiracy to enrich "upper management"? Or maybe the judge has seen HB's books and otherwise done what bankruptcy judges do?

Management, I think, is delighted with this ultimate development. One doesn't even have time to do the bookkeeping in a mere five days. They were pushing and squeezing all the unions, hoping one of them would give them an excuse to shut down.

Once again, show your math. Show the evidence that management makes more by driving a company out of business rather than returning it to profitability?

And how much better* that it's the baker's and not the drivers? The Teamsters could impact other companies they buy out in the future, but unless they're going out there and buying a slough of bakeries (not likely anyone's going to take them seriously as a purchaser after this misadventure), the baker's and whatchamacallits have no way to effect them.

*And safer. They're still the Teamsters, after all. Trucks have been known to crush BMWs in parking lots by accident, sort of.

The conspiracy deepens...