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Union Rules were Harder to Digest than Twinkies
Myth: Twinkies have a shelf-life of forever. They don't; they stay fresh for about 25 days.
Hostess: Union Rules were Harder to Digest than Twinkies
Courtesy of Dr. Paul Price
Did union workers simply get their 'Just Desserts' for backing Hostess into a corner with too many unreasonable demands? Consider the evidence.
Union workers have now completed their mission. 18,500 jobs are gone forever.
The national labor bosses stood firm. Labor leaders are proud they stood up to those nasty ‘suits’ [see Entourage for definition] who refused to run a money-losing business simply to continue paying salaries and benefits.
Hostess posted a $341 million loss in 2011 on revenues of about $2.5 billion. Contributing to those 2011 losses:
- $52 million in Workers’ Comp Claims
- Dealing with 372 Distinct Collective-Bargaining Contracts
- Administration of 80 Separate Health and Benefits Plans
- Funding and Tending to 40 Discrete Pension Plans
- $31 million in year-over-year increases in wages and health care benefits for 2012 v. 2011
Uncounted in the above numbers were the outrageous union-imposed rules that made for a too-high-to-bear cost of sales:
- No truck could carry both bread and snacks even when going to the same location
- Drivers were not permitted to load their own trucks
- Workers who loaded bread were not allowed to also load snacks
- Bringing products from back rooms to shelves required another set of union employees
- Multi-Employer pension obligations made Hostess liable for other, previously bankrupted, retirement plan contributions from employees that never worked for Hostess at all
America has come to this. The only defense against insane union demands is the willingness to walk away and close shop.
With General Motors and Chrysler we found that even that remedy wouldn’t work.
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Quite so.
What are the salaries of the Union leaders?
They're probably taking obscene money plus benefits off the dues of their members.
They then complain about the pay of the company officers, many of whom own equity- unlike the union bosses.
Actually pretty reasonable considering the shit they have to deal with. All of it is low-6 figure. Call me when they are pulling in millions and I might care. Not bad at all considering they have to oversee well over a million members.
Union dues support lobbying for beneficial legislation, which help to lock-in the gains they have fought for. Union dues also support union funds for members as well as strike funds to ensure that strikers don't just starve and have the ability to strike effectively. Managing all of that, for what they get in payment isn't really that big a deal.
Kinda funny how none of this vitriol was tossed around when the unions supported Reagan and HW Bush. It's almost as if it's connected somehow....
Salary + Benefits (+ Other Corporate Expenses if you are actually looking for the total cost to the union members)
It has nothing to do with who is or was the face of the Great and Powerful Oz head, its because people were still lost in the dream that magic wealth creation financed by massive deficit spending was a viable long term plan. The cracks hadn't appeared in the foundation yet and few ever thought such a thing could possibly erode the foundations of the country.
Bush knew better and I still recall his entirely accurate criticism of Reagan's "Voodoo Economics"- but of course he embraced the religion when he took over and zombie creation became the accepted way of the nation.
Could be, but this "article" certainly does not prove the case. It only repeats a claim made by the union with nothing to back it up. On the other side there are claims that managers forfeited their salaries (also backed by nothing but assertions without supporting documents that I have seen).
Think Progess? LOL- thats a propaganda factory, anything from that place should be taken with a barrel of salt and the supporting documentation (when even given) triple checked for bad methodology and unsupported assertions. It is usually nothing but parroting of talking poionts with little or no backing substance.
So we can all rest easy knowing that you are too lazy to dig up the truth, as opposed to bashing the messenger.
There is no doubt there is blame on both sides. But management never should have given in to the unions years ago. I agree dollars are worth less than 20 years ago but lets get real. The entire country has changed and we have to adjust. Unions and upper management are both dreaming.
I am sorry and no disrespect to truck drivers which this country will always need. But $125,000.00 a year + benefits. What company can afford that long term? 0
But for management to give themselves raises as the company continues to lose money. Wrong! And to continue on as they did in this 2nd great depression is also irresponsible. It shows that neither side is devoid of guilt. It is just the degree of failure. Thank goodness we destroyed the bond holders at GM and kept them alive. I mean now, they can build shit cars, stuff them into dealers showrooms, give 0% financing, repossess the cars as needed and fail again with our absurd govt. at their backs. Now that is the way to build an economy on strong fundamentals.
What a fucking joke this country has turned into.
Monopoloy, your avatar gives the answer:
Monopoly capital from Fed on down getting something for nothing instead of free markets with enforced Constitutional protections of justice, peace, productive enterprise and prosperity.
Can't fool Mother Nature or Whee the People forever.
Parasitism.
No symbiotic relationships where management and employees work together to succeed.
Both sides the leech and tapeworm, sucking the blood of the host. Government steps in to keep the parasites alive with blood from the taxpayer (GM, WaMu, Counrtywide, AIG, etc., etc., etc.).
Fuck 'em both, unions and top brass. A bloated, debt-ridden company making garbage food, with everyone skimming. Just another part of the deleveraging. A guy came to Fight Club for the first time, his ass was a wad of cookie dough. After a few weeks, he was carved out of wood. We're gonna come out of this recession lean, mean, and stronger for it.
SHows how pathetic people have become when they oppose any sort of responsibility or self-improvement.
So let's see the other side of the coin; huge payouts to "management" and bonuses and kick-backs for the blood sucking hedge funds and "investors".
It takes both sides to truly sink an iconic brand.
we can't look at both sides of corrupt coin, we would need welders' goggles to avoid burning of our oh-so-focused-on-the-truth retina's.
Don't worry, keep blaming the working people and eventually you'll get around to laying yourselves off. The more diligently management tries to put the failure of a business on the workers, the more management is involved in the business' demise. It was a Rip and Run operation beneath all the smoke and mirrors. Perhaps even Bain Capital got some of the action.
Agree.
Willard's primary BC investors from Panama laundering money:
http://www.veteranstoday.com/2012/10/15/breaking-romneys-bain-capitol-dr...
More hit and run red flags.
Never say anything intelligent when you can just click a red arrow, eh?
Good luck with that in real life when the internet goes down.
And now for the rest of the story:
This was yet another failed LBO on its second BQ to stiff the 99%.
The CEO gave himself a +300% raise while cutting Bakers' pay -8% and Benefits -32%.
9 executives gave themselves raises from +60% to +100%.
Management stopped paying the employee pension fund, owing employees $160 Million.
Management petitioned the BQ judge and got approval to pay additional bonuses to themselves while laying off 18,500 workers just before the holidays.
Why blame workers making less than $2 an hour in 1971 dollars for voting for a living wage and benefits?
PS: Campbell Soup just donated $598,000 against Prop 37 Right to Know if GMO and closed their Sacramento plant with layoffs.
PPS: $232 B market cap WalMart (Always Low Wages) manager Sara Gilbert is striking on Black Friday, because she makes so little and works so long her kids are on food stamps and state health insurance for the poor.
PPPS: When we buy from a small business we are not helping a crooked CEO with backdated stock options buy a fourth foreign vacation home in France, club membership or personal jet, but helping a daughter get dance lessons, a son get a team jersey, a family pay a mortgage, a student pay for school, a sick child get life-saving surgery or a mom or dad put food on the table.
http://www.facebook.com/pages/The-Peoples-Boycott/162657530435267
Some people can't handle the truth...
Hello, ATG. God, it's such a relief to encounter someone with a sane response to a situation these days. The fact that you wound up with eleven negatives is simply more proof to me that most people will still be watching re-runs of The Gong Show while the ship goes down, the neighborhood burns, the banks, zzzzst, vanish and the macaroni & cheez isle at the local grocery is unable to magically keep the shelves stocked. I'll either meet you in the soup line, the 'prep' room line for my place in a cell or within the long line of streaming and steaming refugees headed out of our particular urban area in search of a few crumbs or the compound where management has taken the loot and last load of cupcakes and twinkie-dinks. Bon Voyage!
Walmart is not the canary in the coalmine, just another example of how the standard of living for America's middle class is continuing to decline.
Shove your bullshit.
Unions love zero/undocumented process, granulated procedures and complexity where it is unnecessary. Why? So unions can force the hiring of more "make workers" to work in that type of environment.
It's a fucking joke. Like kindergarten run by the kids.
And guess what asshole. The CEO and his managers lost their jobs too you half-witted lazy slob toxic waste-oid.
If you're too stupid to understand the different between losing your job after making $300k a year, and losing your job when you make $40k year, go stand in the corner, Einstein.
Coarse ad hominem attacks without balanced facts demonstrate ironic stupidity.
Happy Thanksgiving and a Wonderful Life.
Not really no. It's about having documented work guidelines and a worker only being responsible for their actual job. The union looks out for the interests of ALL workers. Why are different things on different trucks? Because there is commission invovled. Hours are also vastly different. The more seniority you have, the cushier jobs you get. Drivers starting out get the crap routes. Why? Because someone's gotta take em. Someone has to be up and at work at 4:30am. You might be a hotshot worker early on, but you'll be wishing you had a more relaxing route when you get older. They already nuked the mechanics. They previous concessions were based on new equipment and trucks which was never invested in. Those trucks are all from the 80s and break down constantly. Guess who's gotta fix em? Yep, the drivers. For heavy routes you're going to need actual loaders, why should the driver have to load their own truck? Furthermore, why should some get loaders and others not? Trucks get loaded based on orders, orders come from different stocks in the bakery. Far easier to have dedicated staff to keep track of their own stuff instead of having them try to keep track of it all.
What this all comes down to in reality is ensuring that you are just doing your own damn job. When you start doing other people's work for them, you're not going to see nearly as much additional compensation as you should be. Poof, there goes a job, probably a cushy job that was earned through years of bitch work and dedication. If you were some randian superman and could do the work of 50, it's not like you're going to be getting those people's paychecks. At best you'll get a modest increase and a pat on the head. Unions are about looking out for ALL workers and getting closer in compensation to the actual profits generated by employees. On your own, you'll never ever get that and you'll probably just be fired for trying to get it.
You get my up vote. People forget workers are humans too, and workers need to be invested in the outcome. Unions can be a bit extreme, but management will grind you to poverty.
Precisely. The secret to work is to do only your own. Outside your scope? Don't do it. Refuse to do it without proper compensation. And if it's someone else's job... it's up to them to do it. Helping turns into favors, turns into tasks, turns into obligations and your good intentions now have you working unpaid overtime. Good job killing that job, here's an extra nickel an hour and your picture on the wall for a month!
Until you work for yourself, you will never extract 100% of the value you create. But you should be able to come damned near close to it. And staying loyal to a company SHOULD be rewarded. In return, your company should be staying loyal to you! Unions help to ensure that happens. Maybe not on a 100% individual basis, but as a whole, they most definitely do.
I can only guess that the reason why people hate unions so much now is twofold.
1) The class who has always hated unions because they get in the way of extracting profits
2) The class who experienced unionized first jobs and saw meager part-time paychecks that sucked out initiation fees and minimum dues which hurt at the time.
And I guess there's a new third class now as well. Those who buy the bullshit of the 1st class.
If you see union member bleeding to death by the side road, DO NOTHING, until the SOB has compensated you in specie. It's that sort of sick and perverted outlook that makes union shops unviable as going business concerns.
What unions?
With a stroke of a pen, politicians can end this.
After a few more unionized corps go tits, may Ben and Barry will figure it out.
And its sad, but Barrycare has little to do with healthcare - it is a red carpet for unions to run healthcare like they do in Europe and Canada.
This won't last, but it makes me fucking sick to my stomach that we, as a society, have to blow the next 10-20 years to experience this and then clean this shit up. What an absolute fucking waste.
Unions are down to 6% of the workforce. Yeah, THEY are destroying America. Get a fucking grip.
Your an idiot. Obamacare is a ticket for insurance companies and medical conglomerates to rape and pillage America. If it was like Europe, workers would have some protections, and people wouldn't have to fight not to eat HFCS, GMO Bullshit, and to be able to keep a job. Canada and Europe do all right, and remember, in both of those places, you have the option to pay more for better care if you want it. You make one mistep with the American sickcare system, and your bankrupt even with "insurance."
"Over $1b in assets have vanished only to be replaced by high-interest debts"
Corporations are people, so says the Supreme Court. This sort of thing is an attack upon the corporate person. Maybe it is time to make this a criminal act against a corporation, punishable by prison time.
In most countries, crap like this is stupidly illegal. Prison time isn't enough. There will always be a fall-guy in the wings with a pair of golden handcuffs waiting for him. Or it will be explained away as an "accident" and a tiny fine will be paid that amounts to nothing near the amount stolen. It really should be viewed on the same exact levels as terrorism, carry the same asset seizures and carry the same death penalty. For some odd reason, flying a plane into a building and destroying 3000 lives warrants 2 wars, drones and trillions of dollars spent in anger. Destroying 18,500 lives through financial fraud means you blame the victims.
If the courts had any balls at all they would kick out the owners, clawback all stolen assets and cancel all of the predatory "loans".
Fraud illegal in USA too, just not enforced on the 1%.
"America has come to this. The only defense against insane union demands is the willingness to walk away and close shop.
With General Motors and Chrysler we found that even that remedy wouldn’t work."
That is because GM and Chrysler didn't do it. They went to the government rather than close down their companies.
GM and 0 stiffed the bondholders, dealers and gave GM to Canada, Ontario, Treasury governments and UAW union.
GM choking on Volt and still trading below the $33 IPO.
The Animal Farm Road to Serfdom indeed.
Maybe if GM got back into 1984 style domestic insurrection tanks like the ones they made for Hitler?:
http://andy9279.xanga.com/608154993/ford-gm-ibm-armed-hitler-before-and-...
Ok, I get it, unions are bad and they are responsible for destroying an otherwise wonderful company....
I used to think this way too, however unions have been around for a long, long time, to include decades when unionized companies and industries were strong. So what has changed?
First, the unions didn't create the health care situation, so they are not to blame for run away health costs. Second, what's your solution, have everybody work for minimum wage under the Wal Mart model? That hasn't worked out too well for the American middle class.
If you want to know what has changed, and explain what happened to Hostess, go to Counterpunch and read David Macaray's article. Hostess was bought out by a private equity firm and two hedge funds. Then the life blood of the company was slowly leeched away by owners that really didn't care about the long term health of the company. They leveraged it up and didn't put any money back into the company, effectively killing it just like that JACKASS Jack Welch killed GE. There's two sides to this story and your article takes the side of the people who are destroying this country.
For another perspective, read the article:
http://www.counterpunch.org/2012/11/20/labor-union-unfairly-blamed-for-t...
Hey, don't take my word for it, listen to former CEOs of Hostess:
“Ignored or left to languish, even the strongest brands can decline or die.”—Charles Sullivan, Hostess CEO, 2000 (Source: Mid-American Journal of Business, Spring, 2000)
“If you over-lever a business, and you don’t invest back into the business for a period of years, you’re going to wind up in bankruptcy.”—Greg Rayburn, Hostess CEO, 2012 (Source: CNBC Squawk Box, November 15, 2012)
I don't come to ZeroHedge to be given the party line. The workers in this country are being utterly destroyed by crony capitalism, a fascist melding of corporate special interests and government, and the destruction of our industries by corporate robbers who are leeching the life's blood out of our companies, blaming the victims, and shipping jobs and profits overseas.
Shame on you all for buying into this tripe.
This is what happens when a duopoly owns politics, a sextopoly owns media and corporations are people...
I used to think this way too, however unions have been around for a long, long time, to include decades when unionized companies and industries were strong. So what has changed?
You're clearly a product of the American education system. No sense of history or proportion. Here's a few things that have "changed":
I could go on, but I won't. The world changed, fella, and America's economic isolation ended a long time ago. That's what's caused a declline in union power; everything else is window dressing.
Yup, all that is true, but the perplexing thing is how you got there from what I wrote. I wasn't writing a long lament for the drop in union power, in fact, I don't even belong to a union. Listing a bunch of (obvious) reasons for our industrial decline other than union activity doesn't undermine my comments. In fact, you strengthen them.
There's two sides to the Hostess story. Union activity has been around for a long time, but union strength is at an historic low level, so we might want to at least entertain other explanations for the decline of companies like Hostess. When we look at the facts, we learn that the company was looted and destroyed. Sure there are allegations that there were union excesses, but the real story isn't about Hostess, it's corportate corruption and betraying both the shareholders and employees in most of our major corporations.
Our companies are being looted by over paid management and the businesses are being run into the ground in favor of "shareholder value" another name for stripping the company of every dollar possible. This won't end well. If you want to blame the unions, which I can't even tell from your post, be my guest. We just spent 20 years dismantling them, and things are getting worse. If you want to point out that we don't call the shots anymore, Captain Obvious, and talk down to other people like they are stupid, well, this is Zero Hedge, you meet people like you every day.
Happy Holidays
You might have some valid points, but that article sucks ass. There just isn't enough data in that article to support its arguments. It's hardly unbiased:
David Macaray ... was a former labor union rep.
David Macaray, an LA playwright and author (“It’s Never Been Easy: Essays on Modern Labor,” 2nd Edition), was a former labor union rep.
Unions are honestly the only reason you even know what healthcare, safety standards, overtime, a 40 hour week and SDI are. Much less being paid in actual money and not living in a company town. You think that was just gifted? That was paid for in blood. Before unions, I could literally chain you to your workstation and lock the doors. Do you honestly believe that workers have no right to band together to make reasonable demands? Cus that's pretty hilarious.
Bullshit. Unions protect lazy and incompetent workers and drive inefficiency. Unions treat everyone as if they were the same in talent and aptitude. Exceptional people have to "put in their time" due to seniority rules, and incompetent schmucks get to ride high on the hog and even get put in charge due to those same seniority rules.
Not to mention, with the massive amount of government rules, regulations, and interference, unions are pretty much redundant now.
You and many others here are example of what happens when history of the labor movement is carefully ommitted from American history texts.
Anyone who wants to return to the days before workers were allowed to collectively negotiate with capital is insane. You have no clue what things were like for the average worker in the 19th century, or if you are a sociopath, you don't care.
Move to China, you assholes, along with the jobs you sent there. What made this country strong was a healthy middle class. What's now making America hollow and weak, is the loss of it.
Exactly. Another so called "independent" evaluation prepared, and posted by, people with obvious agendas.
As an atty who prepresents employers in IL WC claims, I can attest that this phenomenon is not limited to Hostess. Quality employers are beign driven from this state on a daily basis.
Also, I would much rather Obama have bailed out Hostess than GM. At least we would have gotten several high quality product lines instead of the crap we're stuck with now.
Better a case of Ding Dongs than a Volt any day.
"High quality product lines" bwahahahahahahahaha
Have fun ,making fun of the unions now....the teachers are next working half a year in air conditioning, especially in the lower grades are not more than glorified baby sitters with great benefit packages....They'll be next.
Yeah, those people who take care of, and teach your kids all day, fuck those useless proles. Maybe you'd like to stop working and raise your kids yourself.
The way I see it, Hostess was a sacrifice by the unions. Relatively speaking, Hostess was a little fish compared to the other enterprises they have substantial power and control over. If the union had caved in this small case, it would have set a precedent that put all their other larger positions at risk. They simply couldn’t afford to take the chance. They put on a show, fighting valiantly to the death, knowing all along that it would die. It’s similar to any number of ways unions sacrifice the interests of their junior members to protect the benefits, pensions, and interests of the senior members. This happens all the time.
How much do you think a truck driver who delivers the NY Times makes?