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US Tries To Wrest Control Of Hostess Liquidation As Management Seeks To Pay $1.75 Million In "Incentive" Bonuses

Tyler Durden's picture


The Hostess bankruptcy liquidation, the result of a bungled negotiation between the company, its equity sponsors, its striking workers, and the labor union, over what has been defined as unsustainable benefits and pension benefits, is rapidly becoming a Ding Ding farce. The latest news in what promises to be an epic Chapter 22 fight is that the judge, pressured by various impaired stakeholders, among which none other than the US trustee, is that the bankruptcy Judge Robert Drain, who has previously presided over such Chapter 11 cases as Loral, RCN, Cornerstone, Refco, Allegiance Telecom, Delphi, Coudert Brothers, Frontier Airlines and Star Tribune, has ordered the company and its unions to seek private mediation to attempt averting what the company has already said is an inevitable unwind of operations.

Per Reuters, "Hostess, its lenders and the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM) agreed to mediation at the urging of Bankruptcy Judge Robert Drain of the Southern District of New York, who advised against a more expensive, public hearing regarding the company's liquidation. "My desire to do this is prompted primarily by the potential loss of over 18,000 jobs as well as my belief that there is a possibility to resolve this matter," Drain said." Sadly, this latest step will almost certainly lead to nothing constructive as it merely extends a status quo which already proved to be unresolvable.

What makes a mediation improbable is that the antagonism between the feuding sides has certainly hit a level of no return:

Several unions also objected to the company's plans, saying they made "a mockery" of laws protecting collective bargaining agreements in bankruptcy. The Teamsters, which represents 7,900 Hostess workers, said the company's plan would improperly cut the ability of remaining workers to use sick days and vacation.

In the off chance that mediation does lead to a reconstruction of the failed company it may ironically benefit from the closeout sale of its products as confused Americans hoarded Twinkies, Ding Dongs and Ho Hos in hopes of selling them on Ebay as collectible items with huge marks up, something we warned previously will fail. Regardless, the firesale will lead to a surge of cash in the company's coffers, which will then lead to a scramble over how it is divided.

Then comes the question of whether or not someone steps up in the liquidation process and buys the company in part or whole. Here we learn that Grupo Bimbo, long expected to be the natural suitor for at least the firm's trademarks and IP, will not participate in said process. Hostess CEO Rayburn said Grupo Bimbo won’t be a potential buyer for the bankrupt baker. “One misconception in the market is that Bimbo would be a buyer and bakery leadership told us in several plants that Bimbo would come in and buy, which is absurd,” Rayburn said in an interview with Bloomberg Television. Rayburn cited Bimbo’s agreement with the U.S. Justice Department to sell some Sara Lee brands in order to complete its acquisition of Sara Lee’s North American bakery business. “Due to antitrust, it would never happen,” Rayburn said.

More to the point, and as we predicted on Friday, if there is an outright purchase of the company, it will be a standalone entity, without its unions: Hostess will draw strategic buyers and private-equity investors for its brands, Rayburn said, without naming potential bidders. The company is “more attractive” to buyers without the unions, he said. In other words, if the Union had hoped that their workers would be retained by the purchasing entity, their dreams just got shattered.

But while the Union may be sad, it is about to add another emotion to its arsenal: blind fury. Because it is here that things get truly surreal. As the US Trustee, a Justice Department official responsible for protecting creditors, disclosed, as part of the wind down of Hostess, wants to pay as much as $1.75 million in incentive bonuses to 19 senior managers during the liquidation.

This is just part of the millions to be spent imminently on the wind down:

The process requires “intensive” planning, staffing and funding, the company said. A fire-sale liquidation would damage equipment and result in improper disposal of waste materials.


It’s “not a simple matter of turning off the lights and shutting the doors,” Hostess said in court papers.


The baker estimated that shutting the plants will cost $17.6 million in the next three months. The plants have about $29 million worth of excess product ingredients, Hostess said.


About $6.9 million will be spent to close depots, while $8.8 million will be used to idle retail stores and $8.1 million will go to shutting corporate offices, according to a court filing. Perishable baked goods at retail stores will be sold at going-out-of-business sales, donated to charity or destroyed, Hostess said.

Most importantly, however, is the question how one explains to 18,500 workers who are already out and looking for jobs that the management team which was just as responsible for crushing the company deserves on average $92,000 each in "incentive bonuses, is anyone's guess and one does wonder what safety precautions said management team may have taken to protect from what is certain to be the collective wrath of its former workforce.

Naturally, the immediate outcome of this rather obscene demand, which may fly in a Chapter 11 KERP proposal but hardly is tenable in a liquidation proceeding, is that said US Trustee is now seeking to take control of the liquidation away from the company. As BBG reported earlier, "U.S. Trustee Tracy Hope Davis asked the judge to convert the case to a Chapter 7 from Chapter 11 bankruptcy, based partly on the company’s intent to pay bonuses, and appoint a trustee to supervise the wind-down."

But wait, it gets better: because it is quite likely that should an emboldened US Trustee get her wishes granted, will push to continue operating Hostess as a going concern, potentially with a court appointed, and US Trustee selected management team.

In essence this could result in a stealth nationalization of the junk food maker, which would preserve the jobs of the workers for the time being, but crush the balance of the capital structure, i.e., secured and unsecured creditors.

Impossible, you say? It has happened, to a big extent, before. Recall a certain bankruptcy case of one General Motors, where the claims of creditors were primed by those of the labor unions.

Granted, such a perversion of the bankruptcy process would be historic, but in a country in which everyone is to blame for everything, and in which property rights are becoming a very nebulous concept, we would certainly not be surprised if the US government ends up "bailing out" Hostess by a mandatory flipping the capital structure, over the cries of the company's creditors, further pushing the country into the twilight Banana zone.


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Mon, 11/19/2012 - 18:09 | 2997024 kaiserhoff
kaiserhoff's picture

Never waste a crisis.

Mon, 11/19/2012 - 18:17 | 2997055 ParkAveFlasher
ParkAveFlasher's picture





Too snackilicious to fail.

Mon, 11/19/2012 - 18:23 | 2997092 Randall Cabot
Randall Cabot's picture
"While the company was filing for bankruptcy, for the second time, earlier this year, it actually tripled its CEO’s pay, and increased other executives’ compensation by as much as 80 percent. Over the past eight years since the first Hostess bankruptcy, BCTGM members have watched as money from previous concessions that was supposed to go towards capital investment,  product development,  plant improvement and new equipment, was squandered in executive bonuses, payouts to Wall Street investors and payments to high-priced attorneys and consultants. BCTGM members are well aware that as the company was preparing to file for bankruptcy earlier this year, the then CEO of Hostess was awarded a 300 percent raise (from approximately $750,000 to $2,550,000) and at least nine other top executives of the company received massive pay raises. One such executive received a pay increase  from $500,000 to $900,000 and another received one taking his salary from $375,000 to $656,256." 
Mon, 11/19/2012 - 18:27 | 2997107 redpill
redpill's picture

I ate a Twinkie today, it's probably been 25 years since I've had one.  Fucking disgusting.

Mon, 11/19/2012 - 18:57 | 2997213 gmrpeabody
gmrpeabody's picture

I spent 30 years in a union, and let me assure you they don’t give a rat’s ass about the rank and file. Their number one priority is to avoid work while maximizing overtime.

And they particularly resent the 20% that have to bust their chops covering for the 80%.

Mon, 11/19/2012 - 19:21 | 2997281 Fredo Corleone
Fredo Corleone's picture

Hostess continues to circle the Drain.

...So to speak.

Mon, 11/19/2012 - 19:44 | 2997343 NotApplicable
NotApplicable's picture

Funny thing is, due to their near infinite shelf life, everybody bought all the Twinkies they'll ever want for the rest of their lives.

They'll be sitting in the spare bedroom closet, right next to the Beanie Babies.

Mon, 11/19/2012 - 21:18 | 2997597 Enslavethechild...
EnslavethechildrenforBen's picture

Why have unions and actually pay people to work when you can get them to work for free in other countries?

Americans need to wake up and start working for free.

As a matter of fact, americans should PAY to WORK


Mon, 11/19/2012 - 22:16 | 2997704 LetThemEatRand
LetThemEatRand's picture

Speaking of which, anyone else see the irony that management -- whose sole remaining job is to wind down a business and put people out of work (the new "productive class" I suppose) -- understands the need to incentivize themselves to do this job, but everyone else should just be happy to have a temporary job for less pay and no benefits?

Mon, 11/19/2012 - 22:27 | 2997722 TruthInSunshine
TruthInSunshine's picture

The U.S. Treasury, being brilliant Central Planning Committee that it is, could always merge Solyndra & Interstate Bakeries, somehow, and create a successful (by CronyKomradeCapitalismSocializationOfLosses standards) company.

Mon, 11/19/2012 - 23:10 | 2997817 Zer0head
Zer0head's picture

McCartney says skip the turkey/dingdong on Thanksgiving

Mon, 11/19/2012 - 23:51 | 2997878 palmereldritch
palmereldritch's picture

Obama's Twinkie Economy.  Best before 2016.

Tue, 11/20/2012 - 00:59 | 2997973 Bananamerican
Bananamerican's picture

"Hostess, wants to pay as much as $1.75 million in incentive bonuses to 19 senior managers during the liquidation."


Asked about the fate of Hostess line workers, upper management responded, "let them eat Twinkies"

Tue, 11/20/2012 - 01:35 | 2998007 ebworthen
ebworthen's picture

I just knew this was a crony capitalism operation.

"It's the Unions!"


Oh yeah, it's those bakers making $18 an hour, not the managment making $100K + bonuses for doing nothing other than making the company fail to cash out.

Fucking joke the U.S.A. has become.

Tue, 11/20/2012 - 02:15 | 2998041 Richard Chesler
Richard Chesler's picture

God's work is not free.

Tue, 11/20/2012 - 05:56 | 2998161 Bobbyrib
Bobbyrib's picture

Depending on the region of the country that the union workers are in, to me it is excessive to pay these people $16-$18 an hour. They had one guy on CNBC who was makin $16 an hour, but $4 an hour in additional compensation should have been going to his pension. He was bitching that if the agreement with management were accepted he would lose his pension benefits. The guy was from the high COL area of Kansas City, Mo. $20 an hour is compensation to bake goods for the fatasses of this country in KC,MO!? Give me a fucking break. I'm usually pro union, but this is an example of unions taking advantage of their position.

Tue, 11/20/2012 - 08:03 | 2998251 Gazooks
Gazooks's picture

"These people", heh?


You probably should know by now, bobby, those words are a dead give away of someone not deserving a fucking break. Like the rest of the predictable anti-labor choir here, you just pull shit out of your ass and fling it at the screen for points. Sorry mf's every fucking parrot one.


“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


'Despite the fact that it’s had two bankruptcies since 2004, that its management has proven woefully inadequate (it’s had six CEOs since 2002), and that its Wall Street masters ( a private equity firm and two hedge funds) burdened Hostess with $800 million of debt, the blame for this mess is being laid on the BCTGM (Bakery, Confectionery Tobacco and Grain Millars International Union)...'




'In the wake of Hostess’ 2004 bankruptcy, the BCTGM willingly gave back $110 million in concessions. This was done in return for the company’s promise that it would invest in new machinery and new technology...'


...of course, the exec's pocketed millions and the 'investment' was never made. Read it.

Tue, 11/20/2012 - 13:11 | 2999132 flattrader
flattrader's picture

I am continually surprised at the anti-worker, anti-labor and anti-union sentiment expressed here.  Some of us who have been watching the Hostess drama for the past several years know what a wholesale rape the management has committed against the company and the employees.

You would think ZH readers would learn by now that whatever the first idiot story posted by the Tyler's blaming the union workers for killing their own jobs had to be full of crap if for no other reason than it just didn;t make any sense.

Yeah, there's more to this than meets they eye and it will come out.

Tue, 11/20/2012 - 09:58 | 2998446 archon
archon's picture

$16 an hour?  Heck, they'll make more than that on welfare and unemployment, and now they'll have time to protest and break other peoples' sutff too.  This is win-win...

Tue, 11/20/2012 - 08:03 | 2998249 onthesquare
onthesquare's picture

These, so called bakers, are not the same cut as a hands on, one off, baker.  They are more like people who start the machines, dump the truck loads of chemicals in the giant mixers and let the computers do the rest while they read the sports section. 

The 3000 mile salad has nothing to be ashamed of considering the bulk of air bag chip crumbs carried across the country to satisfy every remotely discerning taste bud.  Reduculous!

The sooner this petrochemical food is left behind the better.  Eat a locally grown apple with some apple scab to be sure it is pesticide free.

Tue, 11/20/2012 - 13:59 | 2999287 Carl Spackler
Carl Spackler's picture

Well played, sir (Bananamerican), well played.

Tue, 11/20/2012 - 14:15 | 2999323 Carl Spackler
Carl Spackler's picture

$1.75MM for 19 managers is cheap for a bankruptcy of this size.  Tyler is playing so many union and democrat hacks here for fools by touching to their socialist nerve.

The REAL WORLD situation and decision the Banruptcy Trustee faces is this...would the creditors lose less money than $1.75MM in recoveries from liquidation of assets if certain key people remain to liquidate those assets or would the creditors lose more than $1.75MM in recoveries from liquidation if those people leave the company now.

The Bankruptcy Trustee believes the creditors will lose less if there is an incentive for certain managers to stay on board until after liquidation of assets. Duh!

Tue, 11/20/2012 - 00:54 | 2997965 jonjon831983
jonjon831983's picture

Maybe it is more politically correct to call it an incentive than to call it "Hazard Pay".  Wouldn't want it to seem like a dangerous endeavour to fire off thousands of pissed off workers.

Tue, 11/20/2012 - 07:29 | 2998214 Go Tribe
Go Tribe's picture

"...understands the need to incentivize themselves to do this job, but everyone else should just be happy to have a temporary job for less pay and no benefits?"


Are you describing the Federal government?

Mon, 11/19/2012 - 23:57 | 2997893 HurricaneSeason
HurricaneSeason's picture

I doubt you'd find a country that would pay twinkie factory workers $32.50 an hour plus a pension and have them want more for their twinkie skills.  They should pay $2.95 an hour in Mexico and have them flown in on some of the brand new cargo planes the government is getting ready to throw away. We need a ding dong twinkie solution before tackling the fiscal cliff.

Mon, 11/19/2012 - 21:28 | 2997615 tenpanhandle
tenpanhandle's picture

More likely packed in their collective colons, indefinitly.

Mon, 11/19/2012 - 20:51 | 2997539 smithcreek
smithcreek's picture

The politicians have truly succeeded when they get the citizens subjects to go at each others throats over something that has no real meaning in their life.  Investors made inverstment mistakes, labor made unsustainable wage demands.  Fine, let them both take their lumps and go out of business.  People will find someone else to make their snacks.

Mon, 11/19/2012 - 23:01 | 2997797 Walter_Sobchak
Walter_Sobchak's picture

i truly thought twinkies would be the sole survivors of the collapse.  this changes everything

Mon, 11/19/2012 - 23:11 | 2997819 tsx500
tsx500's picture

nope. That makes way too much sense !

Mon, 11/19/2012 - 23:41 | 2997862 upWising
upWising's picture


Investors made inverstment mistakes, labor made unsustainable wage demands, TOP EXECUTIVES MADE POOR MANAGEMENT DECISIONS YEAR AFTER YEAR AND THEN "REWARDED THEMSELVES" WITH OBSCENE SALARY AND PENSION GRABS.  Fine, let them ALL take their lumps, LET THE EXECS STAND IN UNEMPLOYMENT LINES LIKE EVERYBODY ELSE,  and let the enterprise go out of business.

Mon, 11/19/2012 - 23:49 | 2997873 smithcreek
smithcreek's picture

You didn't fix anything, you simply made my point for me.  It's easy to claim they made poor decisions when you have no clue what decisions they made, except maybe a couple rolled out by your favorite highly slanted source of news.  So itt appears you are exactly the kind of person I described to start with.  All whipped up in a lather for or against the execs or labor in a company whose success or failure means nothing to you.

Tue, 11/20/2012 - 01:29 | 2998001 Bananamerican
Bananamerican's picture

well, yes Smithy....but your response amounts to dickish Sophistry

Tue, 11/20/2012 - 06:00 | 2998165 Bobbyrib
Bobbyrib's picture

Can't you tell? He seems to be one of those people that look up to the executives that gut our country every day and take home large paychecks to do so. Even CNBS wasn't disputing that management had fucked up royally.

Tue, 11/20/2012 - 03:56 | 2998096 Half_A_Billion_...
Half_A_Billion_Hollow_Points's picture

sent from your obamaphone?

Tue, 11/20/2012 - 01:24 | 2997998 Mugatu
Mugatu's picture

So here's a question: If Uncle Sam becomes the owner of Hostess, does that mean that Twinkies will end up in official Food Pyramid?

Tue, 11/20/2012 - 02:10 | 2998032 patb
patb's picture

well, the union workers could chip in and buy the company and run it themselves.



Tue, 11/20/2012 - 03:57 | 2998098 Half_A_Billion_...
Half_A_Billion_Hollow_Points's picture

union leaders, actually work?  

Tue, 11/20/2012 - 06:34 | 2998187 Gazooks
Gazooks's picture

key word here is workers, HAB

Tue, 11/20/2012 - 07:47 | 2998229 Acet
Acet's picture

But then they would be accused of being Communist.


Mon, 11/19/2012 - 19:29 | 2997305 nmewn
nmewn's picture

I have to admit, its been funny as hell watching the left do backflips over this.

The Twinkie you see (according to the left), is all that is bad in America, a Satanic confection really. It makes you fat (jacking up healthcare costs), its delivered in carbon belching trucks (manmade global warming!) and will last for a hundred years unopened on a shelf because of all the chemicals in them (Dow chemical trails!)...long after cockroaches succumb to man's threat to the planet...the Twinkie will survive they say.

However, Twinkies are made by union labor and trucked to stores with union labor. The Twinkie supports thousands of union households. Problem (sound of tires screeching to a halt).

Ding ding the Twinkies dead!...the wicked Twinkies dead!!!...wut?...wait, the Mexicans want the brand & want to manufacture it there and ship it back here? (the Grinchy Grinch snarled)...there needs to be a law!!!

Its just been fucking classic.

Mon, 11/19/2012 - 21:30 | 2997619 Abiotic Oil
Abiotic Oil's picture

Speaking of Anthropogenic Global Warming, this fellow caught TPTB altering the historical temp data. Making the cold colder and the warm warmer to make AGW look real.

Mon, 11/19/2012 - 22:31 | 2997729 edb5s
edb5s's picture


Tue, 11/20/2012 - 00:14 | 2997929 Mary Wilbur
Mary Wilbur's picture

Very interesting.

Tue, 11/20/2012 - 01:06 | 2997982 jonjon831983
jonjon831983's picture




Tue, 11/20/2012 - 03:14 | 2998073 Clashfan
Clashfan's picture

Thanks for that, AO!


Tue, 11/20/2012 - 06:52 | 2998198 Gazooks
Gazooks's picture

de-explains actual accelerating de-glaciation, sea level rise and oceanic acidification 





Tue, 11/20/2012 - 07:41 | 2998222 Go Tribe
Go Tribe's picture

Amazing. Little surprise. They really, really want our money.

Mon, 11/19/2012 - 22:55 | 2997786 A Nanny Moose
A Nanny Moose's picture

No fucking shit. Quite the conundrum indeed.

Mon, 11/19/2012 - 23:21 | 2997833 brettd
brettd's picture

Spot on.  It's funny theater.

Management gets bonused for getting the thing BK'd 3 months ahead of schedule. 


Mon, 11/19/2012 - 23:45 | 2997867 nmewn
nmewn's picture

The "management" was bailed out by Gephardt & Co previously...they then blew through that 170 million? in "corporate/union partnership money"...filed around the first of this year after that for Chapter 11 and everyone was still whistling past the graveyard when something out of the graveyard grabs them and snatches them back into reality.

Realities are a real bitch when you're promoting "clean living" while being paid by the Cookie like investing your life in Pepsi and living in Bloombergs NYC ;-)

Tue, 11/20/2012 - 04:33 | 2998117 ACP
ACP's picture

"...something out of the graveyard grabs them..."

Evil Dead, I say!

Tue, 11/20/2012 - 00:03 | 2997907 Mary Wilbur
Mary Wilbur's picture

There are some outrageously funny comments here. All of you have made my day.

Tue, 11/20/2012 - 04:56 | 2998129 BeetleBailey
BeetleBailey's picture

Concur nmewn....well said.

Mon, 11/19/2012 - 19:59 | 2997399 stocktivity
stocktivity's picture

How many thin union reps have you ever come across?

Mon, 11/19/2012 - 20:42 | 2997516 nmewn
nmewn's picture

Ding!!!...we have a winner!

When the zombie apocalypse happens, just run through the union hall and out the back you an hour head start ;-)

Mon, 11/19/2012 - 21:26 | 2997608 Enslavethechild...
EnslavethechildrenforBen's picture

Bankers are Evil

Bankers are Fat

Some of the Union dudes are Fat

Therefore all Unions are Evil and everyone shoudl forfeit their right to bargain for a fair wage so they can afford to pay their bills..

Makes perfect sense...


Mon, 11/19/2012 - 21:35 | 2997628 tenpanhandle
tenpanhandle's picture

As a past member of three different unions in my career, I'd say you just about nailed it.  Oh wait, was that sarc?

Mon, 11/19/2012 - 22:13 | 2997698 Enslavethechild...
EnslavethechildrenforBen's picture

I'm 5th generation UNION.

I can barely afford to pay my bills. I am not fat. If a non union (non-professional) worker did my job, all of the bridges we build would collapse.

NOT sarcasm

Mon, 11/19/2012 - 22:22 | 2997713 hawk nation
hawk nation's picture

Blame the government for making everything more expensive and destroying the american dream

Its the cost of the benefits that are driving companies out of the usa

Mon, 11/19/2012 - 22:33 | 2997736 Enslavethechild...
EnslavethechildrenforBen's picture


Tue, 11/20/2012 - 02:05 | 2998013 Bananamerican
Bananamerican's picture

this planet will never realize the gifts and genius of truly Free Markets™ until everyone on it is working for free.

Mon, 11/19/2012 - 23:38 | 2997853 A Nanny Moose
A Nanny Moose's picture

I find it amusing that nobody is discussing the role of government in "saving" the sugar industry. The result, of course is; a completely decimated sugar and confectionary industries , higher prices to consumers, and Hecho en Mexico.

Tue, 11/20/2012 - 07:02 | 2998201 Gazooks
Gazooks's picture

'cost of the benefits that are driving companies out of the usa'


not driving health care vultures anywhere


benefits, like my bro doc's regular pharma paid 'loyalty' excursions to paradise

Mon, 11/19/2012 - 22:34 | 2997738 BraveSirRobin
BraveSirRobin's picture

You didn't build that. Now shut up and pay your fair share.

Tue, 11/20/2012 - 02:11 | 2998033's picture



I'm 5th generation UNION.

I can barely afford to pay my bills. I am not fat. If a non union (non-professional) worker did my job, all of the bridges we build would collapse.

NOT sarcasm


Obama and his advisor Robert Reich aren't worried.

"I am concerned, as I’m sure many of you are, that these jobs not simply go to high-skilled people who are already professionals" -- Robert Reich addressing congress on infrastructure spending in the Obama stimulus plan.

Tue, 11/20/2012 - 03:18 | 2998075 Rogue Trooper
Rogue Trooper's picture

Not sarcasm? Well you could have fooled me. Have you got a defined benefit plan as well.... cannot believe these still exist haha! Write to your trustees and insist they go all in Gov Bonds.  You're a partiot are you not 5th gen?

/Hostess Liquidation... The gift that just keeps giving.

Tue, 11/20/2012 - 14:10 | 2998142 cranky-old-geezer
cranky-old-geezer's picture



You mean "professional" union workers like these "professional" union crane operators and riggers here, here, here, here, and (best of all) here?

Bridges don't fall because professional engineers design them 

...and they're non-union :)

Union doesn't make you professional.  It just makes you greedy.

No true professional would ever be in a union. 

Mon, 11/19/2012 - 21:59 | 2997680 nmewn
nmewn's picture

The only people who aren't fat in a union operation are the ones they keep in a locked room, with a single naked light bulb over their head, sliding an abacus back and forth...the accountants, counting the money.

Don't fool yourself.

Every CEO is the same just as every union boss is the same, they derive their wage off the labor of others.

Mon, 11/19/2012 - 22:15 | 2997701 Enslavethechild...
EnslavethechildrenforBen's picture

You are right about your opinions on most subjects, but this is not one of them

Mon, 11/19/2012 - 22:52 | 2997779 nmewn
nmewn's picture

In your opinion? ;-)

My first and last experience with a union went like this (when I was young and full of hope for my fellow man).

I got laid off here in Fla.

Went to the union hall, parked in my beat up un-air conditioned truck and walked past the union bosses red corvette sitting in the sweltering parking lot and into his office where his secretary sat. Explained to her, she buzzed him, he told her for me to take a seat and wait.

I waited about five minutes, admiring the fine paintings on the walls, got up and asked his secretary what the deal was. She said he's busy. I said, well thats nice, I'm not, walked past her desk, opened his door and announced myself.

There he was, cowboy hat, ostrich skin boots propped up on the corner of his mahogany desk talking on the phone, not a care in the world...smiling. He said I'll call you back to whoever he was talking to and hung up...obviously a very important call to keep me (a dues paying member waiting ;-)

I told him what was going on, he said he had heard of the layoffs and said there was nothing available.

So I motherfucker, I've paid my dues (because I was forced to) for your goddamned ostrich skinned boots, your mahogany desk to put them on in your air conditioned office, your secretary outside this door who is no doubt calling the cops right now. Let me tell you something you son-of-bitch, I will never work for another union as long as I live...dick...and wlaked out slamming the door behind me causing one of those fine paintings to fall off the wall.

I never have or ever will work for another union...and now I don't have to...and I keyed his fucking Vette too.

Mon, 11/19/2012 - 23:00 | 2997796 Enslavethechild...
EnslavethechildrenforBen's picture

You are right. Americans should work for free like the Chinese.

Mon, 11/19/2012 - 23:21 | 2997834 nmewn
nmewn's picture

I chose to work for myself from that time FORWARD...for the highest bidder.

Tue, 11/20/2012 - 02:06 | 2998020 Bananamerican
Bananamerican's picture

I'm guessing that ballzy, union kiss-off happened not that long ago.....

I was in a besieged sheet-metal union briefly in the 90's....we had indoctrination meetings once a week in which the glories of past union might were nostalgically, wistfully laid out to the assembled apprentices with promises of regained glory to come.

"What's to stop the same union excesses from happening all over again?" i'd suicidally ask.

Even then I could see the writing on the cave-wall as sure as i could see the number of mexicans coming online for the scab shops on the bigger projects. (which is also when/how I learned to NEVER leave my tools unattended)

Management grinds the line to dirt, as long as it can get away with it....the anvil swings back...Corvettes in the Union lot, double time on Saturday$....The sledge responds "You don't like it? Wang Chung will do it for a nickel and Robbie the Robot doesn't fucking even need that!"....

There IS a place in the middle there somewhere....if People weren't such short-sighted, douchebags of self-importance.

Tue, 11/20/2012 - 08:06 | 2998253 nmewn
nmewn's picture

It happened when I was around 20-22yrs old...I'm 53 now.

You're right Ban, there is a balance. Getting to that balance is the issue.

I had the good fortune to work with a union steward after that. A fine man, ex-Navy, really busted his ass on the job, not a slacker.

At night he would take care of the union business (can't do it during the day, per the rules, and he didn't, I know, I worked with him all day). He told me he would stay up sometimes till 1:00AM trying to come up with ways to get idiot union guys out of trouble, he was their advocate. They would file greivances for the stupidest shit.

He finally got tired of it and gave it up. It ground him down. He then quit the union around the time I moved on to something else.

I walked into an office about five years later and there was this tall guy in a suit...he turned around and I out blurted out "Smitty! the hell are ya?!"

He smiled and said, "Mr. ______ you are the ONLY one in this room who can call me Smitty and get away with it. To everyone else in here, I'm Mr. Smith." We laughed, shook hands, went outside and caught up on old times leaving the room in stunned silence. He had become the Regional Director for the very company he had fought so hard against for everyone else.

He chose a similiar path as me, made his life better.

Mon, 11/19/2012 - 23:54 | 2997886 A Nanny Moose
A Nanny Moose's picture

Either way, you work for the benefit of another.

Tue, 11/20/2012 - 05:56 | 2998162 cranky-old-geezer
cranky-old-geezer's picture



You are right. Americans should work for free like the Chinese.

That argument was valid 60 years ago, but not today when union people make double what non-union people make, triple when you consider benefits.

Unions have gone from oppressed to oppressors, from underdogs to tyrants.

But whatever.   You'll push your employer to bankruptcy and you won't have a job anymore ...unless you're government union. 

Like paying those high taxes supporting your government union buds?

Tue, 11/20/2012 - 04:26 | 2998113 archon
archon's picture

Yeh, that about sums up my two experiences working in "union" shops...  everyone thinks they pay their dues to be protected from random acts of termination, but when it happens, "the union" apologizes because either there's nothing they can do, or they're not interested... Never again.

Tue, 11/20/2012 - 03:11 | 2998071 Rogue Trooper
Rogue Trooper's picture

Yep, 1st rule... Cardio!

The whole Twinkies drama is hilarious.... more to come I think.  You are right 'nmewn' that this whole thing has really fucked up he whole progressive world thinking big time. It's a gift that just will not stop giving!  The Zombieland analogie make it even more special. A question on this: Did not Tennessee claim that they have an expiry date?


Mon, 11/19/2012 - 23:00 | 2997794 A Nanny Moose
A Nanny Moose's picture

Karen Lewis is on a diet...relatively speaking

Mon, 11/19/2012 - 23:59 | 2997900 Mary Wilbur
Mary Wilbur's picture

LMAO. Thanks.

Mon, 11/19/2012 - 21:17 | 2997593 rayduh4life
rayduh4life's picture

And it would seem you learned little in those "30 years".  Who hired and retained those 80%?   It's called divide and conquer peabody.  As management, you Always burden the union with slackers and riff raff(relatives).

Oh, and the roll of the 80% is to keep the 20% from figuring out how hard they're getting screwed.

Mon, 11/19/2012 - 21:41 | 2997642 tenpanhandle
tenpanhandle's picture

Its always someone else, isn't it!?!? Bullshit, I say to you.

Mon, 11/19/2012 - 23:03 | 2997803 Drachma
Drachma's picture

How many union workers does it take to not make a twinkie? All of them.

Mon, 11/19/2012 - 23:31 | 2997840 Retronomicon
Retronomicon's picture

$1.75 million to 19 people???  That's chump change, not even worth writing about really, given the billions that have been stolen.  A government bailout worth be a worthy topic, but that hasn't happened.

Tue, 11/20/2012 - 00:06 | 2997917 HurricaneSeason
HurricaneSeason's picture

I read that the unions get a 2 year severance package.  That might only be their wish before it's over.

Mon, 11/19/2012 - 22:57 | 2997787 Antifaschistische
Antifaschistische's picture as usual.   They have dramatically altered the recipe of all these once tasty treats.   Bring back the original recipes....or die.

Tue, 11/20/2012 - 04:48 | 2998123 ptoemmes
ptoemmes's picture

As long as the Twinkie you ate was not 25 years old you will probably still be with us later today, but please do let us know.



Mon, 11/19/2012 - 18:35 | 2997133 gmrpeabody
gmrpeabody's picture

They're just like, wouldn't you say?

Progressive Journalism for Positive Action

Mon, 11/19/2012 - 18:36 | 2997153 redpill
redpill's picture

I'm not a violent person but if someone actually said that name to me in person it would be hard not to punch them square in the face.

Mon, 11/19/2012 - 18:38 | 2997157 gmrpeabody
gmrpeabody's picture


Mon, 11/19/2012 - 18:59 | 2997220 MillionDollarBogus_
MillionDollarBogus_'s picture

Union rules - the bread from Hostess goes to a store in one truck and the sweet stuff from the same Hostess plant to the same store arrives in a different truck.  The drivers can't touch the product they haven't delivered, once it gets to the store.


Mon, 11/19/2012 - 19:15 | 2997268 ShrNfr
ShrNfr's picture

And that is just the Teamsters Union.

Mon, 11/19/2012 - 20:20 | 2997452 Randall Cabot
Randall Cabot's picture

If these companies would treat their people with respect there wouldn't have ever have been unions-look at the way the bastards treated miners and steel workers.

Mon, 11/19/2012 - 20:55 | 2997546 jerry_theking_lawler
jerry_theking_lawler's picture

Fuck you RC....unions strive to destroy businesses. I work in a plant that a major pharmaceutical owned....this is a new plant (built in the early 2000s). started off non-union and life was great for everyone. when times got a little lean and there was a short spell of wage/benefit comes the union with big promises. now there are complicated work rules and the employees now hate the union but can't muster enough 'force' to get it back out. so i say fuck them and fuck the unions. if a man can't stand on his own merits...then fuck him to.

Mon, 11/19/2012 - 21:02 | 2997561 dark pools of soros
dark pools of soros's picture

you are an idiot..  managers are on a rampage these days laying off everyone and cashing out bonuses and massive raises.  Do you really think these managers are honest people giving a damn anymore??  everywhere is a money grab.

Union compensation hold value since they aren't all in fiat. On a site like this you would think they would say unions are smart to diversify their compensation since beni's rise in value as fiat tanks.   You should be wondering why everyone else is getting screwed down the chute without a fight.


Mon, 11/19/2012 - 23:10 | 2997812 Cathartes Aura
Cathartes Aura's picture

corporate government winding down incrementally, all bonuses go to the top, it's a model, and a pattern.

edit:  and another upvote for the Pinata Economics post - more truth.

what is interesting is where the lines are drawn, and sides taken. . .

Tue, 11/20/2012 - 05:38 | 2998144 NidStyles
NidStyles's picture

You calling someone an idiot with a post like that...


Everything is priced in Fiat, so it doesn't matter if they are just stright up handing out that Fiat for compensation. Likewise when the Fiat runs out for being doled out, the gravy train will stop. The same thing will be apparent when they run out of Fiat to pay for the those extended long term benfits, like Medical and Pensions.

This site is not about teaching about investing.


Mon, 11/19/2012 - 20:49 | 2997529 dark pools of soros
dark pools of soros's picture

Pinata Economics.. 

Why bother running a company when you can steal enough from it to retire?

screw the workers and smash and grab the business to shit..  If Romney was voted in they would blame him for this stuff but this shows you the plan goes on no matter the puppet at the top

you can blame greedy and lazy unions all you want but management and gov officials are all bleeding companies to the ground




Mon, 11/19/2012 - 23:09 | 2997818 Enslavethechild...
EnslavethechildrenforBen's picture

Why blame the criminal bankerticians when we can shift the blame to the common man for wanting to feed his family?

 Americans need to work for free and live in cardboard shacks like the Chinese. Only bankers deserve to have food and clothes

Mon, 11/19/2012 - 23:16 | 2997827 Cathartes Aura
Cathartes Aura's picture

you're right of course, the corporate model for "third world" companies has always been a massive spread between monies awarded the execs vs. monies budgeted for the actual workers. . . this is the model amrkns thought they were spared, because most of the corporations were based in the US - but it worked so well for them, they're finally bringing it to the homeland, and the scramble will be for ANY work that pays - which, of course, is intentional.

up vote.

Mon, 11/19/2012 - 23:33 | 2997842 brettd
brettd's picture

If the exec jobs are so easy, go be an exec!

For the love of Pete folks, there's 10% unemployment out there.  Driving 

a Twinkie Truck and working a dolly are hardly unique/high-value skills. 

Mon, 11/19/2012 - 23:52 | 2997881 Cathartes Aura
Cathartes Aura's picture

you're focusing on the minutiae and missing the massive looting going down - everywhere, it's a model/pattern.

I'm not "defending Unions" - they definitely have their fair share of arrogance and sloth - but if you take the facts of this particular case, and understand them, you can't help but see the pattern of strip mining a corporation in order to wind it down - these are "legacy" US trademark corporations - and yes, they sell toxic shit I wouldn't feed anyone - but this is the globalisation pattern, shuttering amrkn factories, and setting up somewhere "cheaper" down the road.

it's been going on for decades.

ah well.  guess those workers will have to move to Utah for the brand new spy-work .gov paychecks. . .

Tue, 11/20/2012 - 02:47 | 2998055 Bananamerican
Bananamerican's picture

"If the exec jobs are so easy, go be an exec!"

fer sure brett....Just ask John C.

Tue, 11/20/2012 - 03:45 | 2998092 awakening
awakening's picture

'If the exec jobs are so easy, go be an exec!'

Problem is not what you know but more importantly who you know.

Put best by George Carlin - 'It's a big club and you ain't in it.'

No point me wasting the time, effort and money ($1 trillion or so on the books in the US, called student debt, says competition is already fierce before you gain the 10 gram certificate) when I don't know the right people (nor ever would, I'm not that sociable and would be even less so among the type attached to salaries bigger than these small fish in the article) to ensure that it would result in a job that is worth the time spent in its duration.


Tue, 11/20/2012 - 08:12 | 2998258 Acet
Acet's picture

+1 This

What we have is Crony Capitalism, not Free Market.

Harp all you want about Wealth Creators and such. The truth is that nowadays the vast majority of those getting rich from companies are really just hired administrators who got where they are because they know and collude with the right people (and are in each other's Compensation Boards), who have no skin in the game, steal from the actual owners of the company by keeping those that manage the money of others (for example pension fund managers) sweet with personal promises and favours and have used the company's money to buy laws and regulations (like poison pills, staggered board elections and the like) to make sure shareholders have no real power.

Forget about true Entrepreneurs - they're a minority nowadays and when they try and take their companies off the ground, they get screwed left and right by bought for regulations protecting big companies.

We are in the Age of the Parasites, not the Age of the Builders.

Tue, 11/20/2012 - 02:05 | 2998028 Mike2756
Mike2756's picture


Mon, 11/19/2012 - 20:57 | 2997549 Stoploss
Stoploss's picture



It's coming. There's a union involved..

Tue, 11/20/2012 - 00:13 | 2997927 HurricaneSeason
HurricaneSeason's picture

If it brings on civil unrest, then it will be a matter of national security.

Mon, 11/19/2012 - 22:42 | 2997765 TruthHunter
TruthHunter's picture

Unlike Apple Juice, Twinkies can't be made in China.  When Wage equality is Global, maybe unions will have leverage again.


Oh, and try to find Tilapia that doesn't come from a Chinese sewer...

Mon, 11/19/2012 - 22:47 | 2997776 MeBizarro
MeBizarro's picture

Sure they can.  It just depends on the overall cost of production but since you would likely have to ship large amount of raw materials across vast distances for what is a low profit margin consumer item it makes almost no economic sense.  They will just relocate the production to cheaper US states where labor rates are more friendly or to northern Mexico entirely.  

Tue, 11/20/2012 - 05:41 | 2998147 NidStyles
NidStyles's picture

Tilapia is the most abundant fish species on the planet. It's found everywhere, as in Fresh Water, Salt Water, everywhere.



Mon, 11/19/2012 - 23:13 | 2997820 Buck Johnson
Buck Johnson's picture

When this whole game ends, it will be in tears in regard to our economy.


Mon, 11/19/2012 - 23:57 | 2997894 lasvegaspersona
lasvegaspersona's picture

I am so grateful we have laws and we are a country of laws. If we were a country just governed by the whims of men, why we could wind up with another GM type thingy.

When this is settled I hope the merikan peeps see we are finally just another loosely controlled dictatorship.

And I burned a gallon of gas to vote...I may learn my lesson yet...

Tue, 11/20/2012 - 01:55 | 2998022 OldPhart
OldPhart's picture

If it's good enough for a bank, or car company, or investment firm then it's good enough for a bakery.  I don't see the problem here.

Tue, 11/20/2012 - 05:52 | 2998158 LongBalls
LongBalls's picture

"Something for nothing and your chicks for free". - Dire Straits

Mon, 11/19/2012 - 18:12 | 2997033 QQQBall
QQQBall's picture

Barry could have been assured of 18k votes if this had happened b/f the election. He has 4 more years, so bakery workers are not auto workers.

Mon, 11/19/2012 - 18:17 | 2997056 walküre
walküre's picture

Barry or Mittens, who cares? It's time the unions pull together and take their gloves off. Regardless of who is in office.


Mon, 11/19/2012 - 18:21 | 2997077 gmrpeabody
gmrpeabody's picture

I'd say the union has already done a good job. <sarc>

Mon, 11/19/2012 - 21:07 | 2997570 dark pools of soros
dark pools of soros's picture

if you mean the colluding union of corrupt managers, then I agree

Mon, 11/19/2012 - 23:36 | 2997847 brettd
brettd's picture

Yep.  Sure told those execs where to go!

I'm jobless, but I've got my pride!


Tue, 11/20/2012 - 05:42 | 2998148 NidStyles
NidStyles's picture

You're jobless because you are failing at taking responsibility for yourself.

Mon, 11/19/2012 - 18:21 | 2997079 fonzannoon
fonzannoon's picture

Unions should be allowed to collectively bargain and not vote or vote and not collectively bargain. They are just as bad as the banksters, maybe worse.

Mon, 11/19/2012 - 18:29 | 2997121 walküre
walküre's picture

How can they be worse? Do they print money like there's no tomorrow and generate their revenues from thin air?

The opposite is true! The unions are representing the downfall of the banker's monopoly capitalism. Sure, there are bad examples for unions and their actions. This is not one of them.

The only opposition to the banker's corporate dream of mass slavery is the union. The revolution will start at the union level or not at all.

Mon, 11/19/2012 - 18:32 | 2997137 fonzannoon
fonzannoon's picture

I am more curious about your felings on the public unions. By worse I mean that every public union dispute around me is quietly solved by raising taxes. Raising taxes is the same to me as printing money. You are taking it from me without my permission to give to someone else.

Mon, 11/19/2012 - 18:58 | 2997218 Matt
Matt's picture

It seems to me that Unions are a kind of cartel, that collude to manipulate the price and supply of labor. As such, I think they should be examined under RICO.

Mon, 11/19/2012 - 19:25 | 2997294 mercenaryomics
mercenaryomics's picture

Always found it sickening that antitrust law doesn't apply to unions, since its pretty obvious that's exactly what they are. 

Mon, 11/19/2012 - 22:17 | 2997706 Debt-Is-Not-Money
Debt-Is-Not-Money's picture

Union = Legalized Extortion

Mon, 11/19/2012 - 18:36 | 2997141 darteaus
darteaus's picture

Yeah, that Richard Trumka - he's like a Kyle Bass and a Mother Theresa all rolled up in one!

Unions - especially public unions - have always been known for their sage economic wisdom, long term view and altruism!

Tue, 11/20/2012 - 11:05 | 2998672 Ident 7777 economy
Ident 7777 economy's picture


Mon, 11/19/2012 - 18:47 | 2997182 1100-TACTICAL-12
1100-TACTICAL-12's picture

Screw the unions & screw Ding Dongs, We are better off if they both disappear. Every union job I had to work on all they did was bitch & hold the job up as much as they could. I mean we would have to get a carpenter from the other end of the site to bend a fucking nail over ..GMAFB..

Mon, 11/19/2012 - 18:51 | 2997197 fonzannoon
fonzannoon's picture

My wife is in design. She gets to work by 8:30. Her company has some union workers. They get in around 9am. They take several breaks and are gone at 4:59pm. She can't rely on them for anything because they could give a shit. If she treated her job the way they did she would have been fired a month after she started.

Mon, 11/19/2012 - 18:58 | 2997217 walküre
walküre's picture

It's never a good idea to have a blend of employees in one business.

Mon, 11/19/2012 - 19:30 | 2997308 gmrpeabody
gmrpeabody's picture

Makes the union workers look pretty bad..., eh?

Mon, 11/19/2012 - 22:07 | 2997691 ali-ali-al-qomfri
ali-ali-al-qomfri's picture

screw ho-hos with your ding-dongs; there fixed it.

Mon, 11/19/2012 - 21:31 | 2997624 rayduh4life
rayduh4life's picture

If you're going to have capital organized, you sure as hell need to have labor organized.

Ask a dentist what happens when you have no opposing force.


Mon, 11/19/2012 - 20:27 | 2997468 Antifaschistische
Antifaschistische's picture

Collective Bargaining is coercive representation...its that simple. Its anti liberty and anti freedom. Sort of like me being represented by the clowns in Washington. Its the Enslavement of societal host for the benefit of the collective parasites.

Mon, 11/19/2012 - 18:49 | 2997188 Dan Conway
Dan Conway's picture

Leave mittens out of this because he had nothing to do with it.  The unions blindly support dumbocrats so take that "save the workers BS" elsewhere.  It was the bakers union that turned down the deal and then whined when they realized the chief restructuring officer wasn't bluffing.  How stupid are these union thugs?  The only jobs the union leaders care about are their own and they view the union membership as nothing but pawns to collect their big checks.  The union membership pay their dues that get funneled to dumbocrats like bloomberg, obama, and pelosi that are doing their best to bankrupt all of these companies.  Do you think bloomberg's initiatives to eliminate crap food and drink from NYC is a benefit to hostess bakers?  Morons!

Mon, 11/19/2012 - 19:47 | 2997358 NotApplicable
NotApplicable's picture

Wasn't Bain involved in the first bankruptcy?

Mon, 11/19/2012 - 22:53 | 2997782 SokPOTUS
SokPOTUS's picture

Yep.  Gloves off.  Tools down.  Asses sitting.

Tue, 11/20/2012 - 01:25 | 2997999 Oldwood
Oldwood's picture

Bring it on! I'll be damned if anyone tries to tell me who i hire or fire and what i will pay. No one wants to excuse a corrupt business but as far as I know no business outside of government has been "officially" granted a monopoly as unions have. I have no problem with collective bargaining but no one has the right to force me to employ them and I have no right to force anyone into my employ. So far as I know this is still America, not communist China....yet. But you pro union socialists just keep it up and I'm sure we'll get there soon enough!

Mon, 11/19/2012 - 18:13 | 2997035 Robslob
Robslob's picture

But but...Senior Management didn't "Eat That"....hahahahahahahaahahaha


This may be the first time in history Unions lose...and with a stacked deck...guess they thought Hostess couldn't live without'em...what a bunch of Ding Dongs...

Mon, 11/19/2012 - 18:29 | 2997119 Debt-Penitent
Debt-Penitent's picture

A twilight Banana-Creme

Mon, 11/19/2012 - 22:15 | 2997497 Ballin D
Ballin D's picture

What keeps these companies with unskilled union labor from going to universities and offering 50% over minimum wage to all the unemloyed lib arts students?

Serious question.  The students get better wages than they would at starbucks and the company gets labor for a much lower cost than the unionized labor.  Theres no need to do much hunting around either.  I bet they could get a flow of a few hundred students a year from each school they recruit at.

Tue, 11/20/2012 - 04:06 | 2998103 Rogue Trooper
Rogue Trooper's picture

Good point but carefully consider how much value for that extra 50% will you get from an MA Arts graduate with a double major in Interpretive Dance and Cultural Diversity? Just sayin'

Tue, 11/20/2012 - 05:48 | 2998151 NidStyles
NidStyles's picture

Better value than the 200% Union alternative that you can not use the loss of their wages as a motivator for them to actually improve the quality of their labor with.

Mon, 11/19/2012 - 18:13 | 2997036 spastic_colon
spastic_colon's picture

just about every US company is worth more without their unions....the US is more competetive without the unions......let precedent be set for god's sake

Mon, 11/19/2012 - 18:15 | 2997044 walküre
walküre's picture

Move to China then.

Mon, 11/19/2012 - 18:19 | 2997064 spastic_colon
spastic_colon's picture

four more years here and I won't have too

Mon, 11/19/2012 - 18:24 | 2997098 walküre
walküre's picture

You'd be there quicker on the Mittens ticket! I guarantee you that. Do you like slave labor?

Mon, 11/19/2012 - 18:32 | 2997131 spastic_colon
spastic_colon's picture

there are no guarantees....and we like to call it unit labor cost

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