Hostess may go bankrupt: Twinkies no more?

H

Hornius Emeritus

2,500+ Posts
Sad stuff. We may get to see how long Twinkies really can last before they go bad. The company is owned by two hedge funds and the employees have been told that they have to accept large pay cuts and huge benefit cuts in order for it to not shut down.

In reply to:
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Sounds like a sandwich of what's wrong w our economy. Greed hedge funds in the name of capital "investments" and unions complaining about the cold food and stale bread on the Titanic.
 
The absolute best outcome for America is for the owners to shut it down. new owners will buy the assets and re-open as a non-union shop. They will offer wage and benefit plans that the company can live with. Either people will take those jobs or they wont.

As I know I have mentioned on ere multiple times I have worked directly with unions and union heads like Frank Hurt far too many times. His public statement is EXACTLY what is wrong with unions today. The unions do not care, even a little bit, if a company succeeds or not. They just want to get paid. When Hostess shuts down, Frank Hurt will continue to collect his full paycheck. he will say he had to make a stand for all unions. His people will be out of work but he wont really care.

I especilly love the comment about 1950. The plants these folks work in are safer than most high schools. All of the wages are many percentage points higher than minimum wage. They get regular breaks, benefits, have work comp protection, have stringent laws to protect OT rules etc. Not a single worker is getting screwed at these plants. The other fun tidbit is that they cant even lay off folks due to the union agreements. I really do hope they tube it and then a new group comes in and employs all of the workers that actually want a job there.
 
Same here, Bronco.

The real tragedy in all this is that the corrupt union bosses won't feel any pain at all, while the dumbass strikers may lose their entire livelihood because they willingly let a piece of **** thug organization like their union speak for them - and they pay them to do it to boot. Idiots.
 
This demonization of hedge funds is just stupid. They likely have stepped in extremely late in the game to provide financing through the bankruptcy process and hopefully make a profit.

If they have been funding the company for longer, they are likely the only financing sources that allowed this teetering company to stay afloat.

I really, really doubt that they had any hand in the mismanagement of the business or the unrealistic compensation and benefit demand from the employee base that has led to this bankruptcy event.
 
Yeah, they're union. They're as blue as they can get.

I don't know the whole story of this company's financial problems, but I'll bet the unions have had a lot to do with it going bankrupt.

The whole notion of a union was that when a company made money, the employees should share in the success. However, when a company starts losing money, the unions seldom agree that their members should share in that fate too.

I had a friend that was a pilot for United Airlines. He told me way back in the 90s that the pilot's union was "taking this company to its knees" because they wouldn't give them as much of a raise as they were demanding. They were a large contributor to United's going bankrupt a year or two later. Seemed to me the pilot's union didn't give a damn about the other United employee unions or the company itself.
 
So we've established that the unions don't give a **** about the company and the company's owners don't give a **** about the unions.

You guys are regular Rockefellers.
 
Sounds like the old analogy - they're in the middle of the Atlantic in a leaky rowboat, with the sharks gathering around, and they're wondering whose half of the boat is going to sink first.

HHD
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That is too simplistic, BI. There is a big difference between trying to keep a company solvent and trying to make a "big" profit. Sounds like they have tried to avoid bankruptcy. If you cannot make any profit you shouldn't and generally can't be in business. Profits are not evil, they are necessary. Otherwise there would be a minuscule - like zero- number of people willing to take risks by starting a business venture. And DFW is right - many hedge fund managers are trying to rescue sinking ships. Notice I didn't say all, but you seem to believe all hedge fund managers are evil devils.
 
Unions Win! Unions Win! Unions Win!

Hostess management to ask bankruptcy judge for permission to liquidate the company's assets. 18,000 jobs lost. Enjoy unemployment suckers.

In reply to:
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I agree that the pure unadulterated pursuit of profit has its costs and sometimes has negative effects. That is why we have a criminal justice system and why some degree of regulation is necessary.

On the other hand, a pure and non-commercial defense of employee interests is a slower, more insidious and in many cases more devastating pressure on an economy and population. While no one rejoices about layoffs, I firmly believe we would not have modern industries like technology, biotech, clean energy, etc. if we were not able to as a nation move past small focus agriculture, mining, commodity clothes manufacture, and a host of other industries that we found we could no longer compete effectively in.

France and other markets have institutionalized the rights of the individual over the rights of the market and have suffered slower growth and higher structural unemployment as a result.
 
So the largest union, Teamsters, agreed to the deal and the smaller union rejected it and brought down all 18,500?

I don't think they should get any taxpayer benefits
 
That sucks. Now they can live the Republican, middle class, wet dream - slave labor conditions and making a fraction of what they used to make, all the while the price of the Twinkie stays the same. What a great win for working class citizens!!
 
If the unions were the only thing holding the company back, why wouldn't you buy the brand and start making a profit? The union is stupid in this case, but I think the company was going down either way. The unions make a nice scapegoat for upper management, management makes a nice target for unions, and the world goes 'round.
 
I'm guessing they will sell the brand off and you will see twinkies again. Considering the shelf life of twinkie it will probably be made in China and shipped to the US.
 
Nobody posting here has any idea what the facts are, it is clear. Everyone has just dusted off their anti-union arguments again. I don't claim to know either; it is too early. Of course none of that ever matters on the West Mall.
"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.

Over the past 15 months, Hostess workers have seen the company unilaterally end contractually-obligated payments to their pension plan. Despite saving more than $160 million with this action, the company continues to fall deeper and deeper into debt. A mountain of debt and gross mismanagement by a string of failed CEO’s with no true experience in the wholesale baking business have left this company unable to compete or survive." The Link

I will reserve judgment until I know a little bit more, but at some point it is rational for workers to refuse further concessions to a failed management team.
 
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