Slog
News & ArtsFriday, November 16, 2012
Chow 18,000 Working People to Lose Their Jobs
Posted by Dan Savage on Fri, Nov 16, 2012 at 8:04 AM
Maybe the president could've stepped in to save this industry too?
More classic Hostess commercials over at NYMag.
1
Unions in their typical murder/suicide pact killing jobs as a prelude to disappearing from the American economy.......
2
Would be strange to have no Hostess items on the shelf. In my younger stoner days they were essential.
7
How do you step in and save this business? You can't force it to stay open. I suppose you could try to seize it and nationalize it, but I don't think you can do that in the USA (yet). Anyway, labor can go on strike, but so can capital.
Also, not that "Hostess's current private equity owner, Ripplewood Holdings, is unlikely to recover anything in the liquidation."
Also, not that "Hostess's current private equity owner, Ripplewood Holdings, is unlikely to recover anything in the liquidation."
8
This is terrible! No amount of worker discomfort is too great a price to pay for the nostalgic thrill of seeing twinkies on the store shelves. It is tradition! Boooo unions! Booooooo
9
@7 The brand and it's products are still worth a ton....Don't worry, Twinkies aren't going anywhere any time soon.
10
Typical anti-union bullshit from WSJ.
Pro-tip, guys - companies that aren't mismanaged to within an inch of their lives don't actually have the labor problems you do. Maybe it's time you learned that CEOs are not interchangeable, that it actually does matter if the person at the top knows what the fuck he is talking about.
But what do I give a shit - I'm just hoping to ride this wave out until my death sometime in the 2050's - after that it's not my problem anymore.
Pro-tip, guys - companies that aren't mismanaged to within an inch of their lives don't actually have the labor problems you do. Maybe it's time you learned that CEOs are not interchangeable, that it actually does matter if the person at the top knows what the fuck he is talking about.
But what do I give a shit - I'm just hoping to ride this wave out until my death sometime in the 2050's - after that it's not my problem anymore.
11
Hostess has (had?) annual sales of $2.5 BILLION. Seems to me that there's some sort of deal that could have been crafted that would've 1. saved the business and 2. not required workers, who have already had their wages and benefits slashed in previous deals, to suffer more cuts.
12
@6 Me too. Goldy's probably cooking up his post on this right now. The good news for Twinkie fans is that Hostess is an iconic brand. I'd expect to start seeing the products again in a year or so, produced by a nonunion firm.
14
@11 Agreed - something fishy going on here. Watch who buys it back up, follow the money, there we will find the smell.
16
@11 Legacy labor costs have put more than one company out of business. There's not much to go on in the WSJ article, but my guess is that more than one buyer is out there waiting to bid on the Hostess brand and has calculated that the brand alone is worth more than the firm as a whole because of the firm's liabilities and existing labor agreements.
18
Hostess has been in bankruptcy since 2005, saved up millions that never got reinvested in the company but instead went to the stock owners. The workers have already accepted cuts and downsizing and the new demands was, after the mismanagement by the owners, the last straw I guess.
So the attempt was to either force them into reinvesting in the company or I guess force in a new owner of the brand, hoping it would lead to reemployment.
(this is kinda like Iphones, people are ready to accept any kind of horror aslong as it doesn't happen to them and they get their treats and toys)
So the attempt was to either force them into reinvesting in the company or I guess force in a new owner of the brand, hoping it would lead to reemployment.
(this is kinda like Iphones, people are ready to accept any kind of horror aslong as it doesn't happen to them and they get their treats and toys)
19
@15 The Hostess name would likely be for sale and of value. It's entirely possible that the buyer would separate Twinkies from Hostess, but I wouldn't unless I already had a very well-known brand that would benefit. Starbuck's Twinkies? Kraft Twinkies? Haliburton Twinkies?
21
@18, do you have a link with more info? I've been Googling around but haven't found reliable information.
23
Well I for one will miss the vaguely food, vaguely chemical refinery smell that came out of the Thomas Street bakery whenever they were making fruit pies.
24
Twenty years from now, when kids are watching that scene from "Ghostbusters" where Spengler is comparing the normal amount of psychokinetic energy in the New York area to a Twinkie, those kids are going to turn to us and say, "Grandparent, what's a 'twinkie'?" And we will just cry, and cry and cry.
25
@17 - Me, too. They already have a few bakeries here in Denver. Now that our Hostess bakery is apparently up for sale, why not expand?
26
Fortune has a good article that was written in July, published in August that goes through the whole damned story. Mismanagement, bankruptcy, CEO pay raises, hedge funds, nepotism, etc etc.
The closest to a good guy in the story are the unions which had previously taken pay cuts during the first bankruptcy.
The closest to a good guy in the story are the unions which had previously taken pay cuts during the first bankruptcy.
27
Sad about this. One of my once (maybe twice) a year guilty pleasures is a fried Twinkie. I hate all of that state- fair-street-fest novelty fried stuff....but the fried Twinkie really is transcendent.
Frying it gives it that nice crispy exterior, and the oil transforms the otherwise artificial mass into a super warm and rich sponge cake. Throw on a little carmel sauce, and you've got some artery clogging perfection there.
Frying it gives it that nice crispy exterior, and the oil transforms the otherwise artificial mass into a super warm and rich sponge cake. Throw on a little carmel sauce, and you've got some artery clogging perfection there.
28
@13: Hostess still makes Chocodiles. Well, they did until today. They're just not available nationwide.
29
@16
I think you're right.
Watch who buys the brands AND the factories.
Then they'll start up production again making the same product in the same factories with non-union employees and without the debt.
I think you're right.
Watch who buys the brands AND the factories.
Then they'll start up production again making the same product in the same factories with non-union employees and without the debt.
32
@17, @25 Me, three! Grupo Bimbo already owns the Wonder label in Mexico. And in the U.S. they own everything from Entemanns to Arnold to Sara Lee. Not sure they'll need the bakeries and distribution network of old Hostess, they already have a pretty good setup and probably some spare production capacity.
The brands will live on. The workers get screwed.
But speaking of Drakes, Hostess, and Bimbo and delicious chocolate snack cakes, have you tried the Marinela's Gansitos? As cello-wrapped preserved bakery products go, they're pretty fucking awesome.
The brands will live on. The workers get screwed.
But speaking of Drakes, Hostess, and Bimbo and delicious chocolate snack cakes, have you tried the Marinela's Gansitos? As cello-wrapped preserved bakery products go, they're pretty fucking awesome.
33
Hostess could survive if they really wanted to. They just need to focus their production and sales in the states that just leagalized pot.
34
You can make Twinkies at home.
I recommend coating them in organic fair trade chocolate from Theo's though.
I recommend coating them in organic fair trade chocolate from Theo's though.
37
I refuse to believe that Twinkies and HoHos will go away forever. Facts be damned, I just refuse to believe it (she said, like a Republican).
>:l
>:l
38
Don't forget about the Ding Dongs! That makes this whole thing twice as tragic. I had to stop by the local convenience store and buy a package of Twinkies and Ding Dongs as a solemn remembrance.
41
This is incredibly shitty. The town next door to me - Biddeford, Maine - has a Hostess plant that employs 500 people. 500! Huge employer here. All those people thrown out of work the week before Thanksgiving.
I'm sure the company is largely to blame, but I can't help but be angry at the union as well, for calling their bluff - how many times did the company threaten to liquidate if the strike continued? Why didn't the union recognize that it wasn't an empty threat? Was it really worth 18,000 people losing their jobs?
This is incredibly shitty. The town next door to me - Biddeford, Maine - has a Hostess plant that employs 500 people. 500! Huge employer here. All those people thrown out of work the week before Thanksgiving.
I'm sure the company is largely to blame, but I can't help but be angry at the union as well, for calling their bluff - how many times did the company threaten to liquidate if the strike continued? Why didn't the union recognize that it wasn't an empty threat? Was it really worth 18,000 people losing their jobs?
42
@41 There were people at Hostess with 20, 30 years or more of pension contributions, and the company was just demanding that they hand it over. Their life savings, in some cases. That wasn't a reasonable demand. You can't blame the union.
The big venture capital play, which pretty much started with Bain Capital, is to find a company with a well-funded pension and large long-term debt. They then pile on more debt, "restructure" (i.e. pocket) the pension fund "surplus," and see what else they can sell on the way out the door. In most cases, the company ends up parted out like a wrecked car. Parts worth more than the whole, etc.
I'm hoping the hedge fund guys who are holding the bag on this one don't win. They probably will make a profit, though. They almost always do, and the wreckage be damned.
The big venture capital play, which pretty much started with Bain Capital, is to find a company with a well-funded pension and large long-term debt. They then pile on more debt, "restructure" (i.e. pocket) the pension fund "surplus," and see what else they can sell on the way out the door. In most cases, the company ends up parted out like a wrecked car. Parts worth more than the whole, etc.
I'm hoping the hedge fund guys who are holding the bag on this one don't win. They probably will make a profit, though. They almost always do, and the wreckage be damned.
43
@41 Hostess was run by Private Equity vultures (think Mitt Romney) who make money if a business fails. Especially if a business fails. They knew what was going to happen and will now make a s---load on selling the brand and recipes.
And the employees and surrounding communities will get screwed.
The bankruptcy was long in planning. Don't believe the BS from the CEO's PR firm.
And the employees and surrounding communities will get screwed.
The bankruptcy was long in planning. Don't believe the BS from the CEO's PR firm.
44
@Clayton @30: that was my thought. Maybe now, people who shoot mayors and council members will do some serious time, even if the perp is a white, male, Catholic, ex-cop veteran.
45
I understand how the venture capitalism stuff works. And that motherfuckers like Romney run such things. And that that sucks and is wrong and immoral and shitty. I grew up in a liberal household, and my brother was part of a union for years (he's a machinist) and was left with very mixed feelings about it. The main point to me, no matter what was going on with management and mismanagement and shady deals at Hostess, is that the union in this case SHOULD have recognized a valid threat when they saw it. Period. Because it has now obliterated the work force they were supposed to represent. Hello? These are factory jobs for fuck's sake - there aren't a whole helluva lot of those around any more in this country. Certainly not here in Maine. The vast majority of factory workers do not have college degrees, or any schooling beyond high school, and a certain percentage didn't graduate high school. Transitioning to another field would and will be an incredibly long, sorry, expensive, and difficult process ... so if you are lucky enough to hold one of these rarer and rarer positions which pays you decently - a fuck of a lot more than retail, even with the concessions + tons better benefits ... ALL WHILE the country is still in the midst of a fucking years long semi-recession and unemployment is still 8% ... I mean, shit, does it take a brain surgeon to figure that now is maybe NOT the time to go on strike ? Especially when mgt repeatedly tells you in strongest terms that they WILL shut the plant, if you do?
Unions used to have power, when so much more of the country was unionized than is the case now (read up til the late 70's). It's just not the case anymore. The company these days holds the cards absolutely, because THEY employ YOU, and can decide whenever they want to UNemploy you, all 18,500 of you. It doesn't make it right, or good or moral. It sucks. But it's reality. All I see is 500 of my neighbors now without a paycheck at all, heading into wintertime, instead of one that is way better than what they will now scrounge and scramble to have while working seasonal at Macy's.
More...
I understand how the venture capitalism stuff works. And that motherfuckers like Romney run such things. And that that sucks and is wrong and immoral and shitty. I grew up in a liberal household, and my brother was part of a union for years (he's a machinist) and was left with very mixed feelings about it. The main point to me, no matter what was going on with management and mismanagement and shady deals at Hostess, is that the union in this case SHOULD have recognized a valid threat when they saw it. Period. Because it has now obliterated the work force they were supposed to represent. Hello? These are factory jobs for fuck's sake - there aren't a whole helluva lot of those around any more in this country. Certainly not here in Maine. The vast majority of factory workers do not have college degrees, or any schooling beyond high school, and a certain percentage didn't graduate high school. Transitioning to another field would and will be an incredibly long, sorry, expensive, and difficult process ... so if you are lucky enough to hold one of these rarer and rarer positions which pays you decently - a fuck of a lot more than retail, even with the concessions + tons better benefits ... ALL WHILE the country is still in the midst of a fucking years long semi-recession and unemployment is still 8% ... I mean, shit, does it take a brain surgeon to figure that now is maybe NOT the time to go on strike ? Especially when mgt repeatedly tells you in strongest terms that they WILL shut the plant, if you do?
Unions used to have power, when so much more of the country was unionized than is the case now (read up til the late 70's). It's just not the case anymore. The company these days holds the cards absolutely, because THEY employ YOU, and can decide whenever they want to UNemploy you, all 18,500 of you. It doesn't make it right, or good or moral. It sucks. But it's reality. All I see is 500 of my neighbors now without a paycheck at all, heading into wintertime, instead of one that is way better than what they will now scrounge and scramble to have while working seasonal at Macy's.
46
Hey you dumbasses! This is the first step in Texas secession! If we don't toss that uppity ummm community organizer out of the white house, you will never see a piece of balloon bread again! And forget twinkies until the 1% are safe fromo any taxers at all!
48
@45 The point is, as @43 points out, the company was probably going to head to bankruptcy and dissolution in any event. That was the whole point of the private equity takeover. They had no interest in running a successful baking company. Their expertise is in disassembling enterprises to "release their hidden value." They wanted to loot the pension fund, sell off the pieces and walk away with as much money as they could. The union's only option here was to try to not voluntarily surrender their pensions.
49
I'm torn:
This makes me sad -> 18,000 people losing their jobs.
This makes me happy -> Junk food peddling Megacorp bites the dust.
Let's put those folks back to work at green energy jobs. Jill Stein's Green New Deal would sure come in handy right about now.
@31: Thanks raku! I haven't had a Dillo before, but I see they are for sale at Sidecar for Pigs Peace in the U District.
This makes me sad -> 18,000 people losing their jobs.
This makes me happy -> Junk food peddling Megacorp bites the dust.
Let's put those folks back to work at green energy jobs. Jill Stein's Green New Deal would sure come in handy right about now.
@31: Thanks raku! I haven't had a Dillo before, but I see they are for sale at Sidecar for Pigs Peace in the U District.
50
A new low in union bashing. I personally can't eat them, and never did eat that stuff as an adult. Not only are they empty calorie bombs, they aren't even vegan. Maybe part of the problem is that the products aren't up to modern standards of nutrition and rejected by the health conscious public. IDK how the administration could have helped.
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