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Crandell: Unions didn’t kill the Twinkie

Published 3:46pm Wednesday, November 21, 2012

The Democratic Voice

By William Crandell

For the past week, I’ve been listening to the media and corporate America blame the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union for forcing the Hostess Corporation into bankruptcy. But I think it has been forgotten amid the jokes and the accusations that 18,500 workers could be losing their jobs. Hostess is claiming that it’s the fault of the workers and that employee costs are eating up all the profits and forcing the corporation out of business. But union leaders are saying that the issue is more about the greed of the shareholders and years of corporate mismanagement that has caused the failure, and that the union is being unfairly blamed.

Hostess had revenues of about $2 billion last year,  but that doesn’t appear to be enough to save them. The company had already filed for bankruptcy in 2004 and, at that time, the employees gave up many concessions that included wage and benefit reductions in an effort to save the failing conglomerate. In return, management made promises to modernize and make structural changes, but those promises were never kept.

The current CEO of Hostess, Gregory Rayburn,  has a long personal history of placing companies into bankruptcy and then liquidating them and leaving the employees with nothing while he walks away with huge bonuses. Recently, he gave himself a 300 percent pay raise and has given away millions of dollars in salary increases to top executives all the while accusing the union employees of being greedy and uncompromising. But with his previous history of raiding companies, odds are that he planned to liquidate Hostess from the beginning and he is using the union as a scapegoat.

The other union involved with the Hostess catastrophe is the Teamsters. They have recently signed a contract that gave up large concessions hoping to save the company, but apparently their efforts were not enough. Under the previous contract with the Baker’s Union, members had once again given up pay raises so more money could be diverted into their failing pension fund to try and save it. But it was revealed recently that the company was no longer paying into their retirement and many of the Hostess employees feel betrayed and believe they have been sacrificing while the company’s management has not.

The CEO Rayburn used one of the ugliest of negotiation tactics when he threatened the employees stating that if they didn’t accept the contract the company would file bankruptcy. Some are ignoring the fact that workers did offer to make concessions during this negotiation, but they were rejected.

The average employee was expected to take an 8 percent pay cut and give up most of their benefits while the CEO gives himself a pay raise. The workers refused to be bullied and now could lose their jobs because of his gluttony.

The workers of Hostess are not the cause of the bankruptcy; mismanagement and greed are what has forced them out of business.

What’s going on at Hostess is exactly why the middle class is being destroyed, a corporate CEO willing to destroy a company and put thousands out of work so he can line his own pocket. The American worker has got to stand up to this callous greed or we will all soon be making minimum wage.

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