Unions = bankruptcy
This article from the New Yorker asserts that Unions are being made the scapegoat, it was management and its failure to adapt:
http://www.newyorker.com/online/blogs/newsdesk/2012/11/who-killed-the-twinkie.html
EXCERPT:
Management, of course, blames the company’s demise on the greedy, unreasonable unions. But, while the strike may well have sent Hostess over the edge, the hard truth is that it probably should have gone out of business a long time ago. The company has been steadily losing money, and market share, for years. And its core problem has not been excessively high compensation costs or pension contributions. Its core problem has been that the market for its products changed, but it did not. Twinkies and Ding Dongs obviously aren’t anyone’s idea of the perfect twenty-first-century snack food. More important, the theoretical flagship of Hostess’s product line, Wonder Bread, has gone from being a key part of the archetypical American diet to a tired also-ran.
Hostess’s management certainly bears some of the blame for its failure to successfully adapt, though the company made numerous (and failed) attempts to introduce healthier products. But the simple truth is that this kind of failure is endemic to the system—there are always going to be companies that are unable to change in response to the marketplace. And those companies are supposed to go out of business. Not to be too clichéd about it, but this is what creative destruction is all about.
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The Twinkie: Will it return as a Mexican expat?
Hostess Brands is liquidating its business after 82 years, which means some of the most iconic brands of the century may be up for auction. Will Twinkies become a foreign import?
Especially if a Mexican buyer is involved, production may go the way of the Brach’s and Fannie May candy concerns: south of the border. With US sugar tariffs set artificially high to protect Florida sugar-growing concerns, a non-unionized shop with access to lower-priced sugar in Mexico could be the Twinkie lifeline, economists suggest.
http://www.csmonitor.com/USA/2012/1117/The-Twinkie-Will-it-return-as-a-Mexican-expat
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I despise unions and their tactics, but in the illustration, the other bad guys are also employees— “executives” who helped hang themselves by, in IH’s case giving themselves million dollar bonuses, and in Hostess’ case, the CEO was taking out 100K A MONTH in a bad economy and at the same time the unions and their ilk want more. Look, the shareholders are the ones who got fleeced BOTH by the executives, who likewise squeeze money out of a company in return for their “management” and the thuggish unions. The executives are many times more piggish than the unions, but the bottom line is this: it is a myth that “management” is any different than just another money pit.
The owners got shafted by the people they gave jobs to and probably the best way to run a company is to make the employees shareholders and owners so they will care what happens instead of acting like spoiled little parasites
I put in a summer working for Youngstown Sheet & Tube company in East Chicago while I was in college, back in the 1950s. The company was already obviously in trouble. None of the workers liked their jobs (can’t say that I altogether blame them), and everyone did as little as possible. When they added stuff to the steel pours, they did it carelessly, so a lot of the product had scabs after it went through the rollers, and had to be done all over again.
The mill shut down soon afterward, as did virtually all the other steel mills in the country. They were squeezed between cheaper imported steel and demanding labor unions, and no longer could cut it or afford to modernize.
I believe in free trade, but I also believe in moderate and reasonable import duties, to level the playing field. But the steel users evidently had a better in with the politicians than the steel makers. And the unions pushed the whole business over the cliff.
What we have now, of course, is a playing field that is tilted AGAINST us, with free entry of goods from other countries but very little reciprocity for exporting OUR goods to them. But that’s another story.
I wondered why the last Hostess product I tried had the taste of feathers embedded in it. It must have been the union label.
This is not a parasite-host relationship, and Hostess and the Unions are not those related. This is a predator-prey relationship between Socialism and Individual Freedom.
Kill Socialism, or die.
OUTSTANDING informative article by Robert Tracinski! Thanks very much for posting. HOORAY Bob!
