Union Greed and the Death of the Twinkie

The battle over who can rightly be labeled “greedy” rages on. Recently, Hostess went out of business after stubborn negotiations between the company and bakers unions who felt that harsh economic realities should only be felt by companies and not employees. It didn’t work out the way unions had hoped.

Those in the labor movement are quickly demonizing Hostess for closing up shop. However, who is truly the greedy party here? The company that closes up shop rather than operate at a loss, or the workers whose demands made it impossible to continue to function as a business?

Welcome to the new face of labor in America. No longer can companies negotiate based on maintaining maximum profitability over the longrun; companies that are now operating with razor-thin margins are forced to negotiate with unions with the intention being mere survival as a company. Nobody likes pay cuts, but as Hostess has been on the brink of shutting its doors for years, union leaders should have seen that the hard line from Hostess was not a bluff and taken the company at their word that there really was no wiggle room.

The Teamsters got the message and made some reasonable concessions, but the Bakery, Confectionery, Tobacco Workers and Grain Millers’ International Union kept pushing the issue, and now 18,500 people are out of the job. Greed cost these people their jobs, and it wasn’t corporate greed.

Richard Trumka, the head of the AFL-CIO, stated,

“What’s happening with Hostess Brands is a microcosm of what’s wrong with America, as Bain-style Wall Street vultures make themselves rich by making America poor. Crony capitalism and consistently poor management drove Hostess into the ground, but its workers are paying the price. These workers, who consistently make great products Americans love and have offered multiple concessions, want their company to succeed. They have bravely taken a stand against the corporate race-to-the-bottom. And now they and their communities are suffering the tragedy of a needless layoff. This is wrong. It has to stop. It’s wrecking America.”

Yeah, yeah, yeah, we got it. The Hostess Empire is an evil, capitalist entity that seeks to maintain its tremendous fortune by screwing over the poor, impoverished bakers who ask for pennies and discarded Twinkies on which to live. It had nothing to do with the hard-line coming from the union that refused to accept the economic realities affecting virtually all businesses.

There is a false moral superiority often claimed by labor. Maybe it’s because the unions started off as a legitimate force against true unchecked greed. Or, maybe there’s something seemingly inherently noble about standing in the rain with a sign and a warm cup of coffee; but either way, unions talk a great deal about the nobility of the working man. But is it really so noble to, in harsh times, extort money from a company? Is it noble to sentence workers to the unemployment line rather than make the necessary cuts?

I am genuinely concerned about America’s willingness to scapegoat business. Profit is not a bad thing, and as people suffer hard times in this recession, we must resist the temptations to buy into the purposeful misdirection by the left to blame enterprise. Capitalism is not broken, it is the subversion of capitalism by over-regulation and over-unionization that are costing people their jobs.

What we saw with Hostess is a similar fiasco to our national economic malaise. We are heading to certain ruin with unsustainable, socialist practices, and as we head towards the fiscal cliff, we are still hearing about how we shouldn’t be looking to cut entitlement spending. As Obamacare takes hold, businesses are announcing that there will be consequences to the costly law, and people are outraged. Businesses need to remain profitable, and that is not greed- it’s just a fact. It’s time for Americans to grow up and learn how the world works.

The world has changed and everyone in both the public and private sectors needs to accept the fact that when the money’s gone, it’s gone, and act accordingly.

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One Response to Union Greed and the Death of the Twinkie

  1. dana martin says:

    What happened to employees getting annual raises and merit raises when we work for successful companies/corporations? What happened to employer contributions into 401k plans like they match our contribution dollar for dollar, why do they contribute 50% in company stock instead of real money? They do rally each quarter with us to let us know how much of the market we have conquered and how much earnings have gone up/off the industry chart! Just looking for a real answer. Thanks.

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