Hostess closing

[PilotMan]

Molson, I admire you persistence in this fight, and I appreciate your viewpoint. However, your view is a fairly recent evolution in US business ethics and practices. Up until the last 30 years or so, the idea was that the management and the labor were in the same pool and that companies were built from the inside out, not from the top down.

[RainMaker]

Originally Posted by molson

Ya, that's probably true, I'm being too general here with my labor/management perception pet peeves. I don't know anything about Hostess's specific situation. It appears they were terrible. I just don't totally get the heartburn/blame over the raises part of it. I think they destroyed the company through business incompetence.

I think it has to do with their incompetence costing 18,000 people jobs. That's a part of life and business obviously, but I think it got ramped up when they essentially blamed workers for not taking huge cuts as the reason the business failed. I don't think there would be as much backlash if they just closed down without taking shots at employees.

[molson]

Originally Posted by larrymcg421

If I was asked to take concessions to almost half of my original pay and get worse benefits, while the management was giving themselves huge raises, I'd be pretty fucking angry. I wouldn't care whether those raises were the direct reason why I had to make the concessions. I really don't understand anyone who wouldn't angry in this scenario.

If they're acting lawfully, management can't give themselves raises (unless its a private company and the management and the ownership is the same.) If they're not acting lawfully, we definitely need to do a better job in the criminal enforcement end of this. I'm all for that - I think the government has done a better job of going after corporate criminals but there's a lot more room for improvement still. It'd also be a nice little boost to the legal job market for prosecutors and investigators to go all in on this.

[sterlingice]

Originally Posted by Suburban Rhythm

Every time I open this thread I keep thinking -

Yo, Ding Dong man...Ding Dong...Ding Dong, yo!"

My favorite Weird Al video. I love the intro, especially

SI

[PilotMan]

Originally Posted by molson

If they're acting lawfully, management can't give themselves raises (unless its a private company and the management and the ownership is the same.) If they're not acting lawfully, we definitely need to do a better job in the criminal enforcement end of this. I'm all for that - severe crackdowns on corporate crimes.

But that's just it. It's all done legally, but not ethically. Before Delta and Northwest filed for bankruptcy on the same day, then ended up merging, the Delta management legally gave themselves 5 million dollar golden parachute retirement plans that were totally protected from the bankruptcy. The employees were never in a position to do the same thing, and were forced to concede millions and lost the vast majority of their retirement themselves. Hell, the amount of concessions my small company made, that would supposedly make us competitive wasn't even close to the amount of guaranteed money that the upper management made off with. And it was all legal.

[RainMaker]

Originally Posted by molson

If they're acting lawfully, management can't give themselves raises (unless its a private company and the management and the ownership is the same.) If they're not acting lawfully, we definitely need to do a better job in the criminal enforcement end of this. I'm all for that - I think the government has done a better job of going after corporate criminals but there's a lot more room for improvement still. It'd also be a nice little boost to the legal job market for prosecutors and investigators to go all in on this.

I don't think anyone is arguing the legality of anything. I think people are just saying those people are morally bankrupt human beings.

[molson]

Originally Posted by PilotMan

But that's just it. It's all done legally, but not ethically. Before Delta and Northwest filed for bankruptcy on the same day, then ended up merging, the Delta management legally gave themselves 5 million dollar golden parachute retirement plans that were totally protected from the bankruptcy. The employees were never in a position to do the same thing, and were forced to concede millions and lost the vast majority of their retirement themselves. Hell, the amount of concessions my small company made, that would supposedly make us competitive wasn't even close to the amount of guaranteed money that the upper management made off with. And it was all legal.

I think the better argument is that practices like that should be illegal, rather than that they just shouldn't do it for ethical reasons.

Like I was saying, ethics in business is tricky. Because ethics are an individual thing. Corporations have no morals, good or bad. The public can punish them economically for perceived "immoral" conduct, but at the end of the day, the corporation, as an entity, only reacts to that kind of thing for business reasons.

I'm not saying we shouldn't criticize individuals who work for corporations who act unethically, when that conduct can be isolated. But when we're evaluating the activities of broader "management" or "corporations", ethics are less and less useful as a tool for evaluation, I think. One guy in one of those broader groups doesn't necessarily have the legal and contractual authority to act in the way we'd like companies and management to act as whole. That's why laws are so important. Unfortunately, we can't rely on "management" or "corporations" to act, as entities, in ethically responsible ways.

[RainMaker]

The only law I think that could be made is that you can't run up your executive salaries right before you file bankruptcy. Sort of like how it's illegal to run up your credit cards with luxury items 90 days before filing personal bankruptcy.

Top executives who knew of the situation and yet still raised salaries should be responsible for paying those expenses out of their pockets toward the creditors.

[Blackadar]

Originally Posted by molson

Ya, that's probably true, I'm being too general here with my labor/management perception pet peeves. I don't know anything about Hostess's specific situation. It appears they were terrible. I just don't totally get the heartburn/blame over the raises part of it, that's such a minor thing to me in the bigger picture. I think they destroyed the company through business incompetence. And if they did anything illegal to destroy the company or profit from its destruction, I hope they get locked up. But my hunch is (ya, a hunch, no data), is that this brand just didn't evolve and was therefore doomed. Is anyone surprised Hostess failed in 2012? Except that it took so long?

The raises are minor - they're just indicative of the gross mismanagement of the company.

The thing that set me off on Page 1 was the whole "unions destroyed us" rhetoric that was spoon fed to the media. That's what everyone grabbed on to. I heard the whole anti-union shit in SPADES around my right-wing office that day. It's an outright lie that's so intellectually dishonest I'd love to see management get sued for slander for that kind of this (though the unions would lose in court due to the narrow definition of slander). But that's all that 90% of the people who heard about this story will every know - "unions destroyed the twinkie". It's untrue, unfair and someone should get beaten in a dark alley for that kind of lie.

As for your last statement, Hostess shouldn't have failed. Did Hershey or Mars go bankrupt? Little Debbie? McKee Foods? Pepsico? Frito Lay? There's plenty of room in the market for sweet snacks. Hostess *should* dominate the market - it's what many of us grew up with in our lunchboxes. We should be putting it in our kid's lunchboxes. Yet we don't because the product quality isn't great, the prices are too high and their visibility in the supermarket has declined. The Hostess brand can be more than viable again with some decent management.

[Blackadar]

Originally Posted by molson

Corporations have no morals, good or bad.

Hence the reason that making corporations "people" was a monumental mistake by the Supreme Court.

[molson]

Originally Posted by Blackadar

Hence the reason that making corporations "people" was a monumental mistake by the Supreme Court.

Ya, I tend to agree with that, at least when they're acting within the legal invention that is a corporation. (though that would require legislative action to ensure corporations have free speech, and are not subject to unreasonable searches and seizures, but that's a whole other thing, and I agree with the spirit of what you're saying). I'm not as sure when it comes to non-profits, but I know there's an incorporation process there too.

[CrimsonFox]

Originally Posted by sterlingice

My favorite Weird Al video. I love the intro, especially

SI

LOL! Yeah that is one of my favorite lines ever! HAHA

Yo Ding Dong man, Ding Dong. Ding Dong yo!

[sterlingice]

Originally Posted by CrimsonFox

LOL! Yeah that is one of my favorite lines ever! HAHA

Yo Ding Dong man, Ding Dong. Ding Dong yo!

I love the nervous but mostly nonchalant "Oh you know, around" followed by more and more agitation until it erupts into "You ain't fat. YOU AIN'T NOTHING!"

SI

[CrimsonFox]

Originally Posted by sterlingice

I love the nervous but mostly nonchalant "Oh you know, around" followed by more and more agitation until it erupts into "You ain't fat. YOU AIN'T NOTHING!"

SI

the bad acting is what sells it (and pulling a piece of pizze from his pocket)

[DaddyTorgo]

Originally Posted by molson

I think the better argument is that practices like that should be illegal, rather than that they just shouldn't do it for ethical reasons.

Like I was saying, ethics in business is tricky. Because ethics are an individual thing. Corporations have no morals, good or bad. The public can punish them economically for perceived "immoral" conduct, but at the end of the day, the corporation, as an entity, only reacts to that kind of thing for business reasons.

I'm not saying we shouldn't criticize individuals who work for corporations who act unethically, when that conduct can be isolated. But when we're evaluating the activities of broader "management" or "corporations", ethics are less and less useful as a tool for evaluation, I think. One guy in one of those broader groups doesn't necessarily have the legal and contractual authority to act in the way we'd like companies and management to act as whole. That's why laws are so important. Unfortunately, we can't rely on "management" or "corporations" to act, as entities, in ethically responsible ways.

Who's going to write those laws into practice though man? It's all well and good to say they should be illegal, but the CEO's are the ones who can afford to fund the campaigns of the lawmakers and hobnob with them - they'll make sure that kind of stuff is never wrtten into law.

You can't just wash your hands of it by saying it should be written into law when that's not realitically going to happen.

[molson]

Originally Posted by DaddyTorgo

Who's going to write those laws into practice though man? It's all well and good to say they should be illegal, but the CEO's are the ones who can afford to fund the campaigns of the lawmakers and hobnob with them - they'll make sure that kind of stuff is never wrtten into law.

You can't just wash your hands of it by saying it should be written into law when that's not realitically going to happen.

That's true, the general public has a ton of power in a free economy too, if they refused to buy products from companies whose CEO's salaries were deemed to be too high, that would have a big impact. The general public could frame the reason for that stance as "ethics", and even though I don't think it's a ethics issue, it doesn't really matter how they frame it, if they did it, it would make a difference. We might have better luck with laws and enforcement of them though. I think there's already been progress there.

[PilotMan]

Originally Posted by molson

That's true, the general public has a ton of power in a free economy too, if they refused to buy products from companies whose CEO's salaries were deemed to be too high, that would have a big impact. The general public could frame the reason for that stance as "ethics", and even though I don't think it's a ethics issue, it doesn't really matter how they frame it, if they did it, it would make a difference. We might have better luck with laws and enforcement of them though. I think there's already been progress there.

I enter as exhibit "A"; Walmart.


---Price will always be the bottom line with the public. And I'm right there, hell, I own stock in the damn company. I still prefer Target though.

[SteveMax58]

Originally Posted by DaddyTorgo

Who's going to write those laws into practice though man? It's all well and good to say they should be illegal, but the CEO's are the ones who can afford to fund the campaigns of the lawmakers and hobnob with them - they'll make sure that kind of stuff is never wrtten into law.

You can't just wash your hands of it by saying it should be written into law when that's not realitically going to happen.

I think the first step to anything like this is having a publicly organized thinktank that can put forth parameters around a tiered classification system of company performance/exec compensation/manager compensation/worker compensation. Not unlike a "green" rating...the system would attempt to identify & link "reasonable" executive compensation, relative to company performance metrics, and contrast that to worker compensation (adjusted for the perceived skillsets needed to perform job functions).

In all likelihood...such a thinktank would be a liberal thinktank (whether perceived or reality) but the key here is to start with voluntary adoption. Mainly small companies would adopt this initially (especially those looking to attract a certain type of worker with a certain type of skillset) but there is a point where it could hit critical mass & gain acceptance to the point of becoming law. Or in lieu of "law", could be used as the basis for tax breaks & public benefits...i.e. you fit this criteria, you gain "too big to fail" status as you qualify as a company "looking out for its workers".

While I tend to fall on the "let the market decide" crowd...I can speak firsthand at the ease of which a former CEO of mine was able to essentially loot the company. And I can tell you that as much as we'd like to think other executives would notice this & take action...they simply won't (especially if the CEO/CFO are smart enough to include them in the looting).

A classification system (if adopted) would effectively serve as the market balance to those with the power to control compensation & be (properly) accountable to the general public.

[JPhillips]

You could do greater transparency and a real say by shareholders easily if there was political will. That wouldn't solve everything, but it would be a good start.

It might be possible to divorce compensation decisions entirely from the management and stop cross pollination of corporate boards, but I'm not sure if that is really feasible.

[SteveMax58]

Originally Posted by JPhillips

You could do greater transparency and a real say by shareholders easily if there was political will. That wouldn't solve everything, but it would be a good start.

It might be possible to divorce compensation decisions entirely from the management and stop cross pollination of corporate boards, but I'm not sure if that is really feasible.

Yeah, I agree with the end result of eliminating the "exec network" that keeps itself safe via the boards but I dont think you get there by waiting for the government alone to do it. Who would even propose it today aside from Sanders & a few others?

The very people who are elected to government positions want to have "job security" themselves after their public service is done. So they have a natural incentive to play ball & feed the corporate network (if we assume no worse motivation such as direct bribery) with executives at corporations as they are their future employers. Lets face it...you dont go from being a congressman to working in a hostess bakery. Hence why there is such disparity in definition of "the people" that they are serving.

I don't mean to suggest shaming alone will unravel anything there. But we cannot expect the very people who benefit from corruption to initiate it's demise. It has to start with a bipartisan (to the extent possible) group of economists & business people that have give a crap about people that cannot afford to live in their neighborhood. But it has to be serious people with legitimate credentials who can get the attention of the Buffets, Gates, Bransens of the world with their name attached to it (or summation of names at the least).

[Abe Sargent]

A large truck came into teh Hostess store today and people were grabbing boxes and crates of snak cakes, unloading them into their carts en massee, and buying hundreds of items in one purchase. It was crazy.

[JPhillips]

Originally Posted by SteveMax58

Yeah, I agree with the end result of eliminating the "exec network" that keeps itself safe via the boards but I dont think you get there by waiting for the government alone to do it. Who would even propose it today aside from Sanders & a few others?

The very people who are elected to government positions want to have "job security" themselves after their public service is done. So they have a natural incentive to play ball & feed the corporate network (if we assume no worse motivation such as direct bribery) with executives at corporations as they are their future employers. Lets face it...you dont go from being a congressman to working in a hostess bakery. Hence why there is such disparity in definition of "the people" that they are serving.

I don't mean to suggest shaming alone will unravel anything there. But we cannot expect the very people who benefit from corruption to initiate it's demise. It has to start with a bipartisan (to the extent possible) group of economists & business people that have give a crap about people that cannot afford to live in their neighborhood. But it has to be serious people with legitimate credentials who can get the attention of the Buffets, Gates, Bransens of the world with their name attached to it (or summation of names at the least).

I definitely agree with shaming. Part of the solution is encouraging a very public exposure of corporate heads that are looting their companies. I like the idea of an almost Better Business Bureau approach for compensation issues.

[CrimsonFox]

Hostess Chapter 11 trustee sought by Bakery Workers’ union - KansasCity.com

[Galaxy]

Originally Posted by Blackadar

Hence the reason that making corporations "people" was a monumental mistake by the Supreme Court.

This never bother me, as long as unions and religious organizations have the same rights that the corporations got. I would like to see a outlaw ban on it all, however.

[Jacob Typer]

I already miss mytwinie

[Young Drachma]

Hostess wins OK to give execs up to $1.75 million in bonuses - latimes.com

Hostess Brands Inc., in the midst of winding down its business, won approval Thursday from a federal bankruptcy judge to give as much as $1.75 million in bonuses to its executives.

The money is intended as an incentive for 19 top-level managers to remain with the Twinkies and Ding Dongs maker to oversee its liquidation.

The payouts will be granted only if managers "achieve a set of specific tasks and goals within a specified time frame that are designed to speed and lower the cost of the wind-down," Hostess spokesman Lance Ignon said.

The maximum bonus amount, Ignon said, represents 0.07% of Hostess' revenue and 0.17% of the value of its assets and is below the average for bonuses in comparable bankruptcy cases. Hostess Chief Executive Greg Rayburn would be not be eligible for a bonus, Ignon said.

U.S. Bankruptcy Judge Robert Drain in White Plains, N.Y., also agreed Thursday to grant final approval for Hostess to sell its cult-favorite brands and shut down its operations for good. The company filed for bankruptcy after a battle with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union. The union accused the company of slashing wages and benefits while bumping up executive pay.

Last week, Drain gave interim approval to the liquidation, which is expected to take about a year. Hostess' closure would result in more than 18,000 workers losing their jobs.

[molson]

If they split that among all 18,000 employees instead they could have given them all a one-time payment of $100.

Even the leftover staff of Enron got bonuses to wind down the company. It's kind of a dead-end job. And it's kind of tough to bring in new talent to do it.

[Abe Sargent]

The local store here in KOP still had Twinkies today, but not in boxes, just the two packs. They had a ton of snack cakes but nothing left. They said that Monday would likely be their last day, open from 10 to 3, closed tomorrow. That was likely my last trip to Hostess


When I was a child, my grandmother's farm in Clarksbug WV needed bread for the animals. So we would take a truck tot eh local Hostess store and collect their expired bread for them free of charge, and then use it to feed the animals, such as ducks and stuff. Moldy bread is fine for them, and the store managed to get rid of their stuff without spending any money or work hours.

When were we at the store, my grandmother would always buy me one snack cake as a gift. Every single time, i would get a Honey Bun.


Here's to Hostess, Wonder Bread, and all of the many days I've spent with them and their products.

[stevew]

I, for one, now welcome our new TastyKake overlords

[sterlingice]

I guess it's up to me to do the thread necromancy

http://money.cnn.com/2013/03/19/news...ead/index.html

Originally Posted by story

A bankruptcy judge has given final approval for the sale of Twinkies, Wonder Bread and many of Hostess Brands' other assets, clearing the way for the iconic products to return to shelves.

SI

[21C]

Hostess: Twinkies to return to shelves July 15 - Yahoo! News

[BYU 14]

I just want zingers