Seems like this could help the Little Debbie company and Tennessee (Little Debbie is based in Chattanooga).

18,500 people are out of work. That is funny to you?

You are funny to me!

No, it's not funny. The post is funny. The closing isn't. It's sad. The company has been through a string of bankruptcies and mergers and acquisitions, and is now owned by an equity capital company (similar to Bain Capital). It sounds like they have been mismanaged for quite some time, and keep asking the unions to make up for their failures. The unions said enough, and the company is using that as an excuse to exit the business they apparently can't run. Atlas shrugging, and all that. Their competitors will move in and many of these workers will get jobs with them if they want.

Per CNBC, all that's certain is that the only victors here look to be two "vulture funds" (hedgies), Silver Point and Monarch.

They nabbed a 60% interest in the company, presumably for pennies on the dollar, following Hostess's last bankruptcy.

Everybody else now loses.

(Do follow the link therein to David Kaplan's Fortune article, which is also interesting reading.)

Edit: Shoulda said Silver Point and Monarch bought 60% of Hostess's debt. Their interest isn't an equity interest. Mea culpa.

Among those 18,500 workers are employees in Chattanooga and Knoxville. Chattanooga employees were striking and 60 percent of the Knoxville employees were honoring the strike.

They had been asked to take an immediate 8 percent wage reduction take on 20 and percent more of the healthcare costs. There was also an elimination of the retiree medigap insurance and a pension supplement used to pay health and funeral costs. as well as elimination of an eight-hour work day and there had been closure of 12 plants with a refusal to tell the union which plants are profitable, which plants will be closing.

They are in a National Labor Relations Board dispute over Hostess' refusal to honor pension obligations to the workers' pension funds.

Little Debbie saves the day.

Edit: Nevermind

Heard from a friend they laid off workers today. But she stated her bother-in-law had his wages cut $20k the last few years, halving his salary.

If the fight is working for a livable wage or acquiescing to working below the poverty line, it kind of makes the decision easy doesn't it?

in rejecting their contract. Ironically, the Teamsters, the guys that drive the trucks, approved the contract as it pertains to their routes, schedules, deliverables, and their wages.

American's eating habits are changing one way or the other and this one looked like a very easy decision for management and for the labor leadership, nobody was happy, lets just shut the thing down and let the pieces fall where they may. They can place the thing in bankruptcy court, but divorce courts may be better suited to wind up this unfortunate experience of a corporate catastrophe.

By the way, McKee Bakery is a non union shop, headquartered in a right to work state, and they are looked at as the potential purchaser for certain Hostess assets and a potential "savior" of some of the 18,500 union jobs that just vanished in the liquidation of Hostess.

Statement from the BCTGM cross posted on the AFL-CIO website (emphasis mine).

Over the past eight years since the first Hostess bankruptcy, BCTGM members have watched as money from previous concessions that was supposed to go toward capital investment, product development, plant improvement and new equipment was squandered in executive bonuses, payouts to Wall Street investors and payments to high-priced attorneys and consultants.

BCTGM members are well aware that, as the company was preparing to file for bankruptcy earlier this year, the then-CEO of Hostess was awarded a 300 percent raise (from approximately $750,000 to $2,550,000) and at least nine other top executives of the company received massive pay raises. One such executive received a pay increase from $500,000 to $900,000 and another received one taking his salary from $375,000 to $656,256.

Over the past 15 months, Hostess workers have seen the company unilaterally end contractually obligated payments to their pension plan. Despite saving more than $160 million with this action, the company continues to fall deeper and deeper into debt. A mountain of debt and gross mismanagement by a string of failed CEOs with no true experience in the wholesale baking business have left this company unable to compete or survive.

The Baining of Hostess.

I think the mismanagement of Hostess was a Right wing response to the legalization of marijuana in many states. Twinkie sales are strongly correlated with marijuana use, or so I've heard.

I have a friend who drove a '69 Ford pickup truck for years with a package of Twinkies on the dash in the hot sun. He always said it was there in case of an attack of the munchies.

Cue Fox and talk radio, e.g., Rush et. al., to preach this is what the workers wanted all along. Now they can get free unemployment, food stamps, and all the other wonderful so-called "gifts" from Obama.

Darn your union thuggery, Bronco Bama!

This was nothing but plutocrats draining the value out of a struggling company. It also happens to give the radio idiots and Faux News something to talk about...

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