Let me tell you something you might be unfamiliar with: companies that cannot manage their affairs properly will end up in bankruptcy. They will owe more to those who provide it with goods and services than they can collect. This happens when companies cannot (or will not) adjust their operations to accommodate changes in market conditions or regulatory environments.
The cost structure of Hostess made them uncompetitive. And unions are a big part of the reason why they could no longer compete effectively.
You're free to disagree with my analysis but you're not entitled to your own facts. A company that goes bankrupt several times is prima facie evidence of poor management. And by poor management, I mean management that could not or would not deal with a major cost of their operations: labor.
If Hostess hadn't gone into bankruptcy, we wouldn't be having the argument at all. Private equity would have never swooped in to buy up the distressed assets, free itself of the onerous union contracts and poorly negotiated supplier agreements to rise from the ashes.
I can still buy Twinkies and I have private equity firms to thank for it. Not unions.
So when it's labor's fault it's labor's fault. Also when it's bad management then it's labor's fault. And when it goes bankrupt it's because labor is greedy and wants too much money. And later when management siphons hundreds of millions of dollars out of the company that's not because they are greedy and want too much money.
Uh, no. I think I was very clear that I blame management for incompetence. They didn't manage their way out of it and cut REALLY BAD DEALS with the unions.
And believe me, I think the unions share some of the blame here. They negotiated terms for their members that included overly generous pension terms because one of the things that unions like to do now is control member pensions. And when they control member pensions, they have a nice pot of money to invest for their members behalf (har har har) until they do such a bad job of it that they need someone to blame (that greedy company).
That particular story has played out over and over again because union management swings investment funds to "favored" firms which court pension funds aggressively (read: kickbacks).
Think I'm making this stuff up?
Do your own research and tell me if you can find any examples of union-run pension funds exceeding the market performance of something like an index fund. Do pension funds even have to meet the disclosure and transparency requirements of your garden-variety mutual fund?
That is total unmitigated bullshit.
Source: https://www.nytimes.com/2016/12/10/business/dealbook/how-the...