“Incompetent Managers”: Vulture Capitalism Ate Your Twinkies
What happens when vulture capitalism ruins a great American company?
The vultures blame the workers.
The vultures blame the union.
And vapid media outlets report the lie as “news.”
That’s what’s happening with the meltdown of Hostess Brands Inc.
Americans are being told that they won’t get their Twinkies, Ding Dongs and Ho Hos because the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union ran the company into the ground.
But the union and the 5,600 Hostess workers represented by the union did not create the crisis that led the company’s incompetent managers to announce plans to shutter it.
The BCTGM workers did not ask for more pay.
The BCTGM workers did not ask for more benefits.
The BCTGM workers did not ask for better pensions.
The union and its members had a long history of working with the company to try to keep it viable. They had made wage and benefit concessions to keep the company viable. They adjusted to new technologies, new demands.
They took deep layoffs—20 percent of the workforce—and kept showing up for work even as plants were closed.
They kept working even as the company stopped making payment to their pension fund more than a year ago.
The workers did not squeeze the filling out of Hostess.
Hostess was smashed by vulture capitalists—“a management team that,” in the words of economist Dean Baker, “shows little competence and is rapidly stuffing its pockets at the company’s expense.”
Even as the company struggled, the ten top Hostes executives pocketed increasingly lavish compensation packages. The Hostess CEO who demanded some of the deepest cuts from workers engineered a 300 percent increase in his compensation package.
“Wall Street investors first came onto the scene with Hostess about a decade ago, purchasing the company and then loading it with debt. All the while, its executives talked of investments in new equipment, new research and new delivery trucks, but those improvements never materialized,” explains AFL-CIO president Richard Trumka.
“Instead, the executives planned to give themselves bonuses and demanded pay cuts and benefit cuts from the workers, who haven’t had a raise in eight years,” said the AFL-CIO head. “In 2011, Hostess earned profits of more than $2.5 billion but ended the year with a loss of $341 million as it struggled to pay the interest on $1 billion in debt. This year, the company sought bankruptcy protection, the second time in eight years. Still, the CEO who brought on the latest bankruptcy got a raise while Hostess demanded that its workers accept a 30 percent pay and benefits cut.”
When BCTGM workers struck Hostess, they did not do so casually.
They were challenging Bain-style abuses by a private-equity group—Ripplewood Holdings—that had proven its incompetence and yet continued to demand more money from the workers.
“When a highly respected financial consultant, hired by Hostess, determined earlier this year that the company’s business plan to exit bankruptcy was guaranteed to fail because it left the company with unsustainable debt levels, our members knew that the massive wage and benefit concessions the company was demanding would go straight to Wall Street investors and not back into the company,” recalled BCTGM president Frank Hunt, who described why the union struck Hostess rather than accept a demand from management for more pay and benefit cuts.
“Our members decided they were not going to take any more abuse from a company they have given so much to for so many years,” Hunt explained. “They decided that they were not going to agree to another round of outrageous wage and benefit cuts and give up their pension only to see yet another management team fail and Wall Street vulture capitalists and ‘restructuring specialists’ walk away with untold millions of dollars.”
On November 6, American voters rejected Mitt Romney and Bain Capitalism.
But that didn’t end the abusive business practices that made Romney rich. They’re still wrecking American companies, like Hostess.
Instead of blaming workers, we should be holding the incompetent managers to account and cheering on any and every effort to rescue Hostess from the clutches of the vulture capitalists.
By: John Nichols, The Nation, November 18, 2012
“It’s Not About Fundamentals”: The Internal Republican Phony War Intensifies
For the cynical-minded, today’s front-line reporting from the Struggle for the Soul of the Republican Party can induce bitter laughter: in response to “establishment” talk that Republicans need a clearer and more systematic conservative message that is marketed un-stupidly, some self-conscious conservative activists are “pushing back,” per a deeply confused WaPo piece from Paul Kane and Rosalind S. Helderman:
After nearly two weeks of listening to GOP officials pledge to assert greater control over the party and its most strident voices in the wake of Romney’s loss, grass-roots activists have begun to fight back, saying that they are not to blame for the party’s losses in November.
“The moderates have had their candidate in 2008 and they had their candidate in 2012. And they got crushed in both elections. Now they tell us we have to keep moderating. If we do that, will we win?” said Bob Vander Plaats, president of the Family Leader. Vander Plaats is an influential Christian conservative who opposed Romney in the Iowa caucuses 10 months ago and opposed Sen. John McCain’s candidacy four years ago.
So now the shallow trenches have been dug for the phony war:
The conservative backlash sets up an internal fight for the direction of the Republican Party, as many top leaders in Washington have proposed moderating their views on citizenship for illegal immigrants, to appeal to Latino voters. In addition, many top GOP officials have called for softening the party’s rhetoric on social issues, following the embarrassing showing by Senate candidates who were routed after publicly musing about denying abortion services to women who had been raped.
Yes, years from now conservatives will sit around campfires and sing songs about the legendary internecine battles of late 2012, when father fought son and brother fought brother across a chasm of controversy as to whether 98% or 99% of abortions should be banned; whether undocumented workers should be branded and utilized as “guest workers,” loaded onto cattle cars and shipped home, or simply immiserated; whether the New Deal/Great Society programs should be abolished in order to cut upper-income taxes or abolished in order to boost Pentagon spending. There’s also a vicious, take-no-prisons fight over how quickly to return the role of the federal government in the economy to its pre-1930s role as handmaiden to industry. Blood will flow in the streets as Republicans battle over how to deal with health care after Obamacare is repealed and 50 million or more people lose health insurance. Tax credits and risk pools or just “personal responsibility?”
Look, there could be a true “period for reflection” and “struggle for the soul of the Republican Party;” the list of heterodox conservative thinkers that David Brooks trots out in his latest New York Times column would provide a good starting point. The trouble is none of these people have a bit of influence over Republican political actors, particularly when they are heterodox. The real debate is between people like Reince Priebus and John Cornyn and people like Bob Vander Plaats and Ted Cruz. They are entitled to fight with each other all day long about how many zygotes could fit on the head of a pin, and how deeply the 47% have been corrupted into permanent serfdom. But the MSM really, really needs to show it understands this isn’t a fight about any kind of fundamentals.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, November 19, 2012
“Weird Science”: A Guide For Republican Candidates Asked About Earth Science
Twenty years or so ago, a few politicians got caught when somebody asked them the price of a gallon of milk and they didn’t know the answer. As a consequence, campaign managers and political consultants started making sure their candidates knew the price of milk and a few similar items like a loaf of bread, should they ever be called upon to assure voters that they do in fact visit the supermarket and are thus in touch with how regular folk live their lives. In a similar but somewhat more complex game of gotcha, Marco Rubio is the latest Republican politician to express discomfort about the question of the earth’s age. Unfortunately, unlike the price of milk, that’s not a question upon which people of every ideology agree. But if you’re a politician wondering what you should answer if you get asked the question, here’s a guide to the possibilities, and what each one says about you. There are four possible answers:
1. “The earth is approximately 4.5 billion years old.” This answer says more than, “I have memorized this particular fact.” By being stated as a fact, it communicates not only that you accept that the work of physicists and geologists is a more helpful guide to this question than counting up the “begat”s in the Old Testament, but also that you also aren’t particularly afraid of those who believe otherwise. It also might indicate that you are a believing Catholic, since the Vatican, not exactly a bastion of progressive thinking, is totally fine with the science on this one.
2. “I’m not sure of the exact number, but it’s in the billions.” Much like answer number 1, this one marks you as someone who is pro-science. But it says you aren’t a know-it-all, so that might make it go down a little easier with the folks back home.
3. “I’m not a scientist, man. I can tell you what recorded history says, I can tell you what the Bible says, but I think that’s a dispute amongst theologians…” This is Rubio’s answer, and it means, “I’m a Republican with national aspirations.” You’ll notice how he cleverly offers something for everyone. By saying “I’m not a scientist,” he acknowledges that a scientist might be able to tell you the age of the earth, as opposed to telling you the approved propaganda of the International Scientific Conspiracy. But then he says “that’s a dispute amongst theologians,” which I’m not even sure is true (do theologians really argue about this?), but in any case winks to the Republican base that maybe Rubio thinks the real answer is to be found in whether you assign each “begat” 20 years or 25 years. So if you’re a Republican, this is safe territory. Although I have no idea whether this applies to Rubio, this is also what you say if you know full well how old the earth is but are afraid that you’ll offend the rubes if you say so.
4. “The earth is somewhere between 6,000 and 9,000 years old.” This answer says, “I’m a Republican from a safe conservative district.” Not all Republicans from safe conservative districts believe this, but I’m pretty sure that everyone in Congress who does believe it is a Republican from a safe conservative district. As Representative Paul Broun of Georgia recently put it so colorfully, “All that stuff I was taught about evolution and embryology and the Big Bang Theory, all that is lies straight from the pit of Hell. And it’s lies to try to keep me and all the folks who were taught that from understanding that they need a savior. You see, there are a lot of scientific data that I’ve found out as a scientist that actually show that this is really a young Earth. I don’t believe that the earth’s but about 9,000 years old.” For the record, despite what he said, Broun is not actually a scientist, though he did somehow manage to obtain a medical degree, which of course makes him an expert in geology, enabling him to sift through “a lot of scientific data” and determine that every actual scientist is wrong about this question.
So those are your options. I don’t know if any of the Republicans who will soon be lining up for 2016 will be asked this question, but if they are, I’m betting they’ll all choose answer number 3.
By: Paul Waldman, Contributing Editor, The American Prospect, November 19, 2012
“Homemade Trail Mix”: Obama-Fearing Gun Nuts Are, Well, Nuts
There seems to be a little confusion on the part of gun enthusiasts about what a second Obama term means for them, and how they can battle any efforts to control their firearms ownership.
First, there are the nervous sorts who raced out and bought guns rights away after President Obama was re-elected. The subtext is that somehow this president will take away their guns—and yet there is no evidence to indicate that. In fact, the opposite is true: Obama has not only not done anything to advance gun control, but he actually expanded gun rights early in his term, signing a law that allows people to bring guns onto federal land.
Nor does the ongoing Democratic majority in the Senate pose a plausible threat. The Democrats, while perhaps at heart in favor of sensible limits on guns, figured out a long time ago that they will only be the majority party if they keep pretty quiet about that—and allow some of their recruits to be staunchly pro-gun.
But while that seems a tad hysterical, as a reaction to Obama’s win, it’s positively rational compared to the behavior of the owner of an Arizona gun shop. Says a full-page newspaper ad in the White Mountain Independent:
If you voted for Barack Obama your business is NOT WELCOME at Southwest Shooting Authority. You have proven you are not responsible enough to own a firearm.
There are some obvious inherent problems with this policy. For one, how will the owner know whom a potential buyer voted for in the election? Secondly, wouldn’t a gun-owning, pro-Obama voter be more likely to pull the party even closer to an embrace of the Second Amendment (omitting the inconvenient part about a “well-regulated militia”)? And if someone opposes gun control, why initiate a de facto limit on gun ownership by denying your firearms business to the 51 percent of voters who indeed chose Obama?
Perhaps the owner believes there will be, as a Texas judge irresponsibly and irrationally predicted, some sort of civil war provoked by Obama’s re-election—and maybe he doesn’t want the other side to have guns. Or maybe it’s just about the “other”—Obama’s race, his unusual name, and the legions of African-Americans, Latinos, gays, lesbians, single women and everyone else who doesn’t fit into the Ward Cleaver mode—that are giving the gunshop owner such a case of the nerves. He might want to get used to it. He’s now in the minority.
By: Susan Milligan, U. S. News and World Report, November 19, 2012
“The Nile Is Not A River In Egypt”: Republicans Can’t Face Post-Election Reality
The Nile is not a river in Egypt; it’s the post-election operating principle for Republicans and conservatives. Rather than face reality many Republicans would rather stick their heads in the sand and complain about the voters. In his political thriller Julius Caesar, Shakespeare wrote “The fault, dear Brutus, is not in the stars, but in ourselves that we are underlings.” If Republicans want to get on track, they need to take a hard look at themselves and not blame everything on Mitt Romney.
Many conservatives and Republicans share Romney’s disdain for voters. I like to watch the Fox News Channel when things go badly for Republicans, so I’ve been watching the Fox News Channel a lot lately. I enjoy hearing the excuses that their commentators make for the GOP. The spin out of GOP-TV is that President Barack Obama won because voters are stupid, selfish, or sinful. Now, there’s a winning campaign message for you. Conservative columnist George Will said Sunday on ABC that the Republican Party must “quit despising the American people.” I knew that if I waited long enough, I would agree with Will on something.
The national GOP candidates have also put their heads deep into the sand.
Mitt Romney jumped in immediately after Election Day to remind the public of just how clueless he is. He blamed Barack Obama for his loss. Romney told big money donors that he lost because of the president’s “gifts” to young people, blacks, and Hispanics. Most people think that the things that Romney described as gifts are just basic human rights. One of these “gifts” was ending deportation for people who came to the United States as children with undocumented parents. President Obama ended the deportation because he believed the U.S. government should not punish children for their parents’ mistakes. Voters do not share the GOP’s hostility to immigrants. Data from the national Election Day exit survey indicated that two thirds (65 percent) of the voters want to create a path to citizenship for illegal immigrants while only a quarter (28 percent) of the voters felt that the government should deport them.
Romney’s running mate is just as clueless. Rep. Paul Ryan said that the election was not rejection of GOP tax policies. He was wrong. The former GOP vice presidential candidate apparently didn’t read the national exit poll that showed that almost half (47 percent) of the voters want to raise taxes on Americans who live in households where the total annual income is over $250,000. A small group (13 percent) of voters want to raise everyone’s taxes and only a third (35 percent) of the electorate oppose any tax increase.
If all else fails, blame the weather. I have seen or heard a few GOP pundits say that Hurricane Sandy blew Mitt Romney off course. If Republicans believe that it was Sandy that took the wind out of Romney’s sails, they face a long winding road back to the White House.
To be fair some conservatives got it. Both Sean Hannity and Charles Krauthammer endorsed amnesty for undocumented workers after the election results rolled in. Good for them, they are realistic enough to fear the impact that a growing Latino population will have on the future of the GOP.
But some of the solutions that conservatives have offered aren’t particularly constructive. One of our readers @MaltaSiege suggested that “all liberals should hang themselves.” I assume that includes me. Just to be sure I got the message, Mal was kind enough to include a picture of a noose. Even if we had enough rope to hang ourselves, I don’t think the 62 million Americans who voted for Barack Obama want to leave this earthly coil now that they re-elected a president who wants to eliminate tax breaks for billionaires and who will fight to allow people to marry anyone they choose without government interference.
Not all our readers appreciate my thoughts on the condition of the GOP and the conservative movement. Years ago, I told a female friend that I had finally figured out what makes women tick. My friend replied in horror, “What do you know about women, you’re a man?” I replied “We’re all people, aren’t we?” Well, some of you may resent my comments about Republicans, since I’m a Democrat. But we’re all Americans, aren’t we?
By: Brad Bannon, U. S. News and World Report, November 19, 2012
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