In the east- the coal industry is unionized. In the west- it is not. While some of this has to do with demographics, it is also the mindset of the people. Folk music is filled with the sorry stories of the coal miners daughter- and the poor coal miner who has no option other than to work underground for the evil corporation who pays nothing.
If you think like a loser- you will become a loser. Of course, none of those people are forced to work for those companies, and if those companies had a problem filling those positions then they would have to raise wages until they could attract the labor, but the fact is that those companies out east have no problem finding people to fill those positions. The economy historically did very poorly, and working for the coal company was actually the best gig in town.
In the west - the average coal industry worker makes over $85,000 a year, and with a little overtime - many of those workers make well over $100,000 a year. Over the years, the unions have tried time and time again to get those employees to join the union- without any success. It's because the companies value their workers and pay them very well. The workers also know they get a better deal without the union then they would get with a union, so they vote down every attempt to organize them.
It's not a matter of paying them more so they won't unionize, it's a matter of supply and demand. So companies out west need to pay well in order to attract the labor. These workers also have many more options for employment then do their counterparts out east. A guy could quit a coal company and go work for a gas company the next week.
Unions no longer lift all boats- in fact in an economy like we have seen for the last 4 years, they have been the catalyst that destroys jobs.
Hostess is a perfect example of this. This is not the first time Hostess Brands has entered bankruptcy. Weighed down by an balance sheet heavy with debt and pension obligations, costly labor rules, and declining sales, the company sought bankruptcy protection under Chapter 11 in 2004.
After nearly five years in bankruptcy, Hostess emerged in 2009 under the control of a private equity firm called Ripplewood Holdings, which invested $130 million of new capital in the company.
The lenders, led by the hedge funds Silver Point and Monarch, agreed to provide a new secured loan of $360 million, forgive half the existing debt, and exchange the rest of that debt for a payment-in-kind loan.
This wasn't enough to save the company.
The company's sales declined and attempts to roll-out new products more in line with changing consumer tastes flopped. Ripplewood put tens of millions more into the company in the form of new equity and subordinated debt. Silver Point and Monarch put in another $30 million and then, after the company filed for Chapter 11 again in January of this year, another $75 million.
Time and time again- private investors poured millions and millions into trying to save the company- but the union costs were just too much to overcome. Those investors lost everything. The reality of a company who has a balance sheet heavy with debt and pension obligations, costly labor rules, and declining sales finally caught up with them.
Sorry - but it's not bad management that caused the company to fail- but it might have been bad management to try over and over to save a company that no longer can make a profit in this economy.
The unions have regulated themselves out of business.
I see you still don't believe in providing attribution for your posting of someone else's material.
Calling debt-loading an "investment" is laughable. They borrow money, load up the company, charge the company outrageous "management fees", and the debt they "invested" (read: loaded up debt) belongs to the company. Then they pay themselves with 300% salary increases and try to escape with the money in the pension funds by doing a quick bankruptcy.
Don't make me laugh.
Since you didn't bother to attribute your posting, I found at least one source:
http://www.cnbc.com/id/49853653
By the way, John Carney, is one of the usual right-wing capitalist-writers allied with .... wait for it.... The Tea Party... (Imagine my surprise...)
"Seems like only one month and eighteen days since the debacle that was Clusterstock finance blogger John Carney's firing from Business Insider. Well, after it being originally reported on Guest of a Guest - Guest of a Guest? - we've now confirmed with John Carney what we'd previously heard, which is: he's got a new gig, and it's with CNBC."
Blazer Bob wrote: The Twinkies bankruptcy is a classic example of costs created by labor unions that are not confined to paychecks."......................
No, actually, the Twinkies bankruptcy is a classic case of vulture-capitalist company coming in, demanding wage and benefits concessions from the employes (in 2004) on the promise that they would restructure. After restructuring, they basically blew it all on salary increases for execs, not paying their required share of the pension funds, and loading the company up with debt, and then looking for a way to go bankrupt again, pocket the pension money and dump the obligation on the US Government (Read: TAXPAYERS) by having it taken over by the U.S. Pension Guarantee Trust Fund.
God, I love how FauxNews ignores the truth and to fabricate union blame when it was p*ss-poor management and business decisions that put them where they are. But, hey, for the :Koolaid: drinkers this is just standard business-as-usual.
Fox News placed the blame for the planned liquidation of Hostess Brands squarely on a labor dispute with one of the company's unions. In fact, Hostess' unions had previously made significant concessions when the company went through a failed bankruptcy, and Hostess had many problems beyond labor costs, including an inability to adjust to changes in consumer tastes, which contributed to its bankruptcy.
Hostess Blames Union For Bankruptcy After Tripling CEO’s Pay
But while headlines have been quick to blame unions for the downfall of the company there’s actually more to the story: While the company was filing for bankruptcy, for the second time, earlier this year, it actually tripled its CEO’s pay, and increased other executives’ compensation by as much as 80 percent.
At the time, creditors warned that the decision signaled an attempt to “sidestep” bankruptcy rules, potentially as a means for trying to keep the executive at a failing company. The Confectionery, Tobacco Workers & Grain Millers International Union pointed this out in their written reaction to the news that the business is closing:
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.
Certainly, the company agreed to an out-sized pension debt, but the decision to pay executives more while scorning employee contracts during a bankruptcy reflects a lack of good managerial judgement.
Matt Taibbi: Hostess' 'Incompetent' Management Killed The Company
Hostess announced Friday that the company planned to liquidate and lay off all of its 18,500 workers, citing an ongoing strike that the company claimed was crippling its operations. On Monday, a bankruptcy judge ordered that Hostess enter into mediation with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, the group representing the striking workers, saying that he had “serious questions as to the logic behind this strike.”
The Teamsters, the other union representing Hostess workers, agreed to major pay and pension cuts in September in an aim to save the company and their jobs, even though they had already taken a hit during the company's first bankruptcy.
Taibbi argued that Hostess’ workers are being forced to take the blame for the poor decisions of the private equity firm that bought the company after its first bankruptcy. The firm, Ripplewood, loaded Hostess with debt, according to The New York Times.
“It’s part of this overall mythology that we have to blame the workers for wanting benefits and wanting a living wage,” he said
Ripplewood? Sounds more like Bain...I'll bet if you look under the sheets you'll find an RMoney connection somewhere....
Yeah, standard "Unions=bad / Vulture-Capitalists=good" drivel for the Randroids.
So why doesn't Obama do something about this?
Gee, Fred, who was president in 2004? You want to blame him for the San Francisco Earthquake of 1906 while you're at it? Why didn't Bush do something about it? Oh, sorry... rofllol
You DID read the part about the courts refusing to allow Hostess to declare bankruptcy immediately because they were more interested in trying to dump their contractual obligations to pocket the pension funds and screw the unions than trying to bargain in good faith? I guess even the courts were pretty disgusted by the naked greed the executives were showing. So, the courts ordered them into arbitration, since the company deliberately skipped that step.
I didn't realize it was the President's responsibility to get involved directly in a labor dispute caused by management malfeasance and greed. Who knew?!?! But hey, you keep trying...
Team Obama spent a couple hundred million dollars telling America that Bain and Romney were evil, but the President couldn't have written an executive order about this or used his supermajority in 2008 to reform the system. Instead he just uses it to win an election instead of actually doing something about it.
Thomas Sowell: There are no solutions, just trade-offs.
FredHayek wrote: Team Obama spent a couple hundred million dollars telling America that Bain and Romney were evil, but the President couldn't have written an executive order about this or used his supermajority in 2000 to reform the system. Instead he just uses it to win an election instead of actually doing something about it.
I hate to break this to you, but Bush was the president in 2000... (Remember the WTC attack?)
The myth of the Obama "super majority" has been busted so many times I keep wondering when you'll get the memo? (Psst...It was only 7 weeks... ) And it STILL is not the job of the President to get involved in a labor-dispute that's based on corporate-management greed and malfeasance. That's what the courts and the Labor Relations Board is for....
The Big Lies of Mitt Romney V: Obama Had A Super-Majority In Congress For Two Years
This stood out to me in "The Lies of Mitt Romney III":
"we remember the president’s own party had a super majority in both houses for his first two years"
I'm not sure how Romney defines a super majority, but my recollection was that the Dems only had a filibuster-proof majority (including two independents) from the time that Al Franken was finally seated (July 7, 2009) until the point that Teddy Kennedy passed away (August 25, 2009). That's only seven weeks, not two years.
And there was never a supermajority in the House as Romney claims. The balance at the start of the Congress was 257 - 178, which is a Democratic share of only 59 percent, not 67. So again, Romney simply lied. Obama never had a super majority in both Houses, let alone for two years. In the Senate, his super-majority lasted seven weeks.
The President can get involved in how corporations treat their employees, labor agreements, pension plans, look at statesman like Teddy Roosevelt & FDR. But it looks like Barack prefers to use the mis-treatment of the American worker and the raiding of pension plans more as something to complain about than do something about.
Thomas Sowell: There are no solutions, just trade-offs.
Since you didn't bother to attribute your posting, I found at least one source:
http://www.cnbc.com/id/49853653
By the way, John Carney, is one of the usual right-wing capitalist-writers allied with .... wait for it.... The Tea Party... (Imagine my surprise...)
Yes- that was the article I was quoting from....
Do you deny that the equity firm put multi-millions into the company several times trying to save it?
Do you deny that in 2009 Ripplewood Holdings invested $130 million of new capital in the company?
Do you deny that Silver Point and Monarch agreed to provide a new loan of $360 million and forgive half the existing debt?
Then after that Ripplewood put tens of millions more into the company in the form of new equity.
And then Silver Point and Monarch put in another $30 million and then, after the company filed for Chapter 11 again in January of this year- they put in another $75 million.
This place was a union money hole- and investors time and time again risked their money trying to save this company. They gave this company and it's union every chance to turn it around- and the union failed- and the investors lost all their money.
If anything- equity firms kept those union members employed far longer than they ever should have- they should have been out on their asses long ago.
Do you deny that the "millions they put into it" were actually loaded-up debt that the company was left holding the bag for, and not even their own money?
These vultures ran the Bain playbook perfectly... Loaded it up with debt...got concessions from the employees which they squandered...Gave themselves obscene raises while screwing the company...Then attempted to declare bankruptcy a second time, pocket the money in the pensions, screw the taxpayers, and walk away from the carcass they destroyed...
Next time post your own attribution from the right-wing teabagger that wrote the OPINION PIECE.
You are totally ignorant- those investment companies lost all their money- a few hundred million dollars - investors like you and me who have 401K's- are we the vultures you are talking about?
If anyone were the vultures here- it was the union and it's members who ran the company into the ground.
We will see more and more of this as the Obamanation continues.
I see ignorance alright... It was the vulture-capitalists and the incompetent, greedy management morons that ran it into the ground, and telling the employees that they had to give back--A SECOND TIME--8% of their wages, and 17% of their benefits while the slimebag at the top gives himself a 300% raise is the usual despicable behavior I would expect you to endorse. But you keep sucking up that Rightie/"unions bad" :Koolaid:
