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‘Vulture capitalists,’ not union, responsible for Hostess’ demise

Updated: January 17, 2013 6:34AM

‘Vulture capitalists,’ not union, were responsible for demise of Hostess company

In Jeff Ward’s column of Nov. 26, he puts most of the blame for the end of Hostess on the short-sightedness and greed of the bakers union. Ward goes on to write how he despises unions.

In strong disagreement with Ward is investigative reporter for The Nation, John Nichols’ recent article titled, “Vulture Capitalism Ate Your Twinkies.” Nichols starts his article by writing that vulture capitalism (Mitt Romney’s Bain Capital type of private equity firms) destroys companies to harvest profits. Nichols continues:

1. Vultures blame the workers.

2. Vultures blame the union.

3. And vapid media outlets report the lies as “news.”

Nichols quotes economist Dean Baker on how one of these management firms gets control of a company and “shows little competence and is rapidly stuffing its pockets at the company’s expense.” Nichols also quotes AFL-CIO President Richard Trumka: “Wall Street investors first came on the scene with Hostess about a decade ago, purchasing the company and then loading it with debt.” Trumka continues, “Instead, the executives planned to give themselves bonuses and demanded pay cuts and benefit cuts from workers who haven’t had a raise in eight years.”

Nichols writes that the Hostess unions had a long history of working with the company to try to make it viable. The unions made wage and benefits concessions to keep the company going, as well as enduring layoffs. Nichols continues that when the unionized Hostess workers finally went on strike, they did not do so casually. Union President Frank Hunt is quoted: “Our members decided they were not going to take any more abuse from the company they have given so much to for so many years.”

Both Ward and Nichols can’t be correct in their assessments regarding the fall of Hostess. One of them has to be far more accurate about what happened to Hostess than the other. Ward puts much of the blame on the unions, and Nichols doesn’t. Ward even goes so far to write about his contempt for unions. Apparently, Ward dismisses the fact that the labor movement is directly related the emergence of a once-strong American middle-class that was the envy of the world, when the United States had the highest living standard in the world. Unions ushered in the eight-hour day, the 40-hour work week, health care benefits, pensions and safer working conditions. American workers in the 24 “right to work” states and non-unionized workers such as the Wal-Mart associates have much lower wages and frequently lack affordable health care, pensions and safer working conditions.

It is now becoming very apparent that these non-unionized workers are finding that reaching middle-class status in today’s America is beyond their reach. The Fox Valley Citizens for Peace and Justice strongly supports union rights and is very concerned with restoring the “American Dream” with a strong middle class.

John Butler


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