I haven’t eaten a Hostess product in decades. As such, I’ve no personal interest in the demise of the Twinkie, Hostess cupcakes or Wonder Bread, whose name probably derived from the fact that it’s a wonder how anyone can call a loaf of this stuff ‘bread.’
Furthermore, it seemed at first glance that the unions representing Hostess Brands workers were being stiff-necked and self-destructive in their refusal to take any cuts rather than lose their jobs.
But further consideration offered more proof of why a second glance is always necessary.
As it turns out these workers had already taken substantial cuts in both salary and benefits, adding up to nearly 25%!
Certainly, management would also be participating in the cuts. Right?
Taking inspiration straight from the Republican Party’s practice of protecting fat cats while dumping the burden on everyone else, Hostess Brands asked a judge to approve a plan that will allow it to pay $1.75 million in bonuses to 19 of its executives.
This is after asking workers to take more cuts, and after filing for bankruptcy.
Adding insult to injury, Hostess already gave its executives pay raises earlier this year - even as it blamed unions for the bankruptcy and the 18,500 job losses that will ensue. The salary of CEO Gregory Rayburn tripled, going from $750,000 to roughly $2.5 million, and at least nine other executives received pay raises ranging from $90,000 to $400,000.
Those raises came just months AFTER Hostess originally filed for bankruptcy earlier this year.
To hear Rayburn tell it, it was the fault of everyone and everything BUT management. He spoke to Claire Suddath at Bloomberg Businessweek and spun a yarn fluffy enough to make the warmest Christmas sweater ever knitted.
(His explanation, unfettered by any mention of the bloated executive compensation, can be read at http://www.businessweek.com/articles/2012-11-21/gregory-rayburn-on-the-dimming-of-twinkies.)
Lest you think this is just the way American management is, consider Aaron Feuerstein, the owner of Madden Mills, a large textile company in Massachusetts.
In 1995, the factory burned to the ground. The fire destroyed the mill two weeks before Christmas. That meant no work for more than 2,500 employees.
Feuerstein’s response was to pay full salaries and health benefits to all the workers until production began again.
He also gave them Christmas bonuses.
When asked where he got the strength and inspiration to do such a thing, the “mensch who saved Christmas” explained, “When all is in moral chaos, this is the time to be a mensch.”
In any case, the thousands of American workers treated [sic] by Hostess management like a baby treats a diaper will have a bleak holiday season.
But Greg Rayburn will have his own seasonal tribulations, like hoping that the new Mercedes he gives his wife for Christmas is the right color.