The Unions Ate My Zingers

The Twinkie is the most well known Hostess product, but my favorite is the Vanilla Zinger.  Food of the gods and they were a great pick-me-up way back before the earth cooled when I was trying to wake up between college classes.

It looks like the Zinger and Twinkie may be going the way of the Dodo bird, largely thanks to union contracts and union leaders who would rather close the company than compromise on benefits (from Human Events):

There is no mystery surrounding the death of the Twinkie.  In its bankruptcy filing, Hostess reported a net loss of $341 million last year.  The company blamed reduced demand from a more health-conscious customer base, and rising costs for ingredients like sugar and flour… but above all, the cause of death was an overdose of collective bargaining.  TheWall Street Journal reports that Hostess will use bankruptcy to “confront the ‘increasing burden’ of its giant union workforce,” a claim backed up by reviewing the company’s list of unsecured creditors:

The top unsecured creditor on the list, filed in bankruptcy court but which you can view here, is the pension fund for one of Hostess’s main unions. The Bakery & Confectionery Union & Industry International Pension Fund is owed $944.16 million.

Union benefit funds, including health and pensions, account for 16 of the 40 top unsecured claims. Some of those pension funds include Central States, Southeast and Southwest Areas Pension Plan, owed $11.82 million; Twin Cities Bakery Drivers Pension Fund, owed $9.36 million; Western Conference of Teamsters Pension Plan, owed $7 million; and New England Teamsters & Trucking Industry Pension Fund, owed $4.77 million.

(Emphasis mine.)  Sources told the New York Post that Hostess has its work cut out for it during those union negotiations:

Talks to restructure Hostess, the maker of Twinkies and Wonder Bread, are expected to start distastefully, The Post has learned.

The company, which filed for Chapter 11 protection Jan. 11 due in part to high labor costs, will ask its 20,000 mostly unionized workers to accept stiff concessions, which may include new rules that will force drivers to load their own trucks, adding a couple of hours to the work day and having workers pay more for health insurance.

There could also be demands for thousands of layoffs, including some in the New York metro area.

A person close to the situation who would like to see the union members accept serious concessions says he believes there is only a 50 percent chance that they will.

The unions did not accept a somewhat similar proposal last year from Hostess — prompting last week’s bankruptcy filing.

A union member assured the Post that “any significant concessions demanded from route people will be overwhelmingly rejected.”  The mind-shattering horror of asking drivers to load their own trucks will be avoided by putting them all out of work.

So, how are your union benefits going to be paid with the company in liquidation? Unions have gotten so used to getting their way during the economic good times they just seem completely incapable of recognizing the good times are over for awhile. It will be little consolation to their jobless members that they flushed the whole company rather than give up anything on their precious benefits and work rules.