Growing up in a small south Texas town near the Gulf of Mexico, I was surrounded by Mom and Pop stores. The closet to my home, only two short blocks away, was Julio’s Grocery Store. Julio’s offered a wide variety of penny candy and practically every day after school my friends and I stopped by to purchase as much of the tasty sugary treats that our tiny hands could hold. Saturday was the special day of the week that I reserved what was left of my weekly allowance to buy a Twinkie. The sponge cake like treat with the creamy filling was to die for—admittedly, it had one preservative too many with little or no nutritional value but that was my special kid treat back then that filled my tummy and gave me comfort.
Fast forward almost 60 years later and we learn that Twinkies will no longer be sitting on grocery store shelves and neither will Wonder Bread, Hostess Cupcakes or any of the other sweet treats baked by the company, Hostess Brands Inc. But it’s the Twinkies that griped at my heart—it was like losing a favorite aunt or uncle. I read in a newspaper that the company had gone bankrupt—well that is what the company filed but that isn’t the real cause for Twinkies to come off of the grocery shelves.
Hostess Brand filed for bankruptcy two different times
During the past thirteen or so years, Hostess Brands, Inc., filed for bankruptcy on two different occasions. There were several reasons that led Hostess Brands, Inc., to work itself into bankruptcy this last time; e.g., competition from healthier snack treats, poor financial planning by a hedge fund and union strikes. The company, like the statue of Saddam Hussein, came tumbling down until there was nothing left but wrappers of Twinkies scattered about and memories of our youthful indulgences.
Hostess Brands, Inc. felt that the only way to work itself out of their financial dilemma was to cut wages, commissions and health care benefits and change the structure of the pension plans of its workers, but the baker’s union didn’t agree. Although the Teamsters Union representing truck drivers and other workers agreed to the proposed cuts, in the end it was the baker’s union that refused the cuts and went on strike. If you don’t have workers to bake goods you don’t have a product to sell, simple as that. In essence, the baker’s union decided to flex their muscle believing they had the upper hand to convince Hostess Brands, Inc., to change its proposal. But in the end the union cut off its nose to spite its face, more than 18,000 people lost their jobs, many of whom are Hispanic. All those workers have bills to pay; they also patronize businesses and buy other things. Yes, some of them may have pensions to protect them from financial disaster but many don’t and businesses that benefited from their buying and spending will suffer. This doesn’t help our economy one iota.
Unions have been around since the turn of the 20th century. They were formed to protect child labor, to ensure that all workers were protected in the workplace and that their pensions were rightfully assured. In my last position as a federal official, my job was to break impasses between labor unions and management in the federal government. I learned much about the current state of labor and management relations and the power that unions enjoy in the federal government. But I came away concerned that their power over federal government management could be detrimental to the day-to-day operations of the federal government, especially in time of emergency.
In the private sector it appears that unions enjoy that power as much as they do in the public sector. They have become huge players in the political arena too, raising millions of dollars for candidates of their choice. Unions today aren’t necessarily the same as they first started but then who isn’t—everything and everybody changes at one time or another. We should all be concerned about the economic strength of this country. In the case of unions there will be times they may have to consider dropping their demands in favor of jobs. The end of a business enterprise is the end of jobs and the end of spending and buying. It negatively affects our economy any way you dice it and slice it—everyone has to do their part to work together for the betterment of this country’s overall economy. It’s all about economic recovery and refusing concessions that will keep people employed must be more carefully approached by union leaders than at any time in our past.