Wednesday, January 30, 2013

In This Economy, Unions Engage in Fratricide

Here's a very nice and plausible explanation of the Hostess bankruptcy. Much of the reporting on this story simply noted that the bakers union was refusing to play ball with the employer and that this caused the company to go under. But the actual story is more complicated, and involves a calculated decision by one union to get itself as far away as possible from the greedy and inflexible clutches of another union.

Basically, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (I'll call them the "Bakers") crashed the company by refusing to alter its collective-bargaining agreement arrangements in order to get some kind of separation from the Teamsters and their incredibly onerous work rules, work rules that basically made it impossible for Hostess to continue operating profitably.  The Bakers readily calculated that there was sufficient demand for Hostess products to support their membership, with or without the Hostess brand.  but that profitable operation was absolutely impossible as long as the Twinkies and Devil Dogs were being delivered by Teamster members. The Teamster work rules were almost models of union imposed inefficiency, with drivers not being allowed to deliver different Hostess products in the same vehicle, and specialized employees required to unload and load trucks instead of the drivers themselves.

So the Bakers kissed their truck driving (but not unloading!) union brethren goodbye and took steps to let the company implode, secure in the knowledge that America's appetite for tasteless, manufactured sugar products would guarantee their membership jobs. And those Teamster fellas could fend for themselves.

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