Former Hostess Employees Bitter About Wage Cuts (fork lift operator- $11 an hour)

[ceonupe]

56. nothing stopped them from doing just that in fact

nothing stopped them from doing just that in fact there was a group of former mangers and workers that wanted to do just that. the problem was the cost was to high because the business had been leveraged to a point of no return. The banks that own those loans on the plants and equipment arent just going to let others use it for free. the bankruptcy provided a way to close out the old company and give someone else a chance. THis story happens all the time when we allow business to leverage everything and the owners to walk away with profits but it is legal. The banks to a loss on this and so did the original investors. The employees also lost out. I dont blame the unions (even if they took the deal offered the company most likely would have gone belly up in the next year or so. The debt it took on was just to much and it was never going to work out.

My point is why bash the new company? They may be more responsible by promising wages they can actually afford to pay and remain in business. the new owners may not have other business or the vertical integration the previous owner had (and totally meesed up by leveraging). Also keep in mind this leveraging started almost as soon as the company became no longer a family owned business and may date back decades with various Leveraged Buyouts of previous companies and competitors and partners.

you may think im anti worker im not . I believe the best thing for many of these small towns who lost 200-300+ jobs (town population of a few thousand) having another company come in and open the place backup is better than nothing. Go into a discount retailer like dollar tree or family dollar or dollar general and you will notice all the packaged cake snacks are now not even made in america.