It is often the case in contemporary America. Upon hearing the news, we don't know whether to laugh or cry.
NEW YORK (CNNMoney) — Hostess Brands — the maker of such iconic baked goods as Twinkies, Devil Dogs and Wonder Bread — announced Friday that it is asking a federal bankruptcy court for permission to close its operations, blaming a strike by bakers protesting a new contract imposed on them.
The closing will result in Hostess' nearly 18,500 workers losing their jobs as the company shuts 33 bakeries and 565 distribution centers nationwide, as well as 570 outlet stores. The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union represents around 5,000 Hostess employees.
"We deeply regret the necessity of today's decision, but we do not have the financial resources to weather an extended nationwide strike," said CEO Gregory Rayburn in a statement.
Hostess will move to sell its assets to the highest bidder. That could mean new life for some of its most popular products, which could be scooped up at auction and attached to products from other companies.
A letter that Hostess sent to its network of stores that carry its product said it expects "there will be great interest in our brands." But it said it could not give a time frame for when the sales would take place and its products would be available again.
But even if those brands are bought and restarted, the Hostess workers will not get their jobs back.
"The industry has overcapacity. We're overcapacity. Our rivals are overcapacity," said Rayburn in an interview on CNBC. Asked if the shutdown decision could be reversed if the Bakers' union agreed to immediately return to work, he responded, "Too late."
The "industry" has overcapacity. Think about that. We don't have overcapacity in steel, or copper, or crude oil, despite rumors to the contrary. We don't have overcapacity in automobiles, stereos or microwave ovens. No, we have overcapacity in Twinkies, Wonder Bread, Ding Dongs and Devil Dogs.
And that is not all. There is more. There is always more. 18,500 people will lose their jobs because Hostess claims they can not make money "manufacturing" Ding Dongs. Hostess blames the the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, which represents about 5,000 of the Hostess employees who will lose their jobs. What's up with that?
Hostess filed for Chapter 11 bankruptcy in January, then reached a deal with one of its major unions in September that included a new contract with reduced wages and benefits. But the 5,000 member bakers' union rejected the deal, leading to the protested contract that cut salaries in addition to reducing the company's pension obligations and contribution to the employees' health care plan.
"Our members are on strike because they have had enough," bakers' union president Frank Hurt said in a statement on Tuesday. "They are not willing to take draconian wage and benefit cuts on top of the significant concessions they made in 2004 and give up their pension so that the Wall Street vulture capitalists in control of this company can walk away with millions of dollars."
The company gave bakers a 5 p.m. Thursday deadline to return to work or face a shutdown of the company.
Who are these vulture venture capitalists? The ones who, if they can't have slave labor, are going to take their marbles and go home (sell off the Hostess plant and brands)?
Hostess—now controlled by a group of investment firms including hedge funds Silver Point Capital and Monarch Alternative Capital—will sell its assets to the highest bidder, meaning that some of its more popular products could be picked up at auction and packaged by other companies.
And finally there is this—
Steven Mufson of the Washington Post summarized the company's fatal problems as "a combination of pension burdens, labor rules, crippling debt from financial engineers and management’s failure to freshen up a stale product line and keep up with consumers’ changing tastes."
I don't know what else to say. It's Friday. I've seen enough this week. Well, OK, I do have something to say—
Yadda, yadda, yadda. Blah, blah, blah.
This Twinkies situation is so screwed up in so many ways that one hardly knows where to begin. What a clusterfuck! What a SNAFU! FUBAR! This entire so-called "civilization" of ours is train wreck. The only pity is that we can't tear it down and start all over again.
Have a nice weekend.
Bonus Video — Just listen to these CNBC assholes! There's no fucking hope for US. We are Hopeless.