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Originally Posted by mostpost
The cut is 32% not 8%. The 8% is just the first of many proposed cuts. Do you understand what a 32% cut means? The story talks about a worker who makes $17 an hour. After a 32% cut that workers annual salary goes from $35,360 a year to $24,044 a year. And that is before taxes are deducted; taxes and Social Security and Medicare. Basically they are reduced to the poverty level.
Hostess is owned by two hedge funds. This is Bain Capital all over again. Instead of modernizing the facilities and investing in new equipment, they stopped funding the pension plan. Instead of paying the employees they diverted money to executive salaries. The company is going under not because of union intransigence. It is going under because the owners want it to go under. This is a classic example of vulture capitalism.
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Hostess really is a company who's time has come and gone. There was not the bread competition that there is today, and not too many people are willing to fork over $1.39 for Twinkies when most convenience stores have there own bakery now. When market shares dwindle, the company suffers. It has little to do with "modernizing".
