Those unions watching out for their workers...

[whatbogsends]

Setting the direction of a company is the job of a CEO. That's supposed to be why they make so much money

You gotta love Mach's logic here. CEOs get paid exorbitant amounts of money because they bring so much skill and experience (even though Mach can't specify what any of those skills actually are), yet, at the same time, he posits that the CEOs are helpless to do anything if their existing product line becomes unpopular.

Of course, several options have been put forth by us non-CEOs (examine and updating the product line is the obvious choice - the "snack" and "pastry" markets are still (and will likely always) be in demand. Just because excessively unhealthy snacks are becoming less popular doesn't mean that snack companies everywhere are going out of business. It just means that companies need to alter their strategy and product lines to accommodate the market preferences.

Even more absurd, that in all of this, to those on the right, the failure for the company to evolve lays at the feet of the workers, because the only "evolution" that right wingers are promoting is lowering worker pay.

 

[jgarden]

Each of the following nations have a Moody AAA rating accompanied by their % of labor force that is unionized (2011) and their Global Competitiveness Index Ranking for 2011-12.

Australia - 18.0 % of labor unionized, Global Competitive Ranking 20th
Austria - 28.1% unionized (2010), competitive ranking 19th
Canada - 28.8% unionized, competitive ranking 12th
Denmark - 68.8% unionized, competitive ranking 8th
Finland- 70.0% unionized, competitive ranking 4th
France - 7.6% unionized, competitive ranking 18th
Germany- 18.5% unionized, competitive ranking 6th
Luxemburg - 37.3% (2008) unionized, competitive ranking 23rd
Netherlands - 18.2% unionized, competitive ranking 7th
New Zealand - 20.8% unionized, competitive ranking 25th
Norway - 54.6% unionized, competitive ranking 16th
Sweden - 67.7% unionized, competitive ranking 3rd
Switzerland 17.8% (2009) unionized, competitive ranking 1st
United Kingdom - 25.8% unionized, competitive ranking 10th

How does the OP explain nations with 67.7% (Sweden) and 70% (Finland) of their labor force unionized being considered by the Global Competitiveness Index Ranking (2012-13) to be more competitive than the US - where only 11.3% of its labor force is unionized.

List of countries by credit rating - Wikipedia, the free encyclopedia
Trade Union Density
Global Competitiveness Report - Wikipedia, the free encyclopedia

 

[mathetes123]

Each of the following nations have a Moody AAA rating accompanied by their % of labor force that is unionized (2011) and their Global Competitiveness Index Ranking for 2011-12.

Australia - 18.0 % of labor unionized, Global Competitive Ranking 20th
Austria - 28.1% unionized (2010), competitive ranking 19th
Canada - 28.8% unionized, competitive ranking 12th
Denmark - 68.8% unionized, competitive ranking 8th
Finland- 70.0% unionized, competitive ranking 4th
France - 7.6% unionized, competitive ranking 18th
Germany- 18.5% unionized, competitive ranking 6th
Luxemburg - 37.3% (2008) unionized, competitive ranking 23rd
Netherlands - 18.2% unionized, competitive ranking 7th
New Zealand - 20.8% unionized, competitive ranking 25th
Norway - 54.6% unionized, competitive ranking 16th
Sweden - 67.7% unionized, competitive ranking 3rd
Switzerland 17.8% (2009) unionized, competitive ranking 1st
United Kingdom - 25.8% unionized, competitive ranking 10th

How does the OP explain nations with 67.7% (Sweden) and 70% (Finland) of their labor force unionized being considered by the Global Competitiveness Index Ranking (2012-13) to be more competitive than the US - where only 11.3% of its labor force is unionized.

List of countries by credit rating - Wikipedia, the free encyclopedia
Trade Union Density
Global Competitiveness Report - Wikipedia, the free encyclopedia

And yet the highest ranked country has only 17.8% unionization?

 

[mathetes123]

You gotta love Mach's logic here. CEOs get paid exorbitant amounts of money because they bring so much skill and experience (even though Mach can't specify what any of those skills actually are), yet, at the same time, he posits that the CEOs are helpless to do anything if their existing product line becomes unpopular.

Of course, several options have been put forth by us non-CEOs (examine and updating the product line is the obvious choice - the "snack" and "pastry" markets are still (and will likely always) be in demand. Just because excessively unhealthy snacks are becoming less popular doesn't mean that snack companies everywhere are going out of business. It just means that companies need to alter their strategy and product lines to accommodate the market preferences.

Even more absurd, that in all of this, to those on the right, the failure for the company to evolve lays at the feet of the workers, because the only "evolution" that right wingers are promoting is lowering worker pay.

I have yet to see any of the anti capitalist persuasion provide a definition for a fair wage, or offer a solution to correct this perceived disparity in wages.

 

[mathetes123]

Production cost has little to due with price. A company will make the maximum revenue on a product where the supply and demand curves meet. If that price yeilds a revenue that is below the total production cost then the company can either cuts cost or discontinue that product.

Price reduction was a option available to the execs. Without further research I have no way of knowing if it was a good option.

First you say production costa have little to do with price which flies in the face of logic and common sense, then you offer reducing production costs as a means to lower the cost of the product. which is it?

 

[kermit]

First you say production costa have little to do with price which flies in the face of logic and common sense, then you offer reducing production costs as a means to lower the cost of the product. which is it?

I never said reducing production cost as a means to lower cost. Rather I said, lowering producion costs allows a lower price point to be profitable.

Production costs have no bearing on price. Suppose I make widgets and it costs me $10 to make one. If the market value of widets is $7 I can't sell mine for $10. If production cost determined price no product would ever fail and there would never be a need to lower production cotsts. Production cost only has a bearing on the net gain/loss of selling a product.

Lexus makes a high-end performance car called the LFA. They sell each one at a loss. The reason they can't sell them to cover production costs is that the market wouldn't bear it. Companies can choose to sell products at a loss for any number of reasons. But the lesson is that the market determines the price of a product not the manufacturer.

 

[jgarden]

And yet the highest ranked country has only 17.8% unionization?

"Mathetes123" is referring to Switzerland, a nation with few natural resources, no access to the sea and totally dependent on its labor force.

The fact remains that in 2012-13, America slipped from 5th to 7th in terms of gobal competitiveness and yet every nation above it has a higher % of unionized labor. That makes it difficult to mount a convincing argument that its the unions that are responsible for America's economic woes.

1. Switzerland - 17.8% unionized
2. Singapore
3. Finland - 70% unionized
4. Sweden - 67.7% unionized
5. Netherlands -18.2%
6. Germany - 18.5%
7. USA - 11.3%

 

[mathetes123]

"Mathetes123" is referring to Switzerland, a nation with few natural resources, no access to the sea and totally dependent on its labor force.

The fact remains that in 2012-13, America slipped from 5th to 7th in terms of gobal competitiveness and yet every nation above it has a higher % of unionized labor. That makes it difficult to mount a convincing argument that its the unions that are responsible for America's economic woes.

1. Switzerland - 17.8% unionized
2. Singapore
3. Finland - 70% unionized
4. Sweden - 67.7% unionized
5. Netherlands -18.2%
6. Germany - 18.5%
7. USA - 11.3%

Your argument assumes unionization is the only factor that affects an economies competitiveness, which does not hold water as three other nations ranked above the USA have low rates of unionization. Another factor would be Economic freedom. Last I heard, we were falling in this category in the rankings.

 

[mathetes123]

I never said reducing production cost as a means to lower cost. Rather I said, lowering producion costs allows a lower price point to be profitable.

Production costs have no bearing on price. Suppose I make widgets and it costs me $10 to make one. If the market value of widets is $7 I can't sell mine for $10. If production cost determined price no product would ever fail and there would never be a need to lower production cotsts. Production cost only has a bearing on the net gain/loss of selling a product.

Lexus makes a high-end performance car called the LFA. They sell each one at a loss. The reason they can't sell them to cover production costs is that the market wouldn't bear it. Companies can choose to sell products at a loss for any number of reasons. But the lesson is that the market determines the price of a product not the manufacturer.

The seller can sell it at any price he wants. Whether he can make a profit at that price is another matter. You cannot tell me that lowering his cost will not enable him to lower his price on the market and make him more competitive.

 

[MachZer0]

Hmmm, they could have not granted their exec 80% raises the year before this second Chapt 11. And once they went into Chapt. 11 they could have not offered their CEO a pay boost to $1.5 million.

Just sayin'.

It's a strong indicator that the executives want to CLEAN UP FOR THEMSELVES at the expense of the workers, so it was clear that the execs didn't much care about the company now did they?

Why else would one ensure they got their nut while others were asked to sacrifice. And considering this was Hostesses SECOND CHAPTER 11 FILING it's an indication that these particular execs were grossly incompetent.

The only other thing they could have done is simply asked everyone else to work for nothing while they got their 80% raises.

Just for the record the 4 executives who got increases subsequently had their salaries reduced to $1. So again, the case again Hostess is being overstated.

 

[MachZer0]

Add healthier products to the line. Rework existing products to make them healthier. Reduce the price of their less popular products. Etc.

Also, not only is the job of a CEO to set the direction of a company, but also to understand what directions are available.

I work for a company that traditionally is a printing company. Many years ago they got into financial printing. Financial printing, like all print, is dying a slow dealth. A number of years ago they started to get into financial services. Today the financial services group and financial printing group draw roughly the same revenue. The point being is that it took strong leadership to recognize a business opportuniy that is drastically different than the original core business. Had they followed the Hostess model right now financial printing would have a much smaller revenue that it did even a decade ago, and within another decade it would be gone.

At what cost. Could Hostess have afforded such a direction? Apparently not

 

[TeddyReceptus]

I have yet to see any of the anti capitalist persuasion provide a definition for a fair wage

So do you really honestly think that someone who makes something like $500-$600/hour is fairly paid when the average worker is making only about $15 to $20/hour?

Again, if we wish to deal in "fairness" can you explain to me how one human being could "earn" several human lifetimes worth of work every year?

If you were to say they achieve "several human lifetimes of effort" in a year of work, can you explain to me how any corporation that pays a CEO a million dollar annual compensation could ever have failed?

You have invested at the top one human being with what we are lead to believe is SUPERHUMAN POWERS and yet they are often powerless against the market.

FURTHER: let us assume a CEO leaves because he or she is ousted due to poor performance...how can there be such a thing as a "golden parachute"?

These are decidedly anti-American, anti-free market concepts. These are "corporate welfare" programs for the cronies at the top.

, or offer a solution to correct this perceived disparity in wages.

Drop CEO pay relative to average worker pay to what it was during the mid-20th century when America had amazing growth and possibilities.

Eliminate "golden parachutes", "golden handshakes", etc.

Give the shareholders binding input on the compensation packages.

Let CEO's live like regular human beings (ie pay for their own family's airfare, pay for their own home security, pay for their own financial advisors, etc. etc.)

There is NO NEED whatsoever for contractually obligated multimillion dollar payouts even after poor performance or questionable ethics activities.

This seems simple enough and very much in keeping with free markets and capitalism per se.

 

[MachZer0]

In July of 2011 we received a letter from the company. It said that the $3+ per hour that we as a Union contribute to the pension was going to be 'borrowed' by the company until they could be profitable again. Then they would pay it all back. The Union was notified of this the same time and method as the individual members. No contact from the company to the Union on a national level

Daily Kos: Inside the Hostess Bankery

Hearsay. And as I so aptly pointed out, the pensions will be paid out by the other companies involved.

 

[MachZer0]

evasion

Straw men can certainly be characterized as evasions, yes.

 

[jgarden]

Your argument assumes unionization is the only factor that affects an economies competitiveness, which does not hold water as three other nations ranked above the USA have low rates of unionization. Another factor would be Economic freedom. Last I heard, we were falling in this category in the rankings.

My argument is that it is not the unions and unionized labor that undermines a nation's economic competitiveness - which contradicts the position of the OP of this thread.

 

[dies-l]

You can market a product as much as you want, but if it is no longer desirable, it won't matter. Products come into demand, and go out of demand. The companies that produce products that are no longer in demand go out of business. As far as changing the product line, a determination of whether or not that is financially feasible has to be made. If you make heap snack cakes, what can you make instead? All of your production assets are geared toward bakery products. You have to determine if new assets and retraining of employees is cost effective. In this case, it appears not

Is there any evidence that other large bakeries and snack cake makers are on the verge of going out of business? Many of these companies make products that appear virtually identical to some of Hostess' core products.

 

[MachZer0]

Is there any evidence that other large bakeries and snack cake makers are on the verge of going out of business? Many of these companies make products that appear virtually identical to some of Hostess' core products.

Namely?

 

[kermit]

The seller can sell it at any price he wants.

But the optimum price for max revenue is set by the market.

Whether he can make a profit at that price is another matter.

Exactly

You cannot tell me that lowering his cost will not enable him to lower his price on the market and make him more competitive.

That's exactly that lowering production cost does.

 

[Gxg (G²)]

Are all forms of unions bad?

 

[Belk]

Hearsay. And as I so aptly pointed out, the pensions will be paid out by the other companies involved.

Hearsay is information gathered by one person from another person concerning some event, condition, or thing of which the first person had no direct experience

Hearsay - Wikipedia, the free encyclopedia

The link was to a hostess baker who was a primary source as it happened to him. ergo, it is not hearsay. That the pensions will be funded by other companies is not the issue. The issue is the "borrowing" of employee contributions that will not be paid back.