The Blame Game

Don't Worry. They'll Be Back.

Now that Hostess Brands has (temporarily) closed up shop, the recriminations and blaming have started. Most of it is misplaced.

For starters, the reason why Hostess is not in business as I write this (a situation I expect to see change before not too long) is because the management team of the company chose to shut it down. End. It wasn't forced into liquidation by creditors or clobbered by market forces. The management team decided, honestly or cynically, that they couldn't be profitable with the current cost structure, so they closed up shop. They had every right to do so. The point can be made that they had some sort of moral obligation to their workforce to keep the doors open as long as possible, but no laws were broken when management decided to pack it in.

Okay, with that out of the way, you can debate whether or not the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union was wise to stay out on strike with the company threatening to close the company down and simply lay everyone off. Again, they had every right to go out on strike. The point can be made that they had some sort of moral obligation to their members to prevent a worst-case scenario, but no laws were broken. One thing that's worth keeping in mind is that "the Union" is actually a different organization than "the people who worked in Hostess' bakeries," and because of this, their interests don't always align 100%. While this turn of events sucks for the workers, it may actually turn out to be a good thing for the union. And it was, to a degree, to be expected. Strikes are successful to the degree that they a) deprive a company of skills and/or labor that cannot be replaced and b) have the ability to cause harm to the company. If Hostess could have operated indefinitely without its union workforce being on the job, a strike would have been utterly pointless, except perhaps in the Court of Public Opinion. (But when it come to cheap junk food versus the American Worker, smart money always bets the public at large sides with Twinkies.) For my part, I would be unsurprised to find that organized labor as a whole seeks to find ways to make an example of Hostess when they sit down with other employers.

It's only if you perceive the sole aim of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union to be the preservation of some level on income for the workers at Hostess does the union become blameworthy for a miscalculation. But even then, this is how games of Chicken are played. The threat of a collision is what makes them relevant.