I was over at Dkos reading about Wonder Bread (yum, grew up on this stuff and their calcium rich bread was the first bread my daughter ate) and Vulture Capitalism at Hostess. Then, I got an email about a Salon article and found that the food of my childhood suffered not from worker intransigence but bloat caused by GREED, Debt and in-excusable managerial malfeasance. From Salon:
Hostess (then known as Interstate) initially entered bankruptcy in 2004, with uncomfortably close to half a billion dollars in debt. Sixty percent of the debt was owned by hedge funds Silver Point Capital and Monarch Alternative Capital, the rest by an assortment of other lenders. No one who was paying attention to the company’s fortunes was surprised by the move. During the nearly five years of its initial bankruptcy, the company accrued even more debt.Then, they come out of BK only to:
As a result of management that still hadn’t really attempted to adapt itself to new market realities, the company earned profits in 2011 of $2.5 billion: That’s 11 percent less than in 2008, before Ripplewood took over. But thanks to debt approaching $1 billion, Hostess ended 2011 with a loss of $341 million. The CEO who led the company back into bankruptcy? He got a pay raise — while Hostess pushed a 30 percent salary and benefit cut onto its employees. (A previous failed chief executive, Brian J. Driscoll, was pushed out, but only after the board tripled his pay package to $2.55 million.)Emphasis is mine, of course. But there it is, the Romney economy in display at Hostess. Screw the bakers, screw the truck drivers, screw the janitors, and give pay outs to the top guys to LEAD the COMPANY INTO LIQUIDATION. Why is CEO pay not pegged to the performance of the company? Why do they get pay outs when they screw over investors, workers and everyone else but themselves? Bakers Rock, Vulture Capitalists Suck.