Re: Unions Shut Down Hostess
Posted: Tue Dec 04, 2012 1:59 am
Iliad wrote:Iliad wrote:Phatscotty wrote:Evil Semp wrote:Phatscotty wrote:btw, this link has been "corrected" At first I was just going to point out that these management pay raises were "claims" from the union, but it doesn't matter anymore anyways...
Yes it does matter. It could explain part of the reason why the employees would accept the pay cuts.Phatscotty wrote:An earlier version of as well as an earlier headline of this post incorrectly stated that Greg Rayburn received a 300 percent raise as CEO of Hostess as the company approached bankruptcy. Rayburn wasn't CEO of Hostess until after the company filed for bankruptcy. The post also incorrectly stated that he was paid a salary of up to $2,550,000 per year. His salary when he joined the company was $100,000 per month, according to a company spokesman.
The name given was wrong but that doesn't change the fact about the pay increases or at least the attempt at the pay increases.Hostess’ creditors accused the company in April of manipulating executive salaries with the aim of getting around bankruptcy compensation rules, the Wall Street Journal reported at the time. In response, Rayburn announced he would cut his pay and that of other executives to $1 until Dec. 31 or whenever Hostess came out of bankruptcy.Phatscotty wrote:I bet this won't matter though. The incorrect information has been corrected, but the opinions of posters that have been strongly shaped based solely on the size of the pay raises and salaries for the CEO and management will probably stay the same...
Actually it does matter. It show me that he might have taken one for the team but we don't know about his whole pay and compensation package.
Here is an article explaining the CEO changes at Hostess. http://blogs.wsj.com/deals/2012/03/09/h ... as-sought/
ty again for the link. I am eating them up like candy!
However, it does show he certainly did his part, basically taking a 99.9% pay cut on his standard salary. If that isn't good enough, then I'm not sure if anything would have been good enough. He not only took one for the team, he sacrificed so that there was still a "team" at all. He's probably pretty pissed now that after what he gave up to keep the company going and keep the workers working, and they just walked out on the company. I'm more pissed at the employees now too.
Let me read your link
Why are you pissed off at the employees? Why is this an emotional event at all?
Isn't this your fabled free market at work? A company can't operate unless it pays its employees below market rate wages.
Clearly it's inefficient relative to its competitors if it can't maintain a profit and pay its employees the market rate for their wages, so by going bankrupt it's opening up market space for its more efficient competitors. Its employees, as rational self-interested individuals, as all are in an economist framework, have no interest in sacrificing their own wages to perpetuate inefficiency. If a company can't pay its employees the average market rate wages and maintain a profit, then i don't see why it should be in business.
Why is it, when tax hikes are proposed, even by 1 or 2% the lovely business owners can threaten to flee and relocate and this is celebrated as the 'market' in action, but apparently employees are supposed to accept a 5% pay cut just after concessions two years ago. Like their jobs are some kind of gift bestowed on them and their rational self-interest is not at stake.
You make for a shitty economist if you can't even adhere to your own ideology and just blindly shit on the poorer side in an argument.
Still no-one even trying to refute this.