Hostess Brands announced last week that it would go out of business and blamed the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, who recently threatened a strike.
This storyline was parroted by conservative anti-union media outlets. The Wall Street Journalwrote: "The union that brought the 85-year-old baker of Twinkies and Wonder Bread to its knees." RedState.com used the headline: "The Demise of Twinkies? Yes, It's True. Parasitic Unions Kill Their Hosts (or, in this case, Hostess)."
However, Hostess [and the conservative media] failed to mention that the 85-year-old company gave its executives pay raises earlier this year when it declared bankruptcy for the second time.
ThinkProgress.org reports that the salary of the company's chief executive Greg Rayburn tripled from $750,000 to about $2.5 million, and at least nine other executives received pay raises ranging from $90,000 to $400,000.
On Monday, a bankruptcy judge "asked whether he should preside over mediation" between the two parties. Hostess and the union have agreed to mediation, which would avoid the bankruptcy.
Bargaining talks will begin today, but if they fail, then the liquidation of the company will go forward on Wednesday.
Hostess had planned to request that the judge approve a plan to shut down the company and pay $1.75 million in bonuses [$7,400 to $130,500 each] to the executives who already received pay raises earlier this year. The union opposes those bonuses.
Hostess previously declared bankruptcy back in 2004 and was taken over by the venture capitalist company Ripplewood Holdings in 2009 for $130 million, reports Salon.com
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