Friday could very well go down in history as the death knell for an 82-year-old Chicago-born American classic snack cake: The Twinkie.
Hostess Brands, Texas-based maker of Twinkies and a number of other snack foods, announced Friday that, on the heels of a nationwide worker strike, it will be going out of business, closing its production plants and laying off the vast majority of its 18,500 employees nationwide. As for the Twinkie brand? It will be going up for sale.
Three of the company’s plants—including one in St. Louis—closed earlier this week as workers went on strike in response to wage cuts and new limitations in worker participation in pension plans. Now, 1,415 workers at the company’s three Illinois bakeries—in Schiller Park, Hodgkins and Peoria—are losing their jobs, the Chicago Sun-Times reports.
Michigan Capitol Confidential notes the existence of an obviously unnecessary Detroit city job which only continues to exist on the basis of union power.
Despite having no horses, the water and sewerage department for the city of Detroit employs a horseshoer.
Yet even with a department so bloated that it has a horseshoer and no horses, the local union president said it is “not possible” to eliminate positions.
Union rules have turned the department into a government jobs program, some critics say.
The horseshoer’s job description is “to shoe horses and to do general blacksmith work … and to perform related work as required.” The description was last updated in 1967.
The Detroit Water and Sewerage Department (DWSD) has a large debt, rising water prices and inefficient services — using almost twice the number of employees per gallon as other cities like Chicago. ...
John Riehl, president of the American Federation of State, County and Municipal Employees Local 207, which represents many of the DWSD employees, told the Detroit Free Press that the department needs more workers.
“They don’t have enough people as it is right now,” Riehl said. “They are just dreaming to think they can operate that plant with less.”
Criminal investigations have been opened by both the US Attorney and the Brooklyn District Attorney Offices in connection with reports from Sanitation Department employees that snow removal following the recent blizzard was intentionally delayed by a union job action.
The snitches “didn’t want to be identified because they were afraid of retaliation,” [City Councilman Dan] Halloran said. “They were told [by supervisors] to take off routes [and] not do the plowing of some of the major arteries in a timely manner. They were told to make the mayor pay for the layoffs, the reductions in rank for the supervisors, shrinking the rolls of the rank-and-file.”
New York’s Strongest used a variety of tactics to drag out the plowing process – and pad overtime checks – which included keeping plows slightly higher than the roadways and skipping over streets along their routes, the sources said.
The snow-removal snitches said they were told to keep their plows off most streets and to wait for orders before attacking the accumulating piles of snow.
They said crews normally would have been more aggressive in com bating a fierce, fast-moving blizzard like the one that barreled in on Sunday and blew out the next morning.
The workers said the work slowdown was the result of growing hostility between the mayor and the workers responsible for clearing the snow.
Union tactics, in this case, cost more than concessions from city government. There were human casualties in the form of New Yorkers denied access to emergency services because the New York Sanitation Department deliberately declined to do its job.
A 75-year-old Queens mother woke up Monday unable to breathe and alerted her daughter, who tried to call 911. She could not get through for 50 minutes. A neighbor administered CPR but EMS was unable to arrive for another 45 minutes—and they still had to walk to her house.
Talking to reporters yesterday the daughter said: “Mayor Bloomberg you can’t bring my mother back. And that’s all I really want. I’ve been with her for 41 years. I miss her, she’s my life. The snow will melt, but this will never fade from my memory ever.”
A 63-year-old man in Bay Ridge died of a heart attack Monday morning after it took paramedics three-and-a-half hours to arrive. “They made him die. They could have saved him,” the victim’s brother-in-law told the Journal. “They worked at him, but it was too late. He was already blue.” And to add to the pain, it took another 28 hours for a city medical examiner to pick up the body, which had been resting in a bag on a bed.
Another woman in Sunset Park spent more than 24 hours waiting for help removing her late-father’s body. She told the News, “this is New York City, and I’m a New Yorker, and this is not the first storm we’ve ever had. Somebody dropped the ball … big-time.”
Hands down the most upsetting story so far is that of a 22-year-old pregnant woman in Crown Heights. As she started contractions the woman began walking from her home to Interfaith Medical Center on Monday morning but couldn’t make it. She stopped in a building lobby at 97 Brooklyn Avenue and 911 was called at 8:30 a.m.. Because the birth seemed a bit off she was listed as nonemergency status. But by 4:30 p.m. she had started crowning and 911 was called again. Around 5:20 p.m. police arrived (by foot since driving was impossible) and found the woman attempting to leave and walk to the hospital again. She was brought back inside and the baby was delivered—but it wasn’t breathing and despite the efforts of police and neighbors the baby was lost.
[A] three-month-old infant—who was left brain dead when EMS couldn’t get to his door in time because of snow drifts two days after the storm—succumbed to his injuries yesterday.
Some of us would contend that union officials ought to be prosecuted for negligent homicide and extortion but, at the very least, the City of New York should fire everyone belonging to the union and pass legislation prohibiting union membership for employees of city government.
If the argument is, some functions are too critical to public safety to put in private hands, then that is an argument against allowing them to be unionized. If unionized, then the state no longer has a monopoly on the power exercised by that arm, which is the whole idea of putting it in the public sphere. So if you can’t have private police forces running around, let’s say, then it makes no sense to have the monopolized force of the state colonized or even dominated by a union with interests frequently opposed to those of the public. ....
Unions have held up states and cities for trillions of dollars in obligations that can’t be paid off. Throw in the costs of an utterly failed public school system in many cities and you get an idea of the scope of folly of government by unions.
When the police went out on strike in Boston in 1919, Governor Coolidge sent in the State Guard to keep order, and the police commissioner fired and replaced the entire force. Governor Coolidge won national admiration for breaking the Boston Police Strike and went on to win the Republic nomination and the presidency.
Stagehands on strike against Broadway theaters, 2007
James Ahearn, writing from New Jersey, notices the union racketeering at New York City performance centers that has been going on essentially forever.
My wife and I have season tickets for events at Carnegie Hall and Lincoln Center. At intermissions, we sometimes watch absently as three or four men in gray suits emerge from the wings to move a piano into place or bring out extra music stands and chairs.
What they do is essential but unremarkable. Turns out that it is remarkably well-paid, however. Would you believe $422,599 a year? Plus $107,445 in benefits and deferred compensation?
That is what a fellow named Dennis O’Connell makes at Carnegie Hall. He is the props manager, the highest-paid stagehand.
Four other guys, two of them carpenters, two electricians, are paid somewhat lesser amounts, ranging down to $327,257, plus $76,459 in benefits and deferred compensation, for the junior member of the team, John Goodson, an electrician.
The New York Times broke this story last week. The reporter, Daniel J. Wakin, got it from a publicly available document, Carnegie Hall’s tax return for the 2007-08 season.
The hall was legally obliged to disclose the pay of the chief executive, Clive Gillinson, and the names and pay of the next five highest-paid employees. All five were stagehands.
Gillinson, who doubles as artistic director, was paid $946,581, nearly twice as much as O’Connell, the props manager, but not out of line for top arts executives in Manhattan.
The Carnegie stagehands’ pay was something else again, but not, as it turns out, unique. At Avery Fisher Hall and Alice Tully Hall in Lincoln Center, the average stagehand salary and benefits package is $290,000 a year.
To repeat, that is the average compensation of all the workers who move musicians’ chairs into place and hang lights, not the pay of the top five.
Across the plaza at the Metropolitan Opera, a spokesman said stagehands rarely broke into the top-five category. But a couple of years ago, one did. The props master, James Blumenfeld, got $334,000 at that time, including some vacation back pay.
How to account for all this munificence? The power of a union, Local 1 of the International Alliance of Theatrical Stage Employees. “Power,” as in the capacity and willingness to close most Broadway theaters for 19 days two years ago when agreement on a new contract could not be reached.
Wakin reported that this power was palpable in the nervousness of theater administrators and performers who were asked to comment on the salary figures.
Kelly Hall-Tompkins, for one, said, “The last thing I want to do is upset the people at Carnegie Hall. I’d like to have a lifelong relationship with them.” She is a violinist who recently presented a recital in Weill Hall, one of the smaller performance spaces in the building.
She said she begrudged the stagehands nothing: “Musicians should be so lucky to have a strong union like that.” Uh-huh.
Isn’t it wonderful for Carnegie Hall and Lincoln Center donors and ticket buyers to be able to reflect that their contributions to the arts in Manhattan allow a handful of blue-collar union goons to take home salaries higher than many of the actual performers?
Megan McArdle argues that the era of unionized public sector pension benefits keeping retirees living on full salary for decades is over. Demographics giveth and demographics taketh away.
It was nice that a combination of rising life expectancy and broader pension coverage allowed a large segment of American workers to take what amounted to a multi-decade vacation. (Though this was never quite as widespread as people now “remember”). But this was never going to be sustainable. Retirement experts typically say that retirees should shoot for 75-90% of their working income in retirement (the theory being that some expenses fall, but other expenses rise, and you don’t need to save for retirement when you’re already retired).
That’s fine when the ratio of workers to retirees is 1:12, as it was within the Social Security system in the early years. But by the time you get to 5:1, it starts to pinch—assuming everyone has the same income, each worker has to toss at least 15% of their own income into the pot to support the retirees. Once you get to 2:1—which is where we’re rapidly headed—33% of your income is going to support someone in retirement. Woe betide you if you also have kids.
It’s important to note that this is true no matter how retirement is funded. Whether you collect a dividend check, get a corporate pension, or live off your social security, your retirement is funded by real claims on the output of people in the workforce. Private pensions have a couple of advantages: the investments that fund them actually help make the economy more productive, unlike transfer payments; and they aren’t necessarily indexed to inflation, so over time, as incomes grow, it becomes easier to support the older retirees. But they don’t eliminate the problem; they merely mitigate it.
Mathematically, society simply cannot have a high and growing dependency ratio—at least, not if the retirees expect to be supported in the style to which they have become accustomed. (I take it that this is what is meant by “a decent living and a stable retirement”). We can warehouse people in spartan old folks homes (or treat them like kids and move them into the spare bedroom), in which case they can enjoy a lengthy retirement. Or they can retire for less time, and live more lavishly. But there is no conceivable system that is going to allow the vast majority of the population to spend a full third of their adult life in retirement, at anything like the same standard of living they had when they were working.
How did California go broke? In the Wall Street Journal, David Crane how democrat giveaways to unionized state employees created an early retirement leisure class whose maintenance was soon consuming the bulk of the Golden State’s budget.
In 1999 then California Governor Gray Davis signed into law a bill that represented the largest issuance of non-voter-approved debt in the state’s history. The bill SB 400 granted billions of dollars in retroactive pension boosts to state employees, allowing retirements as young as age 50 with lifetime pensions of up to 90% of final year salaries. The California Public Employees’ Retirement System sold the pension boost to the state legislature by promising that “no increase over current employer contributions is needed for these benefit improvements” and that Calpers would “remain fully funded.” They also claimed that enhanced pensions would not cost taxpayers “a dime” because investment bets would cover the expense.
What Calpers failed to disclose, however, was that (1) the state budget was on the hook for shortfalls should actual investment returns fall short of assumed investment returns, (2) those assumed investment returns implicitly projected the Dow Jones would reach roughly 25,000 by 2009 and 28,000,000 by 2099, unrealistic to say the least (3) shortfalls could turn out to be hundreds of billions of dollars, (4) Calpers’s own employees would benefit from the pension increases and (5) members of Calpers’s board had received contributions from the public employee unions who would benefit from the legislation. Had such a flagrant case of non-disclosure occurred in the private sector, even a sleepy SEC and US Attorney would have noticed.
Eleven years later, things haven’t turned out as Calpers promised. While state employees have been big winners from the bet, the state budget has been, and will continue to be, a huge loser. Far from being “fully funded” as promised, Calpers has already required $15 billion more from the state budget than projected in 1999 and $3.5 billion is budgeted for this year, a figure that is more than five times the expense projected by the state legislature in its SB 400 analysis.
New Jersey Governor Chris Christie addressed the necessity of reining in spending in an address to his state’s mayors at the New Jersey League of Municipalities.
His “holding hands and jumping off a cliff” metaphor was a hit, but more important was his identification of the rigged arbitration system which awards government employee unions reliably the better part of everything they ask for, year in and year out, good times or bad.
The current economic crisis has established definitively that the current relationship between unions and government and current levels of expenditure are unsustainable in a number of states.
In the time we got here, of the approximately $29 billion budget there was only $14 billion left. Of the $14 billion, $8 billion could not be touched because of contracts with public worker unions, because of bond covenants, because of commitments we made accepting stimulus money. So we had to find a way to save $2.3 billion in a $6 billion pool of money.
When I went into the treasurer’s off in the first two weeks of my term, there was no happy meetings. They presented me with 378 possible freezes and lapses to be able to balance the budget. I accepted 375 of them.
There is a great deal of discussion about me doing that by executive action. Every day that went by was a day where money was going out the door such that the $6 billion pool was getting less and less. So something needed to be done. ...
Our citizens are already the most overtaxed in America. US mayors hear it all the time. You know that the public appetite for ever increasing taxes has reached an end.
So when we freeze $475 million in school aid, I am hearing the reverberations from school boards saying now you are just going to force us to raise taxes.
Well there is a 4% cap in place as you all know, yet school boards continue to give out raises which exceed that cap, just on salary. Not to mention the fact that most of them get no contribution towards the spiraling increase in health care benefits. ...
Do we need to change some of the rules of arbitration to level the playing field to allow municipalities and school boards to have a more level sense of collective bargaining?
I think the evidence of ever increasing raises being given to public sector workers as a result of the arbitration system tells us that we do. ...
I am tired of hearing school superintendents and school board members complain that there are no other options than raising property taxes. There are other options.
You know, Marlboro, after a two year negotiation, they give a five year contract giving 4.5% annual salary increases to the teachers, with no contribution, zero contribution to health care benefits.
But I am sure there are people in Marlboro who have lost their jobs, who have had their homes foreclosed on, and who cannot keep a roof over their family’s head there is something wrong.
You know, at some point there has to be parity. There has to be parity between what is happening in the real world, and what is happening in the public sector world. The money does not grow on trees outside this building or outside your municipal building. It comes from the hard working people of our communities who are suffering and are hurting right now.
I heard someone in the legislature say two days ago that they wanted no fare hike in New Jersey Transit, no cuts in service, and no cuts in subsidy. And I was thinking to myself, man I should have made this guy treasurer. [Laughter] Because if you can pull that one off, you’re obviously magic.
This is the type of awful political rhetoric that people sent me to this city to stop.
Stanley Greenhut, in the February issue of Reason, explains how the increasing political power of unionized government employees is producing larger government along with luxurious compensation for a new Mandarinate able to tax the rest of us.
Public-sector unions have a growing influence in state and federal governments, and in the overall labor movement, but they are a relatively recent phenomenon. Civil service unionization in the federal government wasn’t allowed until President John F. Kennedy issued an executive order legalizing it in 1962. In California it didn’t become legal until 1968. Yet now California may be spearheading the re-unionization of the country. ...
At all levels, state and local government employment grew by 13 percent across the United States from 1994 to 2004. The number of judicial and legal employees increased by 28 percent. The number of public safety workers increased by 21 percent. The number of teachers increased by 22 percent. ...
The United States had 2.3 state and local government employees per 100 citizens in 1946 and has 6.5 state and local government employees per 100 citizens now. In 1947, Hodges writes, 78 percent of the national income went to the private sector, 16 percent to the federal sector, and 6 percent to the state and local government sector. Now 54 percent of the economy is private, 28 percent goes to the feds, and 18 percent goes to state and local governments. The trend lines are ominous. ...
Bigger government means more government employees. Those employees then become a permanent lobby for continual government growth. The nation may have reached critical mass; the number of government employees at every level may have gotten so high that it is politically impossible to roll back the bureaucracy, rein in the costs, and restore lost freedoms.
People who are supposed to serve the public have become a privileged elite that exploits political power for financial gain and special perks. Because of its political power, this interest group has rigged the game so there are few meaningful checks on its demands. Government employees now receive far higher pay, benefits, and pensions than the vast majority of Americans working in the private sector. Even when they are incompetent or abusive, they can be fired only after a long process and only for the most grievous offenses.
It’s a two-tier system in which the rulers are making steady gains at the expense of the ruled. The predictable results: Higher taxes, eroded public services, unsustainable levels of debt, and massive roadblocks to reforming even the poorest performing agencies and school systems. If this system is left to grow unchecked, we will end up with a pale imitation of the free society envisioned by the Founders.
A concert pianist may get as little as $20,000 for a Carnegie Hall appearance. One of the stagehands made $530,044 in 2008.
That kind of compensation for semi-skilled manual labor can only result from union power rising to the level of extortion. Imagine what staggering sum total of dollars is siphoned annually out of the operating budgets of all the concert halls, museums, and theaters in New York City, and how much richer that city’s cultural life would be if workers were paid conventionally generous wages and the currently misappropriated surplus applied to delivering more exhibitions and performances to the public.
Who would have imagined? Al Sharpton opposing a major trade union legislative initiative. Al Sharpton defending the secret ballot. Al Sharpton actually having principles!
Discussing the Employee Free Choice Act with National Action Network’s Charlie King on his own radio show yesterday, the Reverend Al Sharpton said:
Yeah, well, what I don’t understand about it which is why I’m in the campaign is why wouldn’t those of us who support workers being protected, why would we not want their privacy protected. I mean why would we want them opened up to this kind of possible coercion?