While the media is busy blaming the union for Hostess's demise, nobody is reporting that CEO Brian Driscoll helped himself to a 300 percent pay increase. Just another example of the one percent literally taking food out of the mouths of everyone else -- in this case Twinkies and Ho Hos.
Driscoll's salary went from $750,000 to $2,550,000. Another executive's salary went from $500,000 to $900,000 and another doubled his salary from $375,000 to $656,256.
In the meantime, the company was eliminating its largest debt -- the Union Health and Welfare/Pension to which it owed $989,323,000 as reported in January 2012. If there's no money to pay workers and you're asking them to make concessions such as lower pay and higher insurance premiums, where do you get off doubling and tripling your salaries? Ask workers to take a pay cut while you suck every available dollar out of the company you can and steal their pensions and you wonder why they won't accept your deal?!
Hostess clearly has had numerous problems for a long time now. They first filed bankruptcy in 2004. Then after Driscoll helped himself to his 300 percent raise, Gregory Rayburn was appointed CEO -- the sixth CEO in the past ten years. He immediately reduced the salaries of the four top executives to $1 per year. A day late and a dollar short.
Even without the pension costs, which the company quit paying this year, experts have been commenting on the company's struggles and dim outlook for the future. They emerged from the 2004 bankruptcy more in debt than when they went in. Combine that with bad sales and poor, greedy management eating up all the profits. It's no wonder Twinkies are now extinct.
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