Well, they did it. Hostess said Wednesday that if the Bakers weren't back to work by end of day Thursday, they'd liquidate. The Teamsters (hardly a friend of corporations) backed them up, saying that Hostess really couldn't afford a better deal than it was offering. The Bakers still didn't believe them, and refused to return to work.
This morning, Hostess has declared it will seek judicial permission to liquidate its assets, shutter all of its plants, and lay off approximately 18,000 mostly union workers. The Bakers union was the second largest, after the Teamsters, for Hostess. The represent about 5,000 employees. These 5,000 employees decided that it was better that no one get anything than that they take an 8% pay cut.
Think about that. Rather than take 92% of their prior pay rate, they would rather take 0% and force the other workers (again: largely union workers) also to get 0% of their prior wages.
Heck of a job.
Now, I'm not sure what the Bakers Union told the employees, but I suspect people didn't really think things all the way through. You see, when a company normally lays off employees, they are eligible for some benefits. These include Unemployment and COBRA. When a company liquidates, however, all of those benefits go away. That includes for people currently on them. So it's not just current employees who are being screwed over by the bakers, it's employees who had been fired, laid off, or otherwise left the company in the last 18 months. I'm sure in this time of (real) 14+% unemployment, they'll really appreciate not having access to Unemployment benefits or COBRA.
Then there are retirees. Pensions? Gone. Retiree health benefits? Gone. The company will discharge all of those liabilities in bankruptcy. The bakers union has absolutely destroyed well upwards of 18,000 lives, because they didn't want to take an 8% pay cut. Zero percent was better, in their minds, than 92%.
Now, it's easy to pin this just on the bakers union. In this particular case, it's where the blame belongs. But there is a larger point, here.
Unions often talk about a fraternity, or a sense of mutual respect even between unions. One of the reasons strikes are often effective is that when one union strikes, others often will in solidarity. Unions help each other out. Union members respect members of other unions. They're not like those icky Scabs who just want to work for a wage, and don't particularly care about Sticking It To The Man.
But when it comes down to it, they'll throw that fraternity away. Their selfish desires mean they'll use the other unions, but they don't really care about them. If they think they can get more, even if losing the gamble means ruining other lives, they'll take the gamble.
And why shouldn't they? It's not the union bosses who are going to be out of a job on Tuesday. They won't be the ones losing their pensions and benefits. The union bosses won't be looking for work in this economy. What skin is it off their nose if these 18,000 families suddenly have no, or at least greatly reduced, income?