Saturday, November 24, 2012

Twinkies and golden eggs

By Thomas Sowell

Killing the goose that lays the golden egg is one of those fairy tales with a heavy message that a lot of adults should listen to. The labor unions that have driven the makers of Twinkies into bankruptcy, potentially destroying 18,500 jobs (subject to court-ordered mediation), could learn a lot from that old fairy tale.  Many people think of labor unions as organizations to benefit workers, and think of employers who are opposed to unions as just people who don't want to pay their employees more money. But some employers have made it a point to pay their employees more than the union wages, just to keep them from joining a union.

Why would they do that, if it is just a question of not wanting to pay union wages? The Hostess Brands bankruptcy is a classic example of costs created by labor unions that are not confined to paychecks.  The work rules imposed in union contracts required Hostess, which makes Twinkies and Wonder Bread, to deliver these two products to stores in separate trucks. Moreover, truck drivers were not allowed to load either of these products into their trucks. And the people who did load Twinkies into trucks were not allowed to load Wonder Bread, and vice versa…… To Read More…..

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