The day the Twinkie died.

[rattran]

Guessing when people die isn't hard at all. The actuarial tables are well defined, and get better every year. As even an accountant should know. Misfunding pensions isn't about how long people live, it's about shitty companies not wanting to fund their obligations, and knowing a bankruptcy judge will let them ditch them.

[Paelos]

Guessing when people die isn't hard at all. The actuarial tables are well defined, and get better every year. As even an accountant should know. Misfunding pensions isn't about how long people live, it's about shitty companies not wanting to fund their obligations, and knowing a bankruptcy judge will let them ditch them.

Ok just so we're clear. On the one hand I have absolute certainty about a known value. On the other I have an educated guess. Are you really telling me you'd rather (on either side of the equation) rely on people living by the tables AND having a company continuing to be a going concern, let along being subject to variances in interest rates?

In my mind, I've much rather have the tax free dollars flow to me in my own account that's completely untouchable, rather than grouped together in some potential lump sum fund that's promised to all. Part of that reasoning is because I can transfer it away from my employer should I choose to leave. The other part is that the risks fall on my direction of how I want to invest the money rather than the economic success of my company, and/or their investment choices. If you don't trust companies, it makes logical sense to take it out of their hands.

[Abagadro]

I have both. I like my defined benefit more. I trust my defined contribution more. 

[KallDrexx]

Hostess could always fudge those tables by feeding their employees twinkies, thus having to pay less in pensions 

[Signe]

Now I want fudge.   

[Paelos]

Me too.

[Numtini]

The living longer thing is far less relevant because it's primarily about far fewer early deaths, not long term life expectancy of a retiree.

[Paelos]

I'll put it this way, if anybody was given the option right now to take a lump-sum from their pension, I'd advise them to do that and invest it their way. Interest rates are in the toilet and that affects not only the normal returns, but also the PV calculations for the funded status of a plan.

[Nebu]

I'll put it this way, if anybody was given the option right now to take a lump-sum from their pension, I'd advise them to do that and invest it their way. Interest rates are in the toilet and that affects not only the normal returns, but also the PV calculations for the funded status of a plan.

If you aren't 55, you take a pretty severe tax hit.  Is it still worth it to pay the 10% penalty and reinvest?

[Paelos]

I would say yes, unless it's a federal pension. Those are a different ball of wax. I just don't believe in pensions as a long term option for corporations given the shifts we've seen in the last 2 decades. Also, if you're younger, and plan on working for another 20 years, the DOW has basically quadrupled in that time frame. I believe you can more than make up a 10% hit if you invested wisely with the blue chip stocks.

I've got a lot of money in Coke, as an example. I'd just rather have 90% of my money today and control my own destiny than rely on the economic conditions of one entity doing right by me. It's sort of an eggs in one basket scenario I don't care for.

[01101010]

I hate the thought of gambling in any sense... all this retirement stuff makes me extremely squirrelly. Glad I will never see retirement as not to worry about it. 

[Merusk]

I'm surprised Paelos didn't put actual numbers to his "take it out" when Nebu asked.  Seemed like perfect accountant bait.. I'm so disappointed!

So if you have 100k and take a 10% hit, you get 90K.  Even a modest return of 6% per year will make that up in 2 years. 3% will take 4.

I'm with the monkey on this one.  Too many times we've seen the "pensions defrauded" and "company goes bankrupt, pensioners screwed" stories to put any trust in companies not fucking you over.  Give it to me and let me manage it, then I'm the only one to blame for the hardship on my family.

Too bad the money retained by not paying out a pension is never turned over to the employees and even 401(k) matching is going the way of the dodo.  (Yes, yes, tech sector people. It hasn't hit you yet.  Just wait, because it'll hit your kids.)

[Paelos]

I'm surprised Paelos didn't put actual numbers to his "take it out" when Nebu asked.  Seemed like perfect accountant bait.. I'm so disappointed!

Meh, it involves actual finance calculations, something I'm admittedly not the be best at without a calculator and on top of that I'm already thinking about turkey. Point stands, though. When it comes to your own retirement, I will always fall on the side of keeping your destiny in your own hands.

[cmlancas]

ONO!!!  What will they deep fry for dessert in the trailer park???

Oreos.  Fuck those things are good.

(When you live in Florida you have to try the fare every now and then.)

[Evildrider]

I had the deep fried beer last year at the fair and it actually wasn't bad. lol.

[Tale]

Hostess and the Bakers' Union have agree to mediation, preventing shut down, happy that they just sold a lot of Twinkies.

[Hammond]

Judge forced them into it and I highly doubt their will be any kind of resolution.  Don't worry though someone will buy up the rights to make Twinkies and I wouldn't be surprised if it happened in under a year.

[Signe]

I can't look at this thread anymore.  Every time I do, I get that fucking stupid "Bye, Bye Miss American Pie" song stuck in my head and I hate it, hate it, hate it.  I hope Evilrider gets it stuck in his head forever because he started this thread!   

[Lantyssa]

At least I'm not the only one. ><

[Strazos]

Well, to be fair my pension IS a federal pension.

[Trippy]

Closed.

[Teleku]

That is a very passive aggressive web site.   

[Merusk]

You expected less from the brand of folks that own places?

Fallout from this was I heard a lot of bitching from franchisees this last week, as they couldn't find buns & bread for their stores.  No concern about things beyond, "Those assholes had a contract with me and now I'm inconvenienced."  We're all self-centered in our own special ways.

[cmlancas]

There are a significant number of labor-intense companies without CBAs or with weaker CBAs that're nervous about this sort of action.  Sometimes unions push things a little too far.  I've yet to read compelling evidence as to why the union representatives found a Hostess company bankruptcy and subsequent mass layoff acceptable.

Many times I see unions as necessary (NHLPA right now for sure), but this is the type of thing that makes my company nervous.

[Selby]

I've yet to read compelling evidence as to why the union representatives found a Hostess company bankruptcy and subsequent mass layoff acceptable.

They believe management was screwing them by rewarding themselves at the expense of the common man (which a few years ago was definitely true).  So they are sticking it to the man and now everyone loses.

[Abagadro]

They also sometimes take a pretty wide view of things. If they "cave" on wages for this group of employees it will put downward pressure on wages across the industry and affect all their other members. Not saying it is correct thinking, but that is likely part of the thinking.

[Evildrider]

Teamsters union is definitely not happy with the bakers, that is for sure.

[Shannow]

From a story that I read the bakers union weren't happy with the teamsters.  Supposedly the bake shops were pretty well run but the bakers union got sick of having to make concessions because of how expensive the teamsters had become.   I'm sure there is plenty of blame to be spread around.   

[cmlancas]

It's times like these I'm proud to work for Publix Super Markets.  They really take care of their employees (associates).  I firmly believe that taking care of your folks and paying them fairly equates to no union activity.

I'm not demonizing unions or supporting them.  Rather, I see them as pointless if employers employ optimally.

[Pennilenko]

You must be lucky. The Publix a few blocks from my house has the most unhappy poorly treated staff I have ever seen.

[Merusk]

With big corps like that it's always about local management, though.  Look no farther than the store or regional manager to discover why things are so bad.  (Store if it's one or two stores, regional if it's the whole area, obv.)

[Samwise]

I'm not demonizing unions or supporting them.  Rather, I see them as pointless if employers employ optimally.

If nobody ever broke any laws, we wouldn't need police.

[Ingmar]

I'm not demonizing unions or supporting them.  Rather, I see them as pointless if employers employ optimally.

If nobody ever broke any laws, we wouldn't need police.

If nobody was ever Sinij, we wouldn't need moderators!

[Goumindong]

Sometimes unions push things a little too far.  I've yet to read compelling evidence as to why the union representatives found a Hostess company bankruptcy and subsequent mass layoff acceptable.

The unions found it acceptable because they views the payout from the liquidation into their pension funds would be higher than if they continued working.

When a company is liquidated the payoff order basically goes input>bonds>equity. Pension funds are input costs (as they're associated with labor) and so get paid off relatively first(as with all debts relating to flour etc).  This means that if a company is failing, and prolonging the company may or may not save it, but will reduce its general funds and asset position it may make sense for labor to force a liquidation.

I.E. labor says "we can find new jobs, but if the company keeps losing money we can't find new pensions".

There was a general view that the management at Hostess was looting the company. After the first negotiations they did not reinvest the concessions labor had made and ended up paying large retention bonuses to management and still closed plants. This is not something that is uncommon. If a company is potentially going to fail, it makes sense for management to loot for the same reason it makes sense for labor to liquidate. If you can get more out of a companies coffers by (essentially) robbing it than you can from getting paid in the future then you rob it. The best way to do this is to sell assets (I.E. shut down plants) and then don't reinvest that money into new capital (I.E. give management bonuses)*

Basically the narrative that you're not hearing from the media is that the Labor choice to strike and so force a liquidation probably makes the most sense once you look at their incentives.

Labor had given them a chance to turn the thing around and management failed to do so. Labor then said "well ok, time to cut our losses"

---------

Big picture what happens is Hostess sells its brand and the plants, another company buys the plants and the brand and hires all(or many) of the people that Hostess fired. The money from the sales go to pay the pensions of the laid off workers.

If hostess was allowed to continue running they would have shut down plants and sold the equipment, then instead of putting that money into the pensions they would have paid it out as management bonuses. Eventually hostess fails and other companies rehire the people that hostess laid off.

The difference is that if labor liquidates now they still have some amount of their pensions. If they wait, they don't have pensions.


*Edit: If you shut down plants and then invest in new capital that new capital can be sold and so doesn't reduce the asset position of the firm. I.E. If reinvestment occurs labor essentially just transfers some of their money from current wages to their pension when they make concessions. If reinvestment doesn't occur, labor essentially transfers some of their money from current wages into the pockets of management.

Basically the unions were saying "we don't think you're actually going to do the right thing"

[Lantyssa]

It's easier to blame 18,000 people than the handful at the top looting the coffers.  Obviously those 18k had more influence.