I come for the soju,
I stay for the pictures.
I come for the soju,
I stay for the pictures.
This is the seriously-no-bullshit soup plate,
Where it all falls asunder into metal,
and I don’t mean angry white men playing guitars.
It’s peaceful, the undying here,
and I’m trying to figure out how to make some art out of this monstrous tranquility.
I throw compassionate grenades,
and perform brutally humane triage.
Beer Junction in West Seattle will have one of the region’s craft brewers in to showcase their products. Last night the special guest was San Diego’s Ballast Point Brewing and Spirits, and for a mere $4 you could sample five of their varieties. You can’t beat that with a stick, as we used to say back home.
Tasteless and overpriced is a bad combination. A friend told me to avoid the place and I should have listened. I ordered the teriyaki beef and the sprouts were easily the most flavorful thing on the plate.
Okay, so I’m a pimp for Elliott Bay. But this lager is incredible.
Rich, although not as heavy as a stout, and aged in Heaven Hills bourbon casks.
The result is a sour robust enough for the snob (in the house!) but not one that will weigh you down if you prefer lighter body beers (although the ABV may well kick your ass).
Brewed back in early 2010 to commemorate Elliott Bay Brewing’s 1000th batch (hence the name), this anniversary brew was divided into four separate barrels. This year’s release has been aging since then in Merlot casks after having brettanomyces yeast and a souring bacterium added. Notes of vanilla and grape.
Please, please, please, save enough to take to the Great American Brew Festival. They have a gold medal waiting for you. Continue reading
My esteemed colleague, Sam Smith, recently posted the recipe for his award-winning Doc Sammy’s Three-Meat, Three-Bean and Molasses Crock-Pot Chili. It sounds amazing. And if I’m ever in Seattle when 40 degrees and damp, I’d be tickled to sample the original.
Today is my 6th wedding anniversary and John and I celebrated at home with a pot of chili (a good idea on a blustery day in November in Ohio). We started with Sam’s recipe, but made some alterations to accommodate our lower-salt diet. My thanks, and apologies, to Sam. Hope you enjoy. Continue reading
Tasty coppery ale with crisp pumpkin, cinnamon, nutmeg high notes and rich malt body. Continue reading
There’s a petition making the rounds on Facebook. The short version is that Vermont’s Magic Hat Brewing is suing Lexington, KY-based West Sixth Brewing for trademark infringement. West Sixth is asking the good citizens of Facebook to help them back Magic Hat off. You can read the post here, and it nicely explains the kerfuffle from West Sixth’s perspective. Have a look here for Magic Hat’s side of the story, and rest assured, their version differs from West Sixth’s.
Here are the logos in question. First, the full MH mark:
And here’s the West Sixth logo alongside the Magic Hat #9 Not Quite Pale Ale mark that is the point of gravest consternation.
My initial reaction was along the lines of “bite me, Magic Hat.” I’m someone who tends to believe that most corporate litigation is wankery (the main job of lawyers being to keep their profession healthy) and this is a case where I just don’t see the point. I’m not an attorney, but I have been a brand nazi (I sort of own that role with a couple of clients right now, in fact), so I’m not entirely unfamiliar with the issues surrounding brand integrity and infringement.
My friend and former student Seth Michalak (one of the two or three best students I ever had the pleasure of teaching, in fact) isn’t so sure, and we’ve been back and forth this morning on the issue. He began thusly:
Seth: I’m no fan of Magic Hat, but have you seen the logos side by side? It’s fairly telling that West 6th uses the general Magic Hat logo and not the #9 logo that is in question on their site…
Well, they use elements of both. Yes, the W6 “6″ is similar to an upside down MH “9,” but the eight-sided star resembles, sorta, the star on the MH primary logo. W6 uses a clean, symmetrical star as opposed to MH’s stylized “hippie” star, but it’s an eight-sided star paired with a “6″ that employs a similar font to the MH “9.”
How similar are they? Well, close but not exactly. I broke out the Photoshop and did a little overlay for comparison sake.
I have no doubt that the W6 logo is, ummm, inspired by MH. But this kind of thing happens every day. I can easily imagine the folks at W6 telling the design firm that “hey, we like that Magic Hat look and feel – can you do something like that?” And designers being what they are – that is, sheep – the result is a logo that’s a good bit homage. But do you look at the two and get confused?
If imitating were a crime Apple could sue about a million companies. Wander through the world of corporate logo and Web design and count the number of sites that owe their souls to the Cupertino design team, which may be the most influential industrial design collective in history. You can’t swing a dead cat these days without hitting a Mac rip-off.
So sure – if I’m MH, I might be sneering at the wannabes, but suing them?
Seth: If people don’t get confused then what is the point of such an homage? It’s trading on someone else’s reputation by creating a link in the consumer’s mind. We both know that a lot of marketing happens on a subconscious level.
Good point. But. You can invoke an emotional response without confusing someone. In fact, you don’t want the imitation to rise to the level of conscious awareness. Once the customer starts thinking actively about it, you lose ground quickly. Brands work best at the emotional and, as you say, subconscious level. Feel is good, think bad. So if you’re going to imitate, do it subtly.
Listen, there are only so many ways that a logo can look. There are a finite number of visual identity approaches that are stylish and that speak to what you want to accomplish as a brand. If you look at the logo samples produced by that design shop, you’ll see a certain trendy, ragged-around-the-edges aesthetic that looks contemporary and familiar and slightly hip. Every single one of them is stylistically familiar, yet the best of the lot come off as fresh and engaging. (These guys aren’t my style, for sure, but they’re not bad at all for a local retail-focused designer.)
If you had never seen the MH logo, the W6 mark wouldn’t look even slightly out of place in that portfolio.
I’m not arguing that West Sixth isn’t ripping Magic Hat off. As I say, designers are sheep and just about every new logo you encounter is ripping somebody off, whether you know it or not. I have sat and watched very talented designers sift through online logo boards looking for things to steal. This is where SO many of them get their ideas. In this case, though, the core idea was apparently lifted from someone visible and established in the same industry, making the process a little more obvious than usual. Were I the brand nazi at W6 I’d have guided the process in a different direction because I don’t want to risk getting lost in someone else’s shadow, but I guess that’s just me.
But this doesn’t mean what they did is necessarily illegal. Ultimately that will be up to the courts to decide if it gets that far (which I doubt). It seems that MH is going to play hell trying to assert that they own a font family that existed long before they did or that another brewery shouldn’t be allowed to use a visual design concept that’s being used by who knows how many other businesses around the country already.
Seth: I would say check out some of the posts on Reddit that have Magic Hat’s side to this story before doing so. It rounds out the picture a bit more than the post from W6 alone does. W6 says Magic Hat doesn’t want to talk, and Magic Hat says they have talked and W6 walked away. The truth is probably somewhere in the middle. The point is that W6 likely isn’t the victim of a blindside that the post contends.
Oh, of this I have no doubt. I’m not going to look at those two logos side by side and conclude that West Sixth has all the angels on its side. I encourage readers to have a look at both of those links up top and draw their own conclusions.
In the end, I absolutely get why MH is annoyed, but this is one of those cases where winning the battle might cost them the war. Regardless of the outcome, they have allowed themselves to be cast as a big lawyered-up corporate bully in a dust-up with a brewery in feckin’ Kentucky that until now nobody had ever heard of. And not everybody is going to see the Reddit thread.
It seems to me that there is little to be gained legally and a lot to be lost on the PR front.
Mississippi Republican State Senator Tony Smith, who, as a restaurant owner as well as a state senator, conceivably profits from the poor nutritional choices of his constituents, has proposed a piece of state legislation being dubbed the “anti-Bloomberg bill.” The act’s official title is “An act to reserve to the legislature any regulation of consumer incentive items and nutrition labeling for food that is a menu item in restaurants, food establishments and vending machines; to specify that the act would not affect the federal regulation of nutrition labeling under existing federal law; and for related purposes.”
The purpose would be to prohibit cites or other entities in Mississippi from enacting legislation like that in New York banning enormous sodas (which was recently derailed by a judge). It would also prevent bans on the plastic chachkes that fast food loves to include in its kids’ meals – “Hey kids, collect all 6 and get fat in the process.”
The bill passed 50-1 in the Senate.
Lest you think that the drive to remain the most obese state in the union is somehow partisan, I offer the following. The bill’s sponsor in the House, Democratic Representative Gregory Holloway, explained “We don’t want local municipalities experimenting with labeling of food and any organic agenda.” That’s right, organic food has its own agenda. It’s right up there with the feminist agenda and the homosexual agenda in its threat level to Mississippians.
Perhaps, not surprisingly, Mississippi also gets another prize: worst state for math and science education.
For years, Mississippi has been awarded the “fattest state in the US” prize. If the legislature has its way, they’ll continue an unbroken streak for the foreseeable future. Go Mississippi!
In case you haven’t been tracking along, the folks at Maker’s Mark (which is owned by Beam, Inc.), faced with more demand than they could meet, recently announced that they’d be lowering their alcohol by volume (ABV) from 90 proof to 84 proof. You won’t even notice, they assured us.
The backlash was swift and loud. Makers Mark customers pitched a hissy fit, and at least one marketing analysta (Roger Dooley, writing at Forbes) wondered if the company had committed “brand suicide.”
Do you really want to go on the record as saying the palates of your customers are so unrefined that they can’t tell the difference when the whiskey is diluted? In reality, in blind taste tests most people probably can’t tell the difference between similar colas, beers, whiskeys, etc. Nevertheless, brands still strive to maximize their taste differentiation. Can you imagine Coke saying, “We could change our formula a little, or even put Pepsi in our cans, and not many of our customers would notice.”?
To their credit, MM leadership today changed course, announcing in a public letter that:
…effective immediately, we are reversing our decision to lower the ABV of Maker’s Mark, and resuming production at 45% alcohol by volume (90 proof). Just like we’ve made it since the very beginning.
Good for them. The thing is, we shouldn’t over-congratulate them because this was a butt-stupid mistake to start with. Dooley had commented on their missed opportunity last Thursday:
Maker’s Mark could have used their looming shortage as an opportunity to make their brand stronger. If they encountered sporadic shortages for a period of years, they could raise prices and leverage the scarcity to take the brand up a notch in prestige.
And all he was doing was stating what every smart marketer in America knew instantly: you never give people less. If the choice is between raising prices or cutting portions, for instance, raise the prices. Customers may not like it, but they react worse when they find themselves getting less for their money. Psychologically, when you do so you are taking something away from them.
Same thing with the MM trainwreck. The shortage was arguably even good news from a brand perspective because the unanticipated shortage (whatever that may say about your forecasting operation) emphasized the demand for your product. You could have responded with something like this:
Wow, folks, you like our product so much that you bought more than we expected. It’s going to take us about five or six years to get caught back up because we will not sacrifice the quality of our fine whiskey, no matter how much it costs us. In the meantime, we’re grateful to our customers and salute their discernment.
Instead, you miss the obvious opportunity, you violate the customer’s trust, and you dilute your brand by far more than the three percent you’re cutting the ABV in your now somewhat less prestigious liquid refreshments.
Given that Makers Mark had committed the gaffe, today’s announcement was precisely the right move. But there was no excuse for the mistake in the first place. Now, thanks to a moment of unfathomable stupidity, they’re faced with the challenge of restoring their tarnished reputation.
Maybe Makers Mark will be just fine. Maybe this won’t even register a blip on their sales numbers – time will tell. In the meantime, though, the company’s need to understand what they have done. Leaving the product as is, running a new ad campaign, dumping money into PR aimed at assuring us that everything is hunky-dory, none of that can undo one simple fact: a few days ago, they announced to the world that they can water down their whiskey with no noticeable impact on quality.
That’s a hell of a brand promise, and it’s a bell that you can never unring.
Think. Act. In that order.
In something of a Big Deal, it has emerged that China no longer will pursue the goal of being self-sufficient in food. According to the South China Morning Post, Chen Xiwen, who is the director of the rural affairs policy-making committee of the Communist Party, and who therefore presumably knows a thing or two, the policy of self-sufficiency laid out with great fanfare in 1978 won’t work anymore. Xiwen is quoted as saying the following: “During the process of urbanization, we must pay attention to modern agricultural development and to farm product supplies, but of course, we certainly cannot pursue self-sufficiency.” I imagine agricultural commodities traders worldwide creamed their jeans when they heard this—because China is now going to have to decide what to import and what to keep growing. But the traders probably already knew this—in fact, most of us knew this, long before the Communist Chinese government could actually admit that this was going to be the case.
Rice is probably fine. But as the Chinese middle class grows and wants to eat more like the west, farmland is coming under pressure, so crops like corn are coming under more pressure as well. The corn, of course, is used for meat production, which is also growing rapidly. Then there’s the ongoing and very rapid urbanization that’s taking place over the past several decades, which has seen an estimated 260 million farmers leave the field (so to speak) according to the SCMP article, and the rural population decline by about 80 million since the early 1980s. The urban population, already pretty large, continues to grow, which is more or less the problem—or a significant part of it. All this is compounded by China’s increasingly serious water issues. As a result, China’s hunger for farmland outside of China has become significant enough that it has roiled local property markets in any number of regions.
I still remember the hoo-hah that accompanied Lester Brown’s book Who Will Feed China when it appeared in 1995. Brown’s central point was that there simply weren’t the global resources—to say nothing of indigenous resources within China—to feed the population of China to the standard of Western Europe or the US. At that time, the Chinese government pushed back strongly on this, and did so for many years, suggesting that Brown was full of crap. Hmmm, not so much now. But there was a corollary point as well, which was the pressure that Chinese demand would put on global food supplies. As the SCMP article cited above indicates, food imports are growing rapidly in China, and represent an increasing share of what’s available to Chinese consumers. And, of course Chinese food imports are actually food exports from somewhere else.
Everywhere we look we’re bumping into resource constraints, but we continue to deny this. Carbon in the atmosphere is just the most glaring example, but there are plenty of others—the imminent (but probably preventable) collapse of global fisheries being perhaps the best example. This year, 2013, we’re likely to see further strains on agricultural commodities as droughts persist, but demand continues to increase. Even with additional acreage being planted in North America in 2012, the crop was well short of targets. It would be nice to think we had political systems that could deal with this sagely—but we don’t. We do have an economic system that sort of knows how to deal with this—but we don’t know yet how successfully it will deal with food scarcity on a global level when the capacity to actually grow food is compromised. Pity.
Because he’s back home from secondary school for the holiday, Simon is in charge of the kitchen at the Bethlehem School this month. Although only seventeen, he’s easily one of the best cooks whose food I’ve ever eaten. “In Uganda, it’s considered a disgrace for a man to cook unless he trains to be a chef,” he tells me.
“In America,” I tell him, “if you like to cook, it’s a good way to find a girlfriend.”
“I love to cook,” Simon admits.
Simon’s kitchen is a mud brick hut with a metal rook and two small cookfires crackling away on the dirt floor in one corner. In the opposite corner, two tables give him room to lay out his diced peppers, sliced tomatoes, a bowl of beans soaking in water, and several banana leaves each larger than a sheet of newspaper.
Outside there’s a room-sized pavilion where he can build larger fires for larger cooking projects. Several other secondary school kids home for the break are out there now, roasting ears of maize to snack on, but when the kitchen is going full-swing during the school year, it feeds six-hundred kids a day: porridge for breakfast and pasho and beans or pasho and matooke for dinner.
It’s the matooke that’s brought me to Simon’s kitchen today. Matooke, also spelled “matoke,” is basically a thick mush made of plantain bananas, and it’s the staple food of Uganda. Although high in calorie content, matooke is a great source of potassium, and I’m told it’s fairly nutritious. Most importantly in a country where life can be little above subsistence, matooke is extremely filling. I’ve asked Simon to teach me to make it.
We sit outside the kitchen on a bench with a box of the green bananas on the ground in front of us. Forget the easy-peel Cavendish—the supermarket banana most Americans and Europeans are familiar with—these plantains mean business. The peels don’t just slip off. Simon cuts off the top end with a knife and then runs the knife back toward him to cut the peel away. With several quick knife strokes, he strips away the peel, the slices of skin falling back into the box. He drops the peeled fruit into a pot and then grabs another unpeeled plantain. The process takes on the rhythm of a private peeling potatoes, although Simon does it with good humor.
“It gets sticky,” he says. Banana sap is notoriously thick and gooey. He shows me the build-up on his fingers as he goes. He’ll need kerosene to clean it off his hands and knife when he’s finished.
It takes about ten minutes to peel the fifteen bananas. As the peels pile up, Simon lifts the box and shakes it like a sand sifter, and the few unpeeled fruit rise to the top.
He rinses the banana, and then fills the pan with enough water to cover them, then wraps a banana leaf over the top of the pan and sets it on one of the cookfires to simmer for half an hour. While they cook, he works on a sauce for the beans he’s making, mixing diced peppers, onions, and tomatoes. “I add salt to break up the tomatoes,” he tells me, as though divulging his secret recipe.
The plantains absorb the water as they cook, and when we pull them off the fire, they’ve turned yellow and mushy. One of Simon’s assistants, Nmutale, wets his hands to cool them, then begins to knead the banana leaves that cover the cooked plantains, mashing them to pulp. “He’s kneeling as he prepares the food,” Simon points out. “In Ugandan culture, we believe it’s important to respect the food, so that’s why we kneel.”
Every few seconds, Nmutale dips his hands again to cool them, then continues kneading. When he finishes, he scoops the mash from the saucepan into a banana-leaf-lined basket. He then folds the leaves in on themselves, wrapping the mash into a volleyball-sized globe. Who knew it took so banana leaves—let alone bananas—to make this stuff; there’ll be no way I can make it at home.
As Nmutale mashed, Simon has taken some of the thick central veins from other leaves and coiled them, then set them in the saucepan. He’s also added some water to the bottom, and then lines it all with more banana leaves. The coils keeps the leaf ball out of the water and will allow the pot to act like a steamer once Simon sets it back on the fire.
While all that’s been going on, Simon has had me washing slices of cassava root and pumpkin. Nmutale sets the wrapped mash in the pot, and I place the washed vegetables around it. Simon folds up the leaves into a tidy package looks almost like a cabbage. It will slow-steam like that to stay warm until ready to serve.
By the time we all sit down for lunch, another hour has passed. The matooke arrives still wrapped in the banana leaves. People lift a flap of leaf like a game of peek-a-boo and scoop off big gobs. It’s yellow by now, and tiny, tiny black dots—banana seeds—are visible throughout. People eat it plain, although I’m still experimenting with a way to make it taste palatable. Heaps of salt might help, but that’s no good (and not really available), so I’ve tried mixing it with ground nuts (which look like hideous purple baby puke but taste sweet), beans, goat soup, and beef soup. So far, nothing’s helping. “It’s an acquired taste,” Deb admits.
I’ve been trying for ten days and haven’t acquired a taste for it yet. I’ll keep trying.
The well at Nakagongo sits in a low valley, with a web of trails that lead down to it from the surrounding hillsides. It’s not an especially grueling walk and not especially steep, but it’s a five-minute hike downhill from the road. On days like today, when it rained for a couple hours in the morning, the dirt path gets muddy. We also have to step over a pretty angry stream of ants.
About three hundred adults and eight hundred children are serviced by the well, which is nothing more than a clean natural spring surrounded by a cement basin. The basin seems to be draining well today–the water at the bottom is only ankle deep, although Deb has seen it back up almost to the output pipe. The ground around is a mucky mess.
Families have to walk from as far as forty-five minutes a day to collect water in five-gallon plastic containers. Once someone arrives, he or she might have to wait as long as half an hour before they have the chance to fill up. The villagers may then balance the jugs on their heads so they can carry jugs in each hand, too. Enterprising boys have set up a business where they’ll load their bikes with water and take them to the houses of people who can afford to pay for delivery.
At home, villagers use the water for cooking, cleaning, and bathing.
During the dry season, when the well dries up, villagers have to walk to another water source that’s an additional hour away.
To say I am thankful for indoor plumbing seems like a trite understatement. Seeing the well might be the most profound reminder of just how different life is for much of the world than it is for us in America and in other developed nations. This is everyday life for these villagers, and yet it is so far removed from my own life that it might well as be a different century or a different planet as a different continent and country.
Certainly America has its share of drought–I think of the summer of 2011 when much of the cornbelt baked–but water generally flows pretty freely…at least freely enough that most of us still take it for granted, although climatologists could offer some disheartening insight into that, I’m sure. I can walk into three rooms in my home that have running water, and that’s not counting the baseboard heat I have. Some of these people have to walk for forty-five minutes.
Think about that when you turn on the tap.
One of the best ways to see how the locals live, I’ve found, is to visit the market. Alas, on such a trip, words fail me—mostly because I don’t always know what I’m looking at and a language barrier prevents a lot of question-asking. So I’ll let some pictures do the talking this time:
As you probably already know, the world ends tomorrow. If you didn’t know this, you might want to Google “Mayan calendar” and start getting right with Jesus. Anyhow, the end of the world is a pretty big deal, and we’d like to know how you plan on spending it. Also, we want to know how you’d spend it if you had your druthers. No answer is too fanciful, too fantastic, too outlandish. I mean, take a swing here, folks. The world will be over, so it’s not like anybody will be able to hold you accountable, right?
I’ll go first. What I’d like to be doing when the world ends… For dinner I’d like a big cut of prime rib from the Chop House, start it rare, then pan-blackened. Bourbon Stout. And I’d like a taste of Port Ellen, to boot. For dessert a generous helping of bread pudding with vanilla bean ice cream and bourbon sauce. After dinner, I’d like to retire for the duration with the lovely Kaley Cuoco. Oh hell, dream big, Sam. Kaley Cuoco and Zooey Deschanel and Hannah Simone and Stana Katic.
What I probably will be doing is watching TV with the dog. Not with a bang, but a whimper.
And now, let’s hear from some of our favorite musical artists. Here’s REM:
And Rob Dickinson, with a romantic take for those of you lucky enough to be ending it all with the one you love.
So, bye, I guess. It’s been nice knowing everybody.
Prep time is about 45 minutes, then four or five hours in the crock pot.
1: Pour tomatoes in large crock pot and turn on high.
2: Cut green peppers into strips and chop onion. Set aside.
3: In large frying pan, fry bacon until it’s done but not yet crispy. Remove from pan, leaving as much of the grease as possible. Put bacon on some paper towels to drain and cool.
4: Put chorizo into frying pan and cook until thoroughly browned. Remove from pan, against leaving as much of the juice as possible, and put into crock pot. (I prefer beef chorizo, but pork works great, too.)
5: Put garlic into frying pan and then add the beef cubes. Brown in the remaining grease. Again, remove the meat and place in crock pot, being careful to leave as much grease as possible. (Beginning to detect a theme here?)
6: Put onions and peppers in frying pan and saute for three or four minutes – ideally until the onions are cooked down a bit but the peppers still look fairly crisp. Dump everything into crock pot. (Yes, everything – you can stop worrying about leaving the grease in the pan now.)
7: Now that bacon has cooled, cut it into roughly 1-inch squares.
8: If your house is like mine, there has been a dog in the kitchen ever since you opened the first pack of meat. Give dog a small piece of bacon and some ear scritches. Add the rest of the bacon to the crock pot.
9: Add the molasses and all of the spices. Pour beef broth into crock pot until the liquid level comes almost to the top of the meat and vegetables. Stir thoroughly.
10: Cover and cook on high until you can see the liquid bubbling/boiling. Reduce to low, cook for 4-5 hours, stirring occasionally.
11: With about an hour remaining, drain the beans and add them, along with the corn.
Serve with tortillas, add shredded cheeze and/or sour cream if you like.
And by all means, let me know in the comments below what you thought of it. If you have suggested improvements, I’d love to hear them. I’m a guy who loves chili, but I’m hardly a chef, so anything that helps me become a better cook is welcomed.
As with most things the mainstream media gets hold of, there’s more to the Hostess story than meets the eye. A quick scan of headlines will give the impression that striking bakers have cost all Hostess employees their jobs. A check on liberal sensibilities would indicate that it’s the greedy bastards at the top. But what really happened? Was it death by vulture capitalists? Or death by union thugs?
To hear Hostess Brands tell it, it’s union thugs:
We are sorry to announce that Hostess Brands, Inc. has been forced by a Bakers Union strike to shut down all operations and sell all company assets.
The Board of Directors authorized the wind down of Hostess Brands to preserve and maximize the value of the estate after one of the Company’s largest unions, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM), initiated a nationwide strike that crippled the Company’s ability to produce and deliver products at multiple facilities.
On Nov. 12, Hostess Brands permanently closed three plants as a result of the work stoppage. On Nov. 14, the Company announced it would be forced to liquidate if sufficient employees did not return to work to restore normal operations by 5 p.m., EST p.m., Nov. 15. The Company determined on the night of Nov. 15 that an insufficient number of employees had returned to work to enable the restoration of normal operations.
The BCTGM in September rejected a last, best and final offer from Hostess Brands designed to lower costs so that the Company could attract new financing and emerge from Chapter 11. Hostess Brands then received Court authority on Oct. 3 to unilaterally impose changes to the BCTGM’s collective bargaining agreements.
Hostess Brands is unprofitable under its current cost structure, much of which is determined by union wages and pension costs. The offer to the BCTGM included wage, benefit and work rule concessions but also gave Hostess Brands’ 12 unions a 25 percent ownership stake in the company, representation on its Board of Directors and $100 million in reorganized Hostess Brands’ debt.
On the other hand, according to BCTGM President, Frank Hurt:
Hostess failed because its six management teams over the last eight years were unable to make it a profitable, successful business enterprise. Despite a commitment from the company after the first bankruptcy that the resources derived from the workers’ concessions would be plowed back into the company, this never materialized. Management refused to invest in modernizing its bakeries or devote necessary resources to advertising and marketing, product development and new technology. Business plan after business plan failed, leaving the company ever deeper in debt.
When a highly-respected financial consultant, hired by Hostess, determined earlier this year that the company’s business plan to exit bankruptcy was guaranteed to fail because it left the company with unsustainable debt levels, our members knew that the massive wage and benefit concessions the company was demanding would go straight to Wall Street investors and not back into the company.
Our members were aware that while the company was descending into bankruptcy and demanding deep concessions, the top ten executives of the company were rewarding themselves with lavish compensation increases, with the then CEO receiving a 300 percent increase.
The problem with claims like the foregoing from both sides is in the way they oversimplify the situation from the perspective of their vested interests.
Abby Zimet, in On Twinkies, Ho Hos, Hedge Funds and Greed paints a more complex picture in a few brief strokes:
But the company has a long history of financial instability and ownership changes, including two earlier bankruptcies. The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union blames greed by Wall Street hedge funds that had taken over control, unreasonable demands including wage and benefit cuts of up to 30% even as top executives got large pay increases, and a decade of gross mismanagement by a company that had already gone through six CEOs in eight years. Changing tastes, too, played a part.
For a more detailed picture of the nuts and bolts, one may wish to consult John Carney’s How Hostess Failed: Hedge Funds Vs. Unions at Business Insider.
Early into the article, it may seem the culprits are quickly and readily identified:
Only Silver Point and Monarch could have kept Hostess out of liquidation and kept the Twinkie bakery ovens firing. But they were, ultimately, unable to reach a deal with the unions that represents the workers who make and deliver products like Twinkies, Wonderbread and Ding Dongs. Without large union concessions—what some would say, total union capitulation—the hedge funds decided Hostess would have to die.
Near the end of the article, Carney states,
Silver Point and Monarch—as well as the other secured creditors—will realize some value for their investment in the company, although certainly far less than they had hoped. (But, since we don’t know how much they spent on the debt, we may never know whether they gained or lost on the deal.)
On that basis, it would be anyone’s guess whether the lenders were just mitigating losses or cutting out while there was still any money to be had. Thankfully, Carney recommends a piece at Forbes that sheds even more glaring light on the backroom donnybrook leading up to Hostess’ demise.
In that article, Hostess is Bankrupt … Again, by David Kaplan, Kaplan describes the situation thusly:
The company was going to pieces — again — and Hostess filed for Chapter 11 protection — again — in January of this year. This time, though, the moneymen were no longer on the same page. As the majority equity holder, Ripplewood badly wanted to keep Hostess out of bankruptcy. It pleaded with the lenders to show flexibility, but they were not so inclined. They lenders held superior fiscal hands and had less downside if Hostess failed. In the event of a bankruptcy, given all the assets Hostess owned, the lenders would still walk away with millions.
Faced with this situation, the Teamsters eventually capitulated and asked BCTGM to do the same. BCTGM wasn’t having any of it. According to the new deal offered, employees would take an 8% pay cut, followed by modest wage increases over time (although not totaling 8%), as well as cuts in benefits. As the various articles have framed it, BCTGM saw this, especially in the face of “looting” by top executives who received substantial (shall we say, “obscene”) raises, as just one slap in the face too many and stuck to their guns. They maintained the strike. The lenders didn’t blink.
Hindsight is a bitch sometimes, especially now that 18,000+ workers are out of work, in part thanks to corporate mismanagement, in part to weakening demand, in part to the vagaries of a sour economy that saw raw material prices rise, in part to obstinate union negotiators, and in part to the BCTGM strikers that kept up the picket. And for what?
Wage information for the bakers is hard to come by. The best estimate I could find is somewhere between $14 and $20 per hour. For the sake of somewhat easy math, let’s say $20 (and for now, forget the cuts to benefits, such as cuts to the employer contribution for health care). 8% of $20 is $1.60. $20/hour wages would thus drop to $18.40/hour. For the individual, that would amount to $3,328 (gross) less per year (or $277/month). Tack on higher deductions for their increased share of insurance and sure, that would hurt. Step back and look at the estimated big picture, however, and that $3,328/year X 18,000 employees represents just under $60M saved for the company per year.
I can see how the bakers would take that as a grave insult, especially when executives are pulling in six and seven figures after their grotesque raises. I can understand even moreso when those executive raises hardly seem earned, given the failing history of the operation. I know I would like to see my salary double or triple were I to suck at my job. It would be nice to make $60,000 a year.
Oh, there’s the bitterness. And you thought I was holding back. On the one hand, I applaud labor for standing up for its principles. On the other, while I’m more than happy to heap condemnation on the management and on the vultures for structuring a deal that only they could conceivably win (or afford to lose), I must confess I’m a bit miffed at the bakers. 18,000+ jobs were lost for the narrow interests of less than a third of them, because they couldn’t fathom making it on $6/hour more than many of us, myself included, take in.
As for where I got my wage info, here. If you really want to see some verbal elbows getting thrown, I recommend it. Definitely NSFW. It’s also not safe for any simple, preconceived notions as to what went wrong at Hostess. There are claims that union thugs brought the company down. In essence, that’s too simple to be true. At the same time, in the heat of verbal battle, there are many cries from “seeming” union members much to the effect of, “let the company fall.” I can’t verify that the comments are actually from union members, but it does look damning when some of the picketers may very well have felt that way.
In other news, Rush is still a blithering idiot, but his detractor at PoliticusUSA only gets it half right. The Teamsters capitulated. The bakers, on the other hand? Well, suffice to say that, in light of this story, we can’t just lump all unions together as one homogeneous force with which to reckon.