There’s No Excuse for Journal’s One-sided Account of Hostess Liquidation

November 27th, 2012 · 1 Comment · economy, Fact Check, financial coverage, journalism, labor, Uncategorized

By Arthur Alpert

This post begins as a tale of two headlines. It will end with an unfunny joke.

The Albuquerque Journal headline on the Business Page Saturday, November 17, told us:

“Workers’ Strike Proves Fatal to Hostess”

The Wall Street Journal headline on the front page that same day read:

“Twinkie Maker Hostess To Close”

Now let’s look at their leads.

The Albuquerque Journal’s story (from “Journal and Wire Reports)” offered this:

“Hostess Brands Inc. says it’s going out of business – and eliminating 18,500 jobs – after striking workers across the country crippled its ability to make its Twinkies, Ding Dongs and other snacks.”

After opening cute (“The seemingly imperishable Twinkie finally may have an expiration date”) the WSJ wrote:

“Hostess Brands Inc, the 85-year-old maker of iconic treats such as Twinkies, Ding Dongs and pantry staples like Wonder Bread, on Friday said it would go out of business after failing to reach agreements on wage and pension cuts with its bakers’ union.

You see the difference. Our Journal wrote a headline blaming Hostess’ demise on organized labor. The Wall Street Journal didn’t.

And the Journal’s lead blamed the workers for striking, while the Journal’s implied the company was responsible for a labor agreement.

Why the difference? WSJ and Albuquerque Journal managements agree unions are the Devil’s work.

Ah, but at the WSJ a wall separates the news operation from its editorial page.

No wonder the Journal and WSJ stories continued to diverge.

The WSJ noted in paragraph four that Hostess hasn’t coped with the healthy eating trend and in five that organized labor is tiring of surrendering wages and benefits.

The Journal’s account omitted Hostess’ struggles in the marketplace and the possibility unions might be suffering from “give-back” fatigue.

The closest it came was in the penultimate graph:

“Union workers went on strike,” after rejecting a “contract offer that slashed wages and benefits.”

Then the plot really thickens. For when the WSJ story jumps to page six we learn that the company suffers from a “burdensome debt tracing back to Hostess’s first bankruptcy in 2004 and missteps by private equity firms and managers since also burdened the company despite its more than $3 billion in annual sales.”

Not the most graceful prose, but you get the idea – Hostess had been deep in the red for years, partly because of management failures.

Deep in the red? Management failures? Our Journal cited neither.

Nor did it note that the Teamsters accepted what the Bakery, Confectionery, Tobacco Workers, and Grain Millers union rejected.

To be fair, the WSJ has infinitely greater resources than our local daily; heck, they put three reporters on the Hostess debacle. So we expect the WSJ to produce a superior story.

But that doesn’t excuse the Journal’s one-sided account.

Further, how come the editors who assembled it in part from “wire reports” found nothing to cast doubt on the Hostess version of events.

It took me only 10 minutes to do that.

Take the New York Times Nov. 16 story; it included the bakery workers’ argument:

“Frank Hurt, the union’s president, seemed to lose patience with Hostess’s management, upset that it was in bankruptcy for the second time despite $100 million in labor concessions. He saw little promise that management would turn things around.

“Our members decided they were not going to take any more abuse from a company they have given so much to for so many years,” said Mr. Hurt.

“They decided that they were not going to agree to another round of outrageous wage and benefit cuts and give up their pension only to see yet another management team fail and Wall Street vulture capitalists and “restructuring specialists‚” walk away with untold millions of dollars.”

And at Daily Kos, Labor Editor Laura Clawson reported the company had planned to liquidate even if the unions had accepted the latest cuts.

Her Nov. 16 article also included the bakery union charge that Hostess had six CEOs in eight years “none of whom had an bread and cake baking industry experience.”

Please understand. I do not expect the Journal to recall what Rick Perry and Newt Gingrich said in recent memory about “vulture capitalism.”

I accept as rock solid our daily newspaper’s policy of whitewashing how Wall Street – and corporate America –works.

Nor do I suggest the Journal accept labor’s picture of the Hostess debacle.

My object is to show how the Journal published a sliver of the Hostess story, leaving out information that might cast doubt on its headline – the headline that blamed organized labor for the company’s demise.

Which reflects the newspaper’s narrative perfectly.

The Journal has since followed the story without rectifying the initial bias. An AP account of last-minute talks (Tuesday, Nov. 20, A6) did mention near the bottom that Hostess was “weighed down by debt, management turmoil, rising labor costs and the changing tastes of Americans.”

Next day, the Journal’s syndicated humorist, Argus Hamilton, wrote:

“Hostess shut down bakery plants and went into bankruptcy Monday due to a bakers’ strike. The judge ordered mediation. Eighteen thousand workers could soon be collecting unemployment which today is known as winning the lottery.”

Unfunny? Yes, but more crucially, he got the story wrong.

I forgive Hamilton, though – he thinks he’s a comedian.

What’s the Journal’s excuse?

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One Comment so far ↓

  • Mr Wolf

    The Journal’s excuse has a name and it’s Ken Walz. You did a perfect analysis of why thevAJ is a disgrace to all real papers. Well done.

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