In response to:

Hostess Bankruptcy: What Role Did Policy Play?

SpaceVegetable Wrote: Nov 19, 2012 7:37 PM
I always tell these anti-business people that they should go start a business of their own and then com back to me in a few months and tell me how easy it is to run a company and how much money they're rolling in (and how many big fat paychecks and cushy benefits they're paying their employees). You can guarantee they'd be singing a far different tune if they did make the attempt. Alas, most of them are too risk-averse to even consider it.

The demise of Hostess and Twinkies is not a national emergency, but it is certainly sad when a major business goes under and thousands of people lose their jobs.

If federal and state policymakers want to play a useful role here, they should study why Hostess couldn’t make a go of it. Were there tax or regulatory factors that stood in the way of the company earning a decent rate of return?

Unions were an important factor that pushed up the firm’s costs and reduced its operational efficiency. The policy reform here is obvious for people who appreciate market economics: repeal America’s coercive union laws. If policymakers don’t...