As usual, when there is a takeover or merger story, with the probability of hundreds or maybe thousands of job losses, amalgamations and relocations for people at the bottom who have no say whatsoever in the outcome... there is a tale of greed and avarice for the man at the top who has a great deal of say. Such is life...
And so it is with the latest story of a British company being bought over.
Todd Stitzer, the American chief executive of Cadbury will receive: a £12m pay off; a year’s salary of £985,000; a bonus of around £2m, and the right to cash in shares worth £8.6 m. So it’s a pretty fair bet that he thought it a not bad idea, and that come Monday morning Mr Stitzer will not be queuing to sign on for £60 a week at the local Dole Office!
Cadbury's resistance to the takeover melted yesterday as Kraft Foods, known for Dairylea and Philadelphia cheese, increased its offer to £8.40 a share. Investors will also get a 10p a share dividend, taking the bill to £11.9 billion. Cadbury employs around 45,000 people in 60 countries. It has 5,600 staff at eight sites in the UK and Ireland.
Cadbury chairman Roger Carr said the board was recommending acceptance even though it inevitably meant job losses. He did not say how many jobs would be threatened but said the axe would fall at Cadbury's HQ in London.
Workers at the company's landmark Bournville plant in Birmingham had no idea what is going on or what it might mean in terms of job losses. Jennie Formby of the union Unite said: "This is a very sad day for UK manufacturing. A successful, iconic, independent UK brand will now be owned by a giant company with massive debt. The sad truth is Kraft will be under pressure to pay down their debts and this raises real fears for jobs."
Gordon Brown promised to fight for Cadbury's British workers. He said: "We are determined that, at a time when people are worried about their jobs, jobs in Cadbury can be secure." And Business Secretary Mr Mandelson said he would do everything he could to keep Kraft to the undertakings that have been given.
I imagine that a huge sigh of relief will be heard from miles away at the utterances of these two. Meatime it's reassuring to know that at least Todd will be alright!
If Jonah says he's going to fight for Cadbury's workers jobs, then put money on the business being moved out of the UK lock, stock and barrel.
ReplyDeleteWhen Kraft bought Terry's chocolate they shut the factory down in York and moved the machinery and jobs to Poland so the same thing will probably happen here.
ReplyDeleteQM: Yes, he's the last man I'd want on my side if I was in a fix. He's saved the banks (?), the world (?), the climate (?) and now he's going to save Cadbury's (????) Aye right.
ReplyDeleteAnon: Sounds like what they will do. Although maybe for a bit of variety they will go to Hungary, Slovakia, or Bulgaria....
ReplyDeleteIt is time for us to realise that it is neither free nor fair trade to ask the UK workforce to compete against slave labour wages abroad.
ReplyDeleteWorking class welfare and rights have been hard fought for in the more economically advanced western hemisphere, surely it is not against a free and fair trade principal to ask that the insentive to exploit un-unionised labour in under developed economies is ended. For example through a more rigerous EU tariff wall programme?
Yes Dean, But in some of the European countries, there is simply a lower wage cost, because there is a lower cost of living. So, Polish wages are lower because Polish costs are lower.
ReplyDeleteThere is certainly something to be said for acting against the slave labour that produces some of the products in our shops... but, how would we explain to Brits that they will now have to pay double or triple for their shoes, shirts, jeans, etc, from Primark for example.
To ban this kind of product would push the cost of so many of these things out of the range of so many people here....and push up the cost of living....
It's not easy.... I'm always amazed that anyone would want to be a politician!!
Well, it isn't banning foreign produced shoes etc...merely artificially increasing the price to produce products outside of the eurozone, this ends the economic incentive to exploit 'slave wage' economies.
ReplyDeleteAnd what do you say to the primarkers? I would say governments have to do what is right, morally ethically and economically- not just following the populist lead of the polls and public self interests.
Otherwise we shall all end up seeing our PMs repeat the Jim Hacker phrase "i am their leader, i must follow them"
LOL. Lovely phrase.
ReplyDeleteAs for the Primarkers... I don't know. It's a way for people who are not so well off, to feel a bit rich, because they can go buy a whole outfit for about £15. And, who cares if it falls to pieces after a few wears.... It's out of style by then anyway.
But, it keeps a lot of people in this country in work selling the stuff, a lot of people happy buying it, and if instead they were wearing locally made clothes, they would need a mortgage to buy an outfit...
I'm not disagreeing with you... I'm just playing devil's advocate.
"It's a way for people who are not so well off, to feel a bit rich"
ReplyDeleteWhile it is important to enable people to enjoy clothing as cheaply as possible, and to maximise peoples purchasing power.
That said, is it really the point of an economy to enable people to 'feel' rich? Surely it is not a reasonable position for anyone to maintain that we should continue to exploit un-unionised labour forces in poorer nations just so Britons can save a quick buck and live slightly above their means.
And given the levels of public indebtedness it is questionable whether primark shops are good or bad. Is it good to encourage people to spend spend spend just because the goods are slightly cheaper?
Dean:
ReplyDeleteI'm not saying it is necessarily good. Although politicians are there to give us the kind of life we would give ourselves.
But that aside. In the dreary, miserable world of horrible dull jobs, paying just enough to live on, squalid housing, dilapidated town centres, decrepit transport, cheap clothes for younger people at least is a way of brightening up their lives. The youngsters I work with talk about them a great deal of the time.
I’m thinking it might be a brave politician who tried to double or treble the price of their one great pleasure....
I’m also thinking we probably don’t have many brave politicians....
Tris,
ReplyDeleteThat is a cause for raising living standards for those on average and below average incomes! Rather than exploit poorer countries by utilising their un-unionised and unprotected labour force, why not do what Clegg says and make the tax system fairer? Or even better perhaps raise the minimum wage, and increase EU tariff walls to undermine the exploitation insentive.
Thoughts Tris my friend?
Well I'd certainly be happy to see a fairer tax system. Without a doubt the minimum wage needs to be increased. It must be amongst the lowest in Western Europe.
ReplyDeleteI'm not an economist and I'm not sure what effect that would have on inflation.
EU tariffs... yes, maybe that's a possibility.
That said, the other argument that I’ve heard on this is that, without the slave wages that are being earned say in India or Bangladesh, the people who make these cheap clothes for us would, quite simply, starve.
I wish I had something positive to say Dean, instead of being so negative to your every suggestion. I just don't have any answers ...That's why I'm not a politician (oh also, I'm not a greedy git either!!) :¬)
:) Not a politician, this must be wh your so respected on the blog!
ReplyDeleteBut yes, the argument of paying them slave ages to avoid them starving was one of the tactics used by the 19th C politicans when faced with unions and the chartist movement. It is hardly fair.
When this insentive is removed, these economies can be liberated from exploitation, and can develop as industrial powers like we once did. We never had foreign conglomerates more powerful than most nation-states deliberately holding down our working class wages...why should we tolerate this iron hand of globalised capitalism from taking its excesses out on the worlds most vulernable?
The moral dilemma as Jim Hacker once put it [sorry, I am currently watching Yes Minster/Prime minister...]
And your negative, but not apathetic. That is a critical difference, and a positive one between your attitude and the majority of peoples in this policy area.
Respected... oh, er I dunno about that... LOL. But thank you anyway.
ReplyDeleteLike I say, I'm not nearly clever enough to know that anwer to this. I agree with most of what you say, but I know that there are always consequences to these things...
I watched all the Yes Ministers, just a few months ago. Brilliant! Moved on to Allo Allo now!
PS...are you sure you are a Tory? :-)
Surely sure? Yes. Yes I am.
ReplyDeleteIn the path of Heath [who also supported the implimentation of the minimum wage approaching 1997].
One of my troy student fellows in stirling has accused me of being "a fabian Heathite". He meant it as an insult, but I seem to take a strange pride in being a Heathite...dont know about the fabian thing. Not sure I'm a socialist!!
Dean:
ReplyDeleteIt is good to be who you are, rather than who your party wants you to be.
It may make fitting in more difficult, but I'm pretty sure that it makes feeling good about yourself a bit easier....
Mandelson and Brown lined up for lucrative posts - krafty baskets.
ReplyDeleteThey have to have some form of income after it all falls flat on its face. An MP's salary won't be enough for Brown, and Mandleson couldn't possibly last on Lords' expenses. Parties in Corfu don't come cheap.
ReplyDelete