Iowa buys Maytag’s attention for now


Iowa buys Maytag’s attention, for now
 
Date January 27, 2005
Section(s) Opinion
Brief  
 
What does Amana have over Galesburg? Not enough old world, family dining halls in Galesburg? No PGA caliber golf courses?

Whatever it is, Maytag Corp. seemed eager to add 200 new jobs and retain 550 more at their Amana refrigerator plant in return for government incentives that are nowhere near the windfall lavished upon the company a decade ago by Galesburg.

Iowa promises $1.5 million in tax credits and Economic Development Director Mike Blouin heralded the deal as a blow against global outsourcing.

Uh huh.

It may look that way from Des Moines. But in the Quad-Cities, 43 miles north of Galesburg, that $1.5 million seems less than quaint.

Maytag took that, plus $6 million more in state of Illinois grants that looked every bit like a blow against global outsourcing in 1992. Then Maytag took another $4 million in local tax breaks. And $3 million cash incentives paid for by hiking sales taxes on the Galesburg residents who are still paying even after Maytag shuttered its plant last year.

That’s $13 million in incentives for about 10 years of jobs. Galesburg made refrigerators. The Amana plant makes refrigerators.

The Amana expansion involves value-added, high-tech jobs, re-engineering refrigerators so that better products can be made more cheaply. “This product will help improve Maytag‘s competitiveness in the refrigerator market,” company representative Karen Lynn said.

The company sang a similar tune a decade ago in Galesburg: “Maytag decided to redesign not only the product but also the manufacturing process from the ground up,” Managing Automation wrote about the Galesburg innovations back then.

If $13 million in taxpayer incentives buys jobs for a decade, how much can Iowa expect for $1.5 million?

Quad City Times

Contact the Quad-City Times Editorial Board at opinions@qctimes.com.

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