Politicians hear concerns about Maytag situation, Newton’s future

Politicians hear concerns about Maytag situation, Newton’s future
Date September 06, 2005
Section(s) Local News


Local, state and federal politicians heard an earful from angry, frustrated and fearful Maytag workers and retirees gathered at the Maytag Park Bowl on Monday wanting answers to what the future holds in light of the company’s planned sale to corporate rival Whirlpool. Uncertainty remained the bottom line after the two-hour meeting.

“A cloud hangs over all of us,” Iowa Gov. Tom Vilsack told the 300 people gathered at the park bearing the name of 112-year-old company’s founder.

Vilsack outlined the steps he has taken since the Maytag board of directors announced last month that it would accept Whirlpool’s $2.7 billion buyout offer and urge shareholders to vote to end Maytag‘s reign as an independent appliance manufacturer.

Vilsack said a protracted anti-trust review by federal regulators would only continue the “anxiety and stress” both the Newton and Amana communities feel. He said he has urged Whirlpool CEO Jeff Fettig to accelerate the process as much as possible to provide “some stability in the state.”

The governor, who organized Monday’s meeting, said that he also talked with Whirlpool about the benefits of retaining Newton and Amana production operations.

“I conveyed my hope and desire that the jobs of most of the production workers would stay,” the governor said, noting the productivity of Iowa workers and how it would be in Whirlpool’s best interest to maintain and expand jobs locally.

“We have a huge marketing job to do over the course of the next six to eight months,” Vilsack said.

The governor also said he conveyed to Whirlpool that the state stands ready to assist Whirlpool and has the means to do so through the Iowa Values Fund.

“We want to partner with Whirlpool,” he said. “I conveyed that we understand this is a partnership. It is incumbent on government to do what it can to help. We at state government have a role to play. We want to sit down and put our best foot forward. We want to keep jobs in Iowa.”

The governor also took a poke at the Maytag board of directors who “get a pat on the back” for negotiating a better deal for shareholders with Whirlpool’s $21 a share offer while the “people who built this company … who put their blood and sweat into the machines, they don’t get anything out of the deal. That’s not right in today’s America. That’s just not right.”

Previously, the governor floated an idea — that would require federal action — that companies be required to put aside a portion of the proceeds of any corporate merger for distribution to the workers impacted by the sale. He said the current unemployment benefit system is not sufficient and that money set aside could be used for worker health insurance and retraining programs.

“Maybe we ought to be requiring that when a deal is worked out, a portion is set aside for workers,” the governor said. “The current safety net was built for a different time. Fairness dictates that the safety net be good enough to provide for individuals and their families.”

Rep. Leonard Boswell, D-Iowa, said he has already written to President Bush and House leaders about the governor’s set aside idea.

“I have written to the president and said that when an entity buys someone else up, it would seem they should have the wherewithal to put something aside to take care of the workers,” Boswell said.

He also said he will join Sen. Tom Harkin in making Whirlpool “mindful of what made this company a success for the past 100 years. We care. We’re here. We are going to stay with it and give it the best possible effort we can.”

A representative from Sen. Harkin’s office read a prepared statement that echoed many of the governor’s and representative’s comments.

“I remain deeply concerned about Whirlpool’s bid because the company has not yet shown a commitment to keep Maytag jobs in Iowa,” the statement read. “The strength of Maytag is its workers. Shareholders and corporate officials stand to benefit from the acquisition only because of the efforts of those of you here today who have given your heart and soul to this corporation.”

While the comments from elected officials were meant to be reassuring, Maytag workers and retirees pointed angry fingers at a corporation they feel has not been straight with the public.

Chuck Gifford, a former local union official, noted that the recent energy bill signed by the president calls for the manufacturers of high efficiency washers to recoup as much as $40 a unit for labor replacement costs. He said he estimates a Maytag Neptune front load horizontal axis machine costs about $32 a unit to build.

“This takes off the table the argument we can’t compete with foreign competition,” he said. “And then they say to the press that they’re not going to sell the Neptune. Maybe we ought to file a lawsuit against Maytag and Whirlpool to stop this. I’d rather file a lawsuit and look foolish rather than ask later why we didn’t.”

Gifford also suggested that if Maytag CEO Ralph Hake is no longer interested in running the company that he should resign.

“If you’re tired of running this company get the hell out, resign, get the hell out of town so we can get back to making washers and dryers in Newton.”

UAW Local 997 President Ted Johnson took issue with the reasons given by the corporation for the layoffs at the plant that begin today. Maytag said the decline in production workers was forced by a decline in the products sold in the marketplace made at the Newton facility.

“Bull,” Johnson said. “They will not market anything made in Newton.”

Johnson said the union is also ready to work with corporate officials in ensuring continued production in Newton. However, which entity the union should talk with remains uncertain.

“Once we find out who we’re dealing with, then we will deal with them,” he said. “But we want a fair deal. I wish the corporation would figure out which way its shoes are pointed so we can get back to making washers and dryers.”

Pat Teed, the recently retired UAW Local 997 president, said he has been frustrated by the lack of willingness on the part of the company to acknowledge the union has made great strides in meeting the challenges Maytag has said it needs to face. He said efforts to show state officials that “this is not the old union of the past” were turned down by Maytag executives.

“The health care is cheaper and the labor is free,” Teed said, also implying that Maytag has purposefully lost market shares over the past years in order to meet anti-trust provisions in any proposed takeover.

Max Tipton, another retired Maytag union official, noted that as far back as 1971 Maytag workers had agreed to divert a portion of the cost-of-living allowances to help Maytag pay for insurance costs. He estimated that since that time, a Maytag worker now divests as much as $5.50 an hour to help the company pay for insurance.

“The workforce has saved millions in time,” Tipton said. “The efforts of the membership in 2004 saved the company millions and they’re still saying the cost of labor is too much. This whole damn thing is about greed. Something is going to have to happen to get this turned around.”

David Willoughby, another retired Maytag worker and past union president, compared the potential impact to workers and retirees should the merger move forward with events along the Gulf Coast.

“The only thing different between those involved in that disaster and the loss of jobs at Maytag is that we won’t be wading in water,” he said. “God help us. This is the worst Labor Day ever.”

Others asked more basic questions.

“What’s out there to help us now?” asked Kim Jackson, who is laid off as of today after more than eight years of service at the plant, noting that her unemployment payments will barely be enough to pay for her mortgage and utilities, leaving the question of grocery money up in the air.

Vilsack said a reinvigorated sense of community might hold some of the answers.

“When jobs are lost in Newton it’s easy for people in other communities to say ‘it’s not my problem,'” he said. “But it is. It’s our problem. The country needs to regain its sense of community.”


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