Archive for the ‘Editorials’ Category

Cardinals and Crows

November 18, 2005
Cardinals and Crows
Date November 18, 2005
Section(s) Opinion
A Cardinal goes out to the Newton Fire Department for its efforts at professionally responding to two recent fires. Early Monday morning, fire fighters responded to a house fire that gutted the home. On Wednesday, the department responded to an attic fire at USA Healthcare. (The staff at USA also deserves a Cardinal.) We are fortunate to have such a high-quality fire department in our city.

A Crow to the corporate culture that rewards failure. Sure, the Maytag executives who stand to gain millions of dollars upon successful completion of Whirlpool’s acquisition of the Newton-based company are only following the current business model, but that doesn’t make it set any better. The whole thing leaves one wondering how such a system can be.


We need to face our challenges

October 5, 2005
We need to face our challenges
Date October 05, 2005
Section(s) Columnists
Newton Daily News Editorial  
Newton has long benefitted from its relationship with Maytag. The company founded in Newton 112 years ago has supplied generations with stable employment, provided a tax base to enable the city to provide first-rate services and been a generous contributor to the development of the physical assets that sets this community apart.

But Maytag‘s future in Newton is now up in the air. No one knows — or is saying — what its future might hold.

Some indicators, as previous stories in this newspaper’s continuing series have pointed out, say that maybe it won’t be so bad should Maytag leave or pare its presence down. The community has appeared to weather the first onslaught of Maytag job reductions fairly well. Residential property values are up and the market remains strong. U.S. Census Bureau population estimates — as can be verified by the first growth in school enrollment levels in the past seven years — are on the upswing in Newton and countywide. And those who have lost jobs appear to have found new ones, largely due to Newton’s easy access to the Des Moines metro area’s strong economy and job opportunity base.

But, we fear, these indicators may only be offering false hope. The reality of Newton’s current plight may be much more severe.

As the news articles today and Tuesday show, the City of Newton is close to rope’s end when it comes to its ability to provide basic city services to its residents. The city has already lost nearly $32 million in taxable value due to decisions made 10 years ago — probably rightly so — to keep Maytag in Newton. Growth tactics initiated by the city — including urban renewal, tax increment financing and tax abatement — have proven to be hugely successful over the years but have stymied the flow of tax dollars to the bottom line. State-set percentages of how much local governments can tax on the value of residential property have fallen so low that Newton’s $12 million valuation increase this year actually results in a $4 million loss.

And all this is while Maytag is still here. Pull Maytag out, including its $1.68 million property tax payment, and the future becomes much less secure.

We are at a crucial juncture in our history. Changes loom ahead. Maytag‘s likely departure or lessened presence would have a huge impact on the health of this community. We cannot escape that fact.

But we must also realize that we can have a say in our community’s future path. It is up to the residents of Newton and Jasper County to forge a successful future, regardless of Maytag‘s course.

First, we need to assess the risks we face.

Next, we need to identify the assets and resources we do possess that can help us grow. Further, we need to understand what specific growth opportunities and strategies have the most potential for us.

Finally, we need to take steps now to pursue those possibilities.

That effort, however, won’t be easy. But it’s a challenge we must face.

With local change looming, leadership needs to emerge

August 8, 2005

Globalization. We’ve all heard the word, and we have some idea what it means. But until it happens to you, it’s hard to grasp its real impact.
Globalization is converging over Newton and Jasper County like a thunderhead spawning a tornado. And, as New York Times columnist Thomas Friedman writes, globalization means that “one person’s economic liberation is another person’s unemployment.”
As today’s front-page stories on Maytag indicate, Newton and Jasper County are headed for a change. Although expert analysts say the local impacts will be different depending upon which bidder is successful, all possible outcomes would pose serious economic challenges.
Figuratively speaking, we are likely to lose an arm or a leg — and the choice is not ours to make.
Under the Ripplewood buyout, Newton and Jasper County might not see the full effect for a few years. But it’s only delaying the inevitable. As one analyst said, “you get to keep your jobs for now.”
Ripplewood would work to return the Maytag brand to its former stature.  However, it would probably achieve this by moving more production offshore, closing plants and reducing employment across the board.  Then it would sell the company for a tidy profit, quite possible to a foreign competitor.
The Whirlpool deal would likely result in quicker, more catastrophic results. Maytag corporate headquarters could close in short order, as the global appliance giant would have little need for Maytag’s white-collar workers.
And if either bidder succeeds — or if neither does — the future of Maytag production in Newton remains uncertain. Workers took concessions in last year’s four-year contract deal, but Maytag says the Newton plant remains one of its highest-cost facilities, and another round of layoffs is expected next month. In addition, the corporate leadership is in the process of redefining its overall manufacturing footprint, which could lead to closure of Maytag’s flagship facility.
Analysts say any owner — Maytag, Ripplewood or Whirlpool — will need to renegotiate the contracts to make the plant more competitive.  Without that, the plant may not escape closure or downsizing in the near term, or a phaseout in the long term when its product lines are replaced in favor of new designs.
None of this bodes well for Newton and Jasper County’s prospects, but we are not without hope. This community possesses immense resources and talents that can be brought to bear on making a new future.
Exhorting Americans to conquer outer space, President John F. Kennedy said, “The facts of the matter are that we have never made the decisions or marshaled the resources required for such leadership.”
Neither has Newton or Jasper County — and now, with the scenarios for Maytag’s future now becoming clearer, it’s time to rise to the challenge.

Newton’s future – new beginnings

February 8, 2005
Newton’s future — new beginnings
Date February 08, 2005
Maytag once employed nearly 3,000 workers in Newton; present employment is below the 1,500 level.

Newton Senior High once had close to or more than 400 students in each grade when I first came here in 1967. Present student population at the high school is now around 967 (269 freshmen; 254 sophomores; 238 juniors; 206 seniors).

The Parson’s Company and Winpower, along with the Vernon Company and Newton Manufacturing, Thombert and Maytag once provided Newton with a manufacturing mix. Today, two of those companies are gone, while the other four have reduced employment and have been outsourcing for some time.

Remember H. Ross Perot’s “giant sucking sound?” In early 1990s, he spoke loudly about the job loss caused by foreign competition. Yet, on Feb. 7, 2004, Times of India reported that Perot Systems was going to double its total worldwide employment in Asia from 3,500 to 7,000. If Perot couldn’t resist the economic logic of foreign outsourcing, what American CEO wouldn’t do likewise? A folk singer in the 1960s sang about “the world – she is a changin.” We can simply add: Yes, it always has and always will.

While some of our manufacturing base has moved partially or completely or has been outsourcing to foreign countries, our information services’ industry is experiencing similar change.

SOME IN OUR COMMUNITY have said that certain projects could not be done here: TIF program, Park Centre complex, the city hall, fire and police department complex, the Center for Performance, the DMACC Poly-Tech Campus, the Jasper County Museum, the Maytag Pool renovation, the YMCA, the Agnes Patterson Park, the arboretum and botanical garden, the hike and bike trail and the enhancement of the school district’s facilities.

All became a reality, starting with a germ of an idea with an individual, or a group’s seeing a need, and then creating and selling a plan to succeed. Big projects! Big dreams! Big efforts! We are the beneficiaries. Granted, all of these projects involved sacrifice in time, talent and money, along with an element of risk. The sacrifices and risks continue for our generation and for those who follow. Doesn’t life consist largely of trying to manage risk?

Perhaps the time is ripe for Newton to be much more pro-active. Wringing our hands over revenue shortages, seeing only negatives, pointing the finger at others and pitting one group against another won’t build a better tomorrow.

Newton is in competition with other communities to provide solid job opportunities in order to stabilize the work force, reduce stress from lost jobs and add to the economic mix. If we can add new jobs, Newton will enter its own renaissance or rebirth. We have what it takes to revitalize and to re-invent ourselves!

A spark of genius anchored in common sense begins the process. Who creates the spark? The City Council? The Newton Development Corporation? JEDCO? Each of us? Make no mistake, movers and shakers are active here. Projects are in the works; however, confidentiality issues don’t allow some plans to be made public until the time is right.

Let us hope that enough citizens care enough to be involved in promoting change. We also hope that all involved have a similar vision for Newton. Do we know what makes our community unique?

We have received our “wake-up” call. How and when we respond is not only the question before us but is a challenge as well.


* Seek ways to involve our youth in opportunities to do community service.

* Work to make the golf course be self-sufficient, even a money maker.

* Rely on department heads for direction. Trust them, but verify and hold them accountable.

* Anticipate economic business cycles by budgeting contingency funds in good years to cover for economically deficient years.

* Be sure that all groups working to “sell Newton” are saying the same thing.

* Keep basic security a top priority. Police and fire departments are our first line of defense.

* Do what is possible to keep Newton physically attractive to perspective businesses and families looking for a new home.

* Ask civic groups to pitch in even more with volunteer labor projects.

* Stay positive while working for the common good.

* Set good examples for civility in public discussions.

* Nurture the art of compromise.

The brain power, the dedicated workers, the impetus for positive change is here. Let’s roll up the sleeves and get to work for Newton’s brighter future. We have time to do what needs to be done; however, the clock is ticking!

Iowa buys Maytag’s attention for now

January 27, 2005

Iowa buys Maytag’s attention, for now
Date January 27, 2005
Section(s) Opinion
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

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