Wednesday, May 10, 2006

Will the Last Person Leaving Newton Turn Off the Lights?

It was reported a few minutes ago that the other shoe has indeed dropped and Whirlpool, which recently acquired the Maytag company, will close Maytag's facilities in Newton, Iowa, and lay off 4,500 worker bees. When the plant closes, presumably right after the mandatory 60 days, that will be the end of 113 years of Maytag manufacturing in Newton.

Maytag, which had fallen on hard times with a series of incompetent bumbler CEOs from Numbnuts staffing, put itself on the block last year. There were a couple offers, from a vulture capitalist operation and some interest from Haier, a Chinese company, but the offer for Maytag stock from Whirlpool knocked the competition out of the box.

One suspects that Ralph Hake, the latest Maytag CEO, was brought in, after all, to liquidate the place. The last straw had to be the Neptune line, which was a major flop in the very competitive market place for home laundry machinery.

On the other hand, Whirlpool is in the fight of its life if the goal is to continue making home appliances in the U.S. It's tough to compete with workers in the developing world, and the only way that Whirlpool has survived thus far is because of its relentless and unsympathetic pursuit of manufacturing efficiency. That fact alone made the demise of manufacturing in Newton a certainty.

Now. Don't get me wrong. I've never liked Newton and I always thought that the folks who held down the factory jobs at Maytag were smug, overpaid people who had no interest in looking at the reality of the world we live in. There was also very little sympathy for the worker bees who lost their jobs in Illinois when Maytag closed its refrigerator plant there last year.

The takehome has to be, what goes around sure as hell comes around.

Having said all that, to a small prairie state like Iowa and a small county seat town like Newton, this represents a hard blow that is going to take a long time to recover from, if ever.


At 9:25 PM, Blogger ChinaLawBlog said...

As a Grinnell College grad, who always loved Iowa, I find this terribly sad. But, and, of course, this is easy for me to say living in Seattle (though I am from Michigan), but I have every confidence Newton will eventually fully recover.

At 5:49 AM, Blogger Robert Luedeman, attorney at law said...

I have no doubt it will be a different Newton.

Maytag has been a local institution that paid high wages and gave steady employment. That made Maytag a sort of blue collar valhalla where you didn't need an education if your father worked at Maytag because you had a job for life. It also made the worker bees something of a blue collar aristocracy, immune from all the crap that goes on in the rest of the world and able to afford trinkets like bass boats and tricked out Harleys and nice homes and big screen teevees.

What the takehome was, of course, is that Newton just became part of the United States in the brave new world of the 21st century. There's no more lifetime employment. The market finally reached into Newton for a smackdown.

The folks who will find life difficult are those who were within striking distance of their thirty years and out.


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