A Simple Story

John Edwards is the dark horse in Iowa. Many observers believe that he is gaining ground in the last days before the caucuses, as his populist message resonates with Iowa Democrats. In this morning’s Washington Post, Chris Cillizza describes Edwards’ final campaign push:

Former North Carolina Sen. John Edwards will close his Iowa campaign with an ad featuring an emotional appeal from an unemployed Maytag employee named Doug Bishop.
The 60-second commercial will run statewide during the 5:30 news tomorrow and Thursday and dovetails with a full page ad in the Des Moines Register that also features Bishop.
Laid off in September 2004, Bishop and his family were invited to meet Edwards who at the time was the Democrats’ vice presidential nominee. As Bishop tells the story of that gathering, Edwards bent down, looked his seven-year old son in the eye and said: “I’m going to keep fighting for your daddy’s job, I promise you that.”

Here is the ad:

The ad is simple and effective. As usual, though, if you dig a little farther, the story becomes more complicated, and more interesting.
To begin with, who is Doug Bishop? Cillizza describes him in contradictory fashion as an “unemployed Maytag employee.” The Associated Press calls him a “working class father.” Actually, Bishop is a long-time Democratic Party activist. He was an official with the United Auto Workers when he worked for Maytag, and he endorsed Dick Gephardt in 2004. While working for Maytag, Bishop served on the City Council of Baxter, Iowa, and was elected Mayor.
Currently, Bishop is the County Treasurer for Jasper County and is a member of the Central Committee of the Democratic Party of Iowa. So it is a bit misleading to describe him merely as an unemployed factory worker or a working class father.
There are other aspects of Bishop’s story that may shed light on the issue–opposition to globalization and free trade–that Edwards uses Bishop to promote. Maytag was the biggest employer in Newton, Iowa when, in September 2004, it laid off a number of employees, including Bishop. At that time, Bishop had worked for Maytag for 7 1/2 years.
Edwards is hostile to free trade agreements like NAFTA. But when Bishop lost his job, it was NAFTA that paid for eight months of training, following which Bishop was appointed to a job in the County Treasurer’s office and ultimately was elected County Treasurer on the Democratic Party ticket.
As for Newton, it isn’t doing so badly:

As presidential candidates converge on Iowa ahead of the state’s crucial first-in-the-nation nominating contest in January, Newton has found itself at the heart of an intensifying debate over US trade policy. Democratic candidates have seized on the Maytag closure as evidence that international trade has become rigged in favour of global corporations, the Wall Street elite and China, at the expense of middle-class Americans.
There is a problem, however, with using Newton as a political prop. Visit the town and it becomes clear that its population is unwilling to accept the role of victim. Instead, Newton is aiming to become a case study in US economic resilience.
Less than a month after Maytag closed, the company’s former headquarters and call centre have already been occupied by new tenants and there have been at least 60 expressions of interest in the manufacturing facilities, according to Chaz Allen, mayor of Newton.
Mr Allen says the town is also close to clinching a deal with TPI Composites, a Rhode Island-based wind turbine manufacturer, to build a plant that would create up to 700 jobs. “Losing Maytag was like the death of a parent,” says the mayor. “It’s traumatic but you have to move on.”
Newton had been seeking to diversify its economy for several years as it became clear that Maytag’s future was shaky. A $70m speedway track was built to expand the hospitality industry, and incentives were provided to attract new businesses and encourage local entrepreneurship. Nearly 300 jobs have been created over the past year and Mr Allen predicts that all 3,000 of those lost at Maytag will be replaced by 2010.

Most fundamentally, though, the Maytag story raises the question of what, exactly, John Edwards proposes to do to “fight for [Doug Bishop’s] job.” Implicit in Edwards’s left-wing rhetoric is the idea that companies like Maytag are blameworthy if they employ fewer people–or fewer Americans, anyway–over time, rather than more. But Maytag was a failing company with declining market share. One of its faults, arguably, was that it kept too many jobs in the United States:

The great irony of Hake’s fixation with the balance sheet is that he wasn’t aggressive enough in the one area where it might have mattered the most: moving factories overseas. Even today, some 3,000 Maytag workers at four U.S. factories make 88 percent of the company’s goods. To offshoring critics like Lou Dobbs, that’s a red-white-and-blue mark of distinction. But in the appliance market, it’s a death knell.
Top appliance maker Whirlpool, for example, began offshoring a decade ago. Today it runs factories in 13 countries. Sweden’s Electrolux is spending $1.4 billion to build cheaper factories around the world, and its Frigidaire brand is the only one to gain market share in the past six months.

Does Edwards propose to ban the sale of Frigidaires? One assumes not. There are, however, some measures that could help companies like Maytag. In the same month in which Bishop was laid off, Maytag settled a class action lawsuit. The plaintiffs’ lawyers got millions. So, what is Edwards’ position on litigation reform? He opposes it; he got rich by extracting money from companies like Maytag, at the expense of their shareholders, employees and, often, their customers.
As a plaintiffs’ lawyer, John Edwards made tens of millions of dollars by demonizing companies. It’s not hard to understand why he thinks the same approach will win over voters. But his simplistic vision of the American economy isn’t just wrong, it’s dangerous. There are a number of ways in which the country could make a wrong turn in 2008, but electing John Edwards would be one of the worst.
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