Newton, Iowa: Anger in the Heartland

Some of the car dealerships in town and the tractor supply company are either out of business or going out of business.

Since the recession, we've seen a lot of troubled towns in the country but nothing that looks quite as broken as Newton. Even the local chapter of the Optimists Club has closed.

"I wanna tell everybody that we're a company town where the company left, but we're gonna thrive," Chaz Allen told Pelley.

Allen is the mayor of this town of 15,000 people; it's a part time job that pays about $4,000 a year. Allen walked "60 Minutes" and Pelley through an abandoned Maytag plant that, at its peak, held 2,500 factory workers building washers and dryers.

If anyone out there is interested, the mayor has more than 1.7 million square feet to rent. "It is available, it is available, we'll make you a good deal," he told Pelley.

The mayor has been trying to pull new jobs into town. He made a run at green energy, and got a company that makes wind turbine blades. But every time he gets a few hundred jobs, he seems to lose a few hundred.

This fall, a telecom company called Windstream had two layoffs.

"It was 60, and then it was 146 the next time," Mayor Allen explained.

Asked how that affected people around Newton, Allen said, "You know it's a rollercoaster. I was affected in the first layoff. I was one of the ones at Windstream that was affected in the first round."

The laid-off mayor told Pelley he still doesn't have a new job.

His town is shrinking: this year they closed an elementary school and they're slashing the city budget. Allen told Pelley that due to budget cuts, the city has lost policemen, firemen and that the hospital is being reduced in size.

And that is the backdrop for Tuesday's election. In our national poll, we asked folks what the most important issue is in America: fifty four percent said jobs; health care came in second at seven percent. Only one percent said the war.

Newton's congressional district is bipartisan country. It voted for George Bush in 2004 and then for President Obama. But now Democratic Congressman Leonard Boswell is fighting for his job. He has been reelected six times, but this week his race against Republican Brad Zaun is too close to call.

"My wife and I watched the news last night and I think every ad was a political ad," McNeer said.

"Well how much relevance does all of that have to you?" Pelley asked, referring to the ads, including one about the debate on the Islamic cultural center near New York's Ground Zero.

"Nothing, nothing. Doesn't have a bit of relevance to me," McNeer said.

We invited some of the folks in town to the Legion Hall. About 40 gathered on a Thursday evening.

"How many of you would say that you're angry about politics?" Pelley asked.

Virtually the entire room replied with a "yes."

"I'm sick and tired of people going to congress in Washington D.C. and making a living out of it while we starve to death," one man told Pelley.

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[johninlongmont]

the real problem here is WHY did maytag move to mexico?...because we have trade policies, tax rules, and a string of other rules and regulations that practically FORCE them to move to mexico...if you want to compete, you have to move to mexico...THAT IS THE REAL PROBLEM

[bearfan841]

techwriter, did you see the show 'the talk' on CBS this week? looks like your blasting of that college girl backfired. the meyer family got a brand-new car and her college tuition is paid for. your blasting her,along with bragging about what you do for a living,already looked mean-spirited and misguided, even more so now.

[techwriter777]

My thoughts exactly. Maytag got into debt, had to sell itself, and now the little guy is out on the streets.

[bearfan841]

I am amazed, but not too surprised, at how many people couldn't get their facts straight. Maytag was bought out by Whirlpool, not Speed Queen. Too many commenters just want to point fingers, be partisan, and stray too far from the subject. My dad's a retiree, worked there at Plant 1 (there was 2 plants) and he got annoyed with somebody who told him he should be working for minimum wage when he supported the incentives to keep Maytag there over 10 years ago. What is so wrong with wanting to work for a decent wage? I am proud of my dad wanting to do the work, even though I only saw his workplace once- just after I had graduated from college. I have a degree in history from the U. Of Iowa. it got me into a better school system- he was a southern IA farmboy-and allowed me to go to college. it helped us live the American dream! Though I recall movies like Michael Moore's 'Roger and Me' that was an ominous warning of what could happen to Newton, and did. I'm afraid the story will be a band-aid solution for Newton, as many have short memories. Donald Trump called the mayor,and made it a talking point on Fox News. And people are donating money for free Domino's Pizzas. Lot of good that does, as neither action will bring jobs to town. It's sad to visit Newton now, I was there in May for a
fundraiser in hopes of saving Emerson Hough School- the closed school mentioned in the story. (the shady politics of which school got closed is a story as well) I would have liked seeing mention of Emerson Hough being a Newton native, a western writer that became Teddy Roosevelt's friend.

[bluecollarman]

What difference does it make who bought them out. The Maytag execs who left after the sale made mega-millions as parting gifts when they left. The ones that stayed on with Whirlpool made mega-millions as "consultants". The 2500 people the made the company the success that it was were left in the unemployment line.

[caliber1mt]

I understand the pain and know the frustration in Newton--I see it as I travel for my work across the US. I also know what happens when you put to much faith in just one revenue stream as it can change in an instant--after 911 my work stopped for a year instantly. I just worked through it and diversified. It took a a couple years to get back up to where I had been.

Newton is more challenged--when the town loses the employer that effectively supported the town with employment and those folks supported all the businesses that they needed--recovery will be very long. No Gov't stimulus, no magic wand will work--just hard determination and work to diversify.

I wonder what the city council talked about when times were good--not business diversity before/if Maytag left or just got smaller with time . Newton is a lesson for towns with one or two major employers--diversify--it will take years--but if you never start you will never get close to finishing.

Homestead Florida is still recovering from how long ago?-long time--New Orleans has another 20 years to go. Newton has it tough--but not as bad as either of those places. But it hurts a lot.

Newton will rise again and I hope more diverse because of it.

Take care and keep moving ahead one day at a time.

Ken

[jjr02]

I will tell you this. The world is entering a stage where the middle class is global. I am about to complete ONE degree in business. College is outrageously expensive, but careers for a college degree are also drying up. That is, you have to be CREATIVE. The upper class and the welfare generations are always going to survive and exist. A business degree is costly here, but one can educate oneself online or in another country as well. First, we are competing with people from India and China who do ALL of the maytag stuff for 30,000 dollars MAX. Quantum computing is already creating robots THAT can FOLD laundry, effectively cutting out hospital staff. Unfortunately, looking at someone in the eye and HELPING them is as old and reliable today as it was yesterday. GOOD LUCK to all!!

[bluecollarman]

The Middle class is global ??
The middle class here is becoming extinct. They are dying off as American manufacturing leaves here to go to foreign countries where these companies don't have to pay taxes or decent wages or worry about the EPA or OSHA or anything like that. The days where people can graduate from high school and go out to get a job are just about gone. We are left to compete against people that make 86 cents an hour. There is only so much room for people with degrees also. There is no shortage of them in the unemployment lines too.

[afriges]

I live in California and heard about the town of Newton Iowa in 2007 - I've watched it from a distance grow and shrink and grow and shrink - until they get a new company in there the green energy plant isn't cutting it.

One thing that I found most surprising was the domino effect that was created due to the loss of Maytag.
They were at the forefront of the recession, then led with a rise in gas prices (while many are now commuting to Des Moines for work), and finally the crash in the housing market - Newton has become somewhat of a bedroom community. All of this before California.

One other observation - Newton is not going to be a "ghost town" too close to a major city, and too much pride. There are pretty bad towns out there, that look dumpy because no one cares. The people of Newton DO care - and is a very beautiful place to visit - or even live...

A few Ex-Maytaggers who I have been working closely with: returned to the plant 2 years after their last day of work.
See "Goodbye Blue Monday" and "Why Play Leap Frog?"
www.aprilfriges.com

[kimmarie57]

I am hoping that everyone in Iowa was able to watch the story on Newton, IA. on 60 mins Sunday evening. The sad thing is that all our cities are going thru this. What about all the jobs lost in Webster City when Fridgidaire closed?? Here's a list of just a few companies that Fort Dodge has lost; Iowa Beef, The Box Factory, Hormel, Gus Glazer, American Can factory, CRL, and several Creameries were closed and many more. I think that Iowa has been hit the worst because we have alot of folks on Medicare and disabilty, and the government just keeps taking away from us. Come on we aren't able to make ends meet now, I really hate to see what next year brings. I was happy to hear that Donald Trump was going to help the people in Newton, but just wanted to speak out on our behalfs. People are losing their jobs, their homes, can't feed their families and the list goes on and on.

[Dajovue]

Yes yes yes. We worked, were paid, we spent. The realism is that we Newtonians were used to things being nice. Now we are surrounded by circumstances bewildering and foreign to us. Going bankrupt. House foreclosure. Working at walmart and getting a pension...$24,000. Opening a business. Closing a business. Finding a job. Getting laid off, filing unemployment papers out, being denied, going back to school to be retrained, applying for FEMA, applying for foodstamps, qualifying for free hot lunches, not paying some bills in order to pay others, going to the food bank after qualifying for foodstamps and carrying a paper over to prove your in need then to apply for further assistance. Sold all my stock. Cashed in my 401. Spent my saving. Heat assistance. Good thing I went to DMACC otherwise I would't know how to fill out these disqualifying questions truthfully. Apply ... Denied. Oh good, I am not poor enough to qualify but I have to skip a light payment. I hover right above the guidelines of qualifying for assistance. I am afraid one day I will qualify.

[Reality2U]

It's interesting that so many people keep committing that Maytag moved it's jobs to Mexico... Whirlpool bought Maytag and closed them down. They still use the name as a scapegoat to continue to reap high profits in the industry because people THINK Maytag sold out the American dream and ran to Mexico! Seriously, wake up people! Whirlpool makes many models overseas and you buy them! If you continue to support companies who treat people like this your job may be on the line next! Our children/grandchildren will be working in the new third world company as India, China, Mexico, etc take over as the leaders in manufacturing, communications, etc.