A new ad sponsored by a labor union PAC in support of Democratic presidential candidate Edwards implies that the closing of an Iowa Maytag factory and the loss of 1,800 jobs are due to "tax breaks to companies that move jobs offshore." And it says Edwards would end such breaks. We found two problems:
- The jobs didn’t move offshore. They were actually sent to Ohio.
- Eliminating the "tax breaks" in question probably wouldn’t do much to keep jobs in the U.S.
The ad began running in Iowa last week. It is sponsored by Working 4 Working Americans, which is a PAC registered to the United Brotherhood of Carpenters and Joiners, a union that has endorsed former Sen. John Edwards for president. The ad begins by reminding Iowa voters of the recent closing of the Maytag plant in Newton, Iowa, then immediately shifts to denouncing the export of jobs from the U.S.
Working 4 Working Americans: Maytag Edwards
Narrator: A home and a good job. The American Dream started in towns like Newton, Iowa with companies like Maytag.
This October, Maytag closed its doors forever. Eighteen hundred jobs lost, while our government gives tax breaks to companies that move jobs offshore.
John Edwards knows the Maytag closing jeopardizes a way of life. He says it’s time to end tax breaks for companies that move good jobs offshore.
Give voice to your values. Tell John Edwards he’s right.
Paid for by Working 4 Working Americans and not authorized by any candidate or candidate’s committee.
My Heart Is In Ohio
Narrator: The American dream started in towns like Newton, Iowa, with companies like Maytag. This October, Maytag closed its doors forever. Eighteen hundred jobs lost, while our government gives tax breaks to companies that move jobs offshore.
It is true that the Maytag plant in Newton closed in October. In all, the closure resulted in the loss of about 1,800 jobs: Roughly 1,000 from shutting down the factory and another 800 from the closing of Maytag’s corporate headquarters. The closings were the result of a merger of Whirlpool and Maytag. Besides the Newton plant, Whirlpool also closed washer and dryer plants in Herrin, Illinois, and Searcy, Arkansas, (as well as administrative centers in Mexico and Canada).
But what the ad doesn’t mention is Maytag production was actually moved to Ohio. In other words, manufacturing moved from one part of the Midwest to a different part of the Midwest. When we spoke with Working 4 Working Americans, the group offered us no evidence to the contrary (although Whirlpool does have plants in Mexico and other countries), arguing instead that "the Maytag plant in Newton, which operated for generations, is symbolic of many of the issues facing working Americans." Maybe, but the ad strongly implies that workers in Newton lost their paychecks because their jobs were shipped abroad, which is not true.
Making Mountains of Molehills
Associated Press and Daily News Staff. "TPI will build factory in Newton, add 500 jobs over next three years." Newton Daily News, 26 Nov. 2007.
Brownstein, Ronald. "Kerry Wants to End Tax Breaks for Corporate Profits Abroad." Los Angeles Times, 26 Mar. 2004.
Brumbaugh, David L. "Tax Exemption for Repatriated Foreign Earnings: Proposals and Analysis." CRS Report for Congress. Washington, D.C.: Congressional Research Service, 2004.
Clausing, Kimberly A. "The Role of U.S. Tax Policy in Offshoring." Brainard, Lael and Susan M. Collins. Brookings Trade Forum: 2005. Washington, D.C.: Brookings Institution Press, 2006. 457-490.
John Edwards ’08: Smarter Trade That Puts Workers First. 8 Dec. 2007. 17 Dec. 2007.
Ryberg, William. "Leaders Look for Ways to Help Newton Recover." Des Moines Register, 25 Sept. 2006.
Whirlpool Corporation. Whirlpool Corporation Announces Steps To Integrate Maytag Operations. News Release. Benton City, MI, 2006.
Weisman, Jonathan. "U.S. Firms Keep Billions Overseas; Kerry’s Plan Spotlights Huge Untaxed Earnings," Washington Post, 2 Apr. 2004.