Like the generations before him, Boyer started in the sluer, put in a bid for the hot end, became a floor boy, and worked his way up. He operated a press, making pressed-glass casserole dishes and other bakeware, mainly. He preferred presses over the H-28s—their rotations, and walking around them to service the molds, made him feel a little queasy, almost dizzy.
“Standing right next to it gives you a funny feeling, and I had some bad experiences. I got caught in one: It ripped my glove off, it ripped my watch off. I just didn’t like operating those. I liked the press ’cause they will move, and then stop, and you’ve got time to work on it. You could lose a hand in a press, too, but it’s different.”
Joe was a gearhead who was good with his hands—and took pride in his work. But he didn’t feel especially attached to the company. Guys would tell him about how it used to be in the plant and the company, back before Newell, but it wasn’t like that anymore. There were no more baseball or bowling leagues, no more softball games, golf outings, company clubs. The company didn’t love him. He didn’t love it. It was strictly business. He put in his time, took his check, went home. He even avoided union meetings. Though he walked the line, he wasn’t sure what the strike was all about. Most of the younger guys were like Boyer: They didn’t care who signed their checks, as long as somebody signed them.
The strike lasted a month. Salaried employees tried to work the machines. They packed ware and loaded trucks. For some of them, it was the first time they lived the life of a factory worker. “We had nurses there, and when we’d come into work, they’d tape up our fingers and hands, put elbow braces, knee braces on some of us,” Shook recalled with a laugh. In the end, Newell decided not to raise retiree premiums as it had planned, but the company gave current workers only a token increase in retirement benefits for the future.
Lamb didn’t want to settle on those terms. Newell was spending millions upon millions of dollars on acquisitions—it could spare a few bucks for workers’ pensions. In fact, even as Newell was trying to cut Anchor retiree benefits, Ferguson was mounting yet another hostile-takeover fight, this time over the Stanley Works of New Britain, Connecticut. (It lost when a court approved a settlement that maintained Stanley’s independence and forced Newell to desist.) Who knew what the future would bring? Lamb told his Flint brothers, “Be prepared.” You might think life with Newell was okay now, but it wasn’t like the old days, when Anchor was just Anchor, and your kids went to school with Gushman’s kids and Barber’s kids and Ellwood’s kids. Now it was just one of many Newell divisions. The real power was in Illinois, inside Newell’s offices. Just five years after the takeover, there were already signs that Anchor wasn’t Newell’s favored child anymore. Someday, Anchor could be tossed aside.
The members instructed him to settle. “I lost a couple of friends on that one,” he said. The strike didn’t dent Anchor’s profits. The glass operations made money for their new parent, contributing significantly to Newell’s return on equity, a measure Newell liked to parade for investors.
Anchor Hocking’s success in satisfying Newell’s management put to rest the myth that Anchor Hocking—and the glass business in the United States in general—could never compete against imports and that offshoring American glass manufacturing was the only way American glass companies could stay in business.
* * *
Shocked as it was over the events since Carl Icahn first put Anchor Hocking in play, the town tried to tell itself that everything would be okay. And on the surface it seemed to be, at first. People got used to the absence of the headquarters. There were still about twelve hundred people working at Plant 1 and the DC. Not all the former executives and spouses and families left—not right away, anyway. At the insistence, and through the persistence, of an Anchor attorney, extra weeks of service were added to the tenures of some office employees during the negotiations with Newell, so some were able to take an early retirement and remain in town rather than having to find a new job elsewhere. Lancaster Glass remained in business, and though Diamond Power was losing orders for its soot blowers, thanks to a move away from coal-fired power generation, it remained, too. Drew Shoe had nearly a hundred people making footwear.
The county fair still arrived every October, kids still showed their prized heifers and rabbits and lambs, and people still tossed Ping-Pong balls into little goldfish bowls to win a fish in a baggie. The festival—thank goodness for the festival, many said—still animated the town every July. Well over a hundred people still volunteered, Andy Rooney–like, to put on the show. Those who could still donate money did so. Attendance climbed every year. Membership at the country club declined, but kids still swam in the club pool. Tiki and Miller weren’t as crowded in the summers as they once were, but they were still popular.
But the bond between Anchor and Lancaster had been as much emotional as financial, and that bond was irredeemably broken. Newell had no emotional investment in the town. On the contrary, it seemed determined to avoid it.
Anchor Hocking donations to the local United Way dropped to just a few thousand dollars, from $50,000 the year before the takeover. Despite the Eagle-Gazette’s entreaties to make the new team welcome, there wasn’t anyone to welcome. Newell executives rotated in and out of Anchor Hocking, a way station to what they hoped would be higher-ranking jobs within the Newell galaxy. From 1987 to 2004, Anchor Hocking had six CEOs, none of whom lived in Lancaster. The company had five CEOs in the eighty-two years before the takeover, all of whom lived there. To Newell’s executives, Lancaster looked like an old hick town. They didn’t know the Lancaster story, and didn’t care to know it. That was what hurt the most, maybe. Nobody came out and said, “You’re not good enough for me,” and I could find no evidence that Newell ordered executives not to live there, no matter how many people told me otherwise, but the humiliating insult of their absence was real enough all the same.
Whether because of the conservative small-government tide ushered in by Reagan, or because many internalized its diminished status and lost confidence in the future—and any willingness to invest in it—or both, Lancaster stopped spending on itself. In 1988, the year Brian Gossett was born, a vote to increase Lancaster property taxes to support the schools failed. The next year, the year Mark Kraft was born, the city’s school district tried to pass a small income tax, with the proceeds allocated for operating expenses. That failed, too. Voters soundly defeated road improvement taxes and bond issues.
The trend continued into the 1990s. A 1996 school-funding ballot measure lost by a thousand votes. Out of 18,521 registered voters, only 6,939 participated.
In the late 1990s, Lancaster’s schools, once a source of town pride, cratered. According to a state “report card” of school districts, Lancaster’s passed only ten of twenty-seven standards. Most fourth graders couldn’t pass a reading test. By 2000, fourth and sixth graders failed nine out of ten proficiency standards.
In 1991, the fire department employed seventy-four firefighters. By 2016, it employed sixty-nine, even though the number of calls had more than doubled and the population had increased, thanks to Columbus commuters buying up tract housing on the city’s newly annexed north side.
Old rules and common restraints eroded. Lancaster suffered embarrassing scandals that made people from all around Ohio wonder just what kind of hillbilly town it was. In 2000, Gary DeMastry, the Fairfield County sheriff, was indicted for misspending the public’s money, roughly $300,000. He was convicted and sentenced to state prison in 2002. Also in 2002, Municipal Court judge Don McAuliffe torched his own house to collect the insurance money. He was indicted in 2003, convicted in 2004, and sentenced to prison.
In the mid-1970s, every teenager with even a few social skills knew where to find some anemic marijuana. (My first joint was shared with the sons of a local attorney and an insurance man. We survived.) But the poorer Lancaster became, the more drugs clung to the web of its life. In June 2001, county law enforcement agencies applied for—and were given—a st
ate and federal grant to start a new task force called the Major Crimes Unit (MCU). When they applied for the grant, they cited methamphetamine and crack as their number-one concerns. But they’d also begun to see a new drug: OxyContin pills. The mere existence of something called a Major Crimes Unit appalled the longtime Lancastrians who remembered when a “major crime” was a kid stealing a case of beer from the basement of a grocery store.
Some in Lancaster, led by the old core of post–World War II residents, refused to go prostrate. They responded the way they always had. The west side, around Plant 1, suffered the most from the breakdown of Lancaster’s education system. As Anchor Hocking declined, more and more west-siders fell into poverty and family dysfunction. Too many children were failing to learn. So in 1998, Rosemary Hajost, MCU chief Eric Brown’s mother-in-law, along with the director of a west-side food bank, the principal of West School, and a west-side minister, formed a committee to address the problem. They created the West After School Program.
Hajost rounded up now-elderly friends like Nancy Frick (the former Nancy George) for another tour of volunteerism. They brought paper, pencils, and their children’s old books to the basement of the United Methodist Church, by the Anchor Hocking parking lot. One day each week, the volunteers tutored children in reading, math, and general behavior.
By 1990, the Lancaster YMCA had fallen into disrepair. A capital campaign raised $840,000 to rejuvenate the building. Then, in 1998, Robert K. Fox, the retired president of Lancaster Glass, donated $1.5 million—almost half the cost of a $3.5 million expansion.
With the sale of Anchor Hocking, there was a pool of well-to-do retirees who were migrating out of town, but no mechanism to capture money they might wish to leave to Lancaster. So, at the urging of a local probate judge—who had seen too many estates leave the city, as I. J. Collins’s had—forty people, most of them older, met and formed the Fairfield County Foundation in 1989. Nancy Frick volunteered to serve as the first executive director.
* * *
As the town felt diminished, so did Anchor Hocking. When it was purchased, Anchor ware was considered a “core” product line for Newell, though Newell continued to sell off bits of it, like a perfume bottle maker. Dan Ferguson retired as CEO in 1992, the year of the Anchor strike, but Newell kept acquiring: WearEver cookware, which it combined with Mirro; an office products company; pencil and pen makers Faber-Castell and Sharpie; Levolor window treatments; hair and beauty accessories. In 1990, it even made a run at Lancaster Glass. But after financier James Goldsmith made an Icahn-like charge for the Akron-based Goodyear Tire and Rubber Company, Ohio passed anti-takeover laws, joining a parade of other states responding to the leveraged-buyout wave with a bipartisan counterattack meant to protect their industries. So Lancaster’s parent company, Columbus-based Lancaster Colony Corporation, moved the corporate registration from Delaware to Ohio. Lancaster Colony found shelter back home.
Newell was relentless. The American Promise had changed from the time of Forbes’s elevation of the Lancaster way. Modesty was out, acquisitiveness was in. America became a big-box nation—cheap goods for a people newly addicted to cheap stuff—and Newell wanted to be the big-box wholesaler to the big-box retailers, the place where Walmart, Target, Kmart, Home Depot, Staples, and Lowe’s could go to find all kinds of products for their shelves. Every new annual report contained a list of companies Newell had absorbed. And as the list of Newell companies grew longer, Anchor’s relative importance grew smaller.
In 1997, Newell acquired Rolodex, and, in 1998, cookware maker Calphalon. Then, in October of that year, it decided to swallow a whale: Rubbermaid, a company that included not only the famous Rubbermaid storage containers, but Graco baby strollers and Little Tikes toys. Newell, already carrying about $900 million in long-term debt, agreed to pay $5.8 billion. Newell changed its name to Newell Rubbermaid.
The merger, completed in 1999, nearly killed the company. Rubbermaid was more troubled than Newell had suspected. Newell’s enormous debt was suffocating. And Newell had grown so many tentacles, each with its own operations, that its famously strict control over each tentacle eroded. Return on equity fell, and Newell, once Wall Street’s darling, was cast off. On April 21, 1999, Newell closed at $52 per share. By the fall of 2000, it was trading at $19, even as the stock market was on the biggest bull run in history.
* * *
Glass plants run on money as much as on heat, sand, and labor. The best furnace can’t hold up forever under the strain of 2,400-degree molten glass. Furnaces need overhauls, and then—when overhauls won’t do—to be rebuilt. Machines require maintenance.
The factories themselves need to run. Unlike, say, when a company makes strollers, pens, or hair clips, you can’t just stop a glass factory. Back in 1905, when Collins ran day tanks, he could make glass until he emptied the tank. He could shut off the lights and go home. But you can’t easily idle a glass plant like Anchor Hocking, where huge continuous tanks contain tons of molten glass. Glassmen understand this. For much of its history, when the slow spring-to-early-summer sales season rolled around, Anchor made ashtrays and other items from which it expected to make little or no profit, just to keep the plant operating. The items were put into inventory to be used as loss leaders. But the business school boys Newell sent through Anchor never seemed to grasp the concept. That lack of understanding didn’t matter so much when both Anchor and Newell were running full steam and Anchor was meeting its financial goals for the parent. But now that Newell was tripping over itself, the goals changed. Newell needed—or wanted—better margins, and Anchor came to be viewed as an expensive stepchild. As a result, Newell began skimping on maintenance and upgrades.
“We ran by the seat of our pants,” Chris Nagle recalled. “If baling wire would go out of business, Anchor wouldn’t have been running, ’cause we used wire to keep stuff. You wanted a piece of equipment up, you’d wire this section up.”
Newell shuffled CEOs. On January 1, 2001, the board hired forty-two-year-old Joseph Galli. Galli had started his career at Black & Decker, then, in 1999, joined Amazon as president. He made a generally bad impression on the employees. Thirteen months after he was hired, Galli left Amazon for another Internet company called VerticalNet. Five months after being hired there, he took over Newell Rubbermaid.
Galli restructured the company into four brand segments: Rubbermaid, Sharpie, Irwin Tools, and Calphalon Home. Anchor was shunted into Calphalon. Most office operations in Lancaster, like marketing, moved to Calphalon’s offices in Toledo. More Lancastrians lost their jobs.
“They took the business away from us,” Shook recalled. “I started attending product development meetings, but would have to drive to Toledo. I just sat around, waiting for the other shoe to drop, waiting for them to tell me to go pound sand: ‘We don’t need you.’ Well, that all went to hell in a handbasket in pretty short order.” Calphalon wanted no part of trying to market a product it knew nothing about; it soon sent the work back down to Lancaster.
Shook kept his job, but it was obvious to everyone that, fourteen years after fighting like hell to take it over, Newell no longer wanted Anchor Hocking. It was now a “non-core” business.
“They did everything under the sun to ruin us,” another Anchor veteran recalled. Anchor was not alone in feeling the pain. Other towns with a Newell presence had it worse, crushed by global politics and Friedmanesque corporate profit seeking.
The North American Free Trade Agreement (NAFTA) went into effect on January 1, 1994, removing tariffs from goods traded between the three signatory nations. Republicans and many Democrats swore NAFTA would be a boon for American business and workers. That same year, Bill Clinton renewed China’s most-favored-nation trading status, despite having criticized the same move by his predecessor, George H. W. Bush. Clinton had cited China’s repression of human rights as the reason for his initial opposition, but lobbying by U.S. manufacturing executives apparently changed his mind. China quickly joined the World Trade Organizatio
n.
Most CEOs, corporate boards, and large shareholders loved the trade agreements. But factory workers and the unions that represented them paid the price.
Galli shut down Mirro’s offices and factories in Manitowoc, Wisconsin, where the company was first established in 1897, and sent the manufacturing to Mexico. Mirro’s corporate functions were sent to Calphalon in Toledo. About nine hundred people were thrown out of work.
Galli was increasingly desperate to dump Anchor, too. In May 2001, he laid off three thousand employees from several Newell companies. Rumors spread around town that Anchor was about to close. Company officials refused to comment.
Lancaster had already lost jobs that year. The heirs of the longtime owners of Drew Shoe sold the company in 1997 to BCAM, an outfit trying to commercialize ergonomic pump bladders like the ones once built into athletic shoes. BCAM hoped to use such bladders in the medical shoes Drew made for diabetics, the elderly, the arthritic. The hope proved illusory, and BCAM never made a penny. A year later, it sold control of Drew to Wexford Management, a New York investment company founded by an alumni of Alvarez & Marsal, the same fix-it firm Sam Solomon would encounter on his first day in the Anchor offices. On March 30, 2001, Wexford announced it would close the Drew factory in Lancaster and move production to China. Ninety-four shoemakers received pink slips. A century of shoemaking in Lancaster came to an end. Drew Shoe’s presence in Lancaster narrowed to a few office workers and a warehouse that received shipments from China and sent shoes to retailers and dealers.
* * *
As it turned out, the rumors of an Anchor sale were true. Negotiations were already under way to sell Anchor to Libbey, its longtime Toledo rival. On June 17, Newell and Libbey signed the deal. Libbey would pay $332 million for Plant 1, Monaca, and the DC.
Lancaster celebrated. Now, at last, glass people would resume control of Anchor Hocking. Ohio glass people. Yes, Libbey and Anchor had been fierce competitors for nearly a hundred years, but suddenly all that history was recast as two brothers who fought constantly but who both had glass in their veins.
Glass House Page 9
