Star Tribune from Minneapolis, Minnesota • Page 41

3- Star Tribune 3,533.99 Up 11.73 Thursday October 71993 1D SI Airlines Column six I 1 1 1 1 -H Union head accuses NWA of reneging on agreement Assertions of corporate excess tarnish atmosphere of worker-management cooperation Good for 1 00 years Cream of Wheat's; been around for a century and is still going strong Analysis conduct by Tom Pedersen, president of the International Association of Machinists (IAM) District 143, and have issued detailed responses to his claims. While some unions appear to be willing to work with the company in harmony, Pedersen's missives clearly have created a sense of distrust and skepticism among portions of the Northwest work force. "Everyone's real skeptical of management right now," said one Northwest mechanic. "There ain't no honeymoon." The concessions package took a year to hammer together and ultimately saved Northwest from seeking protection from its creditors through a Chapter 1 1 bankruptcy filing. Although extremely controversial, the package which contains mostly wage cuts eventually was approved by about 80 percent of the airline's workers.

"This is very much a new and different company," said Chris Clouser, senior vice president for corporate communications, advertising, human resources and quality. "We want to deal with employees fairly, openly and honestly. We've got nothing to hide. There's no sneaking around. We have a new responsibility to our employees." But over the past month, IAM President Pedersen has issued weekly invectives charging the company with a variety of transgressions, from management pay raises and free flight passes for managers' children to the rumored purchase of a $2,500 office chair.

"I think that they management are just sitting back thinking that they're going to run things as usual," Pedersen said in an interview this week. "It's up to us to monitor it and make sure that our members concessions aren't in vain." Company officials are saying private-NWA continued on page 10D By David Phelps and Jill Hodges Staff Writers On the shop floor of a Twin Cities maintenance hangar, mechanics for Northwest Airlines wear baseball caps that carry the outline of a ing 747 and the words "Owner-Operator." With more than one-third of the company now in employee hands, workers are showing heightened interest in how the airline operates. Profits, and losses, after all, now directly affect their pocketbooks and their futures. But what should be a period of enhanced cooperation and an atmos- The economy Summary Minnesotans a bit more confident about economy than rest of U.S. State has more reason for optimism, Art Rolnick says "There are only a handful of products 'j'f.

that last 100 years, and even fewer available in their I ..4 original form." Nabisco's Steve Ricker By Sally Apgar Staff Writer i Cream of Wheat, the hot cereal in the, yellow box stamped with the polite cally incorrect black chef, is as endur-1 ing and American as Mom, Shredded Wheat and Fig Newtons. Today, Cream of Wheat, a classic product from the nation's heartland, celebrates its 100th birthday by serVt ing steaming bowls of the iron-enriched farina to about 600 guests, including three generations of employees at its plant on Stinson Blvd: in northeast Minneapolis. The plant produces the nation's entire supply of the cereal about 70 million pounds of it a year, enough for about a billion servings. After breakfast, Minneapolis Mayor Don Fraser will declare Oct 7 Cream of Wheat Day. "There are only a handful of prod-, ucts that last 100 years, and even fewer available in their original form," said Steve Ricker, Nabisco- regular UUliliLoili.T Bipartisan group of fers compromise health plan Staking out new ground in the debate over health care, a group of conservative Democrats and moderate Republicans in the House offered a reform proposal Wednesday that they described as "squarely in the middle." The measure is similar to President Ginton's in many respects, but rejects his proposal to require employers to pay the lion's share of their workers' health insurance premiums, and his plan to impose government controls on health care costs.

Supporters, led by Reps. Jim Cooper, and Fred Grandy, R-Iowa, also contend that the president's goal of "universal coverage" is not realistic. They aim instead for the more modest "universal access" to medical care by making it more affordable for small businesses and offering government subsidies to poor individuals. Page 7 A. Jordan retirement not expected to affect ad-pitching Michael Jordan's retirement from a high-flying pro basketball career isn't expected to ground his lucrative sideline as a commercial spokesman for products ranging from sneakers to Wheaties.

Jordan's surprise disclosure late Tuesday that he will end his nine-year career in the National Basketball Association sent ad-makers scrambling for new ideas on how to depict Jordan as a retired rather than active player. But most agreed that Jordan has a staying power that makes him different than most athletes, whose advertising appeal fades once they are out of the spotlight They said Jordan's long-term contracts with advertisers, his appeal beyond hard-core sports fans and his decision to leave at the peak of his playing career make him a more durable pitchman. Sports, Page 9C. Irwin Jacobs' purchase could save Conservatory 'Copyright 1993 Star Tribun By Sally Apgar Staff Writer Although Minnesota consumers are still wary, they are more confident about the economy than the rest of the nation. A Star TribuneWCCO-TV Minnesota Poll of 807 Minnesota adults conducted in late September found that the state's consumer confidence in- dex is at 82.

It has not budged much from last winter, when it was at 81, Recent government indicators are pointing to slight growth in the nation's economy. The rest of the nation is at a more skeptical 78, according to the University of Michigan Index of Consumer Sentiment, completed in September. The regional index for the Upper Midwest is 76. The Minnesota Poll is calculated based on formulas and Trade Could it be that finally finally we might have someone who gives a rip about the Conservatory, the Nicollet Mall's lovely-to-look-at but difficult-to-navigate retail center? Word has it that the complex that cost $75 million to 2Rv build and open is about to have its second "w' owner in less than a year none other than Irwin Jacobs. Jacobs, who declined to corn- Tony Carfdce ment has bought the property and while the wmmimm deal hasn't been closed yet apparently all the documents are in place for the Minneapolis businessman to buy his first retail complex.

And if there's one thing worth knowing about Jacobs, it's that he's not the kind of guy who's likely to be a passive owner who will hold the Conservatory as part of some "portfolio" of properties. Page 2D. phere of new partnership has been tarnished in recent weeks with assertions of management reneging and corporate excess. A series of allegations by the head of Northwest's largest union has cast a cloud of skepticism over some employees regarding the company's commitment to the spirit of a landmark $886 million concessions package that workers approved in exchange for their equity stake. Company executives object to the persistent charges of inappropriate StarTrfcuneWCCOeTV questions that make it comparable with the Michigan index.

Minnesotans probably have more reason to be confident than others in the country, said Art Rolnick, director of research for the Federal Reserve Bank of Minneapolis. "The Michigan index includes unhappy people from California and the East Coast," Rolnick said. "The recession hit both coasts pretty hard land. Nafinsa, the development bank of the Mexican government, has agreed to provide money for the first experiment in the Twin Cities and has created a $20 million fund to pitch in for similar projects in other parts of the United States, Garcia said. He said he doesn't stand to gain from the project, except to score points for his side in the national debate over the pending treaty with Mexico.

Anti-NAFTA supporters have said only the largest U.S. companies will benefit from the treaty and smaller U.S. firms will have more to lose than to gain from increased trade with Mexico. Garcia, president and chief executive of Interinvestment based in St Paul, said he and other NAFTA supporters want to establish that increased trade with Mexico can create jobs for Americans working at sale of government securities at nine Treasury auctions. The managing director of Salomon's Washington office, Stephen Bell, confirmed his company's officials had been meeting with the administration and were lobbying Congress to pass NAFTA.

He said he saw nothing surprising about it "That the settlement was a couple of years ago. That's completely behind us," he said. "It's not the first thing we've done for this administration," he said. Salomon had also worked hard on the coalition to pass the Clinton White House's budget Bell declined to give details. But others familiar with the effort said Salomon was involved in organizing "breakout groups" in various industries, from pharmaceuticals to energy, who would lobby Congress and promote NAFTA locally with "grassroots" events.

Project intended to show that NAFTA can create jobs at small firms in U.S. WINDOW ON THE MARKETS Oct. 6, 1993 and they aren't coming back too Rolnick said Minnesota is seeing some job and income growth. Cathie Max of Minneapolis, a 43-year-old mother of four, said her family is financially better off this year than last because her husband found a job as a machinist that pays double what he made before. Despite the new job, Max said she is skeptical about next year.

"Taxes are increasing, costs are going up and I don't know what the new health care reform will do. It could kill some small businesses." Steven Vanderhoff, 39, of St. Paul said his family is definitely better off because his consulting business is doing much better. Looking ahead, he Poll continued on page 6D small businesses just in theory. in reality, not "The only way to do that is to demonstrate through a practical example that there are, indeed, such possibilities," Garcia said.

"This is something tangible, something constructive to help people to truly derive benefits from NAFTA." He stopped short of naming the Twin Cities cosmetics company involved in the project or to estimate how many jobs the program will create. Garcia said he would not release the name of the company without its approval, and the firm's executives were not available yesterday. But he described, in generrl terms, the agreement pending between the Twin Cities cosmetics firm and a company in the same business in Mexico. In Garcia's view, the Twin NAFTA continued on page 9D A number of the businesses involved attended a September meeting of some 200 people at the Treasury Department to hear Treasury Secretary Lloyd Bentsen and NAFTA czar Wil-liam Daley outline the merits of the trade deal. Treasury Department officials said the meeting was an educational briefing.

"We are careful to avoid grassroots lobbying," said one Treasury official who attended the meeting. "We can't tell people to go lobby Congress. "By the same token, people in the administration have been clear in saying there is a need to educate and become active" in winning congressional approval of NAFTA. "Salomon Bros, is one of the largest financial institutions in the country and an important part of the capital markets, so I don't see anything wrong" with talking to them about NAFTA, the Treasury official said. Lobbying continued on page 9D Trade consultant seeks to raise funds to demonstrate value of deal with Mexico By Mike Meyers National Economics Correspondent A Twin Cities cosmetics company soon may have a chance to show that doing business south of the Rio Grande can create jobs at small companies in the United States.

Trade consultant Hector Garcia, a Minnesotan born in Mexico, said he is soliciting big Minnesota companies to put up half the $1 million needed for a pilot project designed to counter opponents of the North American Free Trade Agreement (NAFTA). The other half of the $1 million, would come from Garcia's native Closa1 1.73 to 3598.99; 0.33 3700 O.WThFMTW Past week Aug. Sept jndziyttiiiKmsPflaKn Morgan Stanley International EAFE Index 1000 OJWThFMTW: Past week Source: Bridge Information Systems I II II 36004 f-f-- 3550 3500 I ZZZ 3450 1 ESS! 3400 fc I 3350 j. 3300 -j-- 3250 1 I I i rm i Gainers last CasDta 29V4 15.7 Sheldl 12 114 11.6 Rlmage 10.5 MGI Phr 131a 1 6.9: I GamCp 11! 6.3 WinthpRs 9V2 14 5.0 Vol. (000) ut Net Deluxe 1413 3214 5 LfeUSA 649 19 -VA fi SGrdCasns 477 29 -1V4 Treasury yield curve 8 0V Source: Bridge Information Systems Looking ahead 75-- Yesterday 7.0 Iweekago 1 6.5 4 weeks ago I i 6 0 I I I -f i 4.5 1 4.0 -j0 1 2.5 i Is 3 6 1 2 3 5 7 10 30 vr.

975 i Jmm 950 1 itin I i -I 925 7Zf 875 -TT-- i 850 1- '825 I ZZZ 800 -It- Odd political bedfellows show up in Washington to help Clinton administration promote NAFTA Cream of Wheat has been warming people's breakfasts for 100; years now. Cream of Wheat plant manager, v. Indeed, the comforting white gruel has been marketed to moms and. families for generations. -j From the turn of the century untiL about 1938, Cream of Wheat hired some of the nation's finest illustra-f tors to advertise the cereal's tional virtues on trolley cars and in magazines such as Ladies Home Journal, McCall's and Home Companion.

By the 1960s, the company ran nav tional television commercials of watchful moms sending their chiK dren off to school on a snowy morn- ing with the image of a steaming -bowl hovering protectively over the- head of each child. With its centennial under its belt Cream of Wheat joins the ranks pf other Nabisco Foods Group Incs products such as Shredded Wheat," and Fig Newtons that also have vived more than 100 years of war recession and, above all, fashion. Cream of Wheat, like many of Amer-ica's finest innovations, was born at aP' time of great adversity. According accounts provided by the Minnesota Historical Society and Nabisco's coivt porate history, it is a product of sturvf ning resourcefulness concocted grim hour of near-collapse. -1 4 The year was 1893, and a spectacular' financial panic swept the United States.

European investors dumped, American securities, dangerously de--pleting the nation's gold supply. The: New York Stock market rocked and crashed. The inescapable financial devastaVo tion snared the mighty and the vuj nerable. Even the Diamond Milltng Company, a small flour miit-io Grand Forks, N.D., struggled to stay; alive as its operating capital dwin-ij died. The Panic of 1893 had driven fiourl Cereal continued on page 2D July Aug.

Sept TODAY Retailers report monthly sales. The Commerce Department reports per capital income by state. The Federal Reserve Board releases consumer credit figures for August LATER THIS WEEK Friday The Labor Department reports unemployment figures for September. Some have even been in trouble with government before By Susan Cornwell Reuter Washington, D.C. Those strange political bedfellows are nowhere more obvious than in the White House's appeal to businesses including some that have been in trouble with the government to help sell its trade package.

In recent weeks, dozens of blue-ribbon businesses have been trooping in and out of the Treasury Department as part of a White House campaign to try to create support for the North American Free Trade Agreement (NAFTA). Among the businesses is Salomon Brothers, the investment bank that in May 1992 agreed to pay federal authorities $290 million to resolve civil charges that it violated rules on the index BottomLiners 7D Mutual funds 9D For executives only 2D Regional briefs 3D For your information 7D Markets update 4D cmm-. i i a.