Saint in New England puts workers before profit

Methuen, Massachusetts - Who is America's most admired businessman? Is it Microsoft's Bill Gates, Lou Gerstner of IBM, or the Wall Street billionaire, Warren Buffett? None of the above, at least in this gritty New England town on the banks of the Merrimack River. Here only one name matters: a 70-year-old owner of a family textile firm called Aaron Feuerstein.

It was 11 December when fire struck at Malden Mills, the company Mr Feuerstein's grandfather founded in 1906, burning down three of nine buildings and idling 1,800 employees, three-quarters of the workforce. Malden Mills might have been the largest company in town, but what would happen next seemed obvious. Mr Feuerstein would cash in his chips, taking the insurance money and live out a contented old age in Florida. Or, at the very least, he would simply lay off all the affected men until the plant was rebuilt, and probably only take a few of them back.

If another mid-sized family firm vanished, then so what? Is that not the modern American way, in this age of downsizing and corporate consolidation?

Mr Feuerstein did not follow the script. To the eternal thanks of Methuen (and the amazement of the rest of the country as it learnt of AT&T's simultaneous dismissal of 40,000 workers) Mr Feuerstein neither sacked nor laid off anyone. Instead he promised he would pay the workers their wages and health care benefits for 30 days. That period he extended first to 60 days, then 90 days before announcing that alas he can afford it no longer when that third period expires in mid-March.

But no matter: his fame and the gratitude of his employees is already boundless. "What he did, I can't imagine anyone else doing," Nancy Cotter, a quality control superviser at the plant, says. "He saved our lives. We lost everything and he gave it back to us." His own explanation is no less straightforward: "Why am I doing it? Because I consider the employees standing in front of me the most valuable asset Malden Mills has. I don't consider them as just an expense which can be cut."

And thus was born a moral tale for this election season. Up-river from Methuen lies the state line with New Hampshire, where Pat Buchanan, that Republican scourge of free trade, struck gold in the primary campaign by railing against the textile industry and other US businesses for decamping to Mexico to take advantage of its cheap labour - and turning jobs over to foreigners. So effective is the pitch that even Bob Dole, a staunch friend of corporate America, has started to bite the hand which feeds him, to fend off Buchanan. So far at least, Mr Dole has not mentioned Mr Feuerstein by name, but the Democrats have had no such inhibitions. President Bill Clinton personally invited him to Washington for the State of the Union address.

And like most moral tales, it will have a happy ending. Even though he can no longer pay those who cannot work, an emergency fund of $1m should tide them over until the end of the summer. By then 90 per cent of the work force should be back. The rest are promised jobs at a state-of-the-art new factory.