On July 3, 1986, the glorification of Lido Anthony Iacocca seemed complete.
As he stood before the Statue of Liberty in New York harbor that night - host of America's celebration of Lady Liberty's Centennial - the son of Italian immigrants bathed in the adulation of a nation hungry for genuine heroes. Just back from a guest shot on "Miami Vice" and with "The Pride is Back" commercials for Chrysler saturating the airwaves, Iacocca was by then a fixture in American pop culture. He had become a symbol of the nation's comeback, a man whose life story was a worldwide best seller."He's easily in the top 10 among individuals in this country," Baseball Commissioner Peter Ueberroth said admiringly at the time. Iacocca's horizons seemed limitless, and the question persisted: Would Chrysler's savior lead the Democratic Party back to the White House?
Just two years later, Iacocca seems to have lost much of his heroic allure. In many ways, Iacocca, political observers and marketing experts believe, has been unable to live up to the ideals Americans impose upon their living legends.
Since his shining moment at the Statue of Liberty, the 63-year-old Chrysler chairman has endured mounting public criticism for his actions at Chrysler. He has been moving to close plants, lay off thousands of workers and shift many of their jobs overseas while accepting millions in pay. At the same time, his company has faced an embarrassing charge of odometer tampering and has paid a big fine.
To be sure, Wall Street has cheered many of his toughest actions as necessary to ensure Chrysler's health, which seems to be improving; its U.S. car and truck sales rose to a 15-year high during the first three months of 1988, and the once-struggling firm is solidly profitable.
Still, Chrysler workers, who once cheered when Iacocca walked through the company's factories, now instead sport buttons saying "Iacocca is a liar."
At a press conference earlier this month, Iacocca was philosophic about the decline in his national popularity, but acknowledged, in his own aggressively satiric way, that his image has suffered.
"Whatever it is, it is," Iacocca said, "I never worry about it."
Referring to a bid for the presidency, he said, "I was thinking of throwing my hat in the ring at the last minute, but this did it," referring to the criticism of his actions at Chrysler. "Because of all this . . . God convinced me, `you shouldn't run.' "
"My poll ratings are down," he added. "I was doing a lot better in the polls when I made $1 a year . . . I've taken a beating."
Indeed, the man once touted as the ideal Democratic presidential candidate has become the target of Democratic ads attacking corporate greed in the 1988 campaign. Now, party leaders say Iacocca's image has been so sullied by his recent tough actions at Chrysler that he may not likely be offered any major post if the Democrats retake the White House.
Massachusetts Gov. Michael S. Dukakis, the likely Democratic nominee, is unlikely to offer Iacocca a top job, said a top official in his campaign. "It would be difficult now for a progressive Democrat like Mike Dukakis to consider him for any kind of visible role in government, let alone a Cabinet post," said a top official in the Dukakis campaign. "I think the guy has certainly done himself a lot of damage.
"It's not that what he did to save Chrysler is no longer heroic . . . It's that he should now be viewed as an errant hero."
Iacocca's fall from political grace, some observers believe, mirrors a larger change in American attitudes about business in general. Pollsters say that, in the wake of insider trading scandals, merger mania, the Wall Street crash, and a growing sense of American economic inferiority compared with Japan, the public is now less enamored with corporate America - and with business heroes - than it was just a few short years ago.
"Iacocca was a national hero; four years ago, he symbolized America's comeback in the economic sphere. People felt that Ronald Reagan had brought the country back, and Iacocca was like his partner on the business side of that," notes Mark Mellman, a Washington-based political pollster.
"But today, I think he would have a much harder time running for president," adds Mellman, who worked for former Democratic presidential candidate Albert Gore Jr., who ran a television ad during the Wisconsin primary attacking Iacocca's decision to close Chrysler's Kenosha, Wis., assembly plant.
"The things he symbolized about corporate America were in vogue a couple of years ago, but now they are not. Before, he was seen as the solution to the problem, and now he is the cause, and that's a big shift."
Iacocca's transformation from hero to
goat in the political arena really started with a rash of negative publicity over Chrysler plant closings and layoffs this past winter.
Chrysler, burdened with too many costly and aging factories in the wake of its ambitious acquisition of American Motors last year, decided it had to close its Kenosha plant, a former AMC factory that was the oldest auto assembly facility in the nation.
Chrysler's announcement in January that it would close Kenosha and eliminate 5,500 jobs sparked a storm of protest among workers and political leaders in Wisconsin. The state had given Chrysler incentives to support the plant when Chrysler took over AMC in 1987, and union and state officials charged that Iacocca had lied to them when he pledged, while seeking the incentives, to keep the plant open for at least three to five years.
All the leading Democratic candidates blasted Iacocca's decision when the presidential campaign moved to Wisconsin for the state's April 5 primary. Gore ran a television commercial attacking Iacocca's decision; the 30-second spot showed Iacocca's smiling face while Gore noted that Iacocca "made $20 million in 1986."
"But look here," Gore continued, "this Chrysler plant in Kenosha left the people who built that company without jobs or hopes."
Gore campaign aides said that they went after Iacocca in part because they felt the issue of "corporate greed" - huge executive salaries and bonuses in the face of layoffs and plant closings - will become a key Democratic issue this year.
"There is a real sense that corporations just don't have any loyalty to America anymore, and corporate greed is becoming a potent issue - that's what that spot was about," says Thomas "Doc" Sweitzer, a media adviser to the Gore campaign who produced the Iacocca attack ad.
In fact, in the minds of Chrysler's workers, Iacocca's huge pay - he made more than $20 million in 1986, and nearly $18 million last year - contrasts sharply with the firm's aggressive cost-cutting actions that often cost blue-collar jobs. As a result, much of Iacocca's store of goodwill with his work force has been exhausted.
For instance, Iacocca's plan to sell virtually all of Chrysler's troubled auto parts plants in order to buy more components from outside suppliers nearly provoked a strike earlier this year. Chrysler was finally pressured by the United Auto Workers to back down from the proposed sale; yet the company still is going ahead with plans to shutter four of the facilities.
More recently - in the midst of the company's ongoing contract talks with the UAW - Chrysler said it was planning to shift production of its famous K-car sedans from Detroit to a low-wage plant in Mexico, once again setting off a major protest among Chrysler workers. Iacocca once again backed off, saying last week that the plan has not been finalized.
But the damage to his reputation among Chrysler workers has been done.
While the recent plant closings and layoffs have hurt Iacocca's reputation with labor and political leaders, his larger-than-life standing among consumers was first wounded last summer. That was when federal charges of odometer tampering on newly built cars by company executives who were driving the vehicles before they were sold rocked Chrysler, forcing Iacocca to make a public apology to the nation. Iacocca was lauded by marketing specialists for his forthright handling of the scandal.
Yet while Iacocca turned the odometer story around with a stand-up approach, the scandal lingered. Jokes started circulating across the country about the incident - "Would you buy a used car from Lee Iacocca?"
Iacocca's huge paychecks also seem to be tarnishing his public image. Once a national symbol of self-sacrifice for accepting only $1 a year in pay in order to help nurse Chrysler through its crisis, Iacocca finds himself being portrayed as just another corporate fat cat. Business Week, which said he was America's highest paid executive in 1986 - and second highest in 1987 - also now calculates that he is the most overpaid.
In its May 2 cover story on executive pay, the magazine argues that Iacocca gave his shareholders the least "bang for the buck" of compensation of any top corporate executive in America in 1987. Iacocca's pay was the highest of 339 business leaders surveyed relative to his company's return on investment to shareholders, the magazine said.
Iacocca now seems to be addressing the public relations problem caused by his pay. Chrysler announced recently that in the future, executives will not receive bonuses in years in which blue-collar workers do not receive profit sharing payouts.
"We've got to work out pay plans that smack of more fairness," Iacocca said last week.
But since much of his own money has come from cashing in Chrysler stock options, which are a barometer of corporate performance, Iacocca isn't sure that he is being attacked fairly.
"I was embarrassed," by his income from stock options, Iacocca said. "I guess our value system gets out of whack . . . I can't answer this.
"But what should I do, root for the stock to go down? I'm not just a wage earner, I'm an investor, maybe a smart investor. I held my $6 (Chrysler) stock. But I don't feel bad, because anyone else who held it made the same 2,000 percent increase. I'll give you a tip, stick with us, and you'll make some money like I did."
Iacocca, who once had perhaps the most positive relations with the media of any major corporate executive, now seems increasingly hostile towards the press. At a recent press conference, Iacocca, who writes a syndicated column, lashed out recently at the coverage of Chrysler's proposed shift of production to Mexico.
Still, Iacocca retains an enormous store of popularity with the public, and he is a man who has proven more than once that he can bounce back from adversity.
His second book, "Talking Straight," will be published June 1, and that could once again revive national interest in Iacocca. Orders from distributors have exceeded expectations, and a big initial printing is being increased.
And, Iacocca's defenders feel, the only reason he may have lost his status as a folk hero is that the public demands far too much.
"The only way he could have retained that image was to have retired at the peak," said C. Samuel Craig, a professor of marketing at New York University's Graduate School of Business. "He saved Chrysler, and now to keep Chrysler afloat, he has to make unpopular decisions. That makes him a big target."