In Stowe, a Vermont village tucked between well-worn ski slopes and hardscrabble homesteads, temperatures of30° do not surprise. Frigidity being the stepmother of invention, David Putnam two years ago became proprietor of Stowe Woolens, Ltd., a manufacturer of sweaters and ski caps.
Putnam supplies yarn to 25 or so knitters, who work at home on machines they buy from manufacturers for $350 and up. Each worker is paid, in venerable cottage-industry fashion, by the piece. The knitters seem to like the arrangement just fine. The U.S. Department of Labor does not. Although never...