For NN Corp., an insurance holding company in Milwaukee, 1979 was another good year. Its profit, on revenues of $423 million, was 7 percent after taxes. Its after-tax return on equity was 25 percent.

Those are golden numbers. They make NN Corp. appetizing to other companies. At least 25 would-be buyers have nibbled at NN sine 1973.

None of the takeover proposals succeeded. But the chairman and chief executive officer William M. Berry listened to each one. His responsibility to NN's shareholders required him to, he told a reporter.

Berry is also what he calls "a corporate citizen of Wisconsin." As such, he took on an unusual additional responibility a year ago: to tell a hearing of the Senate Select Committee on Small Business of his concern -- shared by other Wisconsin executives -- "about the negative effects of takeovers on the community."

Community dislocations have long been part of the industrial landscape, painful side effects of the corporate drive toward lower costs and higher profits.

But today there is a new dimension to this old problem. The reason is the wave of conglomerate mergers that has swept across the economy, takeovers of companies like NN by what amount to distant corporate holding companies.

One of Berry's concerns was the financial loss to a state and city when, as often occurs after a takeover, a local firm's headquarters is closed. Had Nn's been shut, he figured, the loss to Wisconsin and Milwaukee -- in 1978 alone -- would have been $3,481,134, half of its pay for 71 employes.

He put a value of $411,359 on the contributions and pledges by NN and its charitable foundation into a host of state and city community causes.

These involved $57,700 to the United Way, in addition to $13,401 given individually by employes. The United Way often has found it "difficult to get much in the way of donations or cooperation from companies that are owned by out-of-state conglomerates," Berry testified.

In addition, the philanthropic contributions included $77,655 to the University School of Milwaukee, $60,000 to Milwaukee Children's Hospital, $17,500 to the United Performing Arts Fund, and $7,500 to the Milwaukee Symphony.

'Conglomerates or outsiders usually eliminate this type of expenditure," Berry told committee Chiarman Gaylord Nelson (D-Wis.). "They have their own causes, their own headquarters city and state, and different corporate purposes to serve in their contributions. Places like Milwaukee and Wisconsin are far away and unimportant to them."

At the same time, in many communities, local managers for large corporations based elsewhere take leadership roles in raising funds for chairitable and civic activities.

Other witnesses tolf of acquisitions of Wisconsin firms that had been followed by the swift transfer of banking, insurance and other professional functions to the out-of-state headquarters of the acquiring conglomerate.

This testimony lent an importance beyond their dollar amounts to three relatively small items listed by Berry in his state-city loss estimate of $3.5 million: $35,194 to two Milwaukee banks for interest charges, $319,268 to local insurance agents for corporate coverage, and $383,783 to local professional firms for accounting, legal and other services.

Berry is but one of many local businessmen across the country who say that decision-makers in distant conglomerate headquarters often don't have -- and can't reasonably be expected to have -- the same concerns as owners rooted in the community. They say the same is true of numerous conglomerate managers.

Such feelings pervaded a two-day hearing in Syracuse, N.Y., in 1978, when three dozen upstate businessmen recalled traumatic aftermaths of several regional mergers.

They told Milton D. Stewart, the Small Business Administration's chief counsel for advocacy, of being displaced as long-time suppliers by centeralized conglomerate purchasing, of emptied factories, of disrupted lives and communities, and of generalized fears for the future of small business.

Much of the feeling of unease about conglomerates was summed up by Theodore Pierson, whose Onondaga Supply Co., he noted, "does 75 percent of its business with corporate giants and conglomerates."

Conglomerates, Pierson testified, "can take vital decisions for a community out of the community, and they can affect the lives of the families of their employes by decisions at a remote corporate headquarters."

And last February, the House Small Business anittrust subcommittee heard two economists testify that conglomerates "are among the businesses most responsible" for massive shifts of capital and jobs not only within the United States, but also to "low-wage, underdeveloped countries."

The witnesses, Barry Bluestone of Boston College and Bennett Harrison of Massachusetts Institute of Technology, also testified that their research "has demonstrated quite clearly that conglomerates are responsible for more plant closings than either large corporations or small business," sometimes because they are less willing to ride out a business downturn than local owners closely tied to the community.

Harvard's Belden Daniels offers a case in point: the 1974 acquisition by Sheller-Globe of Toledo, mainly a maker of auto parts, buses and ambulances, of Colonial Press of Clinton, Mass., a book printer.

Like other conglomerates such as Esmark, Sheller-Globe billed subsidiaries for management services -- an average of $900,000 a year for Colonial. Some of the services weren't wanted, including construction of a big chain-link fence and the stationing of 22 security guards. The theft level had been so low that it "couldn't possibly" justify the costs, Daniels says.

More fundamentally, Sheller-Globe imported a new team of production-oriented managers with no publishing experience. Daniels says the was chaos: lost orders, collapsed relationships with key customers, and, viand installation of a costly computerized management information service, lost books and "terrible confusion" in production.

In the end, Daniels says, sales sagged as book publishers took their business elsewhere. Sheller-Globe finally announced its intention to shut down Colonial. By that time, the number of jobs at Colonial -- Clinton's largest employer -- had shrunk from about 2,000 to 750.

Conglomerate managers may set goals such as a target profit or market share for a subsidiary, close it for falling short, and seek better investments elsewhere. When the result is a plant closing that devestates a community and burdens taxpayers with welfare and other costs, there's a question about defining managerial competence soley in terms of a conglomerate's interests and no one else's.

Some cases in point:

In Herkimer, N.Y., a century-old library furniture plant was the leading employer and customer for area-grown hardwood logs. Starting in 1969, its after-tax return on investment was a low 3 percent to 4 percent. In 1976, Sperry Rand, the conglomerate owner, decided to close the plant. Then, reluctantly, Sperry agreed to sell it to the Mohawk Community Corp., (MCC) for $4.3 million.

In a single day, the 270 workers raised the $197,500 down payment -- knowing it would be forfeited if the balance was not raised in 45 days. A loan of $2 million was made by seven local banks after their conditions were met: the MCC must sell 1 million shares of stock at $2 each, and the Economic Development Administration must lend $2 million more.

With the $4.3 million oversubscribed, the plant for the first time began to sell to U.S. corporations and to do business abroad. Its after-tax profits under the first year of new ownership was 14 percent.

Losing about 1 million in its second year, the MCC brought in a new president, reduced its 1979 loss to $600,000, and has been profitable every month in 1980, said MCC official John M. Ladd. It also expanded the work force by 23 percent and saled by $3 million annually, he said.

In the shaving market, Philip Morris had hoped to make American Safety Razor of Staunton, Va., into an effective challenger of dominant Gillette and Schick, but had failed to win a market share of more that 12 to 14 percent.

Finally, PM, preoccupied with its beer and cigarette lines, and having haf five consecutive years of losses at ASR, ordered the plant closed. But nine ASR managers, pooling $600,00 if their own money with bank and federal loans, bought the company for $16 million in October 1977. About 800 jobs were saved. And, says chief financial officer Gray Ferguson, ASR has been operating at an undisclosed but "encouraging" profit ever since.

Sometimes a company refuses to sell a plant, or a community or employes can't buy it. That can lead to trouble, as illustrated by United States Steel.

USS is one of the industry leaders that went on building obsolete open-hearth capacity long after it could have put in efficient oxygen furnaces. oNot until 1963 -- about a decade after two small steel companies had installed oxygen furnaces -- did USS do so. Then, when the outlook for domestic steel darkening, USS became one of the major steelmakers that diversified heavily into nonsteel activities, and that now complain of being unable to compete with foreign steel.

Recently, USS announced that it will shut down 13 steel plants. The Labor Department has notified the company that the closings could cause local distress for which the government would have to pick up the tab, a department oficial told a February hearing of the House Small Business antitrust subcommittee. Chairman Berkley Bedell (D-Iowa) foresaw "a heavy burden to the taxpayers . . ."

Two of those plants, comprising the Youngstown Works in Ohio, would be acquired, modernized and restored to operation under a plan proposed by a community-worker venture. But USS refuses to sell the plants to the enterprise on the ground that it would use low-interest federal loans. A complaint that the company was violating the antitrust laws was dismissed in U.S. District Court.

Now Ohio Attorney General William J. Brown is asking the court to oder USS to deal with all prospective purchasers, arguing that its refusal to do so simply because a potential competitor would have federal loans or loan guarantees was illegal discrimination. The company is threatening Ohio's economy with "grave and irreparable harm," Brown has charged.

Beyond the social impacts of the merger wave are the political implications of concentrating economic power.

Obviously, a company that acquires plants in several states acquires more political leverage, too. It gains easy access to more officeholders at relatively low cost. It gets more for its money through such means as political action committees, lobbying, and "advocacy" advertising.

International Telephone and Telegraph made the point in 1968 when it made its ultimately unsuccessful effort to acquire American Broadcasting. ITT, which had 256 subsidiaries, 200,000 shareholders and 400,000 employes, mustered some 300 members of Congress to protest the Hustice Department opposition to the proposed merger.

Some business groups and economists try to deflect concern by saying that mergers haven't been shown to have concentrated either economic or political power. "The political muscle in large corporations is practically nonexistent," a reported was told by Thomas G. Moore of the Hoover Institution on War, Revolution and Peace.

Moore's claim, of course, is disputed.

That is part of a more general dispute about the value of mergers.

There is no doubt that some mergers are on balance beneficial: that they enhance competition, infuse needed capital into companies, help remove incompetent managers, enrich stockholders.

But other mergers, for all kinds of reasons, are not so benign.

The question is whether the government ought somehow to restrain mergers, sort out the good and bad, let only the "good" go forward.

So far the answer has been no.

Congress, by not restraining the merger wave, is letting it roll. Business groups defend this decision, or nondecision, saying there's no "proof" of a need for curbs on acquisitions. Others say that to wait for proof is to wait until mergers have transformed the nation irreversibly.

Last May, Sens. Edward M. Kennedy (D-Mass.) and Howard M. Metzenbaum (D-Ohio), who succeeded Kennedy as chairman of the Senate antitrust subsommittee, introduced a bill to bar the 16 largest oil companies (Sun tanks 10th) from buying any firm with assets exceeding $100 million. The bill won a Carter administration endorsement and has been reported by the Senate Judiciary Committee.

On a back burner is a more sweeping bill sponsored by Sens. Kennedy, Metzenbaum, John F. Melcher (D-Mont.) and Larry Pressler (R-S.D.). mThis measure, on which hearings have been held, would allow the very largest mergers only if there's a showing that they would improve either competition or efficiency.

Taking a differenct approach, the Federal Trade Commission's Bureau of Competition, instead of ruling out any merger, would let one large firm acquire another only if it divests a comparable entity within a reasonable time.

A wholly different tack is urged by William C. Norris, cheif executive officer of Control Data Corp.: require a "social impact analysis" so the stockholders of the firms in a proposed merger can judge the effects on jobs, careers, productivity, innovation, communities and themselves.

Numerous other ideas have been suggested. One of the simplest: heavily tax undistributed profits. That would drain a lot of fuel out of the merger tank.