Blame all around in Fruit of the Loom closure

Democrats blame Republicans while GOP blames President Obama’s policies

By Kevin Wheatley, Published:

The Democratic frontrunner to take on U.S. Senate Minority Leader Mitch McConnell placed blame for the closure of Jamestown’s Fruit of the Loom factory squarely on the Republican’s shoulders Friday, citing past votes against legislation aimed to keep companies on U.S. soil.

The company itself said the global market forced the move while Republican U.S. Rep. Ed Whitfield said President Barack Obama’s energy policies and rising electric costs sent the company — and its 601 jobs — packing to Honduras.

Who’s to blame in the factory’s closure, announced Thursday, is the latest development in a contentious U.S. Senate race expected to pit McConnell against Kentucky Secretary of State Alison Lundergan Grimes this fall.

In a statement Friday, Charly Norton, Grimes’ campaign spokeswoman, pointed to McConnell’s previous votes against bills dating back to 2010 that would entice companies to stay in the U.S. and end tax credits for those moving abroad. Norton mentioned a jobs plan released by Grimes in January, in which the candidate said she would support tax incentives for businesses relocating to the U.S. and cutting breaks for those that move operations overseas.

“Kentucky’s middle-class families face continued economic uncertainty as Mitch McConnell supports tax breaks for corporations that send good Kentucky jobs overseas, including 600 jobs alone this year in Russell County,” Norton said in the statement. “Kentuckians deserve a U.S. Senator who will create and protect our jobs — not one who recklessly supports outsourcing hundreds of jobs to Honduras and refuses to offer a plan to help put our people back to work.”

An Associated Press report said Fruit of the Loom, based in Bowling Green, made its decision to align the “global supply chain to allow the company to leverage existing investments and meet customer requirements more timely and cost effectively.”

The plant will lay off its staff in phases beginning June 8 through Dec. 31, according to the AP.

“This decision is in no way a reflection on the dedication and efforts of the employees in our Jamestown facility, but is a result of a competitive global business environment,” Tony Pelaski, Fruit of the Loom’s executive vice president and chief operating officer, said in the AP report.

Allison Moore, McConnell’s campaign spokeswoman, said, “Alison Lundergan Grimes is once again showing her profound lack of understanding on the issues.”

Whitfield, of Hopkinsville, said in a statement he was disappointed “that President Obama’s EPA regulations have impacted the largest employer in Russell County.” Rising U.S. business cost was a factor in Fruit of the Loom’s decision to move operations to Honduras, according to Whitfield’s statement.

He highlighted his legislation that would allow companies to build new efficient coal plants, calling regulations on greenhouse gas emissions from power plants “a de facto prohibition on building a coal plant in America.”

“We want to be able to compete in the global marketplace and the high compliance costs of recent regulations out of EPA are forcing companies overseas,” Whitfield said in the statement. “If our electricity costs rise due to excessive regulations on power plants that negatively impact our manufacturers, then those jobs and facilities will close as is happening with Fruit of the Loom.”

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  • They have done this to me twice now,lost the only home ive ever owned.I dont know all the answers or reasons,id slap tarriffs on all this stuff to as the liberals love to say LEVEL THE PLAYING FIELD.Listen up politicians if someone could fix this they would be a national hero at least in my book.In 20 years there wont be anything left for our grandchildren.

  • They have done this to me twice now,lost the only home ive ever owned.I dont know all the answers or reasons,id slap tarriffs on all this stuff to as the liberals love to say LEVEL THE PLAYING FIELD.Listen up politicians if someone could fix this they would be a national hero at least in my book.In 20 years there wont be anything left for uor grandchildren.

  • Taxes and utilities have noting to do with this. A $12.00 dollar an hour worker competing with a $12 dollor a month worker in some miserable rockpile with no OSHA regs to worry about might figure in though. And, doesn't Obozo's buddy Warren Buffett have a slice of this pie? I know his buddy Jeffery Immelt of GE like to ship jobs to China.  So Ms. Grimes, look at the whole picture, not just Mitch (who needs to go).

  • Oxygenthieves,

    On the last annual report with earnings of $15,312,000 Fruit of the Loom paid $1,710,000 in combined federal, state and local taxes.  Assuming a conservative 6% for state and local they paid an effective rate of $901,620 or approximately 5% in federal taxes so prima facie your argument has no vaildity.  Until we incent corporations to stay and not give them tax breaks to leave this is to be expected.  To blame Obama when Congress sets the tax rates is a bit ludicrous, wouldn't you agree?

     

  • This goes to show how our government can only do finger pointing and have 600 need jobs leave the country

    These people should be very pleased with themself 

    I think its time to take Fruit of the Loom off my list of "American Brands"

  • That is what the WSJ says in an opinion piece...which they are entitled to.  So, which is it, taxes or electricity or what?  Indecison may or may not be a big part of the conservative's problem.  But the fact remains that the US is the only civilized first world country not to have universal health care coverage, which effectively removes the burden of providing the ever increasing health care insurance from the companies in their compensation packages.  In 2009, the U.S. had the highest healthcare costs relative to the size of the economy (GDP) in the world and to say that these corporations are not factoring in these costs, as well as the the cheaper labor costs in places like Honduras when making the decision to move is very naive.  

    Blaming President Obama for the Bush era tax codes (and that have been upheld in the current House) that heavily favor the rich and have lead to the vast inequities of income is like Booth blaming Lincoln for missing the last act of the play at the Ford's Theater.  Obama has tried to repeal these ever since he was in office...this ain't ancient history, there is video tape ya' know!

    Revisionists...can't live wid'em, can't kill 'em.

  • Well well another Fruit of the Loom bites the Dust. When the local plant here closed between my Family and my Husbands we had probably over 500 yrs combined with this plant. Walked out with nothing. I really feel sorry for the Folks in Jamestown. When is Mr Pelaski's last day. He should have been gone when the local plan went under. Just saying now another one goes.

  • NEW YORK (CNNMoney) President Obama has been loud and clear about his fight against income inequality, but he admitted that the rich have fared far better than the poor during his time in the White House. hhmm I thought he hated the rich 1% er's....Well if it wasn't for those 1% er's he couldn't have those $35,000 a person fundraiser dinners....

  • Check the facts under Odumma...More big U.S. companies are reincorporating abroad despite a 2004 federal law that sought to curb the practice. One big reason: Taxes.-source Wall Street Journal....But Obamacare is going to be causing chaos for seniors as well. As NCPA President John Goodman points out in his health policy blog on March 25, almost half of Obamacare is paid for over the next decade by draining $716 billion out of Medicare. While Democrats have been so aggressive about accusing Republicans of wanting to slash Medicare, it is Obama and the Democrats who have actually done it.-source Forbes Magazine.....Under Obama 95% of income gains have gone to? The top 1%-source CNN money.....the median household income has dropped $7,000 under Obama- source Forbes.....who does Allison support? Obama...

  • "McConnell’s previous votes against bills dating back to 2010 that would entice companies to stay in the U.S. and end tax credits for those moving abroad. Norton mentioned a jobs plan released by Grimes in January, in which the candidate said she would support tax incentives for businesses relocating to the U.S. and cutting breaks for those that move operations overseas."

    Nailed it!  Cheap labor gave Froot of the Womb the incentive to move and the Republicans made it easy with their tax credits and tax incentives to move jobs overseas with no penalties...further proof of the fact that the Republicans are the party of BIG business and don't give two hoots for the workers!  

    The proof is in the puddin'.

     

    "“We want to be able to compete in the global marketplace and the high compliance costs of recent regulations out of EPA are forcing companies overseas,” Whitfield said in the statement. “If our electricity costs rise due to excessive regulations on power plants that negatively impact our manufacturers, then those jobs and facilities will close as is happening with Fruit of the Loom.”"

    That is just so much BS, as everyone knows that KY has some of the cheapest electricity rates in the nation.  

    Ditch Mitch