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August 27, 2008 - 12:53pm

Powers knocks Lee for profits from sale of company

posted by Howard B. Owens in Jon Powers, Chris Lee.

Chris LeeThe Powers campaign is trying to make an issue of who Chris Lee (the Republican candidate for the 26th District) sold his company to.  The D&C:

The company Lee helped manage and his father founded was sold for $395 million less than a year after the buyer, an international conglomerate, pleaded guilty to two felony charges related to sensitive defense technology that had been sent to China, Britain, Singapore and Japan. The conglomerate, ITT, also paid $100 million in fines.

The Lee campaign maintains that International Motion Control, an engineering and technology company founded by Patrick Lee, was sold to a division of ITT that was separate from ITT's defense operations, which incurred the charges and fines.

...

"As a combat veteran, Jon Powers is deeply troubled by anyone who profited from a company that gave our national security secrets to the Chinese," said John Gerken, Powers' campaign manager. (via Rochester Turning)

It seems a stretch to knock a guy for legally selling his company.  It  doesn't seem like the sort of thing that will resonate with voters, and what Powers is doing is reminding people that Lee is an experienced, successful business man -- something that Powers, for all his great military experience -- doesn't have in his portfolio.  While that doesn't disqualify Powers for office, why draw attention to it?

It also seems to be a political misstep for Powers to raise this issue now, before he's even won the primary. By the time the general election rolls around, this will be a stale story that most media won't cover.  (Though, a lot of times campaigns get these stories planted in the press so they have a clip to include in a hit piece mailer. The timing, then, doesn't matter.)

I don't know much about International Motion Control, but if it were the case that IMC dealt in defense-related technology that could maybe make its way into Chinese hands via ITT, then Mr. Lee's judgment and fitness for office could be legitimately questioned.  But merely profiting from the sale? That's a stretch.

There isn't much on the web now about IMC, but I did find this press release about the sale. The list of products appears pretty non-threatening. However, it is interesting that Mr. Lee outsourced some manufacturing to Asian countries. That could be a liability for him in this district, but it seems Jack Davis has the stronger track record to make that case.

Chris Lee's campaign site. Jon Powers  campaign site.

John Roach
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Power seems willing to go low to win. I didn't think much of him before, but was giving him a second look. That second look isn't too good.
Russ Stresing
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"Go low"? Please. I've got a greater issue with a candidate who wants to represent a 26th District bleeding jobs after he profited when the family firm sold a company that moved 300+ jobs out of state. For all Mr. Lee's claim to "a portfolio", it was his dad's firm and his dad's decisions that created the company. Chris just hit the genetic lottery. Lee's trip to Leroy area farms underscores his appreciation for what people are going through. He largely admitted he didn't have any ideas or suggestions, and took no stance on immigration visas for migrant workers. On the same day, Powers came out with a fairly detailed agricultural policy that takes a position on that same issue and much more.
Daniel Jones
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John, the rebut to Chris Lee is simple, he claims to be supporting the creation of American jobs....and then outsources them. Hypocrisy much?
Russ Stresing
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Okay,let's be clear. "outsourcing" denotes "overseas". To be honest, the jobs went to another state.
Daniel Jones
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Duly noted. They still left Western New York though.
Russ Stresing
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Don't help me
Robert Harding
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Actually, both of you are wrong. Outsourcing is the practice of taking a job someone can do here and sending it elsewhere - whether that's to another state, another country, another planet, another universe. Take Washington Mutual, for example. To my knowledge, they are set in Washington (the state) and don't have a WaMu branch in the area. However, they do have a call center in Albion. Call centers are perhaps the easiest thing to outsource anywhere. What Chris Lee did wasn't outsourcing though. Those jobs evaporated. The company was sold and another company took over with a different set of people running the show and with a different set of employees. The trade-off? Lee's family sold 300 jobs off for $395 million. Not bad, for the Lees anyway.
Robert Harding
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I must disagree with you on this premise Howard: "It also seems to be a political misstep for Powers to raise this issue now, before he's even won the primary. By the time the general election rolls around, this will be a stale story that most media won't cover. (Though, a lot of times campaigns get these stories planted in the press so they have a clip to include in a hit piece mailer. The timing, then, doesn't matter.)" If it is such a political misstep, why did Jack Davis target Chris Lee (see here and here) on issues that impact veterans? It is actually smart, especially in a primary. Powers and Davis can continue to go at each other's throats, but Chris Lee waits in the wings. He hasn't been touched - until now. I don't know how stale it will be in a district where jobs come at a premium. Here is Chris Lee, someone who profited off of the sale of jobs to an overseas company to the tune of $395 million. That's not something that will go away fast. Will it go away? Perhaps. But this is a good sticking point. For the men and women who have lost their jobs from Kodak, Delphi or other companies that employ folks in the district, hearing Lee's story will anger them. Believe me, it will.
Daniel Jones
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The sale does run counter to Chris Lee's attempt at the image that his campaign is trying to build for him. He's trying to be the second Chris Collins, a successful job-creating businessman who has an independent mindset and who believes in Western New York. He profited off of a sale that ended up cutting over 300 jobs, is that the kind of new economic model that we're trying to build? Is that really the kind of change we need to make, should our next Congressman be the guy who made money off of selling to a multi-national with a deal that resulted in layoffs? Chris Lee isn't what he's cracked up to be, I give him credit for making a decent business decision, but thats not the kind of attitude that we need to send to Congress, I'm looking for a Representative who will be a salesman for our districts economy, not the guy who made money selling it away.
Russ Stresing
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Honestly, Robert, does the popular definition of 'outsourcing' include keeping it within this country?
Robert Harding
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The popular definition of outsourcing does not specify whether or not it means out of country or in country. I found this definition of outsourcing: "The procuring of services or products, such as the parts used in manufacturing a motor vehicle, from an outside supplier or manufacturer in order to cut costs." There are situations where companies in New York will outsource services to a state like North Carolina where the economy is growing and taxes are low. We tend to affix "outsourcing" to only occasions when jobs are sent to China, Mexico or elsewhere. The problem is the term is more broad than that. There is a more specific term: Offshore outsourcing. That deals with the jobs to China-type outsourcing that is more commonly known and discussed. But outsourcing, as a general term, can apply to jobs that are sent to another state or even another town.
John Roach
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If you worry too mcuh about outsourcesing, then the Toyota and other companies from other countries that opened business here might have to leave, right?
Daniel Jones
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John, the difference is that their opening factories here, not overseas, we need to attract companies with extra tax breaks if they open up a plant or a factory here and end outsourcing tax incentives. The problem that I have with Lee is that he made money from outsourcing, I want someone who will go and try to attract more jobs to our district economy, not someone who's already profited by selling away those same jobs. On the note of him being a "businessman", I'm electing someone to Congress, not to be my CEO, I'd like to elect someone who I think can go work with the other 435 Representatives in a team setting, thats whats going to get the job done. When your in congress you don't just show up and start calling the shots, your staff works for you and thats all. Who better to work in a team setting and sell our district then Jon Powers? Not that I have a problem with businessmen either, but you can't just say "I'm a businessman and I've done...." and have it be a solid rational for electing you to represent, not run, an area. It's typically why businessmen are better off at times running for Governor, that way the business experience provides a better argument.

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