The Conversation

Nashua Telegraph Carrying Shaheen's Water on Outsourcing?

A series of emails shared exclusively with Breitbart News by sources within the Scott Brown campaign and the curious timing of a coming Nashua Telegraph story may cause some to wonder if Democrat Jeanne Shaheen isn't outsourcing her campaign's opposition research function to the Nashua Telegraph newspaper.

On the very same day most everyone is acknowledging the big story out of New Hampshire is that Scott Brown has turned what was a double-digit gap with Jeanne Shaheen into a virtual dead heat, Managing editor for content at The Telegraph and Editor of PolitiFact NH Jonathan Van Fleet opted to share this not yet bit of news via his Twitter feed. 

Editing one last @Klandrigan story for @NashuaTelegraph Sunday paper about @SenScottBrown profiting from company that moves jobs to China. — Jonathan Van Fleet (@Telegraph_JonVF) August 22, 2014 

It seems worth noting that most publications are reluctant to tip off their competition to the stories they're about to break. Furthermore, this one seems tailor made to say, not so fast, on the very day the headlines have Brown pulling even with Shaheen. 

Additionally, the journalist in question, Kevin Landrigan, is no longer even employed by the Telegraph. According to news reports, he was laid off on the 12th of August. So, why is this apparent non-story that wasn't published two weeks ago suddenly going to be one of the Nashua Telegraph's Sunday's finest?

Longtime Concord reporter Kevin Landrigan laid off by Nashua Telegraph Newspaper decides to shut its State House Bureau 

 The emails obtained by Breitbart News would appear to indicate the journalist in question had little to no interest in hearing about Jeanne Shaheen's hypocrisy as regards outsourcing, nor is it clear he was interested in the Brown campaign's response to his questions. 

From: Kevin Landrigan 

Date: Wed, Aug 13, 2014 at 2:41 PM 

Subject: Re: Shaheen record on outsourcing 

To: Colin Reed  Kevin Landrigan 

colin 

got this thanks 

already been through her record in senate and all I've seen is doctrinaire ie support for partisan, senate dem moves to close offshore tax loopholes etc.  if you've seen anything different that slipped through my sieve, i'm all ears. 

best 

kevin 

What Kevin  Landrigan 'got' was this detail on Jeanne Shaheen's own outsourcing problems, as well as a detailed response regarding the Brown-linked company, Kadant. How much, if any, of these exchanges makes it into the Telegraph's non-story remains to be seen. Neither Kevin Landrigan, nor editor Jonathan Van Fleet responded to Breitbart News' request for comment on the curious timing of both Van Fleet's Tweet and presumed publication of now ex-Telegraph reporter Kevin Landrigan's story. 

SHAHEEN AND OUTSOURCING 

While Shaheen Was Governor, A Portion Of New Hampshire’s Food Stamp Program Was Outsourced To India 

In The “Late 1990’s” New Hampshire And Six Other States Entered Into A Contract With Citibank To Administer Their Food Stamp Programs.  “In the late 1990's seven Northeastern states brokered a deal designed to modernize their outdated and expensive food stamp systems. But the agreement ended up with some of the work being shipped to India. … The six New England states and New York signed a contract with Citibank that let the company administer a new food stamp program in which beneficiaries buy food with a debit card.” (Tim McCahill, “States Respond To Outsourced Jobs,” The Associated Press, 3/24/04) ·

Shaheen Became Governor In 1997. (Congressional Quarterly, Accessed 3/31/14) 

 In 2004, It Was Disclosed Some Of The Work Had Been Subcontracted To A Firm In India.  “Citibank subcontracted some of the telephone work to a Wisconsin company, which later contracted with an Indian firm. Officials in some of the states said they were aware that work was being performed outside the country, but others said they were not.” (Tim McCahill, “States Respond To Outsourced Jobs,” The Associated Press, 3/24/04) 

A New Hampshire Official Confirmed The State Had Known Since 2001. “Scott Kosowicz, who oversees the debit card program for New Hampshire, said the state has known Citibank was outsourcing the jobs since December 2001. He said the state monitors the calls monthly to ensure participants in the program are getting the help they need.” (Tim McCahill, “States Respond To Outsourced Jobs,” The Associated Press, 3/24/04) ·

Shaheen Was Governor In 2001.  (Congressional Quarterly, Accessed 3/31/14) 

Below is another exchange between Landrigan and the Brown campaign involving a detailed response from Kadant. For now, it remains unclear how much of this will make it into the Telegraph's story given the lack of a response to a request for comment. It's best read as a series of questions and responses in an exchange between journalist Landrigan and Kadant Executive Vice President and CFO Thomas M. O'Brien. 

From: OBrien, Thomas  

Sent: Thursday, August 14, 2014 2:46 PM 

To: klandrigan@nashuatelegraph.com 

Subject: Kadant Inc. Responses to Questions  

Kevin, 

The Scott Brown Campaign sent us some questions from you.  We’ve done our best to answer those below.  Please email me if you have any further questions. 

Tom 

Q: The company said in its most recent annual report that it utilizes low cost manufacturing bases in China and Mexico to improve its internal growth.

Response:   Kadant is a global company with 1,800 employees and manufacturing operations in 17 countries.  We use these manufacturing locations to increase our  competitiveness and position ourselves closer to our customer base.  By becoming more globally competitive Kadant, has been able grow its US business and increase  its US work force particularly for high  paying jobs like engineering and R&D as well as more sophisticated manufacturing. Kadant’s   US employment has increased 30% in the last five years to just under 500 people 

Q: Kadant has been outsourcing jobs since at least 2001. In 2006 the company even shipped jobs in its “home” state of Massachusetts to Mexico. 

Response: Ten years ago we had a hard time winning capital orders for our  doctoring systems which were manufactured in Massachusetts. By moving some of the manufacturing to Mexico, we became more competitive, won more orders, and increased our spare parts and consumables products are also made in Massachusetts . Partly as a result of this, our  Massachusetts employment is the highest it's been in 10 years.   

Q: In 2005, Kadant’s CEO explained that it was closing a manufacturing facility in Alabama because a reduction in North American manufacturing was “necessary as [they] shift toward lower cost regions such as China.”  

Response : We did not close our facility in Alabama . 


 

Q: In 2007, Kadant’s CEO said that the company’s moving more of its “sourcing” to China provided a “nice margin opportunity.” 

Response: It is true that we  expanded  certain manufacturing in  China, mainly  to  serve the China domestic market, but also to help the our  global competitiveness. The vast majority of the products made in China are sold to customers in China.  Much of the engineering for systems sold in China is done in the US and those are high quality high paying jobs.  

Q: In 2013, Kadant purchased a manufacturing company in Vancouver, BC that it planned to outsource operations for to China in order to increase margins. 

Response: Kadant did purchase a company in Vancouver and does plan to build small portion of that company’s products in China in an effort to capture more of the China market as well as provide lower input costs   In April of this year, partly because some of the product could be made in China, the company won two large systems for customers in China. The vast majority of that work will be done in BC .  No jobs have been lost at the company in BC since it was acquired by Kadant last year. In fact employment in the company in  BC has increased 10% since Kadant acquired the business last year .  

Q: In its 2013 annual report, Kadant stated that it reinvested earnings from its international subsidiaries indefinitely as a means to avoid paying U.S. income taxes. The company said it did not pay taxes on nearly $150 million in foreign income. 

Response: Kadant , like many other global companies has operating business  all over the world and pays taxes on the income it makes in those jurisdictions. So it's not correct to say we did not pay taxes on $150 million in foreign income.  We do pay taxes in the jurisdictions where the income is earned.  The US is one of the only counties in the world to seek to collect tax on income earned in other countries. In addition it has one of the highest tax rates in the world.  The rules in the US are that income generated in those other countries is not taxed until the cash comes back to the US.  It's not surprising that Kadant, like other global companies, does not bring cash back to the US unless we really need it.  Kadant does pay US taxes and has a 32% global tax rate.    

Thomas M. O'Brien  

Executive Vice President and CFO 

Kadant Inc. 

One Technology Park Drive 

Westford, MA.  01886  USA 

Web:  http://www.kadant.com


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