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The Oreck Challenge
by: Sen. Trent Lott       Filed 1/5/07 GCN

      Before this column takes on the big issues expected in the Senate this year, I want to address something all Mississippians should note.  It’s a lesson about corporate citizenship and corporate responsibility that our state should resolve to remember, particularly as we try to bring new jobs here.

Right before Christmas, the Oreck vacuum company announced it would close its plant in Long Beach.  This 10-year-old plant was considered a success by the company, but the plant and its workers took a hard hit by Hurricane Katrina.

The Oreck company quickly rebounded and was hailed as a corporate hero for getting its plant up and running so shortly after the disaster.  Basking in accolades, company officials cited their “responsibility” to their workers and families, and Oreck was heralded for restoring a steady wage and restarting production in a short time.  A model good corporate citizen, it seemed, was clearly among us.

That’s why it was surprising that this New Orleans-based company suddenly decided to move its facility inland, not in Louisiana or Mississippi, but to Tennessee, leaving more than 400 of those hurricane-victim workers, to whom the company earlier said it felt so obliged, without jobs.

Oreck then took a swipe at those Mississippi employees.  CEO Tom Oreck, the son of David Oreck, founder of the company and star of the company’s “Oreck challenge” television commercials, was quoted by a Tennessee newspaper as saying the Mississippi work force was unproductive.

To be fair, Tom Oreck now is disputing that quote.  I don’t know whether he said it or not, but I do know a couple of things cause me to question whether Oreck’s actions meet the minimum threshold for good corporate citizenship and decision making that Mississippians should expect.

First, this company is going against the grain.  Even given the possibility of hurricanes, other major manufacturers are choosing Mississippi and coastal states because of our excellent work force.  Hurricanes aside, our workers build quality ships, aircraft, and complex electronic systems.  Companies like Northrop Grumman and Rolls Royce Aerospace have chosen Mississippi, specifically the coast, and kept their commitments to Mississippi.  Most Americans live on or near a coast line, and the number of residents and companies locating or relocating in the Gulf States is robust, despite threats of bad weather.

Second, and more troubling, in 1997 Oreck signed a 10-year tax exemption to locate in Long Beach.  That exemption will expire at about the same time Oreck completely closes the Long Beach plant.  A lot of Mississippians will have very legitimate questions about this timing, and I think the company should have made a genuine effort to address it.

As your Senator, I talk to many CEOs with the ultimate goal of getting them to bring jobs to our state.  Sometimes we must put up tax incentives for companies to locate in Mississippi because competing states are doing the same.                 

But Mississippi’s taxpayers and our city, county, state and federal officials should tuck away the Oreck example for future reference.  Yes, we’ll still have to fight for jobs, sometimes using a tool kit that includes tax incentives.  Still, like a banker scrutinizing a loan applicant, we must assess these companies’ financial health, demeanor and commitment to our state very carefully.  I’m not saying anyone could have foreseen the Oreck situation.  Nor am I saying this company makes bad products.  I am saying Oreck could have handled this situation better and shown Mississippians at least as much commitment and loyalty as we’ve shown them. 
                                            
I’ve often said that Mississippi is “open for business,” and our seasoned U.S. Congressional delegation has proved willing and capable of helping businesses find ways to come to our state or remain here.  Whether it’s an insurance company or a vacuum cleaner maker, I don’t take kindly to companies which aren’t fair to Mississippians and hurt or demean our state, saying one thing and doing another. Mississippi’s public officials, myself included, must resolve to remember the Oreck example when a company is bestowed help from the public vault.  The next time a guy on television asks us to “take the Oreck challenge,” we should remember the many challenges Oreck left on Mississippi’s doorstep. 


Senator Lott welcomes any questions or comments about this column. 

Write to: U.S. Senator Trent Lott, 487 Russell Senate Office Building, Washington, D.C. 20510 (Attn: Press Office) or Email

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