David Perdue on outsourcing: He was playing by Washington rules

Our AJC colleague Chris Joyner has a piece this evening on Republican David Perdue and the role that outsourcing is playing in the race for U.S. Senate.

Below is a good taste of the text, but Joyner has also been kind enough to give us the audio of a session Perdue had with reporters at a Buckhead restaurant this afternoon. Click here to listen to the entire session:

Perdue said the reaction of companies he led was the result of Washington policies:

Perdue spoke to the press at the White House restaurant in Buckhead following a Politico.com article on comments he made in a 2005 deposition where he said he “spent most of my career” outsourcing. When asked how he defends those statements, Perdue shot back.

“Defend it? I’m proud of it,” he said. “This is a part of American business, part of any business. Outsourcing is the procurement of products and services to help your business run. People do that all day.”

The former CEO for Dollar General and Republican nominee to replace retiring Sen. Saxby Chambliss has based much of his campaign on his record as a businessman. But the deposition was taken as part of bankruptcy litigation against Pillowtex, a failed textile company he was hired to turn around in 2002.

In the deposition, Perdue outlined the strategy to outsource much of Pillowtex’s domestic production overseas. He also detailed his role in foreign sourcing in prior jobs with Haggar, Reebok and Sarah Lee.

Did that mean moving all manufacturing jobs out of the U.S., the lawyers asked in the deposition?

“Not all,” Perdue said. “They (Pillowtex) felt like certainly a majority would have to be sourced out. They did not know how much. But the sourcing and marketing strategies were cornerstones of their plan of reorganization.”

He never had a chance to complete the plan at Pillowtex. The company collapsed in 2003 shortly after he left, causing 7,650 layoffs in the United States and Canada — about 4,800 in North Carolina alone. At the time, it was the largest single layoff in state history.

On Monday he said there is a difference between corporate outsourcing and domestic policies that kill jobs in the U.S. The fault for the latter rests with out-of-touch Washington politicians.

“I think the issue that people get confused about is the loss of jobs,” he said. “This is because of bad government policies: tax policy, regulation, even compliance requirements.”

In attempting to deflect the ills of outsourcing to Washington, Perdue took a somewhat strange position on free trade for a Republican with corporate credentials.

“What caused the loss of jobs were the rules that were established by people in Washington who really don’t understand how business works,” he explained. “NAFTA, that’s a government regulation, a government law.”

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About the Author

Jim Galloway
Jim Galloway
Jim Galloway is a three-decade veteran of The Atlanta Journal-Constitution who writes the Political Insider blog and column.