Today President-Elect Trump announced he has chosen Mr. Rex Tillerson, the CEO of Exxon Mobile, as top US Diplomat. This kind of innovative new thinking is why so many people are excited about the strategic possibilities of the Trump administration.
Four Points to Consider:
# 1. There is no Russia “Problem”
Although many in the media will continue to claim otherwise. In the first of no doubt dozens of articles that will be published between now and Confirmation hearings, the Washington Post expresses their concern about Mr. Tillerson’s “ties” to Russia.
Let’s explore the facts:
Mr. Tillerson was the CEO of Exxon Mobile. The company makes its money from finding Oil. Being the largest landmass in the world with endless potential targets for exploration, Russia is a prime location for Exxon. In that context, Exxon’s CEO would logically form relationships with the high-level VIPs, including President Putin, that you have to deal with if you are doing business in Russia.
Why is this controversial?
It’s really not. Whether a 10 year old selling Lemonade on a street-corner, or the CEO of a Fortune 500, this is standard operating procedure for anyone involved in business at any level. Being a friendly and outgoing person is a requirement. You deal with the people you have to deal with. Or you don’t succeed.
Furthermore, it is naive to think that there was real “friendship” involved especially given the ruthless and cutthroat nature of the Russian oil sector. The instant there is no longer a mutually beneficial relationship, whatever “friendship” exists, ends, and US firms in these situations get (sometimes ruthlessly) kicked out of the country in an instant.
The Most Important Issue:
Let’s explore the implicit WAPO allegation that merely doing business in Russia somehow makes one “corrupt” and beholden to Putin. That it would subsequently prevent one from being able to advance American interests as Secretary of State.
The idea that a senior executive like Mr. Tillerson would be sitting in a back room, making shady deals on a whim with Russian oil magnates, or doing anything otherwise that would compromise their integrity and get them in legal trouble back home in the US, just doesn’t make much sense. It isn’t how things happen.
Given the strict requirements for US firms to adhere to laws such as the Foreign Corrupt Practice Act that govern overseas business conduct, in practical terms 100% of Exxon’s interactions with the Russian government are heavily scrutinized and pre-approved by the army of lawyers that a company of this size would have on staff.
President-Elect Trump has been doing business around the world for 40 years. He knows these rules. There is no way that Mr. Tillerson would have been nominated if there was an issue here.
# 2. Most qualified Secretary of State Picks in US History?
This will be another claim of Trump critics over the next few weeks:
But Mr. Tillerson has no foreign policy experience.
Mr. Tillerson doesn’t have a PhD in international relations. He didn’t come from an Army background like Colin Powell. Nor did he come from a standard Congressional background like Senators John Kerry or Hillary Clinton.
But if we look more qualitatively at the Exxon CEO’s “experience,”, we can say, without exaggeration, that he is quite possibly the most qualified nominee ever.
On a pure managerial basis, as described in the excellent book Private Empire: Exxon Mobile and American Power, the company is larger than the State Department in terms of budget and number of employees. But technical managerial expertise is only a secondary factor.
The Real “New” Factor
It’s that Mr. Tillerson brings to the table vast practical knowledge gained from decades of high-level deal making and deal implementation in countries ranging from Saudi Arabia to Iraq to Venezuela and most importantly, Russia. This kind of practical knowledge is extremely unlikely to be gained in any other way than that kind of high-level business experience.
Here are some examples of the things that typically only that kind of “practice” can bring:
- What the leaders you deal with really think about X person, their rivals etc
- The strengths and weaknesses of personalities – what makes them tick, what doesn’t
- Rivalries between different government agencies
- The true strengths and weaknesses of X sector, X person, X company
- Most importantly – the stuff they don’t want you to see
This is a different kind of expertise than what one can typically gain as a journalist or academic on those same countries.
This isn’t to say that journalists or academics can’t learn key things from interviews with high-level politicians, perhaps the King of Saudi Arabia, the energy minister of Kazakhstan, a South Korean industrialist, or the deputy foreign minister of China.
But let’s be frank – the VIPs in any given country (US too) generally have little to no interest in giving away the really critical, super-sensitive information above. It is impossible for me to imagine a situation where a Russian oil oligarch, for example, would sit down and tell an American journalist any of the above information. They are always sending you a message that they want you to see, at a time and place of their choosing.
Whereas negotiating billion dollar projects from Saudi Arabia, to Russia, to Venezuela, over the course of decades, is vast, expert level experience at geo-politics, at leadership in the global stage, at “how the world works” in practice. You are working with then. And seeing every angle,good or bad.
Anyone who has successfully navigated a foreign firm through the shark-tank of the Russian oil industry, followed US law, and made that level of money, has the functional skills to be Secretary of State.
#3. That “Knowledge” is a Tremendous Asset. Not A Liability
Here’s the question that Trump’s critics have to answer:
Is it better to have a SoS that has zero relationships with Russia and Putin? That will start their tenure as chief US diplomat having to break in and “learn” on the job, and enter into the same broken pattern of miscommunication with Russia as the last several Secretaries of State?
Or, do we want someone like Mr. Tillerson that knows the Russian game inside and out, knows what is possible, what isn’t possible, and can step in from Day One and achieve results for the US and our allies?
The answer to the above question should be obvious.
# 4. A Return to Results Oriented Diplomacy that Advances US (Economic) Interests
Last week I published an article at SUSTG writing why there are 3 reasons for optimism about a revamped relationship with key US ally Saudi Arabia, specifically because of the results-centric, business-oriented worldview of Mr. Trump. With today’s new, this is even more the case. Governments all over the world are going to respond positively. It’s a return to Results-oriented, old-school diplomacy.
Senators Kerry and Clinton were honorable people but they had never engaged in substantive negotiations outside of a traditional DC context. Nor did they have any meaningful practical foreign policy experience. And the results showed.
Getting high-level results abroad isn’t something that can be learned from a briefing book. There has never been a Secretary of State Nominee with this much practical experience in global affairs. It’s a tremendous opportunity for the US – and the world.
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