4 reasons why Mr. Tillerson is a brilliant choice for Secretary of State

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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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7 thoughts on “4 reasons why Mr. Tillerson is a brilliant choice for Secretary of State

  1. Thanks, very much for this. It’s a relief to read some cool-headed thinking in all of the hyperventilating that’s been going on on both sides of the aisle.

    Now if only Mr Tillerson manages to restrain John Bolton, the nominee for his second in command. Or better yet, get him removed from the roster before he gets to the confirmations hearing!

    Like

  2. Chris

    It really just depends on your hopes and worldview.

    Tillerson as you rightly point out seems to have a good practical understanding of world politics and trade. But many of us in the critical camp are alarmed not so much by the notion that he won’t be able to navigate intricate political dealings but that he is conditioned to do so in a manner that’s rather reckless in a communal sense. Many skills, practices, and driving values fostered at Exxon — an “empire” — are simply not transferable to a “successful” career in the public sector — defining successful as enhancing public welfare (a measure admittedly not always related to popularity). Profit margins for those who have “made that level of money” are paramount, and typically blinding to most all else. Global environmental devastation has been only the most blatant of many grave, undesirable consequences. And assuming Tillerson retains ties in the energy sector, it’s worth remembering that Western oil obsession has rarely served the Middle East (or the world as a whole) well.

    Now, Tillerson might indeed be a brilliant pick particularly to implement Trump’s agenda given the pair’s similar business experiences and views. But I would warn you against believing that he is in any way a “good” pick that will substantially help create a safer planet full of healthier, happier people — ultimately the point of governance (social contract).

    He likely does have interests in lasting stability in the Middle East, but so did the British and French in Iran, Egypt, etc., etc. (The comparison between Exxon and extractive colonial institutions serves only to indicate similarities in their goals of rent-seeking and desires to manipulate politics to achieve it or as close as possible to it.)

    We expect Tillerson to bring a “business-driven” approach to international politics, but many would sincerely question whether that is desirable in any measures other than efficiency and comparative gains. If we’re recognizing populations’ self-perceived welfare as the key determinant of stability at state and system levels — growing more and more sensitive with globalization — the business-driven mindset has very often undermined its own margin-maximizing intentions and could just as well do so again. Tillerson’s (and Trump’s, for that matter) opaque tax records, for just a single instance, demonstrate his apparent desire to cheat others for his own private profit — a habit inherently offensive and by extension destabilizing (offended people destabilize in pursuit of what they believe to be fair).

    And as for his Russia ties, his advocation for dropping sanctions on Russia is itself concerning, much less his being one of very few Americans ever to receive the Order of Friendship. Client relations are one thing. But there is quite clearly an abnormal tie between the two. The Kremlin gives out that award to those it feels are advancing those interests of the Kremlin that are not only strategically critical but highly contested, thus the benefit in ceremonially solidifying support. The relation may be no more than Putin and Tillerson’s shared interest in fully utilizing and accessing the Russian supply/market. Though not necessarily an immediate US national security concern, it would still be problematic, given the above premises on private-interests, and deserves at the least our diligent attention should it in its obscurity prove anything more.

    In sum, I do hope Tillerson’s cunning business ability and undeniable inside knowledge prove assets in advancing wholesome national (and subsequently global) interests. But there are many reasons for skepticism.

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    1. Nathan

      Hi Chris,

      Thanks for sharing your thoughts. Yes, you should be skeptical. We should always be skeptical of all aspects of what our government does. After all, governments exist to serve the people and to advance the greater good of society. It must justify it’s existence and be held accountable. Nobody is ever entitled to rule or to this or that position.

      Re the nomination of Mr. Tillerson to be Secretary of State, it does seem like you are prejudging him though and relying on some stereotypical views of what running a Fortune 500 would entail.

      Here are my responses to your points:

      (1) Your assumptions about “values”

      “But many of us in the critical camp are alarmed not so much by the notion that he won’t be able to navigate intricate political dealings but that he is conditioned to do so in a manner that’s rather reckless in a communal sense. Many skills, practices, and driving values fostered at Exxon — an “empire” — are simply not transferable to a “successful” career in the public sector — defining successful as enhancing public welfare (a measure admittedly not always related to popularity). Profit margins for those who have “made that level of money” are paramount, and typically blinding to most all else.”

      What specific evidence do you have that Mr. Tillerson doesn’t share your values? You are quickly assuming that because he was CEO of Exxon that he is somehow intellectually incapable of not taking on another role at a different stage of his career. Do you really think that Mr. Tillerson is going to go to State and run it like he did EOX? That he isn’t aware that they are different organizations? If so, what specific tangible evidence do you have to support that?

      (2) Your view of what Big Business entails:

      “and driving values fostered at Exxon — an “empire” —”

      It’s a company. And in functional terms EOM basically is run in the same way as any other Fortune 500 company. The only difference is Exxon does oil whereas Ford does cars and Dupont does chemicals.

      Here is a question – if Clinton had won and had appointed somebody from Facebook or Google to be SoS – would you be expressing similar concerns? Would people be saying “I don’t believe he or she can set aside their previous focus on the corporate bottom line?” Do you really think Google is run any different than XOM? It is not.

      Frankly, I can say this – having worked for a couple of years for a pretty big corporation on projects in Saudi Arabia and had the chance to observe the thinking of very senior level people on a regular basis, they were, on average, far more wordily and intellectual and open minded on average than the vast majority of “academics” or “intellectuals” that I know. In general, I do believe that that at that level of business – the people in it are more intellectually open minded, practical and pragmatic than people, on average, who have only worked as academics or think-tanks or only been government employees.

      You are making an assumption that a person who reaches X level of the corporate world must think rigid-intelectual view X. My assumption when I read about Mr. Tillerson was, anybody who reached that level of experience, must be a goldmine of practical knowledge.

      (3) Your points on Russia:

      “And as for his Russia ties… it would still be problematic.”

      All business at that level by a Fortune 500 company is highly regulated. There is no free base wheeling and dealing that some Trump critics seem to assume might have occurred. Everything that XOM did in Russia would be pre-vetted by an army of lawyers. There is no empirical evidence that someone can point to that would say Mr. Tillerson is not capable of carrying out his duties because of that work in Russia. It just doesn’t exist. But this is why they have the confirmation hearings. If there is some unknown skeleton in the closet it will come out. This is extremly unlikely.

      Moreover, and most importantly, so what if he has “close ties” and a working relationship with Putin? Why is that not an asset? Russia is either the #2 or #3 most important country in the world.

      (4) Skepticism of the New is Great – But What Was So Great About the Old Way?

      “We expect Tillerson to bring a “business-driven” approach to international politics, but many would sincerely question whether that is desirable in any measures other than efficiency and comparative gains.”

      What record of success can you point to by our last several SoSs? What is so good about their track record? Fair enough that you are skeptical of the “new” that Tillerson brings to the table – but what specific, tangible achievements that advance a US national interest have we achieved in recent years? Not liking the New is fair, but what’s so great and noteworthy about the way we’ve done things recently?

      And again, you are not giving the guy any intellectual credit whatsoever.

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      1. Chris

        Hi Nathan,

        Thank you for your response. The dialogue is much appreciated.

        I think maybe a clearer way to put my values point is to look at Tillerson at XOM’s lack of demonstrated interest in public good. Sure, no one can say exactly how he’ll run State and act in a government position, but we should be able to look at his assignment and say it’s quite a gamble. The oil industry is an extractive industry. It does often work against public interests — explicit and assumed. Sure, it in most every case pays its corporate taxes, follows regulations, etc., but it simultaneously works against those aspects of “corporate citizenship”in lobbying (and individuals not paying income taxes). Tillerson does just *seem* to be lacking the typical character traits we hope for in public service, but he in his actions has hardly acted to disprove it.

        And of course, these are essentially stereotypes and prejudgements, but that doesn’t devoid them of what weight they do carry. They can’t prove Tillerson is definitively unfit for public office. There is of course as you rightly point out a fair chance he ends up distinguishing greatly between Exxon and State and the narratives he promotes at each. But they do lessen the odds of that happening. I hope Tillerson’s life-time lotalty to Exxon can be transformed into an equally strong loyalty to the American people, but the reality is that both are often at odds, and he will have to put one aside for the other. Trump’s initial clientelist tendencies (i.e. diplomats and hotels) don’t paint a very bright picture either.

        As for his intellectual capacity, I really don’t doubt Tillerson’s ability to perform the management and even diplomatic functions of SoS. Your testimony to the open-mindedness of upper levels of the private sector is reassuring — practical, experiential knowledge (and good judgement) is certainly required to work one’s way up from bottom to top in a company like Exxon. But worldviews aren’t necessarily a tied to intellectual capacity, and can be rather destructive when implemented. XOM hasn’t been very concerned by the destruction it causes (https://www.google.com/amp/mobile.nytimes.com/2016/06/17/science/exxon-mobil-fights-back-at-state-inquiries-into-climate-change-research.amp.html%3F0p19G%3De?client=safari) and still hides its trail like governments at their worst.

        What’s so great about previous foreign policies and SoSs? Primarily their integral sets of concerns that typically revolve around human rights and dignity. You might be able to make the case the Tillerson shares the same view (his company’s record would certainly taint his credibility though), but is it not concerning that he’s never affirmed it publicly before assuming a position expected to promote those values globally?

        Without a doubt there has been a deficit of creative minds and effective approaches to promoting the above, with US actions repeatedly undermining interests. And surely knowledge of inside workings like Tillerson’s would have come in handy for previous SoSs.

        But what is concerning isn’t his knowledge; it’s his being picked straight out of the industry without any real outward “change of heart.” Business may be amoral (cliché, stereotype, but in many ways true) but governance isn’t (supposed to be). That’s undeniably a division that must be unequivocally traversed.

        If a Google executive had been appointed, I would still be concerned given Google’s recurring monopolistic ambitions, but it would be much easier to swallow for one reason: Google (and its leadership) have demonstrated consistent interest in the public good. From programs to map “off-the-map” communities and to bring wifi to the developing world, to the constant flow of investment into innovation and education, Google, and many other private sector firms, often works to supplement the work of governments. It might find ways to profit out of it but it is certainly working towards an overall societal gain.

        Regardless, we both are operating on assumptions and guesses to discuss a question only time will answer. May you prove right.

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      2. Nathan

        Chris,

        We absolutely have to have more dialogue and frank exchange of opposing view points and less of this wishy washy let’s make everybody feel good that dominates the current media scene but adds zero value to policy debates. . So I appreciate your comment and I encourage you to strongly disagree with anything I write in any future comments but as long as you tell me why.

        Re your point about Google:

        “If a Google executive had been appointed, I would still be concerned given Google’s recurring monopolistic ambitions, but it would be much easier to swallow for one reason: Google (and its leadership) have demonstrated consistent interest in the public good.”

        I think you are overlooking the extent to which Google is no less ruthlessly capitalistic than Exxon or any other major company like this. Sure, they are good at marketing some of these side projects, but at the end of the day it’s far from clear that Google is any more altruistic than Exxon or similar countries.

        On this:

        “But what is concerning isn’t his knowledge; it’s his being picked straight out of the industry without any real outward “change of heart.” Business may be amoral (cliché, stereotype, but in many ways true) but governance isn’t (supposed to be). That’s undeniably a division that must be unequivocally traversed.”

        The only thing you can do is keep an open mind and listen carefully at his confirmation hearings. I think you will be surprised.

        Nathan

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