Why a Commerce Job Goes Unfilled
Politics: Judd Gregg surprised the Obama administration by withdrawing from his Commerce job offer. But it shouldn't have been a surprise. Commerce itself is being devalued in this administration. That needs to change.
It's likely that the Republican senator from New Hampshire intended to be a brave, if lonely, voice for private business inside the Obama administration at a time when stimulus dominates the news and little focus was put on how to help business.
That's a shame, because a stimulus promises to create 3 million jobs at best, and currently 11.6 million people don't have work. Only the private sector can pick up the slack.
At least a dozen candidates turned the prestigious commerce secretary's post down before President Obama came up with Gregg, after assuring him that the Democratic governor in his home state would appoint a Republican to take his seat. Obama even joked about the difficulty of "finding a commerce secretary" to the media.
But the real reason why Gregg pulled out is probably that he found there isn't any real place for commerce in the new administration. With President Obama saying things like "only government" can save the economy, Gregg learned quickly he was unlikely to have any power or influence on behalf of the private sector.
The decision to remove the 2010 Census from the Commerce Department and give it to White House political operatives was a strong vote of no confidence in Gregg.
It wasn't the only signal. On the day Gregg quit, White House Press Secretary Robert Gibbs declared the Colombia free-trade agreement was dead, too. "I think the concerns that (President Obama) and others have are still valid around that trade agreement," Semana, a Colombian publication, quoted Gibbs as saying.
With the Census gone before he'd even started, and no new export markets to bring to U.S. firms as commerce chief, it's a fair bet that anything Gregg did was likely to be ignored in Obama's administration.
That's why the Obama administration needs to rethink its exclusive focus on government spending as the basis for its administration, and start making the private sector a focus instead.
The current approach has been to use business and bipartisan Republicans like Gregg as window dressing. But no one's fooled.
The chief executive officer of Caterpillar, for one, wasn't.
On the day Gregg made his surprise exit, President Obama made a showy appearance at Caterpillar's big plant in East Peoria, Ill., telling embattled workers who'd just endured 22,000 layoffs a week earlier that the chief executive would hire back some with the passage of Congress' $787 billion stimulus package.
Asked about it later by ABC News, Caterpillar CEO Jim Owens denied Obama's claim. "The truth is we're going to have more layoffs before we start hiring again," Owens said. "It is going to take some time before that stimulus bill" means rehiring.
That's because the stimulus isn't what the administration and Congress say it is. A look at what Caterpillar and others like it really want is precisely what is being run roughshod over by special interests in the White House right now.
Caterpillar is vocal about wanting Colombia free trade which would give it another market to sell in during a downturn. It also wants the "Buy American" provisions in the stimulus bill gone, because they could destroy Caterpillar's years of market-building overseas as foreign retaliatory measures kick in.
Caterpillar, like many American companies, exports much of its giant machinery overseas, 63% in Cat's case. The U.S. in 2008 exported $1.84 trillion in goods and services, more than any other country, so any trade war shutting overseas markets will hit us hard.
But Congress paid little heed to that in its $787 billion stimulus bill passed Friday. Sure, it paid lip service to not letting "Buy American" violate existing international treaties. But it still left the measures in, leaving the potential loss of gigantic markets where there are no relevant treaties, real. Among these are China, which needs $200 billion in infrastructure spending through 2030, according to a CG/LA Infrastructure study.
If it retaliates, "Buy American" may turn into "Bye, American."
And that's just one market. In reality, access to the $996 billion global infrastructure market will disappear in a trade war, all in exchange for access to $43 billion in federal stimulus spending on infrastructure — not a good swap. No wonder Caterpillar's chief couldn't tell reporters he'd be back to hiring with the passage of the stimulus.
Gregg made a principled move in leaving because he couldn't be effective. In reality, no one can. Private businesses are critical to economic recovery, but Congress and the administration are focused on government solutions.
Tax cuts, open markets and favorable investment conditions are getting the short shrift. Obama should realize now that a friendlier business climate is as badly needed as a new commerce secretary.