Monday, December 12, 2016
What's good for Exxon
Reports that Donald Trump wants to make ExxonMobil Chairman/CEO Rex Tillerson Secretary of State have many concerned that Tillerson is going to put the company's business interests ahead of those of the United States, particularly with respect to Russian incursions in Crimea, Ukraine, and perhaps ultimately, the Balkans.
In 1953, President Eisenhower nominated General Motors President Charles Wilson as Secretary of Defense. During his confirmation hearing, Wilson insisted that while he would put the interests of the United States above those of GM, he rejected the premise "because for years I thought what was good for our country was good for General Motors, and vice versa." In that less-globalized era, Wilson may have been correct--a thriving GM meant good jobs for its workers and cheap cars for Americans. The question is whether that remains remotely true in a globalized economy (as Daniel Gross notes in the Slate piece linked above, Exxon's presence in the U.S. is minimal and functions more as a corporate citizen of the world). Exxon's need/desire to do business in and with Russia likely conflicts with U.S. needs to stand up to Russian expansionism. And Exxon certainly would prefer that Russia not remain under U.S. sanctions.
Charles Wlson came from an era where corporate executives just assumed that their employer had an obligation to do what was right for America, and that it was in America's interests for his employer to do well. The Adlai Stevenson liberals who were predominate in American academia back then (and who would now be on the right within most faculties) tsk tsked at what they saw as Babbitry.
Today the Bill Gates and Mark Zuckerbergs see themselves as world citizens. They most certainly want the American government to advocate on their company's behalf but feel no more obligation to their country and their fellow citizens than they do to their fellow residents of Washington and California. The cosmopolitan elites on university faculties share a similar outlook, albeit from a much lower net worth. Perhaps we should ponder whether the transformation of the elites from the provincials in the 1950s who ran our largest companies to what we have today has really been a change for the better.
Posted by: PaulB | Dec 12, 2016 6:37:20 PM
What goes for Silicon Valley kids from Harvard, i.e. Gates and Zuckerberg, might not equally apply to an engineer from rural Texas.
Posted by: Anon | Dec 13, 2016 10:15:49 AM
If we pick people who are successful in the private sector, they usually will have investment interests that could conflict with the public trust invested in them, but, being already wealthy, will require a high price before they are motivated to sell out. If we pick people who are not wealthy from the private sector, they won't have so many investment interests, and what they have can be managed in a blind trust, but a lower sell-out price will motivate them. Pick your poison on that score (or require a Catholic-style vow of poverty and see what kind of talent you get). Trump clearly is focusing on talent above all else, so we get apparent conflicts of the Tillerson sort, but then it is hard to imagine Trump or any of his billionaire's club whoring out for speaking fees the way the Clintons did; $250k is pocket change to these people.
Posted by: M. Rad. | Dec 18, 2016 11:35:05 PM