Why Exxon’s CEO is likely to face a tough Senate confirmation fight.
President-elect Donald Trump has selected ExxonMobil CEO Rex Tillerson to serve as Secretary of State, according to an announcement from Mr. Trump’s transition team. “His tenacity, broad experience and deep understanding of geopolitics make him an excellent choice for Secretary of State," Mr. Trump said in the statement. Do not expect this novel choice for the country’s chief diplomat to sail smoothly through the Senate confirmation process.
The President-elect’s selection of Mr. Tillerson demonstrates Donald Trump’s preference for proven business and military leaders to serve in his cabinet rather than career politicians and government bureaucrats. It also demonstrates the importance that Mr. Trump attaches to energy as a central part of his global geopolitical strategy and to improved relations with Russia. Trump sees Tillerson’s track record in successfully negotiating complex international deals with Russia and other nations as the answer to the atrocious deal-making that he believes were the failed legacies of President Obama’s two Secretaries of State, Hillary Clinton and John Kerry. Presiding over a huge world-wide enterprise has also helped Tillerson develop the managerial skills he will need in presiding over the cumbersome State Department bureaucracy. Much of his career has been spent in Exxon’s international division.
Aside from his CEO position at Exxon, Tillerson has served on the board of trustees of the Center for Strategic and International Studies. In a speech to the Council on Foreign Relations in 2007, he said “I believe we must choose the course of greater international engagement.” He opposes protectionist policies and has come out in favor of a carbon tax as "the most efficient means of reflecting the cost of carbon in all economic decisions.” In short, Tillerson is neither an isolationist nor a fossil fuel devotee on climate change policies. Indeed, he may serve as a counterweight to some of President-elect Trump’s own preferences.
However, Tillerson’s lack of diplomatic experience, long-standing ties with Russian President Vladimir Putin, his fossil fuel background, and possible conflicts of interest could present him with problems in obtaining Senate confirmation. He will only need a majority for confirmation, thanks to Senate Minority Leader Harry Reid’s change of the filibuster rules when he was Senate Majority Leader. However, given the Republicans’ slim 52-48 majority in the Senate, it will take only a few Republican defections to block Tillerson’s path to heading the State Department.
Several Republican senators have expressed concern with the selection of Tillerson, most notably Senator John McCain. This is largely due to Tillerson’s close business ties to Russia and President Vladimir Putin, which developed during Tillerson’s years at the helm of Exxon. One of his key accomplishments in this regard was his negotiation of a 2011 agreement with the Russian state-owned oil company Rosneft, under which Exxon gained access to the Russian Arctic.
Tillerson was awarded Russia’s Order of Friendship in 2013. When sanctions were imposed by the Obama administration against Russia a year later because of Russia’s occupation of Crimea and interference in eastern Ukraine, which froze lucrative business dealings between Exxon and Russia’s state-owned oil company, Tillerson sharply criticized the sanctions as causing “very broad collateral damage.” That “collateral damage” included an estimated $1 billion in losses for Exxon.
Especially after recent intelligence reports of Russian cyberattacks intended to influence the U.S. presidential election, a hard line against Russia is clearly emerging on both sides of the aisle in Congress. The perception that Tillerson would be soft on Russia may be too much for a majority of senators to overcome. The Kremlin did not do Tillerson any favors by strongly praising him.
“I don’t know what Mr. Tillerson's relationship with Vladimir Putin was,” Senator McCain said in an interview with Fox News. “But I’ll tell you it is a matter of concern to me.” Senator McCain detests Putin, calling him a "thug and a murderer."
Senator Lindsey Graham has also expressed reservations regarding Mr. Trump’s pick. “Based upon his extensive business dealings with the Putin government and his previous opposition of efforts to impose sanctions on the Russian government,” Senator Graham said “there are many questions which must be answered. I expect the US-Russian relationship to be front and center in his confirmation process.”
Senator Marco Rubio also held back his support, saying, “While Rex Tillerson is a respected businessman, I have serious concerns about his nomination. The next secretary of state must be someone who views the world with moral clarity, is free of potential conflicts of interest, has a clear sense of America's interests, and will be a forceful advocate for America's foreign policy goals to the president, within the administration, and on the world stage. I look forward to learning more about his record and his views. I will do my part to ensure he receives a full and fair but also thorough hearing before the Senate Foreign Relations Committee.”
Democrats such as New Jersey Senator Bob Menendez have also weighed in with even harsher criticism of Tillerson’s links to Russia and Putin. "With Rex Tillerson as our Secretary of State,” Menedez said, “the Trump administration would be guaranteeing Russia has a willing accomplice in the President's Cabinet guiding our nation's foreign policy."
Democratic senators can be expected to push back on Tillerson’s nomination not only because of his Putin ties, but also because of his immersion in the fossil fuel-centric Exxon culture. They are likely to raise doubts about his ability to advocate for policies to combat climate change, including continued U.S. participation in the Paris agreement on climate change, even though Exxon under Tillerson’s leadership supported the Paris agreement.
The negative sentiments being expressed on Capitol Hill regarding Rex Tillerson may be overblown, however. His international experience does not begin and end with Russia. He steered a company with extensive business dealings all over the world, operating in more than 50 different countries. Energy is at the center of geopolitics, and Exxon is at the center of international commerce in energy.
Moreover, Tillerson has received endorsements from important figures with vast experience in the international arena. Robert M. Gates, who served as Secretary of Defense under President Obama and President George W. Bush, called Tillerson “a global champion of the best values of our country” who would bring “vast knowledge, experience and success in dealing with dozens of governments and leaders in every corner of the world.”
Former National Security Adviser and Secretary of State Condoleezza Rice said, "Rex Tillerson is an excellent choice for Secretary of State. He will bring to the post remarkable and broad international experience; a deep understanding of the global economy; and a belief in America's special role in the world."
It should be noted that Exxon is a client of Gates' and Rice's consulting firm, RiceHadleyGates. While they may have some self-interest in promoting Tillerson for the Secretary of State position, the State Department’s top energy diplomat during the first Obama administration, David L. Goldwyn, has also praised Tillerson. Goldwyn told the New York Times that he thinks “Tillerson will be a credible and effective messenger for a US reset, because he is not a member of the foreign policy establishment, but also because his history embodies the investment potential Russia could enjoy with a better relationship with the United States.” The former Obama administration diplomat added that President-elect Trump “decided to do a reverse Nixon and side with Russia against China. He thinks we probably can make common cause with Russia in Syria but also in Libya, and he doesn’t have a problem supporting strongmen.”
The Senate should carefully examine Rex Tillerson to ferret out any lurking disqualifiers from his serving as the next Secretary of State. However, absent any substantial evidence of Mr. Tillerson’s unfitness for office, the President-elect should be given deference in whom he chooses to serve in his cabinet.