Ross Takes the Helm Of The Department of Commerce

Newly-confirmed Commerce Secretary Wilbur Ross is one of the least controversial of Trump’s recent cabinet picks.

Unlike Ben Carson, Ross has experience that is relevant to the job. And he doesn’t seem to be coming in with the goal of using his department to advance a pet project like Betsy DeVos or to destroy the agency he’ll be running from within, like Scott Pruitt. There are several reasons to be optimistic about how Ross will perform as secretary of the Department of Commerce, but there is also a big reason that optimism should be very cautious.

Two of the best things about Ross are that he is pro-data and pro-infrastructure. During his confirmation hearing in January, Ross accurately characterized the infrastructure needs of the country as “monumental.” Having a secretary of commerce who appreciates that need, and wants to push to get resources to address it, may mean we finally start investing in our infrastructure in a real way.

During his hearing Ross also mentioned how he values and uses government data gathered from some of the agencies that he’ll be overseeing, and he commented, “Anything you can’t measure you can’t manage.” This appreciation for data is essential for secretary of the Department of Commerce, which has several offices focused on gathering and analyzing different types of data. This stance on the importance of accurate, measurable information is also refreshing coming from someone in an administration that has, so far ,not put much value on objective truth and facts.

Ross also seems to depart from the president in his understanding of the complexity of commerce and trade. While Trump often presents these issues in stark black and white terms, Ross’ experience seems to have provided him with a more-nuanced view, which he voiced during his hearing. He said at one point, “So I’m not anti-trade, I’m pro-trade, but I’m pro sensible trade, not trade that is detrimental to the American worker and to the domestic manufacturing base.” He also noted that he supported the idea of the Trans-Pacific Partnership but had problems with some of the details.

This type of cost benefit analysis involved in balancing the good and bad outcomes associated with business decisions is something that Ross has exercised a lot. In his business career he is credited with taking over businesses in failing industries like steel and textiles and bringing them back from the brink of failure. This often involved layoffs and sending jobs overseas. But, on balance, it seems that he saved and created more American jobs than he cost and he has had the support of labor unions, which he would be unlikely to enjoy if he were a net job killer. All of this indicates that he is likely to make the kind of decisions that will have actual positive outcomes for U.S. trade and commerce, not just the appearance of positive outcomes.

Another advantage that Ross has is that he is probably capable of doing the job. The Department of Commerce is one of the federal government’s most expansive agencies. It is home to a dozen sub offices, bureaus, administrations, and services, including the Census Bureau, the National Oceanic and Atmospheric Administration (NOAA), the Patent Office, and others that deal with technology, trade, business, and economics. When Ross divested his financial holdings in order to avoid conflicts of interest as secretary he quit roughly fifty different positions in a number of different companies. His background working with so many business entities means that he is probably as equipped as anyone can be to manage such a broad and diverse department.

Unfortunately, when Ross divested, he didn’t get rid of everything. He has kept holdings in several entities involved in mortgage finance and trans-oceanic shipping. And this presents a problem, or rather, the potential for a number of problems. As secretary, Ross will be involved in making decisions that could affect the shipping industry in a variety of ways. Any international trade agreements that he will be involved in negotiating and/or renegotiating, will all have an impact on the shipping industry and it will be hard to say if he is crafting deals that best serve America’s interests or his own. That’s the most obvious problem with his shipping assets, but that’s just the beginning.

There is a good chance that, at some point during Ross’s tenure, Hawaii and/or Puerto Rico will seek an exemption to the Jones Act, a maritime law that only allows U.S. flagged vessels to ship goods between U.S. ports, and which is part of the reason goods in Hawaii and Puerto Rico are so expensive. The law is complicated and its impact on various industries are complex so it would be reasonable for lawmakers to seek a recommendation from the secretary of commerce when deciding whether or not to grant an exemption. But any recommendation Ross makes on this subject will be suspect, because, as a shipping industry magnate, he could stand to personally gain or lose if the law is changed.

As secretary of commerce, Ross could also be involved in something like a policy or rule change to include non-politically motivated ship hijacking in the U.S. legal definition of terrorism. This could lead to increasing the use of U.S. law enforcement or even military resources in fighting piracy, which could benefit the shipping industry, but be very expensive for taxpayers. There could also be potential issues with his shipping holdings involving NOAA. They manage marine sanctuaries and are currently doing research on how marine noise can impact animals. Both of these issues could lead to NOAA recommending policy that may impact the shipping industry and it’s hard to see how Ross could be objective about that.

There is also the possibility that as Secretary Ross will have the opportunity to take actions that impact the mortgage finance industry in a way that financially benefits him personally. But his shipping interests are the bigger issue, because it is almost guaranteed that something the Department of Commerce does in the next four years will affect shipping. Only the Senate Ethics Committee can say why they thought it wasn’t a conflict of interest for the secretary of the Department of Commerce to have active financial involvements in the mortgage and shipping industries. Perhaps they thought that Ross’ good qualities outweigh the potential downsides of this conflict. And they might. Only time will tell if Ross can steer American commerce and create economic growth so that all ships rise, or if he is doing it so only his ships rise.

Alexis Chapman is a Political Consultant and Writer specializing in policy analysis, from international law to local ordinances. She’s lived in Australia, Ghana, Vermont, Hawaii, and Texas and has worked for small and large NGOs, state legislature, industry associations, and a variety of publications. She is a regular contributor to Political Storm and you can find her on Twitter @AlexisAPChapman.