The Senate looks into the case of Rex Tillerson, former CEO of ExxonMobil, and other future cabinet members.
“They’ll all pass.” While the American Senate started on Tuesday, Jan. 10 to question the members chosen by Donald Trump to make up his cabinet, the president-elect, as usual, did not seem to be familiar with doubt. Even if the billionaire can rely on a Republican majority to get the green light, given the profiles of the candidates, the exercise is not a formality.
Walter Shaub, the director of the Office of Government Ethics, announced his concerns about the fact that “several nominees … have not completed the ethics review process.” Moreover, certain potential members of the cabinet have not yet published their financial disclosures. But the most controversial case is unquestionably that of Rex Tillerson, who is to become the next head of American diplomacy after having run ExxonMobil for 10 years. On Jan. 4, Mr. Tillerson agreed to cut all of his economic and financial ties with the oil company. Over the course of the next 10 years, he is to receive 2 million restricted stock units, about $174 million (163 million euros). If his nomination is confirmed, he has committed to turn the value of these stocks into treasury bonds, which will be transferred into independently managed funds. Mr. Tillerson has promised to sell the 600,000 shares that he holds.
An Unprecedented Situation
But that might not be enough to lift all suspicions of conflicts of interest. In fact, the connections that Mr. Tillerson has made for years with different heads of state to obtain oil contracts create an unprecedented situation. The most problematic relationship is the one he has with the Russian president, Vladimir Putin, who himself gave Tillerson the Order of Friendship. Under the management of Mr. Tillerson, ExxonMobil developed important economic interests in Russia starting in 2011, and after the imposition of economic sanctions on Russia in 2014 to protest the annexation of Crimea, he never stopped besieging the White House to obtain the lifting of those measures.
Another complicated case was that of Wilbur Ross, who until now directed his own private equity investment fund, investing in recent years in more than 178 companies. Yet Mr. Ross, as the commerce secretary, is going to find himself at the head of an administration charged with supervising the commercial laws and agreements that can affect these companies. As for Steven Mnuchin, nominated to become treasury secretary, he announced on Jan. 11 that he was going to sell his stock portfolio. The former head of Goldman Sachs still holds stocks in his old company.
Tom Price, who was chosen to direct the Department of Health and Human Services, could be the subject of an inquiry into his portfolio of pharmaceutical stocks valued at $300,000. These securities were the subject of transactions while Mr. Price was, at the same time, lobbying in Washington, which could have influenced the stock market prices of these companies. Andrew Puzder, who could find himself the head of the labor department, was CEO of the fast food chain CKE Restaurants, the costs of which are closely linked to changes in wages and working hours. Finally, Elaine Chao is expected to direct the Department of Transportation, even though her father is a big ship-owner. Nevertheless, she has an advantage in her hearings: Her husband is none other than Mitch McConnell, the leader of Republican majority in the Senate.