Rex Tillerson, secretary of state: What’s good for Exxon is bad for the country.

What’s Good for Exxon Is Bad for the Country: Rex Tillerson, Secretary of State

What’s Good for Exxon Is Bad for the Country: Rex Tillerson, Secretary of State

Military analysis.
Dec. 13 2016 1:10 PM

What’s Good for Exxon Is Bad for the Country

Does Rex Tillerson know the difference between corporate imperatives and national interests?

ExxonMobil Corporation Chairman and CEO Rex Tillerson testifies during a hearing before the Energy and Environment Subcommittee of the House Energy and Commerce Committee January 20, 2010 on Capitol Hill in Washington, DC.
Exxon Mobil Corporation Chairman and CEO Rex Tillerson testifies during a hearing on Jan. 20, 2010, on Capitol Hill in Washington.

Alex Wong/Getty Images

The nomination of Rex Tillerson as secretary of state is like something out of a Marxist comic book: Who better to be the chief diplomat of a neocolonial power, plundering the world’s oil riches, than the chairman and CEO of the world’s largest oil company!

Fred Kaplan Fred Kaplan

Tillerson, 64, has spent his entire adult life working at Exxon (then, after the merger, Exxon Mobil), and even discarding reductionist theories about his material motives, it is hard to imagine that someone of his age and his cloistered background can shift mental gears from corporate imperatives to national interests. In fact, it’s not clear that he could detect a difference between the two.

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The only remotely comparable high-level Cabinet nomination in modern U.S. history is President Dwight Eisenhower’s choice of Charles Wilson to be his first-term secretary of defense. Wilson had been CEO of General Motors, and when asked about conflicts of interest, Wilson famously replied that he didn’t think there could be a conflict of interest because “what was good for our country was good for General Motors and vice versa.”

At least there was something to that equation when Wilson took his oath in 1953, before the age of global supply chains, instantaneous transactions, and porous borders. Exxon Mobil, on the other hand, doesn’t see itself as bound up with the country at all. Rather, as Steve Coll, author of Private Empire: ExxonMobil and American Power, recently wrote in the New Yorker, Exxon Mobil sees itself as “a parallel quasi-state,” a “power independent of the American government, one devoted firmly to shareholder interests and possessed of its own foreign policy,” the goal of which is “to promote a world that is good for oil and gas production.”

Tillerson’s now-famously tight relationship with Vladimir Putin dates to 2011, when Exxon Mobil signed a multibillion-dollar contract with the Russian oil firm Rosneft. Two years later, Putin awarded Tillerson the Russian Order of Friendship. More recently, Tillerson lobbied heavily against President Obama’s sanctions on Russia following the annexation of Crimea—a policy that has cost Exxon Mobil at least $1 billion.

At times, Exxon Mobil has simply ignored American officialdom. The company, for instance, signed a drilling contract with the self-proclaimed autonomous government of Kurdistan, contrary to U.S. policy, which, seeking to unify the Iraqi state, directed firms to do such business through Baghdad. Tillerson explained afterward that his obligation to Exxon Mobil’s stockholders had to take precedent over obeisance to Washington.

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Tillerson’s unbridled internationalism may serve as a counter to the nativist protectionism of Trump’s rhetoric, but it may go too far the other way. Cultivating a feel for national interests would require not only an extraordinarily agile mind but also—as a first step—some notion of what “national interests” are, a concept that has rarely weighed on the mind of Tillerson’s boss-to-be, either.

Tillerson is a dealmaker, and Trump likes dealmakers. But the key questions are: What kind of deals—and made in whose interest? Tillerson has made big deals with dozens of leaders around the world, and Trump has said he’s impressed that Tillerson “knows all the players.” But it’s a fallacy to think that knowing the players gets you the deal, much less the right kind of deal.

Trump also recently said that his son-in-law, Jared Kushner, could negotiate peace between Israel and the Palestinians because he “knows the players” in the region. I suspect Trump really believes there’s a connection (leaving aside the fact that Kushner is an unknown in the region), but this reveals only how little Trump knows about Middle Eastern politics, where everybody knows everybody, yet no peace is in sight. It’s true that knowing the players—knowing the right person to call and knowing something about that person, having done business with that person—can open doors and get talks going. But familiarity doesn’t breed the deal. No two diplomats on the planet have a closer personal relationship than Secretary of State John Kerry and Russian Foreign Minister Sergei Lavrov. Yet the two of them can’t make a deal on Syria because their two countries, much less the other countries in the region, have conflicting interests. Even in successes, their friendship was only part of the story: It probably did help smooth things in the prolonged talks that led to the Iran nuclear deal, but it did so only because the United States and Russia shared a long-standing interest in nuclear nonproliferation.

Trump now faces a real challenge in getting this nomination through. The Senate Foreign Relations Committee, which must confirm the appointment by majority vote before it even goes to the floor, is stacked with Russia hawks who are very suspicious of Tillerson’s close ties to Putin and his opposition to sanctions—especially now, in the aftermath of the CIA’s assessment that Russia’s “senior-most officials” coordinated the hacking and leaking of the Democratic National Committee’s email in order to help hand the election to Trump, whose own fond views of Putin are well-known and disturbing.

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Still, it’s possible that Trump named Tillerson not in spite of the advance protests but because of them. Nominating someone else would have looked as if he were caving in to pressure—something Trump doesn’t like to do. He also hates to lose, so we can expect a brutal fight if the committee seems resistant. Already, a handful of eminent Republicans stand at the ready to campaign on behalf of Tillerson, including former Defense Secretary Robert Gates, former National Security Adviser Stephen Hadley, and former Secretaries of State Condoleezza Rice and James Baker. In fact, when Trump started to widen his search for a secretary of state, Gates and Baker were the ones who suggested a look at Tillerson, according to a former official who knows both secretaries.

In a statement of support released Tuesday morning, Gates acknowledged that he, Rice, and Hadley—all co-owners of a consulting firm—have Exxon Mobil as one of their clients, but he also said that he got to know Tillerson many years before through their mutual work with the Boy Scouts of America. Gates is now president of the Boy Scouts; Tillerson, an Eagle Scout, is very active in the organization. The scouts “are like a religion” to both men, the former official said. “Unlike Gates,” he added, “Tillerson is actually religious, too.”

Gates and Tillerson both supported the move to allow gays into the scouts. And, as Coll wrote in the New Yorker, despite Exxon Mobil’s record as “a ruthless and unusually aggressive corporation,” it “is also rule-bound, has built up a relatively strong safety record, and has avoided problems such as prosecutions under the Foreign Corrupt Practices Act, even though it operates in many countries that are rife with corruption.”

So, one good thing that can be said about Tillerson: It could have been worse. Trump could have nominated Rudy Giuliani, one of the nation’s least diplomatic political figures who seems to have been removed from the running long ago for his myriad, seamy financial conflicts and possibly for his overeager self-promotion. Trump might also have nominated Mitt Romney, though it was clear at the time that their multiple meetings, including a dinner of frog legs, were designed to humiliate one of the president-elect’s fiercest intraparty critics. Trump said, during his charade, that he was mulling Romney for the job because he “looks the part,” which is true, but in that case he might as well choose Jason Sudeikis, and it’s a toss-up which of the two knows less about the subject. Trump might have picked David Petraeus, but the retired general carried way too much baggage (he would have had to consult his probation officer whenever he left town) and perhaps he bowed and scraped a bit too much as well. Trump likes people to kiss the ring, but he may not like it if they slobber over it. (It’s worth noting that the actual nominees to date have not spoken effusively to the press after their visits to the man in the high tower.)

One other possibly good thing about Tillerson: It is unlikely that, after running a gigantic global corporation, he will want to be saddled with a deputy who is dense, troublesome, and dogmatically opposed to Tillerson’s brand of internationalism. In other words, the upside to getting Tillerson as secretary of state is that we may avoid the specter of John Bolton as deputy secretary of state.