The Commerce Dept. May Be A Goner

As the first visionary Commerce Secretary, Herbert Hoover made the term "probusiness" synonymous with the GOP. His success at forging government partnerships with the private sector took him all the way to the White House. Today, he's surely spinning in his grave. The department Hoover built is on the block, put there by his own party.

In a budget-cutting stampede, Republicans want to hang a "For Sale" sign on the Herbert Hoover Building, home of the Commerce Dept. But the current Commerce Secretary, Ronald H. Brown, is resisting the push to gut his agency. He has won raves from business for transforming Commerce from a stodgy back-water since Hoover's day into a global export promotion machine.

So you would think CEOs would be resisting with Brown, right? Not quite. Neither the National Association of Manufacturers nor the U.S. Chamber of Commerce have jumped to Commerce's defense. That makes the department's future dicey. "We'd like to see something constructive come out of this," says Richard E. O'Leary, chairman of Minneapolis-based H Enterprises International Inc., an exporter of construction supplies. O'Leary, like many execs, doesn't give a hoot if Congress shuts Commerce down--so long as export promotion and training for manufacturers surfaces elsewhere: "We don't care where the programs are. We want the best ones to function better at the least cost."

With business sitting on the sidelines, the GOP is sharpening the ax. Senate Majority Leader Bob Dole (R-Kan.) proposes abolishing four departments, including Commerce, to save $70 billion. His rival for the 1996 GOP Presidential nomination, Senator Phil Gramm of Texas, seeks to kill "corporate welfare" programs at Commerce--the Economic Development Administration, the Travel & Tourism Administration, and trade promotion--to fund a capital-gains tax cut. Senate Foreign Relations Committee Chairman Jesse Helms (R-N.C.) wants the State Dept. to run the export programs. And House Budget Committee Chairman John Kasich (R-Ohio) embraces Gramm's plan while going him one further: He'd gut Commerce's subsidies for high-tech research and development. "Giveaways to big business," sniffs Kasich.

Such talk makes the Republicans sound like populists, but the real motivation is pure politics: Brown's murky personal finances have tarnished his image as the globe-hopping trademeister CEOs love, and have made Commerce vulnerable to a budget assault.

SHUFFLING. Even among Clintonites, there's talk of downsizing the department. On Mar. 20, Commerce Under Secretary Everett M. Ehrlich proposed jettisoning the Census Bureau and Bureau of Economic Analysis, which he oversees, so that the government's far-flung statistical services could be consolidated under one roof--probably outside Commerce.

To Reinventing Government buffs, reshuffling is overdue. With a $4.2 billion budget and 36,000 employees, Commerce is an amalgam of programs housed together for reasons long forgotten: The National Weather Service coexists with the Patent & Trademark Office, while a national aquarium is maintained in the basement. "Organizational changes are in order," concedes Xerox Corp. lobbyist J. Michael Farren, chief of Commerce trade programs in the Bush years.

How much of Commerce might actually be dismantled? Many downsizing experts say business would be happy with a new, lean Trade Dept. that could operate at a fraction of current costs. After all, the highly regarded Office of the U.S. Trade Representative gets by with 168 people and a $20 million annual budget. Given such savings, Commerce's biggest defender may be the ghost of Herbert Hoover.

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