White House

Tillerson Exposes the Government-as-Business Fallacy

The secretary of state is off to a feeble start. His Exxon-only management credentials are part of the problem.

Harder than it looked.

Photographer: Alex Wong/Getty Images

Amid all the chatter of the weekend television talk shows, the most interesting segment was John Dickerson's "Face the Nation" interview on CBS on Sunday with former Secretary of State George Shultz.

The 96-year-old Shultz is one of America's wise men, a great public servant, successful business executive and valuable contributor to the public dialogue. He offered sage advice on governing to President Donald Trump and astute reflections on U.S. leadership in the world.

He lost me, though, when he defended Secretary of State Rex Tillerson. Tillerson, who spent his entire career at Exxon Mobil Corp. before rising to become the company's chief executive in 2006, is off to a dreadful start, displaying scant appreciation for the public and institutional role of chief U.S. diplomat.

It underscores the peril of bringing someone into a top Washington job who has no government experience. Shultz, noting that he, too, had a business background, said it was unfair that Tillerson was "being knocked for being a businessman." That background, Shultz said, confers two advantages: the ability to run a big organization and experience choosing people. (Displaying his customary shrewdness, Shultz actually was asked about Trump's business background but instead chose to discuss Tillerson, no doubt an easier defense for him.)

But Shultz, who was president of Bechtel Group Inc. before becoming President Ronald Reagan's Secretary of State in 1982, was no Washington outsider. Before he was a CEO, he had been secretary of labor, director of the Office of Management and Budget, and secretary of the Treasury. Before that, he'd been an economist with the Council of Economic Advisers. It was this background that gave him the sophistication and savvy to succeed at the State Department.

Trump likes to repeat the old saw that Washington needs more executives to run government more like businesses. Paul Light, a New York University public service professor who has studied the federal government for decades, notes that business expertise can be very useful, but that business and government leadership require different skills.

"Running a big government agency requires a nuanced knowledge of politics and Washington," he said, "to know which buttons to push. Unlike a CEO, you can't just order things to be done."

Tillerson, 65, has been oblivious to the deft button-pushing of predecessors ranging from Henry Kissinger to John Kerry. He has shut out the press, explaining, "I'm not a big media-access person." That's fine for the chairman of Exxon, but not for America's top diplomat.

This isn't about press freedom or privileges. It's about the intersection of national and self-interest and responsibility to the public. A small example: during Tillerson's recent trip to Korea there was a report that he cancelled a dinner due to exhaustion. It wasn't true. But because he only took one reporter from an obscure website - not NBC News, the New York Times, Bloomberg or others who cover the State Department -- the story gained currency and made the U.S. look bad.

More important, Tillerson isn't seen as a major player in formulating foreign policy. He has worked to cultivate a relationship with Trump -- they didn't know each other before he was tapped -- but in a town where perceptions matter, there's a sense among both U.S. and foreign officials that the president's 36-year-old son-in-law, Jared Kushner, is a bigger player in foreign policy.

The White House earlier nixed Tillerson's choice of a deputy, something he didn't anticipate, and he has brought in few experienced hands to fill in his political and policy gaps. He has had limited or no contact with some of his predecessors. The secretary reportedly has been reluctant to rely on career experts.

I've never met Tillerson; he is by all accounts is a smart and able man. He has time to turn around his weak start, but not much. There have been a few successful CEOs in top cabinet posts, including a couple of recent Treasury secretaries from Goldman Sachs Group Inc. Think of Robert Rubin, who spent two years in the White House before moving to the Treasury department, and Henry Paulson, who gained respect during the financial crisis when his Wall Street expertise and judgment were invaluable.

Let's hope it doesn't take a crisis to reveal Tillerson's strengths.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

    To contact the author of this story:
    Albert R. Hunt at ahunt1@bloomberg.net

    To contact the editor responsible for this story:
    Jonathan Landman at jlandman4@bloomberg.net

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