In Trump cabinet, Commerce Secretary will run trade policy

[December 21, 2016]  By Melissa Fares and David Lawder

WEST PALM BEACH, Fla./WASHINGTON (Reuters) - U.S. President-elect Donald Trump plans to put his pick for Commerce Secretary, billionaire investor Wilbur Ross, in charge of his get-tough trade policy, a transition team spokesman said on Tuesday.

It is a signal of how Trump, who is also interviewing candidates to be the U.S. Trade Representative (USTR), plans to elevate a crackdown on competitors in the world market and the overhaul of trade deals that he says have hurt U.S. factory jobs.

The USTR will not be merged with Commerce, but Trump transition team spokesman Jason Miller made clear that most trade policy decisions would be steered by Ross, who made a good part of his fortune by investing in distressed steel companies that benefited from stiff import tariffs imposed by former President George W. Bush in the early 2000s.

"Mr. Ross not only has negotiated some very good deals over his lifetime, he's also the person who worked closely with the president-elect on crafting his trade policy over the administration," Miller told reporters during a daily transition briefing. "Mr. Ross will be playing a big role in any trade particulars in this administration."

The move also marks a notable shift from trade policy management in President Barack Obama's administration, where USTR Michael Froman was seen as the main trade architect, negotiating a 12-country Pacific Rim trade deal that ultimately failed to win approval in Congress.

"It looks like the USTR office is being downgraded and subordinated to Commerce," said Derek Scissors, a trade expert at the American Enterprise Institute, a right-leaning think tank in Washington.

"That’s a big change because USTR is this small elite trade agency right across from the White House.”

Trump, who takes office on Jan. 20, blamed multilateral trade deals with Mexico and China for the loss of U.S. jobs, a core message during his campaign, and said he would push to renegotiate the agreements.

Trump's administration is expected to crack down on Chinese trade practices with enforcement cases, which has raised fears Beijing would retaliate.

He has also pledged to hit companies that shift production from the United States to other countries with a 35 percent tax on their exports into the United States -- legislation he said his team would soon "write up."

Ross has also been a key adviser on another top Trump priority: a proposal to use tax credits to help spur $1 trillion of private and public spending on roads, bridges and other infrastructure.

Trump plans to delegate coordination of that plan to the head of an infrastructure task force, the Washington Post reported on Tuesday, citing unnamed sources briefed on the plans.

INTERVIEWS FOR USTR

Trump has picked more than 20 nominees for his cabinet so far, packing his team with billionaires from the business world, retired generals, and loyalists.

Billionaire investor Wilbur Ross. REUTERS/Lucas Jackson

He is continuing to interview candidates for his cabinet this week at Mar-a-Lago, his Palm Beach resort, where he will spend the Christmas holiday -- including potential picks for the USTR job.

Elevating Ross' role as Commerce Secretary could make the USTR job less attractive to potential candidates with top-tier trade expertise, said Scissors at the American Enterprise Institute.

Traditionally, the USTR takes the lead on negotiations for trade deals, while Commerce, a massive sprawling agency, handles enforcement actions including anti-dumping and anti-subsidy investigations of low-cost imports.

On Tuesday, Trump was slated to meet about the USTR position with Jovita Carranza, who was deputy administrator with the Small Business Administration in the George W. Bush White House and a former executive with United Parcel Service Inc.

Carranza, now a consultant, was part of a group of Hispanic leaders who met with Trump in July, after he had come under fire for his hard line on immigration and criticism of an Indiana-born Mexican-American federal judge.

She became part of his campaign's Hispanic advisory council and ran a call center from her home during the campaign to boost support for Trump among Hispanic voters in North Carolina, Miller said.

Trump has also discussed the USTR job with Robert Lighthizer, a former deputy USTR during the Reagan administration, and Dan DiMicco, former CEO of steel producer Nucor Corp.

In 2012, Obama proposed to combine Commerce and the USTR with the Small Business Administration, Export-Import Bank, Overseas Private Investment Corporation and U.S. Trade and Development Agency in one streamlined department -- a plan that was rejected by Congress.

Trump has no plans to merge Commerce with the USTR, Miller said.

(Additional reporting by Dave McKinney in Chicago; Writing by Roberta Rampton; Editing by Andrea Ricci)

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