Monday, December 19, 2016

Rex Tillerson and Russia: Conflict or Confluence of Interest?

Politics breeds bad incentives.
While not everyone may agree with that statement, we all routinely witness its unhappy results. Economic policies are passed that benefit a small minority of business interests while raising prices for all consumers. Government officials are often allowed to break even the most serious laws with impunity. And on the most important issue of war and peace, politicians have started wars on false pretenses, even after being elected on an antiwar platform.
The precise reasons for decisions like these will vary–maybe a prominent donor is pushing for it, maybe a politician wants to save their political capital for a higher priority, or maybe a president has a personal affinity for a foreign country and wants to take their side accordingly. Whatever the particulars, the general theme is that many decisions in government are made based on the personal interests of individual actors, not the interests of the American people at large.
This reality offers important context for assessing the president-elect’s pick for Secretary of State, Rex Tillerson.
Tillerson is the outgoing CEO of the ExxonMobil Corporation, which has considerable investments in Russia. Exxon stands to benefit greatly if the economic sanctions against Russia are lifted, and Tillerson himself has spoken against sanctions in the past. Tillerson was also personally involved in many of Exxon’s Russian investments, and he was even awarded the Order of Friendship by the Russian Federation.
All of this would appear to make Tillerson a logical choice for Trump, who has often signaled an interest in improving US-Russian relations. However, given the deeply anti-Russian climate in the US right now, critics have suggested Tillerson’s Russia ties represent an intolerable conflict of interest. To the more conspiratorial types, Tillerson’s selection offers yet further confirmation that Donald Trump was indeed Putin’s “Puppet.”
I will leave it to other pieces to debate whether Trump truly is a Moscovian marionette. In its place, let’s consider the claim that Tillerson’s conflicts of interest would hinder his ability to serve as an effective Secretary of State. For this purpose, we will take as given both that Tillerson has warm relations with the Russian government and has an interest in seeing economic sanctions lifted.*
In political discussions, it is often taken for granted that government–and by extension, all people in it–exists to serve the public interest. But this is not a realistic view, and, as discussed above, it is not borne out by experience. If people are deemed to be greedy and self-interested when they act in the private sector, we cannot assume they undergo a magical transformation into selfless individuals when they transfer into government employee. Of course, this does not mean every politician or official will put their own interests ahead of the public’s in all cases or in any case. No doubt there will even be some courageous individuals who seem to consistently put the public’s interests ahead of their own ambitions. But it is not wise to rely on this behavior for good policy. We must account for the personal interests and incentives as well.
Since we cannot eradicate (or assume away) the personal interest that government actors have, the phrase “conflict of interest” needs to be redefined in order to be useful. Our chief concern is not that government actors have personal interests–this is inevitable. Instead, what we must care about is where these personal interests are at odds with the public’s interest, the interest of the American people. That is what we must mean by a “conflict of interest.” If the personal interests of the politician, the bureaucrat, or even a private corporation are in line with the interests of the American people, so much the better. This is what we might call a “confluence of interest” instead.
Different people will disagree on what truly is in the American people’s best interest when it comes to foreign policy. But it should be uncontroversial to suggest that peace is preferable to war, and that nuclear war is the worst possible outcome for the American people and everyone else. These must be the top priorities with respect to the US-Russian relationship. Other considerations–such as the proper footprint for the NATO alliance and whether a brutal secular or Sunni government ought to be in charge in Syria–must take a backseat if they are to be pursued at all.
With these priorities outlined, Rex Tillerson’s background and personal interests seem to overlap considerably with the interests of the American people. Whatever else is true, his nomination alone clearly sends a signal that Trump is intent on trying to improve the US-Russian relationship. Hopefully, this will include a lifting economic sanctions–which would do much to move the US and Russia back from the brink of confrontation. Sanctions relief would also directly improve the lives of ordinary Russians and Europeans (and Americans to a lesser extent) as a result of increased trade and specialization.
And yes, such a move would also probably increase the bottom line for Exxon.
If we take a completely cynical view, we might assume that Tillerson would push for sanctions relief and warmer relations solely for the purpose of helping out Exxon.** Even if that occurred, however, the fact remains that the American people (and others) would be collateral beneficiaries of the policy. Why such a policy gets implemented is not material; that it gets implemented is. In this regard, there is a clear confluence of interest between the personal interests of Tillerson and the public interest of the American people. This is cause for cautious optimism.
But while this aspect of Tillerson appears to be an asset, it also comes with risks. It must be remembered that President-elect Trump has not outlined a noninterventionist foreign policy. Rather, he just intends to prioritize the destruction of ISIS and other terrorist groups over regime change. This is marginally less absurd than the present policy of being on both sides of multiple conflicts in the Middle East, but it is a far cry from the noninterventionist ideal. It also creates the possibility of the US and Russia outright allying to achieve this end. This would not be a welcome development.
The goal should be peace with Russia, not a military alliance. Not only would such an alliance be futile in terms of the 15-year-long “War on Terror,” it would also likely increase the potential for blowback against the American people. Just as the US alliance with Israel helped make Americans a target for violence, an alliance with Russia cause the US to unwittingly inherit its stateless enemies as well. Depending on how warm Tillerson’s relations are with Russia, he could help facilitate such an overcorrection. This could represent a risk down the road.
Compared to some of the other names that were in the running for Secretary of State, Tillerson represents a major improvement. (Of course, one of those terrible candidates, John Bolton, was selected as Deputy Secretary, so there’s still plenty of deeply concerning news to go around.)
It remains to be seen whether Tillerson will successfully get through the Senate confirmation process to become the next Secretary of State. No doubt, we will hear much more about his alleged conflict of interest with Russia after Trump is inaugurated. However, we must understand that all government officials face their own personal incentives and interests. What truly matters is not whether such interests exist, but whether they overlap with the interests of the American people.
This is why the Tillerson nomination is cause for some relief. We don’t know his position on everything. But at least on the most important foreign policy issue today–the relationship between the US and Russia–Tillerson’s personal interests seem to point in the same direction as the American people’s, in the direction of peace and commerce.
*It is entirely possible that Tillerson will severe all formal ties to ExxonMobil and sell his shares in the company in order to ease his confirmation as Secretary of State. Even if this were to occur, it seems reasonable to assume Tillerson would still retain some affinity for his lifelong employer and its interests.
**It should be clear that I am here referring to broad-based sanctions relief that frees up trade for all or many industries, rather than some kind of narrow exemption for Exxon. The latter policy would be deplorable mere crony capitalism and would not provide the same economic benefits to regular people, nor would it contribute as much to the state of the US-Russian relationship.

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