It's official: Donald Trump picks Rex Tillerson to lead State Department

- President-elect Donald Trump announced Tuesday he has settled on ExxonMobil CEO Rex Tillerson to be secretary of state, saying that he's "among the most accomplished business leaders and international deal makers in the world."

   "Rex Tillerson's career is the embodiment of the American dream. Through hard work, dedication and smart deal making, Rex rose through the ranks to become CEO of ExxonMobil, one of the world's largest and most respected companies," the billionaire real estate mogul said in a predawn news release from Trump Tower in New York.
 
   "Rex knows how to manage a global enterprise, which is crucial to running a successful State Department," Trump said of his latest -- and much-discussed -- Cabinet pick.
 
   In an accompanying statement, Tillerson said he was "honored" by his selection and shares Trump's "vision for restoring the credibility of the United States' foreign relations and advancing our country's national security."
 
   Trump also said that as the nation's top diplomat, Tillerson would be a "a world-class leader" working on behalf of the American people. 
 
   Tillerson, however,  has close ties to Russia, and his selection sets up a potential Senate confirmation fight.
 
   China's foreign ministry spokesman said that Beijing was looking forward to working with the new secretary of state.
 
   "No matter who will become U.S. secretary of state, China is looking forward to working together with him to push forward greater progress of the bilateral relationship on a new starting point," the spokesman, Geng Shuang, said Tuesday at a regular briefing.
 
   Trump brushed aside concerns about Tillerson's close ties to Moscow in bringing the long secretary of state audition process to an end.
 
   Tillerson has connections with Russian President Vladimir Putin. And on Capitol Hill, leading Republicans have already expressed anxieties about Tillerson, as they contend with intelligence assessments saying Russia interfered with the U.S. presidential election to help Trump.
 
   But two meetings with the oil executive impressed Trump, who called Tillerson a "world class player" in an interview on "Fox News Sunday."  In the Sunday interview, Trump pointed to Tillerson's deep relations with Moscow as a selling point. As ExxonMobil's head, he maintained close ties with Russia and was awarded by President Vladimir Putin with the Order of Friendship in 2013, an honor for a foreign citizen.
 
   For weeks, Trump has teased out the decision process publicly, often exposing rifts in his organization. He also considered former Massachusetts Gov. Mitt Romney, a one-time vocal Trump critic, and Sen. Bob Corker of Tennessee, who leads the Foreign Relations Committee. Romney wrote on Facebook Monday that it "was an honor to have been considered" for the job.
 
   The unconventional vetting procedures are in keeping with Trump's presidential style thus far, unconcerned with tradition or business as usual. In recent weeks, he's attacked CIA intelligence, spoken to the leader of Taiwan and has continued his late-night Twitter tirades. 
 
   Making yet another nontraditional choice, Trump heads out Tuesday for another week of travel, starting with a rally in Wisconsin. 
   Trump postponed a Thursday announcement about how he will handle his massive business empire, though it appears likely he will not follow other presidents and make a clean break from his personal holdings. 
 
   Trump was set to visit supporters as questions swirled about a CIA assessment that Russia interfered in the November election on his behalf. Senate Majority Leader Mitch McConnell, R-Ky., said Monday that Congress will investigate the agency's conclusion, which the incoming commander in chief has called "ridiculous." 
 
   The CIA recently concluded with "high confidence" that Russia sought to influence the U.S. election on behalf of Trump, raising red flags among lawmakers concerned about the sanctity of the U.S. voting system and potentially straining relations at the start of Trump's administration.
 
   On Twitter Monday, Trump pushed back, saying: "Can you imagine if the election results were the opposite and WE tried to play the Russia/CIA card. It would be called conspiracy theory!"
 
   Trump has expressed admiration for Putin. But McConnell said flatly, "The Russians are not our friends." And House Speaker Paul Ryan, R-Wis., said in statement that a House Intelligence Committee probe of cyberthreats by other countries and terrorist groups "will continue and has my support."
 
   For his part, Putin said he was ready to meet with Trump "at any moment."
 
   In the transcript of his interview with journalists which was released Tuesday in Moscow, Putin said "it's widely known that the elected president of the United States has publicly called for the normalization of the Russian-American relationship. We cannot but support this." Putin added that he thought a meeting with Trump would be more likely after Trump's January inauguration.
 
   "We understand it will not be a simple task considering the extent of degradation of the Russian-American relationship," he said. "But we are prepared to do our bit."
 
   The White House embraced the congressional inquiry involving Russia, saying that it "is certainly warranted when you consider the stakes and the consequences."
 
   If confirmed by the Senate, Tillerson's test will be whether his corporate deal-making skills translate into the delicate world of international diplomacy. He would face immediate challenges in Syria, where a civil war rages on, and in China, given Trump's recent suggestions that he could take a more aggressive approach to dealing with Beijing.
 
   A native of Wichita Falls, Texas, Tillerson came to ExxonMobil Corp. as a production engineer straight out of the University of Texas at Austin in 1975 and never left. Groomed for an executive position, Tillerson came up in the rough-and-tumble world of oil production, holding posts in the company's central United States, Yemen and Russian operations.
 
   Early in the company's efforts to gain access to the Russian market, Tillerson cut a deal with state-owned Rosneft. The neglected post-Soviet company didn't have a tremendous amount to offer, but Exxon partnered with it "to be on the same side of the table," Tillerson said, according to "Private Empire," an investigative history of Exxon by Steve Coll.
 
   Tillerson, who became CEO on Jan. 1, 2006, is expected to retire in 2017. Tillerson's heir apparent, Darren Woods, was put in place a year ago, so there would be virtually no additional disruption to Exxon's succession plans if Tillerson were to become secretary of state.
 
ExxonMobil CEO Rex Tillerson, President-elect Donald Trump's choice to lead the State Department, has close ties to Russia through years of deal-making that will serve as valuable experience -- but also raise concerns.
 
   Tillerson has claimed to have a "very close relationship" with Russian President Vladimir Putin and will have deep knowledge of the country's power structure, having led ExxonMobil into a rare oil exploration deal with Russia's state-owned energy company.
 
   His ties, however, could cast a shadow over important decisions on relations with Russia, from whether to extend sanctions to the handling of intelligence reports that Russia interfered with the U.S. presidential election to help Trump.
 
   As an oil executive, Tillerson has argued against sanctions that the U.S. and European allies imposed on Russia after it annexed the Crimean Peninsula from Ukraine in 2014. 
 
   The sanctions are aimed against key sectors of the Russian economy, including financial services, energy, mining and defense, but also individuals in Putin's inner circle. Experts say that if they remain in the long term, the sanctions could affect Exxon's joint venture with Russia's state oil company.
 
   A native of Wichita Falls, Texas, 64-year-old Tillerson is a career Exxon employee, having joined the company after graduating from the University of Texas in 1975 with an engineering degree. Groomed for an executive position, he spent years in the rough-and-tumble world of oil production, working in Exxon's central U.S., Yemen and Russian operations.
 
   By the 1990s, Tillerson was overseeing many of Exxon's foreign operations. He played a key role in Exxon's involvement in the huge Sakhalin oil and natural gas project on Russia's eastern coast. That was a warm-up for a $3.2 billion deal in which Exxon and Russian state-controlled Rosneft announced they would work together to explore for oil in Russia's Arctic region. 
 
   In 2011, Tillerson flew to the Russian resort town of Sochi to meet Russian President Vladimir Putin for the announcement. As news photographers recorded the scene, the men shook hands and smiled broadly at each other. 
 
   "This project promises to be highly interesting and ambitious," Putin said at the time.
 
   Success in Russia required aligning the company's interests with those of the Russian government, mettle, and good relations with Putin. Exxon steadily expanded its Russian business while its rivals faced expropriation and regulatory obstacles. In 2013, Putin awarded Tillerson the Order of Friendship, an honor given to foreigners who improve relations with Russia. 
 
   "My relationship with Vladimir Putin, which dates back almost 15 years now, I've known him since 1999 and have a very close relationship with him," Tillerson said in a speech a few years ago. 
 
   Like other oil companies, Exxon has had to develop its own diplomacy and foreign relations, so many skills Tillerson honed at Exxon could help in his new role, said Antoine Halff, head of the global oil markets program at Columbia University's Center on Global Energy Policy. 
 
   Exxon also has operations in Indonesia, Azerbaijan, Chad, Equatorial Guinea, and many other countries, from the Arctic Circle to the southern tip of Australia. Africa and Asia were its leading sources of oil production in 2015.
 
   Tillerson became Exxon's CEO on Jan. 1, 2006, and is expected to retire next year. His heir apparent, Darren Woods, has been in place for a year, so there would be virtually no disruption to Exxon's succession plans. 
 
   In 2015, Exxon valued Tillerson's compensation at $27.3 million, most of it in stock. At the end of 2015, he held awards that had not yet vested that were worth $149.2 million. 
 
   As secretary of state, by law, he would have to either sell his Exxon shares and stock options or recuse himself from government matters that have a "direct and predictable" effect on his financial interests, said Richard W. Painter, a University of Minnesota corporate law professor who served as President George W. Bush's chief ethics lawyer. Failure to do one or the other would likely result in criminal charges, since Cabinet members, unlike the president and vice-president, are covered by statutes designed to prevent conflicts of interest. 
 
   If Tillerson didn't sell the stock, he would have to stay out of decisions for a wide swath of the secretary's job including climate change matters, the oil industry or many dealings with Russia. "There are going to have to be some pretty broad recusals in the State Department on anything that involves oil," Painter said. "In my view, personally, it's unacceptable to have a secretary of state who has a lot of oil company stock or stock options."
 
   Putting the stock in a blind trust would not be allowed because it would remain a financial interest for Tillerson, Painter said.
 
   Still, it's not unheard of for a high-profile businessman to serve as secretary of state. 
 
   Bechtel, the big, privately held San Francisco engineering and construction firm, gained stature and prestige when President Ronald Reagan picked George Shultz as secretary of state and Caspar Weinberger as secretary of defense. Both had been top Bechtel executives. 
 
   At the time, critics said Bechtel had its own foreign policy, especially in the Middle East and didn't particularly care if its objectives were not aligned with those of the U.S.

 

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