Advice to the President: Abolish the Commerce Department

President Obama has had a difficult time finding a new Secretary of Commerce. He shouldn't worry about it any longer. There is a simple solution--just abolish the post.

The Commerce Department, as presently constituted, is a hodge podge of agencies with no central purpose. It's not a job with great policy influence. The Big Dogs on economic policy are in the White House and at the Treasury. It has become tradition or habit for the President to give the post of Commerce Secretary to one of his chief fundraisers and close friends, or to a politician in need of a payback, or sometimes to a token appointee from the opposition party. President Obama has already unsuccessfully looked at all three options with fundraiser and Chicago friend Penny Pritzker, New Mexico Governor and primary supporter Bill Richardson, and most recently with Republican Senator Judd Gregg. These kinds of appointees are not expected to do much except meet and greet visitors in the huge Secretary's office, almost the size of a sports field. They also encourage the kind of cynicism about government that President Obama wants to combat.

When the Commerce structure was built in 1932, it was the largest office building in the world. It is immense, and visitors often get lost in its long hallways and byways. The National Aquarium, somewhat strangely, is located in the basement. The building was auspiciously named after Herbert Hoover during the Reagan administration (he served as Commerce Secretary as well as President).

Working there, as I did for a time as Deputy Under Secretary, is an odd experience, and does not bring back happy memories. Friends who visited me remember having trouble finding my huge office, then being amazed that the heating and cooling system seemed so out of wack that I was always opening and shutting my windows.

This is not so say that the Commerce Department and its over 30,000 employees does not do useful things. Under its domain, are such valuable public agencies as the National Weather Service, the National Hurricane Center, the Bureau of the Census, and the Patent Office. Abolishing the current Department of Commerce does not mean eliminating these vital government services.

President Obama can shift the political playing field on the Commerce Secretary issue by announcing in his February 24 address to Congress that he is going to rethink the Department's mission and organization. He is going to break it up, and reorganize it in a more effective way as part of his strategy for reviving and rejuvenating the American economy and building a new foundation for economic growth.

Here's how it might be done.

One of the hot issues troubling Senator Gregg and many Republicans has to do with possible political influence over the census. To alleviate that concern and to improve national statistical analysis, the Bureau of the Census and the Bureau of Economic Analysis (which compiles national economic statistics) could be spun off as an independent agency called Statistics USA, led by a highly regarded social scientist just as NIH is headed by a leading scientist. Obama might even credit the example from our neighbor to the north, Canada, where the federal agency Statistics Canada (affectionately known as "StatCan") is the most highly regarded statistical agency in the world. StatCan offers a world class bench mark for independence, professionalism and transparency. A new independent Statistics USA might also fold in other government statistical units such as the Bureau of Labor Statistics.

Like its space cousin NASA, the National Oceanic and Atmospheric Administration (NOAA) could easily become an independent agency run solely by professionals. NOAA includes the National Weather Service, the National Marine Fisheries (with its very cool website "FishWatch" that provides useful facts on seafood), the National Hurricane Center, and the All Hazards Monitor Service. NOAA is one of those government agencies whose services form a foundation for economic and social activity.

Another Commerce office easy to spin off is the National Institute of Standards and Technology. Established in 1901, this office manages highly regarded and necessary labs that provide testing and standardization for American industry, especially in manufacturing and engineering.

The remaining agencies in Commerce deal with the economy, but have had little national policy impact. When I worked there, I invited Laura Tyson, head of the Council of Economic Advisors, over to the Hoover Building to speak to my staff. They told me that it was the first time such a top economics official had ever visited the building. These economic agencies need to be streamlined, given a clearer mission, and placed in a new Cabinet level department called the US Department of Industry and Trade. Being appointed the Secretary of Industry and Trade would be a job worth having, and one for which the President would appoint a serious person. The new Secretary would be a player on the first string of the President's economic team.

The newly constituted Department of Industry and Trade would include the existing National Telecomunications and Information Administration, the International Trade Administration, the Bureau of Industry, the Patent Office, and a rethought Economic Development Administration. It would have both domestic and international economic focus--a necessity in this globalized economy. To promote trade, the Secretary would overhaul and upgrade the US Commercial Service which currently has offices in 100 cities and overseas posts in 80 countries (usually housed in US embassies). In addition to promoting American exports, the commercial service would be charged with greater sharing of innovative ideas on business, technology and economic development, and would work cooperatively with US and foreign business schools to teach entrepreneurship and business skills to citizens in poorer communities at home and abroad. The trade negotiating authority of USTR (currently a stand alone office answering to the President) should be moved into the new department, adding influence to the Secretary and insulating trade negotiations from Presidential politics such as rewarding countries with Free Trade Agreements for supporting US foreign policy (a common practice under the Bush administration).

The new Secretary of Industry and Trade would also become an influential player on industrial policy. A revived and modernized set of industry offices would provide the government with top flight analysis of major industries and emerging ones. The Secretary would have the staff expertise necessary to oversee a revamping of the auto industry, to cite a current pressing need, and to advise the President effectively on the state of other American industries--to benchmark them in best practices against foreign competitors--and to assist industries with research grants, loans, and consultative studies--not to pick "the winners" in specific fields, but to assure that America's industrial base remains strong and vital for the 21st Century.

The new US Department of Industry and Trade would quickly become a career destination for the best MBA and economics graduates, and the US Commercial Service would become as competitive (and as exciting) to join as the US Foreign Service. It would no longer be viewed as a backwater in the Federal government.

Following this course of action or a variant would provide yet another example of President Obama's boldness in making change, and demonstrate his determination to advocate a smart, forward looking economic strategy for the nation. And, in the spirit of bi-partisanship, he could name the National Aquarium in the basement after departed President George W Bush.

Comments

[SilviaMaria]

Great post! I did not know that the Department of Commerce was home of those agencies.

[swkidder]

One more vote for "GREAT SUGGESTION." In one fell swoop, this strategy would both deal with present areas of political dysfunction, and give the administration an excellent tool to help ignite and direct our own economy. Brilliant suggestion ... given the degree to which our government has been "all thumbs" for the last eight years ... this suggestion merits a vote of "Ten Thumbs Up."

[SangZe]

Excellent suggestion. As I recall, Obama pledged to give each segment of government careful scrutiny and to get rid of useless or ineffective units. Commerce might well be the first to go, but it shouldn't be the last.

[pjw5552]

This is a great idea. However, it will require Obama appoint someone before the Department is reorganized. Commerce should be focused on facilitating manufacturing and industrial production and trade. I would keep the office of standards and the patent office as part of commerce, because these are part of manufacturing and trade issues. We want high quality standards in our industry and we want to hold industry to those standards of operation. Telecommunications and information are also part of commerce.
In my honest opinion, government has as a primary function to facilitate the smooth and effective operation of society through its regulations and controls. The Department of Commerce should be focused on those aspects related to industrial policies, trade, regulations that facilitate trade and encourage open and FAIR exchange of goods both nationally and internationally. It must identify where problems in manufacturing exist like quality control or universal standards, where weaknesses are arising, with respect to resources, patent conflicts, intellectual property, abuses and seek resolution of those issues that may hinder current or future problems in manufacturing, trade and commerce.
This Department does need an overhaul and to be refocused on its core purpose -- commerce and trade and all inssues related to those such as standardized practices, harmonization issues, trade, abuses in manufacturing and all problems that decrease the efficiency, increase the cost or diminish the quality of products bought, sold and traded in this country.

[Realization]

I agree. There was talk in the 70s about creating a Department of Trade and Industry (the joke, referring to Japan, was that DITI would be and itti bitti MITI). We should have done it then. The result of bring the only industrialized nation without a strong federal department focused on industry is that we have lost our lead. Time to do some planning and have government, industry, and labor work together.

Yes, industrial policy can work. No, done well it is not bureaucrats calling all the shots.

Another suggestion is to make CFIUS, the Committee on Foreign Investment in the United States, an independent commission and get it out from under Treasury.

[billw8017]

Al Gore did a study of the Executive Branch that had something to do with the Clinton administration reducing the size of government while increasing efficiency. So Clinton was able to cut the government by about a quarter. Reforms in the VA were said at the time to have salvaged its reputation. FEMA became the rescue of choice, displacing the Red Cross. The budget of its anti terrorist program was increased and circumvented the Millennium attack.

Since then, the government has been considerably increased while becoming less effective. Maybe we could dust off Gore's old papers and see what applies. It might not be a good idea to lay off government workers right now, but these are not necessarily stupid people: They might welcome the change to more challenging work as positions open up for new regulation, effective inspection, and auditing government largess.

[Cobia]

Soooo, we'd have the DOT and the DIT eh? A Morse of an idea.

[TJCole]

Rescind NAFTA first, and no more Republicans ever making trade deals, are we a nation of masochists..?

[Matthew Benzor 1]

ARNOLD the govenator for commerce secratery. he's married to a maria a dem. now he is bipartisan he said he would not deni the president as judd did he's weak to begin with he let thugs in the party push him around look at him he looks weak you know the one you pushed around in school.ARNOLD for commerce secratery

[noneIn2008]

Another idea is to give Obama the line item veto. Or, do Nancy and Harry want to retain pork for themselves. Do Harry and Nancy have enough faith in our new President to give him the line item veto?

[bdd]

Line item veto won't happen.
Read the Constitution.
Congress controls the purse strings.

[noneIn2008]

The President must sign and approve. Let him approve parts instead of the whole. If we trust Obama, let him start to correct the mess Congress creates.

Second, if Congress controls then why blame Bush? Pelosi and Reid have been in control since 2006

[JimR]

But the president must approve the spending. I have always been for the line item veto. If two-thirds of Congress feel it's vital that the nation spends (for example) $50 million for a fishing museum in Montana, then so be it.

[JustMyWords]

Perhaps "Harry and Nancy" are bright enough to figure out that we have elections every 4 years, and - get this! - sometimes the face in the office changes.

[mentalslavery]

I disagree with the assertions in this post. The institutional structure makes sense from an organizational approach, see flow chart below

http://www.commerce.gov/s/groups/public/@doc/@os/@opa/documents/content/prod01_004984.pdf

There is no reason to dissolve the organization, if fact a further fracture among these departments via separation would likely lead to less collaboration when we need more. Maybe, we should make the vital functions of each department work in tandem with each other as is implied by the flow chart.

[leftLibertarian]

Sounds like a good idea. Also add the DEA, another useless big government entity. Oh yea, how about shutting down all US foreign military bases, and withdraw all US forces from Iraq.

[camper65]

We did that once. The result was WWII!!

[MainStreetGeek]

I agree: "The new Secretary of Industry and Trade would also become an influential player on industrial policy. A revived and modernized set of industry offices would provide the government with top flight analysis of major industries and emerging ones."
AND, it should create an "Under Secretary of Main Street" to oversee that our downtown business zones get the attention to revitalize they need!

[Kartoffel]

I like the idea of a semi-independent census bureau. Make it a partnership with government and academia. Get the best experts on statistics and social sciences and let them operate without political interference.

[mentalslavery]

In terms of the census, the political battles over sampling is "much to do about nothing". New programs provide advanced statistically techniques that enable independent academics to correct political distortions that emerge as a result of these battles. They think they are making a difference, and in terms of official numbers, they are-which is politically significant in some ways. However, more accurate estimates are available and published regularly in peer reviewed population journals and other sociological resources.

Many times, they're political maneuvering has latent effects that actually work in a counter-productive way in terms of the goals they commonly wish to achieve. Discounting, or over counting a population because it is politically advantageous in one way leads to electoral defeats in either the short or long term.

Latinos have often be treated as a monolithic group and under-counted by census which leads many poli's to believe that they are single issue voters or share voting issue priorities. Of course, the reality is much more dynamic than this. On some issues, most Latino's will share both priority and solidarity and appear as a monolithic voting block, on other issues-not so much. You don't understand your electorate, you suffer. You might win a couple of cheap ones, but it will always get you in the end. Thats why I say that the political census maneuvering is "much to do about nothing". Each side is committing a form of self-imposed ignorance that ultimately will block their goals.

[mentalslavery]

Damn word limitations. As if these issues are simple. Huff, what's going on round this place! What is this?-sound bite-news reductionism policies?

This goes after the other post

[mentalslavery]

For example, Repubs thought they could stand up against the immigration bill and make a big fuss over "amnesty", then a massive population emerged that was united on an issue they thought might separate them, say good-bye to that KEY voting block for a couple of cycles. It was their lack of understanding about the solidarity between citizens and undocumented workers, was well as the real numbers that lead to such a folly. Correspondingly, they assumed that the tension in the Latino community and African American community would split a vote in the prez election. This is because the census has traditionally discounted non-urban populations due to their fluid living arrangements. Just cuze they move around a lot, does not mean they are not here and does not mean they are undocumented, as so many assume. These populations do not typically have frequent conflict with African American populations or strongly held negative feelings and are higher in number than commonly thought. Additionally, what the census classifies as Latinos come from all around the globe and come in a variety of shades, thus such generalizations about tension based upon skin color alone are insulting to a large sub-pop. Basically, repubs screwed themselves by thinking that all Latino's are "basically Mexicans". Currently, the census defined Latino population is really really really pissed. Good luck in the future-pol­i-discount­ers.

[susie1776]

Really interesting post that makes a great deal of sense. I've often wondered what the Dept of Commerce actually DID!!!

[dst1]

Not much lately