Crypto News: Supply Lines: Trump trade czar search

With his announcement that Howard Lutnick will be his nominee for Commerce Secretary and "lead our Tariff and Trade agenda," US president-elect Donald Trump shed a little light on one mystery hanging over his incoming cabinet. Just not the one over who will really oversee trade policy in the incoming Trump administration.

Lutnick, who is now CEO of Wall Street firm Cantor Fitzgerald, was angling to be Treasury secretary and involved in a bitter public fight over the role. Who will sit in that influential chair remains the big whodunit investors and policymakers around the world are eager to see resolved. So Lutnick's consolation appointment to Commerce, which sits a five-minute walk further from the White House than Treasury, at least removed one candidate from the mix.

But even with Trump's pronouncement that Lutnick will oversee trade and have "additional direct responsibility" over the separate Office of the US Trade Representative, there's still reason to believe it might not be that way for very long.

That's because there's an eerily similar precedent in Trump's own previous term in the White House.

When Wilbur Ross was put forward for Commerce secretary eight years ago it was with the understanding he would be Trump's trade czar. In his January 18, 2017, confirmation hearing, Ross, the legendary billionaire financier, fielded questions about not just tariffs but plans to renegotiate Nafta and what to do about China.

Trump's Trade Brain

But within months Ross was shunted aside after flubbing a first attempt at a trade deal with China and losing Trump's confidence. The man who took over: Robert Lighthizer, who had been appointed US Trade Representative.

Lighthizer, a renowned lawyer with decades of experience in Washington, remains the trade brain behind many of Trump's tariff ideas. In recent weeks he has been identified as a candidate to lead both Treasury and Commerce. He is thought not to be interested in returning to USTR and seems even less likely to if he must report to Lutnick. A White House adviser role has been mentioned. But even that wouldn't have the sort of formal authority to deliver policy that Lighthizer prizes.

Which leaves a big and consequential mystery over where Lighthizer will end up and thus who will really run Trump's trade agenda. Even after the Lutnick announcement.

Everett Eissenstat, who served as an international economic policy adviser in Trump's first White House, says there's a rich history of presidents trying to put the Commerce Department in charge of trade. Those efforts almost always fail, however, partly because trade is complicated and mostly because Congress long ago gave statutory responsibility for it to USTR rather than Commerce.

So, the mystery over who will really be Trump's trade czar endures. And meanwhile in Washington, as Eissenstat says, "we're reading tea leaves and these tea leaves are moving around pretty fast."

—Shawn Donnan in Washington

Click here for more of Bloomberg.com's most-read stories about trade, supply chains and shipping

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Run SPLC after an equity ticker on Bloomberg to show critical data about a company's suppliers, customers and peers.
Use the AHOY function to track global commodities trade flows.
See DSET CHOKE for a dataset to monitor shipping chokepoints.
For freight dashboards, see {BI RAIL}, {BI TRCK} and {BI SHIP} and {BI 3PLS}
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