State Department finds NEI too sexy for Commerce

A number of contacts in both the business sector and the diplomatic world have been commenting on what they see as an encroachment by the State Department on trade promotion responsibilities held by the Commerce Department.  The rumblings had been noticeable for some months but grew to a near roar when Secretary Clinton and the State Department held what was billed as the “Global Business Conference” in Washington on February 21-22.  Secretary Clinton outlined her vision for “Jobs Diplomacy” which included promoting U.S. businesses overseas, leveling the playing field for fair competition and attracting foreign investment into the U.S.  – all primary functions of Commerce’s International Trade Administration.

The Conference in question was billed by State as “two days of dialogue and brainstorming on the U.S. Government’s role in supporting American competitiveness and creating American jobs.”  After the conference concluded State reported that it “showcased the State Department’s renewed commitment to being the most responsive and effective force multiplier for U.S businesses abroad.”  The State Public Affairs machinery cranked out a ton of promotion around the Conference and got some pretty good mileage out of it in the business media.

Several attendees noted that while Commerce Secretary Bryson spoke at the conference that the Commerce role and presence was otherwise subdued.   The same attendees reported that the Agriculture Department’s Foreign Agricultural Service was completely absent from the event.  What’s behind this grab by State to venture beyond its mandate and into other agencies territory?   There are two theories; 1) it is part of the pre-election ramp-up on high-profiling job creation or 2) job creation and the National Export Initiative (NEI) have become so sexy that State wants a piece of the show – and the money.   I think #1 is a driver of #2 but there is no denying that when homeland security started drawing the money after 911 that State got in on that largesse to the extent possible.  NEI hasn’t been nearly as sexy as homeland security nor has it attracted nearly the money that the Bush Administration literally threw at anything that sounded anti-terroristy but in these days a few million dollars attracts a lot of attention.

Reflecting State’s tendency to let policy rather than business opportunity drive the agenda breakout sessions on investing in Central Asia, Pakistan and Afghanistan urged U.S. companies to consider investing in these risky areas. It’s unlikely that had this been Commerce’s show that time and money would have been wasted trying to talk U.S. companies into investing money in war-torn and highly risky territories.  Word from the Conference is that these sessions were lightly attended by businesses.  But this just illustrates why the Foreign Commercial Service (part of the U.S. Foreign Service) was pulled out of State in 1982 and given to Commerce.  Commerce is business-focused and State is, well, diplomacy-focused.

How much money was spent by State in putting on this show?  Whatever the amount was, it should have been simply allocated to Commerce’s diplomats and export promotion programs.  That would be smart government.